...in this recent post at the Oil Drum that has a nice over-view of horizontal drillingand an overview of fracking.

While we are on the topic, here's an interesting read: http://www.cwsx.org/21darts.pdf (pdf).

In a nutshell, it would appear that the SEC is changing how it considers the proper way of estimating, and describing the level of estimation, of hydrocarbon reserves. In the gold biz, we have very strict definitions of what is a proven reserve, a infered reserve, etc. In the oil fields, proven reserves have always been restricted to oil or gas deposits that had been drilled, and a reasonable spacing to calcluate a total volume of hydrocarbons.

Well, not anymore. The new rule changes will make it that a company can claim proven reserves based on seismic indications or other geophysical clues that have not been drilled. Furthermore, the source of data and the actual method of calculation might not be released if the company consider it proprietary.

I'd like to hear Nick's view on this, but I think it stinks. Ultimately, it is a way of scamming investors with promises of huge profits from resources that might not be there. It will open the door to fraud, swindle, and profits to the supply services that attempt to exploit a non-existant (or smaller than advertised) resource.