Anticipation: Wells/Spacing Unit

For newbies, note this paragraph from a recent report:

[Lynn] Helms said there are currently 210 drilling rigs working the Bakken, and that companies there are drilling nearly 3,000 new wells every year. For now, there is just one well in each "spacing unit," he said. But that will change starting about 18 months from now, he said, when workers will begin drilling anywhere from 6 to 16 additional wells per spacing unit.

That's not entirely correct. Perhaps in the big scheme across the state, there is "about" one well in each spacing unit, but there are already a lot of spacing units with multiple wells in them.

However, this is what caught my attention: one number and one word.

The number: 16.  I knew that we would be seeing eight wells in each spacing unit (in the core Bakken), and I had imagined even more in some cases based on the dockets, but to hear the director be specific, mentioning 16 wells per spacing unit ... well, that's incredible.

The word: additional. As in, "16 additional wells per spacing unit.

It should be noted that some spacing units are 640 acres but the "standard" in the Bakken is now 1280-acres. We may be seeing a trend toward 2560-acre spacing units. I've argued that mineral owners would do better with 2560-acre spacing units, but in a poll at this site, the majority of respondents felt that 1280-acre spacing was better for mineral owners.

I can't find it now, but Helms also said something to the effect despite the decreasing number of rigs in the Bakken, we are now seeing five (or eight; I think it was five) wells being completed each day compared to only one in the past. I will see if I can find the link, the story.

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It was also interesting to note that unconventional shale "favors" private land, as opposed to public or federal land. Here's the full quote:

Adam Sieminski, the head of the US Energy Information Administration, also addressed the issue at the hearing, as well as on "Platts Energy Week" on Sunday. In both venues, Sieminski said the US' major shale plays are located primarily on non-federal lands.

"So it's hard for the federal government to show big oil or gas shale-production numbers on its own lands, simply because the geology favors private and state landholdings," he said on the show.

Sieminski reiterated that his agency "does not make policy judgments" on questions such as which political party deserves more credit for fostering the shale boom. But he did praise the oil industry for making investing the necessary capital.

Yup. So many story lines, but I will leave it at that.