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The Wolfcamp Shale Could Be A Goldmine

New information says the Wolfcamp Shale, which also overlaps the Cline Shale, could be the second biggest oilfield in the world.
MIDLAND -- New information says the Wolfcamp Shale, which also overlaps the Cline Shale, could be the second biggest oilfield in the world.
 
It's estimated that there are 50 billion barrels of oil in the Wolfcamp Shale just waiting to be drilled for.
 
If you figure the price of oil at $100 dollars per barrel, that comes to $5 trillion.
 
The Wolfcamp Shale was originally thought to be unworkable, that is, the oil was too hard to get at.
 
But that's not the case anymore.
 
Advances in drilling technology make it possible to get oil that was once too tough to get to.
 
"It gives us the opportunity to unlock some oil that was once thought unproductive," Mickey Cargile said.  Cargile is the managing partner at Cargile Investment Management.
 
The Wolfcamp Shale was discovered in the twenties.  Prospectors always knew there was oil there.  Getting it out was the issue.
 
"It was just thought unproductive because they couldn't figure a way to get the oil or the gas out of it.  Now with the new techniques they can.  And so it's a very productive and maybe even the largest oilfield in the country," Cargile said.
 
Now Pioneer Natural Resources, Anadarko, and Devon Energy are all tapping into the Wolfcamp Shale's vast oil potential.
 
Clayton Williams, an oil legend, says it has less to do with the new technology, and more to do with simple economics.
 
"When they didn't think it was commercially viable, it was nine dollars.  Now it's $85 or $90.  So that's made a big difference too, the price, particularly," Williams said.
 
Williams says the future of drilling in the Permian Basin lies in the Wolfcamp Shale.
 
"Most likely most of the Basin will be drilled and developed in the Wolfcamp over the years," Williams said.
 
Both Mickey Cargile and Clayton Williams agree this boom is here to stay.
 
"That will not happen again.  There will be windows where the oil prices go down because of the increased production, but they will not go down substantially," Cargile said.
 
According to Williams, the key is not having an interruption in the world market, which he says there hasn't been in some time.
 
"The difference is basic," Williams said.  "In the other booms we've had, and there have been several, you would have an overhang of about $55 million of potential production, and we'd be consuming [$]35 [million].  You'd then have an interruption that would cut off the Middle East and stop the flow.  It wasn't real.  This is the first time that we have high prices and there has been no interruption.  That's the key to it."
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