Shale Oil

In 1850, Scottish chemist James Young patented a process for making illuminating oil from cannel coal, which he called 'paraffine.' This discovery revolutionized the lamp oil industry by providing a cheaper alternative to whale oil.

In March 1853, Canadian geologist Abraham Gesner patented a process to make lamp oil from a rock called 'albertite,' which he named Kerosene. This innovation led to the establishment of the North American Kerosene and Gas Light Company.

In 1854, the North American Kerosene and Gas Light Company was formed, focusing on manufacturing lamp oil using Abraham Gesner's process. Kerosene became a significant source of revenue for the company.

In 1856, the Breckinridge Cannel Coal Company began producing lamp oil from cannel coal, marking the first American shale oil manufacturer using non-imported coal. This company utilized cannel coal deposits in Kentucky for oil extraction.

In 1857, commercial-scale shale oil extraction, apart from cannel coal processing, commenced along the Ohio River Valley. This marked a significant expansion in the shale oil industry in the United States.

By 1859, the oil drilling industry in western Pennsylvania, led by Edwin Drake, posed a challenge to the established coal oil industry. This marked a shift towards petroleum as a dominant energy source.

In 1890, mining engineer Robert Catlin bought a plot of land near Elko Nevada that was underlain by oil shale of the Elko Formation. He dug a mine shaft, built a bank of retorts and a small refinery, and began producing oil, refining it into gasoline and lubricating oil. However, the products were of low quality.

In 1917, The Oil Shale Mining Company erected the first commercial retort at the head of Dry Creek near De Beque, Colorado, attempting to exploit the Green River Formation deposit. However, these attempts were unsuccessful and the company lost its property by 1926.

Since 1951, hundreds of oil wells had been drilled in North Dakota's Bakken formation, initially focusing on conventional reservoir rock. However, it was not until later years that companies like Brigham Exploration transformed the outlook for Bakken by utilizing new extraction techniques.

In 1957, Texaco built a shale oil extraction pilot plant to develop its own hydroretorting process.

The shale oil production at Parachute Creek was finally shut down in 1961 due to cost.

The federal government offered for lease three large blocks of oil shale land in Colorado in 1968, but rejected all the received bids as insufficient.

US oil output peaked in 1970 and until 2009 appeared to be in a long-term decline. However, the US shale revolution in 2009 reversed this trend and led to a resurgence in oil production.

The year 2006 marked significant advancements in shale technology, leading to the shale revolution that transformed the global oil market and energy landscape.

In late 2008, Brigham experimented with a Bakken well called Brad Olson 10-15 #1H, drilling a long horizontal well and fracked it in 20 stages. The well had initial production far exceeding expectations, leading to a significant expansion of economic acreage in the Bakken.

In 2009, EOG Resources discovered the Eagle Ford shale formation in south Texas, previously overlooked by the industry for oil extraction. By utilizing horizontal drilling and hydraulic fracturing techniques, EOG found approximately 900 million barrels of oil reserves.

In 2015, Harold Hamm, the majority owner of Continental Resources, accused Saudi Arabia of engaging in predatory pricing to undermine the US shale industry. This pricing strategy led to a significant decrease in the number of active rigs drilling for oil in the US.

In 2017, Hilde Bjørnland, Frode Martin Nordvik, and Maximilian Rohrer published a paper titled 'Supply Flexibility in the Shale Patch: Evidence from North Dakota,' highlighting the differences between conventional wells and unconventional wells, specifically shale oil wells. They focused on the extraction process of unconventional wells, which includes multiple stimulations using water, sand, and chemicals throughout the well's lifespan.

The US shale industry is projected to drive global oil supply growth over the next five years, surpassing Russia and challenging Saudi Arabia as the world's top oil producer. This growth is fueled by the industry's rapid response to price signals and production scalability, leading to the US potentially becoming the leading oil supplier.

The report on US shale oil prospects was last updated on October 21, 2019.