Wednesday, June 20, 2012

Thirteen Wells Come Off Confidential List Today -- An Important GMXR Well; The "Williston Oasis" Well a Gusher; OXY USA Surprises

Updates

Later, 7:00 p.m.: Five (5) new permits --
  • Operators: CLR (3), Sinclair, Whiting
  • Fields: North Creek (Stark), Stoneview (Divide), Long Creek (Williams), Parshall (Mountrail)
In addition, one permit was canceled:
  • 21512, PNC, Petro-Hunt, USA 153-95-1C-7-3H, McKenzie,
Two producing wells completed, both unremarkable
Later, 2:10 p.m.: See 3rd comment below (I believe it will be the third comment; may change over time), but the comment regarding the Sharon well below:
  • 21235, 0, BTA Oil, Sharon 1, Winnipeg pool, wildcat, t2/12; cum 0 4/12. 
This was a vertical well drilled as a natural gas well. That speaks volumes, as far as I'm concerned, considering all that I have posted regarding natural gas the last few days, and the price of natural gas, dry and wet. I will have stand-alone post on this. But a huge "thank you" to "anonymous" for providing background regarding this well. At the stand-alone post, I will include the production figures so far provided.

Original Post 

These are the wells that will likely be reported on today's daily activity report. Note: this might be a record -- every well reported an IP/all completed! I am impressed. Oasis has a very nice well, in Todd oil field which includes part of the city of Williston. The Cottonwood oil field continues to show poor to mediocre results.  GMXR reports a nice well based on IP, but likely to be a very good but not great well. And, most surprising: OXY USA reports a nice IP in the Fayette field.

  • 19422, 1,536, OXY USA, Beatrice Kubischta 1-15-22H-143-96, Fayette, t12/11; cum 54K 4/12;
  • 20617, 1,196, Oasis, Anvers Federal 5602 13-18H, Bull Butte, t2/12; cum 21K 4/12;
  • 20942, 32, Baytex, Knudsvig 12-1-160-100H 1PB, Smoky Butte, t12/11; cum 1K 4/12; (no typos)
  • 21147, 16, Baytex, Olson 15-22-162-100H 1CN, West Ambrose, t12/11; cum 9K 4/12; (no typos)
  • 21150, 3,021, Oasis, Kestrel Federal 5401 43-22H, Todd, t1/12; cum 67K 4/12;
  • 21235, 0, BTA Oil, Sharon 1, Winnipeg pool, wildcat, t2/12; cum 0 4/12; (no typos) - more to follow
  • 21256, 47, Baytex, Edna 14-23-162-100H 1CN, West Ambrose, t12/11; cum 25K 4/12;
  • 21321, 236, Baytex, Johnson 25-36-160-100H-1BP, Smoky Butte, t1/12; cum 16K 4/12;
  • 21388, 267, Oasis, Fraser Federal 5300 24-34H, Willow Creek, t3/12; cum 3K 4/12; (no typos)
  • 21414, 1,244, Oasis, O M Erickson 55-1 42-19H, Missouri Ridge, t1/12; cum 24K 4/12;
  • 21582, 2,285, GMXR, Lange 11-30-1H, Bennett Creek, t4/12; cum 17K 4/12;
  • 21633, 291, Hess, LK-State A-145-98-0136H-1, Little Knife, t4/12; cum 11K 4/12;
  • 21671, 285, Oasis, R W Clark 6092 43-9H, Cottonwood, t1/12; cum 7K 4/12;
The GMXR well was particularly important, it was a wildcat, about 18 miles ssw of Watford City. This area is almost devoid of any active oil activity, old or new. This is the first horizontal well in this field and in the immediate area even outside the field. I assume the success of this well de-risks this area for drilling. 32-stage frack; 2.7 million lbs sand frack. They reached vertical depth in 15 days; a total of 56 days to reach total depth. The Lodgepole was noted to be severely fractured (tectonic activity) with a gas show of > 1640 units.  Gas show in the False Bakken was 860 units. Gas shows in the upper Bakken was 1500 units (1600 - 1900). With regard to the Lower Bakken Shale: "The shale is also very petroliferous in nature suggesting that it is one of the source rocks for the Middle Bakken/Three Forks oil play of the Williston Basin. Gas shows in the Lower Bakken Shale averaged between 700 - 900 units." Regarding the lateral in the Middle Bakken: "...in this area is at its maximum up to 26' thick, making steering...very difficult." At one point, gas shows spiked to 3,133 units with a trip flare of 15 - 20 feet. A later trip gas was reported at 3,431 units. Later, 2,728 units with a 15 - 25' flare. The photos of the flare accompanying the report are quite spectacular. It must have been quite an exiting well for those involved.

