The press release.
Most of the press release had to do with EOG's largest asset, the Eagle Ford in Texas, which was incredible for investors, but this about the Bakken, was also quite incredible:
Consistent with its game plan to increase recovery rates in existing fields, during 2011 EOG continued infill drilling on its core acreage in the North Dakota Bakken Parshall Field, which it discovered in 2006.320-acre spacing. I-M-P-R-E-S-S-I-V-E.
Although originally developed on 640-acre spacing, EOG has successfully tested 320-acre down-spacing in various areas and around the perimeters of the field. A recent well in Mountrail County, the Fertile 48-0905H, in which EOG has a 96 percent working interest, was completed at an initial rate of 1,324 Bopd. Also in Mountrail County, the Liberty 24-2531H and Liberty LR 20-26H were drilled on 320-acre spacing.
The wells, in which EOG has 82 and 95 percent working interest, respectively, were turned to sales at initial crude oil rates of 1,507 and 1,165 Bopd, respectively. Over the course of 2012, EOG will continue its efforts to increase recovery of the oil-in-place on its Bakken acreage through further down-spacing tests and the initiation of a secondary recovery pilot project. [See first comment: water vs CO2?]
Going forward:
EOG has hedged approximately 23 percent of its North American crude oil production for 2012. For the periodFebruary 1 through June 30, 2012 , EOG has crude oil financial price swap contracts in place for approximately 33 percent of its production at a weighted average price of$105.36 per barrel, excluding unexercised options. For the periodJuly 1 through December 31, 2012 , EOG has 14 percent of its production hedged at a weighted average price of$104.26 per barrel, excluding unexercised options.
Bruce, once again good job on another great find. Both of these items could be huge!
ReplyDeleteFirst, the EOG switch to 320 acre spacing is a surprise as it's a 180 degree change from the existing trend shooting for seemingly longer and longer laterals. While longer ones are cheaper (than two short ones), it would be exciting if these short ones prove more effective in ultimate recovery.
Secondly, EOG's statement on initiating a secondary recovery pilot project. It sounded like a statement of a future goal. Then I saw the final line in today's (2-16-12) Daily Activity Report. EOG had well #16986 (sec 3, 152-90) "Permitted for Injection". So they're wasting no time in initiating their pilot!
I'd guess this would be a water flood rather than CO2, though who knows. Either way this is very exciting to see one of the majors begin to test an actual EOR project in the Bakken! If successful it could add decades to the life of these wells.
Thank you for taking time to comment.
DeleteThe whole press release was quite remarkable. Maybe more information with the earnings call.