Thursday, April 21, 2011

The Oldest Field in the Williston Basin -- Beaver Lodge Oil Field -- North Dakota

Updates

July 21, 2012: my hunch is that before this Bakken boom is all over, we will see a lot more activity in the oldest oil field in North Dakota, the Beaver Lodge oil field. This was an extremely productive oil field in the early years but relatively quiet in this boom.

2015 permits
31100, 740, Hess, BL-Iverson C-LE-155-96-1423H-1, t11/15; cum 19K 11/15;
31099, 886, Hess, BL-Iverson C-155-96-1423H-4, t11/5; cum 27K 11/15;
31098, SI/NC, Hess, BL-Iverson C-155-96-1423H-2
30691, SI/NC, Hess, BL-Odegaard-156-95-2116H-2
30690, PNC, Hess, BL-Odegaard-156-95-2116H-3, 12/15;
30689, PNC, Hess, BL-Odegard-156-95-2116H-4, 12/15;
30675, dry, Hess, BL-Odegaard-LW-156-95-2116H-1, 9/15;
30674, SI/NC, Hess, BL-Odegaard-156-95-2116H-8, no production data,
30673, SI/NC, Hess, BL-Odegaard-156-95-2116H-7, no production data,
30672, SI/NC, Hess, BL-Odegaard-156-95-2116H-6, no production data,
30671, SI/NC, Hess, BL-Odegaard-156-95-2116H-5, no production data,

2014 permits (list complete)
30356, 819, Hess, BL-Kerbaugh-156-96-3427H-5, t9/15; cum 44K 11/15;
30355, 536, Hess, BL-Kerbaugh-156-96-3427H-4, t8/15; cum 20K 11/15;
30354, 836, Hess, BL-Kerbaugh-156-96-3427H-3, t8/15; cum 45K 11/15;
30353, 820, Hess, BL-Kerbaugh-156-96-3427H-2, t8/15; cum 45K 11/15;
29278, 945, Hess, BL-Iverson C-155-96-1423H-5, t11/15; cum 24K 11/15;
29277, 1,078, Hess, BL-Iverson C-155-96-1423H-3, t11/15; cum 47K 11/15;
28958, 976, Hess, BL-Iverson 155-95-1819H-8, t41/5; cum 76K 11/15;
28050, 1,214, Hess, BL-Iverson 155-95-1819H-7, t41/5; cum 76K 11/15;
28049, 1,069, Hess, BL-Iverson 155-95-1819H-6, t4/15; cum 82K 11/15;
27980, SI/NC, Hess, BLSU E-406, no production data,
27773, 550, Hess, BL-Iverson B-155-95-0708H-5, t2/15; cum 55K 11/15;
27772, 830, Hess, BL-Iverson B-155-95-0708H-4, t2/15; cum 61K 11/15;
27771, 586, Hess, BL-Iverson B-155-95-0708H-3, t1/15; cum 54K 11/15;
27770, 772, Hess, BL-Iverson B-155-95-0708H-2, t1/15; cum 68K 11/15;

2013 permits (list is complete)
26823, 753, XTO, Boe State 31X-16C, t7/14; cum 47K 11/15;
26822, 607, XTO, Boe State 31X-16H, t7/14; cum 48K 11/15;
26821, 1,298, XTO, Boe State 31X-16D, t7/14; cum 70K 11/15;
26074, 879, Hess, BL-Iverson 155-95-1819H-2, t5/14; cum 120K 11/15;
26073, 948, Hess, BL-Iverson 155-95-1819H-3, t4/14; cum 123K 11/15;
26072, 928, Hess, BL-Iverson 155-95-1819H-4, t4/14; cum 106K 11/15;
26071, 860, Hess, BL-Iverson 155-95-1819H-5, t4/14; cum 113K 11/15;
25474, 1,658, XTO, Kerbaugh 31X-4C, t12/13; cum 93K 11/15;
25473, 931, XTO, Kerbaugh 31X-4D, t12/13; cum 107K 11/15;
24889, loc, Murex, Michael Douglas 8-5H,

