Topic: Well Completions

The Proppant Demand Dichotomy in Appalachia Super Laterals

While the Appalachia Basin only accounts for roughly 15% of total proppant usage in the Lower 48, the US Northeast has some of the highest proppant amounts per well. In 1Q18 a typical completion in the Appalachia Basin averaged roughly 16 million pounds, or 8,000 tons, representing a 7% increase year-over-year. Comparatively, the US average is roughly 13 million pounds or 6500 tons. This is partially attributable to specific operators in the region testing longer “super laterals.” Figure 1. Proppant Amount and...

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Has Anadarko cracked the code in the DJ Basin?

The operator stated in its first-quarter 2017 operations report that a new completion design is being tested in their Colorado acreage. The new design involves increased fluid volumes coupled with tighter stage spacing. The report also states early results of the new design show improvements of more than 10% cumulative oil to date, with their fourth-quarter 2017 operations report estimating a 20% uplift in EURs.One crucial part of the puzzle, proppant amount, is not mentioned in the reports. Energent took...

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Parsley Energy Grows Drilling Inventory 73% with Permian Acquisition

Parsley Energy (NYSE: PE) announced in its Q1’17 earnings call that it had closed the acquisition of about 71,000 acres and associated assets in the Permian Basin from Double Eagle Energy Permian LLC. The acquisition — which spans Dawson, Andrews, Martin, Howard, Midland, Glasscock, Upton, and Reagan Counties — increases Parsley’s total leasehold in the Permian to about 230,000 net acres and grows its net drilling inventory (in terms of locations in priority target zones) by 73 percent:Source: Parsley Energy...

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Sanchez Energy (NYSE: SN) Expects to Double Production in 2017

Sanchez Energy Corporation (NYSE: SN) had a blockbuster 2016, partnering with Blackstone the companies acquired Anadarko’s acreage in the Eagle Ford which is expected to close in the first quarter of 2017. This acquisition adds 132 DUCs, 3,400 drilling locations and 67,000 net Boe per day. The company optimized its well design in Catarina decreasing drilling and completion costs which are currently around $3 million per well.     In 2017, the company is expecting to spend $425 to $475 million and increasing...

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Devon Energy Actively Manages $976M in Debt and Continues Refrac Program

Devon Energy (NYSE: DVN) cut their budget by 75%, forecasting a 10% decline in oil production on a quarter to quarter basis from 2015 to 2016. Devon continues to manage their debt by putting assets up for sale and raising equity to cover the $976 million in debt they have in 2016. Committed to the Stack in 2016 In 2016 Devon will be running 4 rigs in the Stack with a focus in Meramec. The company is testing down spacing and staggering to...

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Midstates Drilling Efficiencies Lead to Lower Rig Count and Well Costs in MidCon

Midstates Petroleum (NYSE: MPO) has focused operations in the Mississippian Lime during the 2015 year. They have focused on reducing well costs through drilling efficiencies and working with suppliers. Production is expected to remain flat into 2016 as the number of completions shrink. The chart below shows the number of permits and completions by month in Oklahoma for MPO.  Mississippian Lime: Reduced rig count due to realized drilling efficienciesWells generating IRR’s of greater then 35% at current well costs Reduced drilling cycle...

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Duc…Duc…Goose: Looking at North Dakota’s Uncompleted Wells and Oil Being Sold Close to $0

Earlier this week Bloomberg reported that low quality crude or sour crude is being sold for next to nothing due to lower pipeline capacity for lower quality products. The low quality crude makes up a small part of Bakken production in which some pipelines are no longer transporting. The producers of the low quality crude are being forced to use higher cost transportation methods like trucks or trains to get their products to the refineries that have the capability to...

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Permian: Midland & Crockett are Top Counties for Drilling Permits

The week of July 17th drilling permit activity was down -34%, with 65 permits issued. The top counties were Midland and Crockett. Both counties had 0 permits issued the week prior. Rig activity in the Permian showed positive signs, with rigs increasing +3 this week.The chart below shows the decline in activity this year compared to the same week at this time last year, which had 235 permits during the week. Core Permian Counties The top 5 permitting counties from last week (2015-07-10), which include Reeves, Lea,...

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