The Oasis Kestrel well is the well that attracted so much attention when it was sited; it is located in the southwest corner of Williston (I'm not sure if it actually sits inside city limits; the GIS map server says it does not). It is on the south side of tracks south of the frontage road along the bypass, just before entering Williston. It is sited in section 22, but I believe the lateral runs south into sections 27 and 34.  From the file report, it looks like they reached vertical depth in about 14 days; they reached total depth in about 31 days. I don't see the frack data yet. Regarding the False Bakken: "Fracture porosity was indicated by a gas spike of up to 4,000 units, which is typical of the False Bakken." Regarding the Middle Bakken: a five-foot porosity  zone. "Toward the end of the lateral, background gas increased to an excess of 3,000 units with shows in excess of 5,000 units. The highest peak value observed was nearly 6,000 units at 19,000 feet measured depth. A noticeable increase in hydrocarbon presence was witnessed upon entry into the porosity zone near 15,100' measured depth. Greenish brown oil was observed....

Oasis Kestrel, 21150, Todd field:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN4-201223831279405129817808178
BAKKEN3-2012311543115518900515154015154
BAKKEN2-20122920107206461358519746019746
BAKKEN1-20121622980220682762427127027127

The daily activity report will be posted about 6:00 p.m. EST this evening (as usual).

CLR has a well (#21933, Plano 1-28H) about one mile southwest of the Oasis Kestrel well and is already producing nicely. It remains on the confidential list.

8 comments:

  1. GMX, not broke yet. The stock jumped a cent.

    New presentation next week will be interesting. They always are.

    http://finance.yahoo.com/news/gmx-resources-inc-announces-management-211401335.html

    anon 1

    ReplyDelete
    Replies
    1. I'm glad you pointed that out. This is not an investment site, and so it's important that when I post about companies and various wells, it is not a recommendation for buying / selling shares in a particular company. The business and the drilling are two separate entities. Even a company with great wells can go broke.

      The importance of this story was the success of this well in a relatively -- actually not relative at all, but literally -- inactive area of the Williston Basin. The GIS map server looks pretty bleak in this immediate area.

      Delete
  2. On Cottonwood, I see the consistently low IP's
    from that field and now Oasis has a lot of activity booked in June's ND dockets for Cottonwood including 6 well pads...What do they know? I have tiny leases on sections 10 and 11 The audacity of hope...

    ReplyDelete
    Replies
    1. I won't disagree. I have perpetuated that observation often, which probably I shouldn't.

      First, look at the Baytex results, over and over and over. They wouldn't keep drilling if they weren't making money.

      Second, look at OXY's results, over and over and over. They wouldn't keep drilling if they weren't making money.

      Third, we have all become "spoiled" to some extent. In the "old days," these would be considered good wells, but we are comparing them to Sanish wells, which is certainly not the norm.

      Fourth, related to third; the best wells are paying for themselves in 1 - 2 years; but the less-than-better wells will pay for themselves in 3 - 6 years. After that it takes pennies per day to produce (as long as hooked up to a pipe) and these wells are expected to produce for 39 years.

      Fifth, a well, no matter how little it produces, holds the entire spacing unit lease by production.

      Sixth, there are multiple payzones yet to be explored.

      Seventh, if you go back through the old booms, there was always a dry well for every so many productive wells, and not all the productive wells were all that great. In the Bakken, there are "non" dry wells which really minimizes the risk.

      Eighth, and perhaps this is most important. An operator can only drill where he/she has acreage. If Oasis had better prospects, they would go there, but they are Bakken-centric and, as far as I know, can't easily move to the Eagle Ford, for example.

      So, I am probably too flippant when I point out the Cottonwood wells as being not so great. I need to do better and put them in perspective.

      However, you are correct. From a mineral owner's point of view, it has to be frustrating. For Oasis, long term, these wells will just keep producing and producing and producing. You should see some old Red River wells with double-digit IPs, and had cumulative production over 500,000 bbls, and some approaching a million. And some of those wells are still producing. I posted the results of a group of those wells last week.

      Delete
  3. Bruce, I live in the area of the BTA oil, Sharon 1 well, and it was a vertical gas well. A huge gas flare lit up the sky for many days here, and rumor is that its being hooked up to an MDU gas pipeline.

    ReplyDelete
    Replies
    1. Wow, thank you. I did not know that, obviously. I am learning as I go along. That is critically important and I will note that in the body of the post, as well as a stand-alone.

      Most of us think of the Bakken as an oil play, and ONEOK's natural gas play as taking the by-product that was being flared. I am not aware of a lot of natural gas plays in the Williston Basin. I know that Montana is well known for its gas play; that may be where MDU drills most of its gas wells.

      Great note; thank you so much for taking time to comment. Give me a few minutes to update.

      Delete
  4. I have always believed that the Williston Basin holds numerous suprises for the future. One is possibly the potential to be a very good gas field. If gas prices soar in the future to the price several years ago, things will get very interesting. As the future progresses, so does the imporovement of the infrastructure (pipelines, etc.). I will be interesting to see aerial photos of both MT and ND in ten years.

    ReplyDelete
    Replies
    1. I agree. I am still impressed that ONEOK saw something that apparently others didn't (the value in natural gas gathering and processing plants in the Williston area). I hope I'm around ten years from now to enjoy the satellite view of ND and MT, as you noted.

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