CLR: Five-Year Plan -- Testing the Three Forks -- Three Separate Multi-Year, Multi-Well Tests

For additional background, regarding this post, click here. 

Introduction: CLR's experience in early exploration of the Three Forks

TF1: upper Three Forks; the majority (99%) of all current Three Forks wells
TF2: CLR's Charlotte 2-22H; 10-months of production; 5,000 boe/month; EUR: 561 million boe
TF2: BR's Sunline 11-1TF, #19286, 7,000 boe/month; EUR - 696K boe

• 19286, 1,464, BR, Sunline 11-1TF-2SH, Clear Creek; t5/11; cum 63K 8/12;

Continental Resources: moving ahead with three (3) separate full-scale pilots that will test the simultaneous productivity of the four intervals: the middle Bakken, TF1, TF2, and TF3

The three (3) separate plans: each test will involve three or four wells per zone; the two bigger plots will consist of 14 wells each; the smaller test will consist of 11 wells

1) lower TF exploration and appraisal

• 2013 - 2014
• CAPEX: $70 million for 11 wells

2) pilot 320-acre development

• four (4) wells per zone per 1280-acre unit
• four wells x 4 zones: 16 wells
• 2013 - 2014
• CAPEX: $212 million for 14 wells
• November, 2012 -- February, 2014
• 4 MB, 3 TF2, 4TF2, 3TF3
• micro-seismic monitoring
• 68 feet between TF1 and TF2
• 1,320 feet between wells in same zone; 68 feet vertical separation between TF1 and TF2 wells; 660 feet lateral separation between wells in TF1 and TF2

3) pilot 160-acre development

• eight (8) wells per zone per 1280-acre unit
• eight wells x 4 zones potential: 32 wells
• March, 2013 - March, 2014
• CAPEX: $55 million for 14 wells
• CLR sees very little interference between wells drilled with a 320-acre density; conclusion based both on CLR's analysis of 156 well pairs (CLR's and non-operated wells); so now, CLR will be tesitng 160-acre down spacing
• 660 feet lateral separation between wells in same zone; 320 feet lateral separation between wells in different zones

In the SeekingAlpha.com link, the following comment was made: "In its presentation, CLR shared results of a computer simulation prepared by Ryder Scott for a hypothetical 160-acre down spacing. According to CLR, the model was based on a relatively high permeability assumption (which should translate in conservative estimates)." I assume they mean a "high permeability" between zones. If the permeability is actually lower, the interference between wells in different zones should be even higher.

In sweet spots, the closer the well separation (the greater density) the more oil recovered; less "wasted" by lack of horizontal drilling. In "other-than-sweet spots," down spacing to 160 acres may be less (or non-) economical.

In a sweet spot: the first well could generate 1 million bbls EUR; each of the 8 additional wells could generate 700K bbls each or 5.6 million bbls total.  As I understand it, these eight additional wells would be in two neighboring zones, such as TF1 and TF2. There is still TF3, and possible TF4 to consider, it appears.