Regular readers of the blog know that I am inappropriately excited about the "halo" effect -- that jump in production seen in Bakken wells when they are brought back on line after being off line for a few weeks or a few months while neighboring wells are fracked. In some cases (rarely) the "parent" well is off-line for less than a month.
I tag posts discussing this phenomenon as "halo" or "jump in production." I noted the phenomenon almost a decade ago but had not seen validation from a credible source.
[The very first post that was tagged with the halo effect was dated August 19, 2010. Link here: http://themilliondollarway.blogspot.com/2010/08/another-first-for-north-dakota_19.html.]
I did receive a phone call from an analyst at the largest fracking company in the Bakken at that time about six years ago asking me about my observations. The analyst said his company was referring to these as "parent/child" wells. I did not post the specifics of that phone call at that time assuming that some of the information I had been told was proprietary.
[I was in Belmont, MA, when I received the phone call. I was last in Belmont, MA, in 2013: that's why I know that the phone call was at least six years ago.]
I continue to look for validation from credible sources. About a month ago, maybe two or three months ago, I started getting hints of validation from Whiting. I think I have posted some of that, but I can't recall for sure.
Break, break.
It's my observation that the parent / child interaction in the Bakken is "positive." Either there is no effect, a subtle effect, or a huge positive effect, but I have not seen any suggestion that the parent / child interaction is "bad news" in the Bakken.
On the other hand, however, there have been numerous stories in the popular press that this is not the case in other shale plays. There are concerns, particularly in the Permian, that new wells (or "children" wells) are having an adverse effect on older wells ("parent" wells).
Break, break.
Tonight, in the process of looking for something else, I ran across this slide in a recent Whiting presentation.
The link: https://event.webcasts.com/viewer/event.jsp?ei=1260399&tp_key=d761d52d8c.
Slide #9.
Screenshot:
Note: "Parent / child well activity [in the Bakken] is positive vs experience in other shale plays."
By the way, that one slide above has many, many other interesting data points.
Both CLR and WLL have made hints that, for the first time, give possible support to the halo effect idea. These are really the first (and still quite minimal) things I've heard externally backing up Themilliondollarway blog in the halo effect concept.
ReplyDeleteI sort of maintain most of my initial skepticism though. It's not like you haven't been talking about halo effect for almost 10 years. And other novel ideas get rapid news, education, etc. So I really think if there was that much to it, I'd hear it from more solid analysts. After all, you don't even give relationship advice. ;-)
In addition, I really think someone needs to mathematically define what halo effect means. It's not even explicitly defined for now...part of scientific advancement occurs even just by making falsifiable theories. Not only is falsifiability/testing enhanced by a clear theory, but the skullsweat just to label and describe a phenemenon clearly helps the analysis process (e.g. differentiating different factors).
After clearly describing the concept, we need a statistical study to prove if it occurs or not. NOT (not, not, not!) saying YOU need to do it. But somebody does, for me to take it seriously.
I think it's also important to disaggregate parent/child issues from halo effect concepts. Halo effect (loosely defined as bashing on a new well helps the wells around it) is a different issue than the concept of how spacing wells tighter together gives worse per well results. (And therefore one well per section does better than several.)
One of the reasons why new wells (which are almost all child in the Bakken as it is HBP) look better than old wells is because they are not the same design. The new wells have bigger fracs, better steering, diverters, etc. It's not apples to apples to compare to the old wells. Also, you really haven't "solved" downspacing limitations. For example, if you put a single new technology well in a section (looking hard to find a "virgin" section), it would likely outperform, on a per well basis, a section that was fully drilled out, with modern wells.
Okay.
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