Tuesday, June 5, 2012

How Good Is the Bakken? How Much Better Is It Getting?

I've just updated Blue Buttes oil field, one of the older fields in the Williston Basin. When you click on the update, notice the the change in IPs over the past two or three years.

Then look at some of the cumulative production figures.
  • 20591, 2,656, Helis, Jones 4-15/22H, t4/12; cum 48K 4/12: 48,000 bbls by the end of the month in which it was completed
  • 18973, 2,579, Helis, State 1-16/21H, t10/10; cum 308K 4/12;  over 300,000 bbls since it was completed less than two years ago
Do you think Helis has cracked the code for completing Bakken wells in Blue Buttes?

And, then how about this string of Hess wells?
  • 18013, 842, BR, Mathistad 2-35H, t7/09; cum 124K 4/12;
  • 18053, 467, Hess, BB-State-151-96-3625H-1, t10/09; cum 144K 4/12;
  • 18104, 1,113, Hess, BB-State A-151-95-1615H-1, t11/09; cum 250K 4/12;
  • 18105, 860, Hess, BB-Federal A-151-95-0910H-1, t2/10; cum 201K 4/12;
  • 18218, 615, Hess, BB-Federal-151-95-0817H-1, cum 199K 4/12;
  • 18250, 1,230, Hess, BB-Federal B-151-95-2122H-1, t5/10; cum 160K 4/12;
  • 18271, 547, Hess, BB-Chapin A-151-95-0403H-1, t1/11; cum 106K 4/12; 
Those wells fairly old by "Bakken boom" standards. And some of these wells are going to keep producing for 30 years -- albeit at a declining rate. I think this something a lot of folks keep forgetting: once production comes on line, day-in, and day-out, these wells are putting oil into the pipelines.

Rationally, "we" know that CLR says the EURs of their wells will average 603,000 bbls for the better Bakken, but one doesn't really get a feeling for what that means until one sees specific wells that have produced 300,000 bbls in 18 months, or a string of wells that will probably all come close to hitting 300,000 bbls in 36 months with some exceptions. And, again, these are "older" wells.

Look at the change in IPs from "then" (two years ago) to now.
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5 comments:

  1. AnonymousJune 5, 2012 at 12:25 PM

    WSJ has article today about debate over how scarce earth's natural resources are? Very interesting, but no discussion of oil and has from my reading. 600+ years of potash.

    ReplyDelete
  2. AnonymousJune 5, 2012 at 5:23 PM

    One thing to note is that not all Operators report the same bbl/day average, Hess for instance reports their first 30 day average. Others report the average production during the first few days, when undeniably the oil production is at it's peak.

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    Replies
    1. Bruce OksolJune 5, 2012 at 5:59 PM

      Yes, methods vary.

      The metric I prefer is cumulative production at one year, two years, and five years.

      Delete
  3. AnonymousJune 6, 2012 at 1:52 PM

    Any idea based on the 1,2,3 year numbers what an updated EUR might be? I know it's an average but that 600k number has got to be really low for wells hitting 300k in 3 years.

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    Replies
    1. Bruce OksolJune 6, 2012 at 2:09 PM

      Quick answer: KOG now talks about 900,000 bbls as the EUR. I've blogged about that several times, as has Mike Filloon. One of many such posts:

      http://milliondollarway.blogspot.com/2011/11/part-ii-kogs-january-2012-acquisition.html

      Some short notes:
      1. When talking about average, remember, a lot of Bakken wells are significantly less productive than headline numbers. Those less productive wells will bring down the average.

      2. There is good, better, and best Bakken. It's all about location. One can argue that CLR, spread across the entire Bakken, might have a lower average EUR, whereas a Whiting focused on the Sanish/Pronghorn might have a higher average EUR. KOG with most acreage in better and best Bakken, they should have higher EURs.

      3. When talking EUR, be careful to watch "barrels of oil" and "barrels of oil equivalent."

      4. The interesting thing is that as I update cumulative production, I still don't find many wells that are even three years old. I can't wait to see what production is at the 5-year mark. We're starting to get a feel for the 1-year and the 2-year mark.

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