By Ian Gilson, CFA
New Western Energy (OTC BB:NWTR)
has announced the formation of NWE Technologies Inc., a wholly owned subsidiary that will be involved in next generation Enhanced Oil Recovery technology. New Western intends to use advanced EOR techniques in its Oklahoma and Texas properties.
It is impossible to extract all of the oil in a geological formation. Some oil may be too thick to flow to the well head, some may be trapped in small cavities. Oil pressure at the well may drop to a very low level and that oil field may not respond to external pressure water or carbon dioxide injection. New technologies such as fracking, jetting, fire flooding and polymer flooding can increase the recovery but there may still be over 30% of the reserves that cannot be recovered at a reasonable cost.
A stripper well is defined as a well that produces less than 10 barrels of oil per day, and the DoE estimates that there are 700,000 such wells in the United States. Industry sources estimate that there may be 50 billion barrels or more of oil that could be recovered using current enhanced technologies and next generation technologies could recover another 100 billion barrels.
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