Colorado Oil Project Possible
Colorado has recently experienced renewed attention as a place to explore for oil and natural gas. Crude oil production, for example, spiked by just under 65% from 2007 to 2011.
Colorado ranked 9th among U.S. states in crude oil production in January 2013 with 4.5 million barrels of crude oil (total through end of month).
The state is also known for having among the largest oil shale reserves in the world. Oil shale should not be confused with tight oil, conventional hydrocarbons released from shale rock formations with the aid of hydraulic fracturing and horizontal drilling. The Piceance Basin is particularly abundant in this resource.
In terms of natural gas, Colorado is a national leader, ranking 5th in the nation in January 2013. Interestingly, over 40 percent of Colorado’s natural gas production comes from coalbed methane, an unconventional source of natural gas in which gas is trapped within the rock matrix of subsurface coal structures.
While many of these wells have been or are currently for sale, many were drilled through some or all of the following oil and gas formations. A discussion of which formations were or were not viable for hydrocarbon extraction is beyond the scope of this article at this time.
- The Permian Lyons oil formation, if consisting of hydrocarbons like natural gas and oil, can sometimes produced from the sandstone. This formation is of a fine- to coarse-grained sandstone with conglomerates of fluvial origin, along with mudstone components of various colors. The overlaying member, called the Plainview is a very fine- to medium-grained sandstone of coastal plain swamp and tidal flat environments.
- The DJ Basin, otherwise known as the Cretaceous “D” and Muddy “J” Sandstones, are the primary conventional reservoirs of oil and gas in Colorado. Most of the exploration in this state is focused on the lower cretaceous Muddy “J” Sandstone, and production is often reported to be associated with the D Sandstone that often overlies the Muddy “J.” The depth of wells that produce out of the D or J sands can range from 3,000 to 9,000ft below ground. Crude oil is mostly produced out of these formations with an API gravity of thirty three to thirty nine degrees, and with an average of 1.5 percent sulfur. The Mowry Shale formation and the Graneros Shale formation are thought to be the source rock of the DJ Basin in some areas.
Unconventional reservoirs in Colorado include lower portions of the Muddy J Sandstone, the Niobrara oil formation; the Codell Sandstone, itself member of the Charlie Shale; and the Hygiene Sandstone, also called the Terry “Sussex” Sandstone, a member of the Pierre Shale. These formations are mostly classified as being too low in permeability and porosity for convention hydrocarbon extraction. Wells in these formations are typically held to a 40 acre spacing, though It is not uncommon to see 160 acre spacing for wells in the Lower Muddy J Sandstone.
Niobrara and Cadell oil and natural gas wells are very popular in today’s media.
The Denver Basin is a unique asymmetrical structure that contains over one thousand three hundred oil and gas fields. There seems to be a possible future for the Mowry Shale, Graneros Shale, and the Benton Shale as they are thought to be the source rock for other productive zones. Future improvements in oil recovery may make these formations very popular.
* The photos on this page do not represent any specific locations, projects, or company and are shown for visual purposes only. This is not a project for sale or a solicitation to purchase any oil wells for sale or natural gas wells for sale. This is not a presentation or offer to sell securities or to sell any other product whatsoever. This post is only for informational purposes to aid individuals who wish to develop oil and gas assets in this state.