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The U.S. shale oil boom has hit Texas and North Dakota - and is now looking to take over the Golden State of California.
California's Monterey Shale formation covers 1,750 square miles from southern to central California and is believed to contain more shale oil than North Dakota's Bakken and Texas's Eagle Ford combined.
The potential of the Monterey Shale formation is enormous. According to IHS Cambridge Energy Research Associates, Monterey may hold about 400 billion barrels of oil - roughly half the amount of conventional oil that Saudi Arabia has.
The energy research director at IHS, Stephen Trammel, told CNNMoney, "Four-hundred-billion barrels, that doesn't escape anyone in this [oil] business."
Even if that is an overly optimistic estimate, there is enough recoverable oil there to make it worthwhile.
The U.S. Energy Information Agency said in 2011 at least 15.42 billion barrels of oil could be recovered from the Monterey Shale using existing technology. That would be 64% of the estimated total recoverable oil in the lower 48 states.
It is also half the amount of oil in Alaska's North Slope before oil began to be pumped. And it is twice as much recoverable shale oil as the Bakken and Eagle Ford formations combined.
Geological challenges have made it difficult to get Monterey Shale oil out of the ground, as the oil is 6,000 to 15,000 feet below the surface. But new technologies will make the oil recoverable.
"There are billions of barrels of oil buried in the Monterey Shale, and as far as I know, nobody's been able to find it yet," Neil Ormond, the president of Petroleum Land Management, a company based in Clovis, CA told The New York Times. "But I think there's going to be more people looking for it. You can't let a few dry holes discourage the whole thing, because if you find oil, you make money."
And that's why Monterey Shale has attracted the attention of oil companies.
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