Oil executive Harold Hamm, who made billions tapping the vast Bakken oil field in North Dakota before other companies saw the potential, sounded a pessimistic tone about whether the industry will develop California's Monterey Shale formation, which is estimated to have possibly five times more oil.
"It's just been tough to break the code on how to get that," said Hamm, founder and CEO of Continental Resources, an independent oil company with the largest footprint in the Bakken oil fields in Western North Dakota. "Everybody thought they could and it hasn't worked out."
He added that the field, which is located in the San Joaquin Valley in central California, has not yet matured to a form that companies could develop with today's technologies.
Speaking at a dinner Wednesday night in Washington with media reporters and other independent-petroleum executives, Hamm said his company had considered pursuing the Monterey formation.
"We went there and thought it might have a lot of potential," Hamm said. "I'd be out there, but I just can't do anything different than some of the people who have already been there and made that attempt."
The oil industry's potential pursuit of the Monterey shale formation has triggered an intense debate over hydraulic fracturing, or fracking, in California, a drilling technique that's helped unlock vast reserves of oil and natural gas around the country, including in North Dakota. But it's controversial for the environmental risks associated with it, including water contamination.
Last month, California's Democratic Gov. Jerry Brown passed a law regulating fracking.
Called a "pioneer" by Interior Secretary Sally Jewell this summer for his early insight into the oil industry's potential in North Dakota, Hamm's glum outlook for the Monterey doesn't bode well for producers looking to tap into it.
"I don't see—" Hamm stopped mid-sentence and recast what he said: "It's yet to be seen…It might have a lot of potential, but there are reasons why it's not being produced."