Continental Resources Incoporated and Shale formations, the future of the energy industry?

A company that has recently emerged in the energy industry in the past five years, according to The Wall Street Journal and Bloomberg, is Continental Resources incorporated, who just last year had a 53% capital budget increase to be able to spend more on drilling shale. Continental Resources Incorporated has become a major player in the energy industry in the wake of the recently discovered Bakken Formation, otherwise known as the Bakken Shale Deposit, which spans North Dakota, Saskatchewan and Montana. Continental Resources has been critical in developing a new drilling technique to be able to reach the oil in the Bakken Formation.

The new technique involved drilling several thousand feet into the ground and then turning and going horizontally, which allows for a single well to get more oil. This technique was first used in Texas on natural gas fields and was then later attempted in North Dakota. The first few attempts were unsuccessful; however, Continental Resources Incorporated and various other oil companies including the Marathon Oil Corporation were able to master the technique.

The Bakken Formation itself is, according to the Wall Street Journal, the largest oil discovery in the United States in the past forty years. With the discovery of recoverable oil in the Bakken Formation and of several oil fields in the Gulf of Mexico the United States in 2009, for the first time since 1991, experienced a rise in oil production.

The Bakken Formation region looks very promising as some are prognosticating that it could have upwards of 4.3 billion barrels of recoverable oil. The energy industry, as a result of the new drilling technique used in the Bakken Formation, will now be able to recover oil in similar terrain around the world. This should lead to a worldwide increase in oil production, which could help turn around the current downward trend of the energy industry during the recession.

Sources:http://online.wsj.com/article/SB10001424052748703795004575087623756596514.html
http://www.bloomberg.com/news/2010-07-09/continental-resources-raises-capital-budget-53-to-exploit-oil-rich-shale.html