DNA Helps Americans Map Shale Oil Deposits

U.S. shale oil producers need help.

Saudi Arabia and other OPEC members want to drive the shale producers out of business. So, the OPEC cartel floods the market with cheap crude oil to keep prices so low that the Americans can’t make money.

Coming to the rescue, Biota Technology can do something that has never been done before. It uses DNA sequencing to help U.S. shale producers slash the cost of oil production.

DNA sequencing is a game-changer.

Unlocking the human genome was one of the first great triumphs of the New Gilded Age. By mapping the building blocks of life, researchers hoped to find the paths toward groundbreaking new treatments and precision therapies.

This is kind of what Biota is doing. It uses all of the advances made in DNA sequencing plus some sophisticated data analytic software to find the best places to drill new oil wells.

Most U.S. shale exploration at present is based on old science. Microseismic, petrophysical and geochemistry technologies were designed for finding conventional crude and offshore oil. Shale production is a different beast entirely.

New DNA technology helps shale drillers place their rigs in the best places to drain shale oil reservoirs.

Shale producers poke holes in the ground, then inject a high-pressure mixtures of water, sand and chemicals to fracture the shale layer, which releases trapped oil. And they do this all while hoping that they’ve arranged their wells  appropriately to capture the fossilized dinosaur goo.

Ajay Kshatriya, chief executive and co-founder of Biota, believes Subsurface DNA Diagnostics can help. Math and science aside, the idea seems simple enough:

Rock shavings are collected from the wellhead, and DNA microbe samples are extracted. From there, techs use DNA sequencing and data analytics to model the subsurface depth, size and shape of the oil reservoir. Ultimately, the goal of the model is to enable better placement of future wells for capture.

“This is a whole new way of measuring these wells and, by extension, sucking out more oil for less,” says Kshatriya.

It could not come at a more opportune time for U.S. shale producers. Reuters reports the American drillers have already slashed costs by 50% over the past two years in an effort to stave off OPEC attacks. Although the cartel has been friendlier lately, there is no telling how long that will last.

While Biota will not say exactly how much its technology will cost, Kshatriya claims it should not exceed 1% of the total cost to bring a new well fully online. According to a March 2016 report from U.S. Energy Information Administration, that ranges from $5 million to $8 million, depending on geology.

So far, the company has been involved in about 80 wells, primarily in North Dakota and Texas. And big players like Statoil ASA and EP Energy have nothing but good things to say.

C. Wan, geophysical advisor at EP Energy, told CEP Magazine: “The DNA Diagnostics tool is being used to address real unmet challenges in our Permian Basin fields. The early results are promising, and if DNA sequencing can be proven to work, it would be a game changer for our company and the industry.”

When the Human Genome Project was completed in 2003, I doubt anyone would have bet its building blocks would be used for oil exploration. Yet, 14 years later, there is a very real possibility the science will save the U.S. shale business and thousands of jobs.

That’s the promise of the New Gilded Age. It gives entrepreneurs license to create new technologies where none existed. It allows new business models, new enterprises, new opportunities for investors to profit.

Best wishes,

Jon Markman

 

 

 

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Comments 11

  1. G13Man April 5, 2017

    YUUP ,
    DNA says
    its oil

    Reply

  2. alan styskel April 5, 2017

    but, oil is a inorganic product not organic. And the fracking is done at deeper levels under the earth than fossels have ever been found.

    Reply

  3. Gary Mandigo April 5, 2017

    Unintended positive consequences of new technologies deployed in non-related industries is the extraordinary “technology dividend ” that fuels continued research and development investments from the overall market.

    Reply

  4. Daniel Donkel April 5, 2017

    Alaska is taking away incentives and increasing taxes to deal with this oil price manipulation OPEC used to increase oil market share😩

    Reply

  5. Craig Howe April 6, 2017

    I Miss Larry , and his gold charts , could you email me the lattest gold chart ! Thanks Jon .
    Craig Howe

    Reply

  6. W Stroess April 6, 2017

    This sounds like a “fake news” story. There is absolutely not the tiniest explanation of how this works if it works at all. If it isn’t fake news then it is like the stories that used to appear in mainframe computer journals where the world revolves around a computer because something that was manually done before now used a computer and printer to produce a list of something. If you don’t know what it is and how it works it is best to not type up something that would otherwise be labeled as nonsense! Nonsense!

    Reply

  7. paul ellenbogen April 6, 2017

    Very interesting science is really amazing

    Reply

  8. James Blanton April 6, 2017

    I used an older technology to locate oil in three dimensions plus determine how many vertical feet of oil was above the water zone. Prior to using the vertical sensor I had a geologist define the reservoir extents so we could determine the oil volume, depth, and concentrations. Easy money.

    Reply

  9. Xander Farrar April 6, 2017

    My understanding is that the early belief of oil coming from dinosaur remains has been supplanted by the thinking that oil is from prehistoric vegetation.

    Reply

  10. Philip Bowcock April 7, 2017

    But do remember that most of the oil recovered globally will eventually be turned into CO2 and increase all the forecast problems of global warming.
    PB.

    Reply

  11. James April 16, 2017

    Are we in for a bull market in the commodities Brent crude oil market? I am quite bullish in that I think we will see a rising market in oil shale market. How’s this all gonna effect Americas current account budget surplus where current revenue exceeds current revenue. How’s this gonna effect gross domestic product at factor cost and at market prices. How’s this gonna effect gross national product at market prices. When depreciation is taken into account both straight line and accumulated depreciation. I know for sure that America is supposed to be a large closed economy. Whereas Ireland is supposed to be a small open economy where foreign direct investment and foreign multinational companies give a big boost the the countries gross domestic product and gross national product. We really need to be running a current account surplus in order to be making the interest repayments that we need to be making on national debt. The national debt here looks like its gonna be colossal for our future generations of children and grandchildren. What’s gonna happen to gross national product at factor cost and at market prices when reduced balance depreciation is taken into account. Your guess is as good as mine. What happened to Larry by the way? He was too young to go away at 63 years old. He was a great anthropologist I will give you that. Who’s taken over his work? He has a great legacy I will give you that.

    Kind Regards

    Sir James Connolly

    Reply