The Million Dollar Way (The Bakken Oil Blog): The OctoFrac -- The Bakken -- July 7, 2015

Tuesday, July 7, 2015

The OctoFrac -- The Bakken -- July 7, 2015

Mainstream media is catching up with the Bakken and with the bloggers; I wonder if Jane Nielson still stands by her original assessment of the Bakken:

Don’t believe it. There’s some oil to be gotten out of Bakken, and it’s going to be exploited. But the “bonanza” is nothing but hype.

By the way, several years later, finally, she did acknowledge there was some oil in the Bakken, but it wasn't going to last long. I'm not going to link that post. I have too much fun with her original assessment.

But I digress.

Remember the story of the frack-sand-by-train story posted yesterday?

This is why: refracking is the new fracking. BloombergBusiness is reporting:

The technique itself is nothing new. Oil crews across the world have been schooled on its simple principles for generations: Identify aging, low-output wells and hit them with a blast of sand and water to bolster the flow of crude. The idea originated somewhere in the plains of the American Midwest, back in the 1950s.

But as today’s engineers start applying the procedure to the horizontal wells that went up during the fracking boom that swept across U.S. shale fields over the past decade, something more powerful, more financially rewarding is happening.

The short life span of these wells, long thought to be perhaps the single biggest weakness of the shale industry, is being stretched out. Early evidence of the effects of restimulation suggests that the fields could actually contain enough reserves to last about 50 years, according to a calculation based on Wood Mackenzie Ltd and ITG Investment Research data.

The blog has a tag, refracking, and we've talked about re-fracking for quite some time now; it began with MRO some years ago.

Then just a couple of days ago a reader suggested looking at this old well, recently re-fracked.

More from the article:

If the word fracking has carved out a spot in the lexicon of Americans as the nation advances toward energy independence, then refracking, as roughnecks have begun calling it, could be next. And for an industry that has been hammered by the 50 percent drop in crude prices over the past year, the finding on the technique’s potential -- at a fraction of the cost of the initial well -- provides a much-needed sense of hope.
The risks abound -- from inadvertently siphoning oil from an adjacent well to ruining a whole reservoir -- and the sample size so far isn’t big enough to be conclusive, but oil giants like Marathon Oil Corp. and ConocoPhillips aren’t waiting to incorporate refracking into their shale operations.

Note: Bloomberg specifically mentions MRO and COP. MRO was mentioned years ago with regard to refracking (I even provided a list of wells that MRO was likely looking at to be the first wells to be re-fracked); the BR example linked is one example of the BR experience.

The Octofrac

Years of working on traditional wells have shown that they can be restimulated multiple times, Vincent said. In the industry’s lingo, a well that has been blasted five times is a “Cinco de Fraco.” Eight times gets you an “Octofrac.” When done right, the procedure not only boosts the flow of crude, but can also increase the estimate of reserves held in the well. Vincent said it’s common to see oil recovery climb 60 percent or more.

“I’ve seen a well get 10 fracs through the same perfs, and it appears that we’re adding reserves every time,” he said.

And a long, long time ago, I even suggested 100,000 wells in the Bakken. And here it is:

A study by Bloomberg Intelligence of about 80 wells that were originally tapped in North Dakota’s Bakken formation in 2008 or 2009 and then refracked again years later shows a clear pickup in output. The wells on average produced more than 30 percent more oil in the month after the refrack than they did after the original completion, according to analysts William Foiles and Peter Pulikkan.

I don't know when I first mentioned 100,000 wells in the Bakken, but it goes back to at least July 18, 2013.

A big thank you to Don for sending me the link to BloombergBusiness.

EOG is on record that it is more cost-effective to simply drill a new well instead of re-fracking. It will be interesting to see if they eat those words.

Other posts of interest: