Anadarko Petroleum (NYSE: APC) has struck big in Colorado where the U.S. oil company opened a giant reservoir that may hold up to 1 billion barrels of recoverable oil.
This discovery is one of the largest made in years, and The Wall Street Journal says it’s “… the latest sign that U.S. energy production is set to surge.”
The discovery was made in the Horizontal Niobrara formation in the Wattenberg field in northeast Colorado. Methods of horizontal drilling and hydraulic fracturing were used to open the formation.
The Washington Post reports that “Anadarko said that 11 horizontal wells drilled in the Wattenberg field yielded ‘strong’ initial rates of production and high levels of liquids, which have commanded better prices than natural gas.”
Anadarko has reported that the region could produce 500 million to 1.5 billion barrels in oil and natural gases.
According to The Financial Times, Anadarko plans “…to step up drilling from 40 wells this year to 160 next year, and in total expects to drill 1,200-2,700 horizontal wells in the Wattenberg field.”
The company also has other leases throughout the Niobrara region, Colorado and Wyoming. The Washington Post reports that Anadarko says they operate more than 5,200 wells. These other regions could potentially also yield large oil reserves.
After Anadarko made the announcement about the discovery their shares went up in extended trading to $1.46 at $80.74 from $1.44 at $79.28.
That’s all for now,