Changes announced:
- using oil base mud during the entire drilling operation
- switching to plug and perf vs sliding sleeve
- using more proppant
- using ceramic proppant in the mix
- will reduce pump downtime by installing more reliable diesel electric generators on the pumps where electric service is not available
- reiterated: the company's target is the middle Bakken in McKenzie and Billings counties in North Dakota
- mentioned: 22207, conf, Basaraba 34-35-1H, its first Bakken well in Billings County, may be its best well; IP of 1,673 bopd (48/64 choke); 39-stage plug and pert completion; used 25% more proppant (4 million pounds); 44% white sand; 56% ceramics
- 21947, conf, Fairfield State 21-16-1H, Billings County, a Three Forks well; with good show in the middle Bakken;
- 21545, 1,409, Akovenko 24-34-2H, McKenzie County; t5/12; cum 13K 8/12; long lateral in less than 30 days; $4 million
- 23634, conf, Lange 44-31-2H, McKenzie County;
Comment: if indeed the Basaraba is as good as GMX says it might be, this is a huge development. It's a middle Bakken well, but it is located where there has been almost no activity in the current boom. It's at the far north of Billings County, almost in McKenzie County, but far from any MB sweet spot of which I am aware. By the "rules of the game," I am surprised this was not considered a wildcat.
Comment: I believe this is a very opposite position that QEP is taking. In its conference call following its acquisition of Helis acreage and assets, QEP said it completes wells without using ceramics. At least that's what I recall. The jury is still out, but if QEP can prove its case, the implications are huge; I think most folks understand the issue
Comment: I believe this is a very opposite position that QEP is taking. In its conference call following its acquisition of Helis acreage and assets, QEP said it completes wells without using ceramics. At least that's what I recall. The jury is still out, but if QEP can prove its case, the implications are huge; I think most folks understand the issue
Comment: 4 million pounds of proppant (sand with/without ceramics) seems to be the norm for the better wells; BEXP has vast experience)
Comment: I know very, very little about plug and perf vs sliding sleeve, but my general impression is that I prefer to see plug and perf
Comment: I know very, very little about plug and perf vs sliding sleeve, but my general impression is that I prefer to see plug and perf
Comment: If I read the "cost" of that well, the Akovenko, that's incredible: $4 million for a long lateral. Talk in the oil patch is that Whiting is a low-cost driller at $6 million / Sanish well (higher elsewhere) and most saying wells cost them $10 million or more. But again, I may be misreading/misinterpreting that "$4 million" figure. [See comments below: this $4 million figure probably refers to drilling only, not completion costs; that makes sense because they have not completed the well yet, though they should have budgeted the cost of completion. Some say drilling/completion comes close to 50/50 with high proppant/high ceramic completions, but it would be surprising if completion costs more than drilling. If the well (drilling/completion) comes in under $8 million, that's not bad.]
GMX, not broke yet.
ReplyDeleteAnon 1
"drilling cost" 4 million.
ReplyDeleteNot total well cost.
Anon 1
Yes, that's why all the "qualifications" about reporting it. If indeed GMXR is playing fast and loose with drilling costs + completion costs and not making that clear in their press release, it is quite concerning.
DeleteThe wells that are in a 2-4 mile radius of this well seem to be pretty lousy compared to this one.....did they just goof them up? Could this indicate that the potential for other seemingly "bad" areas could be better than people realize? The eastern edge has been called the edge of death, but could this mean possible potential?
ReplyDeleteYou've posted this on the GMX post about the Basaraba well. As noted above, there are almost no other wells in the immediate area, so I'm not sure if I am seeing what you are seeing.
DeleteHowever, you raise a great question that I've been tempted to talk about in a long stand-alone post, but keep putting it off.
With regard to the Bakken: When planning a well, one certainly looks at the results of the "off-set" wells if they exist. But once the well is spud, all bets are off. Each well has its own peculiarities and one cannot predict with certainty how a new well will do compared to the offset wells. Assuming the well designs and completions are identical (huge assumption) and assuming the drillers have an identical experience drilling and completing the well (an even bigger assumption), the natural fracturing will play a major role in how the wells might compare.
Switching gears, all things being equal, I would hope that five years of experience; increased knowledge about the Bakken; much, much better technology; new well designs and new completion designs; will all result in better EURs and better internal rates of return. Note: EURs and rates of return, not IPs.
With regard to the "edge of death," the jury is still out. But from what I've read, it is my understanding that some good Three Forks will be drilled where the Bakken "does not exist." Likewise the limits of other geographic formations are yet to be determined, at least based on what I've read. But as long as the Bakken / Three Forks is such a cash cow, we may not see some of these other areas explored/developed for many years.
With regard to the "edge of death," this is still the best source to start with when looking at oil production and potential in North Dakota:
Deletehttps://www.dmr.nd.gov/ndgs/Resources/WBPetroleumnew.asp
It's a few years old now, but it's a great place to start, and it's easy to read.