2012 permits (list is complete)
  • 24352, 287, CLR, Gibb 1-24H t3/13; cum 87K 11/15;
  • 24327, 626, CLR, Vera 1-1H, t7/13; cum 97K 11/15;
  • 24294, 324, CLR, Langved 1-35H, t7/13; cum 113K 11/15;
  • 22513, 699, Hess, BL-Amelia 156-95-1415H-1, t12/12; cum 122K 11/15;
  • 23191, 682, Hess, BL-Myrtrice 156-96-2536H-2, t12/12; cum 159K 11/15;
  • 23192, 1,085, Hess, BL-Myrtrice 156-96-2536H-1, t12/12; cum 196K 11/15;
2011 permits:
  • 20820, 569, Murex, Jack David 8-5H, t11/11; cum 133K 11/15;
  • 21140, 862, Hess, BL-Iverson B-155-95-0708H-1, t2/12; cum 143K 11/15;
  • 21399, 55 (no typo), Hess, BL-Davidson 156-96-3526H-2, t1/12; cum 243K 11/15;
  • 21400, 823, Hess, BL-Davidson 156-96-3526H-3, t6/12; cum 218K 11/15;
  • 21411, 598, Hess, BL-Herfindahl 156-95-3031H-1; t5/12;  cum 133K 11/15;
  • 21412, 885, Hess, BL-Herfindahl 156-96-3031H-2, t5/12; cum 219K 11/15;
  • 21818, DRY, Hess, BL-Iverson 155-96-1213H-2, s12/11; this was designed to test Bakken potential; problems with drilling at the kick-off point; abandoned;
  • 21855, 1,279, Hess, BL-S Ramberg 155-95-0601H-2, t7/12; cum 282K 11/15;
  • 21856, dry, Hess, BL-S Ramberg 155-95-0601H-3,
  • 21944, 343, Hess, BL-Frisinger 156-95-2833H-1, t11/12; cum 69K 11/15;
Original Post

It appears to me that when looking at the financial parameters/productivity/success of an oil well or an oil field, there are three important data points:
  • How fast the well will pay for itself (to some extent, a function of the IP)
  • The estimated ultimate recover rate (EUR)
  • The likelihood that a given well will be dry
Offsets
  • If the well pays for itself quickly, it can offset a lower EUR.
  • If the well produces more slowly, a higher EUR may make the well worthwhile
  • And if there are "no" dry wells, that offsets either of the first two
I always get a kick out of seeing nice wells (based on IPs) being reported in old fields, and then going back to take a look at those fields.

I don't have the resources to sort out the math regarding how fast the early wells paid for themselves, or what the overall rate of return was, but given the current trend in the price of oil, one can look back at these "old" wells and compare them to what is going on in the Bakken.

Recently Murex reported three nice wells in the Beaver Lodge oil field in the Williston Basin. This is the oldest field in the Williston Basin.

Going to the GIS map server, one is struck by the number of wells drilled in that field and how very few dry wells there were.

Just out of curiosity, I took one of the sections in the Beaver Lodge oil field, and looked at total recovery to date.

I went to section 17 of T156N-R95W and looked at all the wells (I may have missed one or two).

Most of the wells are now permanently abandoned, although a few are still active. What was most interesting was that many wells were abandoned even though they were still producing at levels they had sustained for several years, suggesting the price of oil had bottomed out and the wells were no longer economic. I believe a lot of this occurred when really "cheap" oil was first being produced in Saudi Arabia, but I could be wrong.

Be that as it may, here are the file numbers, the formation, total oil produced, year spudded, and current status (PNA: permanently abandoned; or still on active and on pump):
  • 88, Madison, 208,654, spudded 1952, PNA
  • 122, Madison, 128,559, spudded 1952, PNA
  • 152, Madison, 291,133, spudded 1952, PNA
  • 182, Madison, 268,577, spudded 1953, PNA
  • 204, Madison, 282,654, spudded 1952, PNA
  • 296, Madison, 733,580, spudded 1953, PNA
  • 325, Madison, 97,653, spudded 1953, PNA
  • 388, Madison, 189,207, spudded 1953, PNA
  • 1636, Devonian, 700,520, spudded 1957, pump
  • 2092, Devonian/Silurian, DRY, spudded 1958
  • 3901, Madison, 555,303, spudded 1965, PNA
  • 4382, Madison, 121,055, spudded 1968, PNA
  • 14915, Madison, 317,348, spudded 1999, pump
  • 16786, Madison, 45,100 spudded 2007, pump
And this is why oilmen keep drilling, looking for the "big one." This one was a mile away from the above wells (same Beaver Lodge oil field):
  • 2462, 340/564, Hess, Beaver Lodge-Devonian Unit C-3051, Silurian/Devonian, t11/59; cum 706K/2.74 million bbls --> total, over 3.4 million bbls; was producing 4,000 bbls/month in 1997 when it was taken off-line; produced for almost 40 years;
For newbies, many (most?) Bakken wells decline to 3,000 bbls/month in less than five years, or sooner.

These were, for the most part, all vertical wells, and relatively (compared to current Bakken wells) inexpensive to drill.

If the price of oil remains at the current level, I can only assume companies will go back into some of these legacy formations in the older fields. But they can't do it yet. They have too many Bakken wells to drill before losing leases.

Unless something incredible occurs/changes, it is very clear that the drilling in North Dakota will go on for some time, and will be very, very profitable.

3 comments:

  1. I have 10 acres in sections 24 and 25. When I look at the GIS map the song, "all by myself" pops into my head.

    ReplyDelete
  2. It's me, Mr. "All by myself" again. CLR is throwing down the "Gibb" in one of these sections soon. (in the active rig section of the NDIC, the Gibb is mentioned on some rigs, "next location") just an update.

    ReplyDelete
    Replies
    1. Thank you. CLR is moving one of the Brooklyn rigs, it appears, to the oldest field in North Dakota. (If I'm reading this right.)

      Delete