Updates
October 4, 2013: two things -- a reader sent me a note suggesting the Bakken numbers could be much, much bigger than what I posted below. I agree. I was concerned with even posting the numbers below, much less even bigger numbers. I am very serious about the Bakken posts (the non-Bakken posts are often hyperbole and venting). I don't need to exaggerate regarding the Bakken, so I tend to hold back on what I'm really thinking.
Another reader sent me the PDF link to Mr Rolfstad's newest presentation on the Bakken. Readers may want to note the number of wells that folks are now talking about.
Original Post
While at the first glance the 40,000-acre position may appear modest in size, one should keep in mind that even under the conservative 40-acre development scenario, it would take over a decade to complete the drilling with a six-rig program, assuming current drilling pace of ~16 wells per rig-year. One would need to double the timeframe if the development proved to be feasible on 20-acre spacing.
Most importantly, Rosetta estimates that on its entire position in Reeves County, it has over 100 million barrels of oil equivalent in place per section (one square mile). The estimate is truly staggering. To put it in perspective, if only 10% of total oil and gas originally in place could be recovered, gross revenue from each square mile could exceed $600 million over the life of the property (using $90 per barrel oil price realization and $5/MMBtu "wet" gas price realization and assuming reserve mix of 67% oil and 33% gas). By comparison, in its current estimates, Rosetta assumes average recovery factor of approximately 3.8%.Don, who sent me the link, asks rhetorically: whatever happened to "peak oil"? Oh, yeah -- horizontal drilling and fracking.
In the best Bakken, 14 wells x 500,000 bbls EUR / 1280-acre units = 7 million bbls/1280-acre units or 3.5 million bbls/section. Of course, in the best Bakken, EOG is suggesting as many as 34 wells in one 1280-acre unit.
In the Permian, in the linked article above, 100 million bbls OOIP/section x 10% recovery = 10 million bbls/section.
So, some idea of the amount of oil that could be produced in these plays.
34 wells in a 1280 would be rather...exciting.
ReplyDeleteMaybe I shouldn't view the 1280 as a blank etcher-scetch and each well is a long line drawn on the etcher, and crossing lines is bad. So in short, do you think the already established 1280's could fit 30 or more wells into them? without messing up the other wells already there?
Yes, we are talking about 1280-acre spacing units.
DeleteI doubt oil companies would purposely mess up wells that are already drilled. In fact, additional fracking will improve all wells that are in communication with the fracking.
Some have suggested that fracking to this extent will help when EOR begins. Others have suggested that; I don't know enough about EOR to comment.
They are already drilling 8 wells across a 1280-acre spacing unit. Now they will drill 8 wells into the lower layers of the Three Forks. If there are six pay zones, then six pay zones x 8 wells into each pay zone = 48 wells.
Four pay zones x 8 wells into each pay zone = 32 wells. Add those 32 wells to the 2 "discovery" wells and one has 34 wells. Four pay zones: middle Bakken, upper Three Forks (TF1); second bench located in the Lower Three Forks (TF2); third bench located in the Lower Three Forks (TF3). Those are given. There are two or three additional pay zones that some are talking about that are sourced by the Bakken Shale. Obviously, not all pay zones are located throughout the Williston Basin.
The operators have pretty much delineated the middle Bakken; they are still delineating the Upper Three Forks. It will be a long time before the Lower Three Forks is delineated.
http://themilliondollarway.blogspot.com/2013/04/what-well-be-talking-about-this-summer.html