Wednesday, January 10, 2018

Random Update Of The Tyler Formation In North Dakota -- January 10, 2018

I follow North Dakota's Tyler Formation here.

Today a reader alerted me to "a new assessment" of the Tyler by the North Dakota Geological Survey. [Update: I thought I had posted this study before but couldn't remember. Now that I've had a few minutes to look, yes, I did post this survey, back in July, 2017. Whoo-hoo!]

The link will take you to an html site, but a google search will take you to a link that will allow ou to download the PDF which will be much more useful. The PDF will include graphics. The html linked above, does not.

The survey was published last summer (2017).

The introduction begins:
Beginning in late 2010, on the heels of the emerging Bakken play, the North Dakota Geological Survey published a series of maps and reports on the resource potential of the Tyler Formation. Mineral rights leasing in prospective Tyler acreage began to take off accompanied by a significant amount of media attention.
The Tyler was speculated during that time to eventually emerge as another Bakken-like unconventional resource play. During September 2013 to August 2014, two horizontal test wells, the Rundle Trust 21-29TH and the Powell 31-27TH (figs. 1 & 2), were drilled in the Tyler Formation and stimulated using multi-stage hydraulic fracture completions. Although both wells went on to produce oil with some associated gas, the production rates were relatively low. Oil prices proceeded to collapse in late 2014, shortly after these test wells were completed.
Two of the summary remarks:
  • even though the production rates were low, the Rundle Trust 21-29TH shows that the upper Tyler carbonate beds are capable of producing oil in an unconventional completion. The question still remains of how much they are capable of producing.
  • the usage of water-based (particularly fresh water) drilling mud and completion fluid should be avoided within the upper Tyler Formation. Diesel or oil-based drilling fluids are preferred because they help maintain wellbore integrity and also may limit damage to the formation if water sensitive clays are present. A non-water frac fluid may be more costly, but could ultimately prove to be the key to unlocking the Tyler’s resource play potential
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Discussion

A reader asked me whether we might see new drilling in the Tyler any time soon. The reader was focused on the price of WTI as a significant data point determining if any operator would drill the Tyler.

I suggested to the reader that in addition to price, other factors need to be considered:
My hunch is there are at least three variables:
a) price, as you noted
b) availability of work force; right now, the Permian is really competing for human resources
c) new operators coming into North Dakota are probably sticking to tried-and-true Bakken

I also think that if the price goes up appreciably, before they go to the Tyler, they will go back to the "periphery" of the Bakken -- trying to expand the "sweet spots.
The reader was interested what others might think. Please feel free to comment.

In addition, I will post a poll asking readers what they think about the chance for new drilling in the Tyler. Note: readers are allowed to post comments unlike most polls posted.

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Ford F-150 vs the Tesla Pick-Up

According to the poll, if given only two choices, 98% of respondents would choose a Ford F-150 over the proposed Tesla pick-up.

4 comments:

  1. I believe that there is not any interest in the Tyler formation after seeing the results of Marathon’s two wells. Companies always look at profitability, and there just doesn’t appear to be any from the Tyler formation. Marathon spent big money to drill and complete two wells that they never really made anything back from.

    ReplyDelete
    Replies
    1. Starting with well #1 in North Dakota and moving to well #16000 (16,000 wells) there are too many dry wells to count. Prior to the Parshall - Bakken well that started the Bakken boom in North Dakota there were many, many, many dry Bakken wells.

      And despite the challenge of hitting a Lodgepole well, operators still go after the Lodgepole.

      Rare, but there are still occasional cases in the NDIC dockets for targeting the Tyler.

      Delete
  2. There actually were numerous (vertical) wells drilled around the Rundle well that were dry holes.
    The companies that drilled the dry Bakken wells didn’t have a formation that they could drill and make money from. If The Bakken hadn’t been discovered, maybe more would be interested in the Tyler. Now there are many other areas to drill in that have known profitability.

    ReplyDelete
    Replies
    1. Agree. There were several dry holes. It was disappointing, soured folks on the Tyler formation. When I look back on the Bakken, it seems quite fortunate that oil companies persevered, and the thing that made is possible: $100+ / bbl oil.

      Delete