Over the last two years, shale producers have decreased production costs by 50%, and now, approximately 12 shale companies are looking to further cut costs by using genetic analysis of oil wells to identify potential favorable locations to drill. Spearheaded by Biota Technology, this technique involves the extraction of DNA samples from microbes in rock samples and comparison to DNA extracted from oil. It can increase efficiency in locating proper drilling spots and decrease production costs by up to 10%, according to the company. The data received from the genetic analysis can also help shale companies ensure that they are able to maximize outputs by avoiding errors such as not applying enough pressure to rocks to reach oil inside or drilling wells too near each other. Depending on factors like geology, shale wells can cost between $4 million and $8 million. Biota claims that the cost of conducting the DNA analysis is less than 1% of the total cost to bring a well into production. As of now, Biota has applied its genetic analysis to approximately 80 of the more than 300,000 wells in US shale basins.

Source: Reuters