Zeits Not Impressed With SandRidge Open Hole Completions In The Mississippi Lime

The link takes you to SeekingAlpha with contributor Richard Zeits, one of the best of the shale analysts. This is a good post to read, bookmark, and save. It's only going to be available for 30 days or so before it's archived.

Some excerpts:

• the comparison across the three well groups shows that based on production test data, SandRidge's fourth quarter promises to show a recovery from the worrisomely weak third quarter
• SandRidge conducts its typical 24-hour production test about three weeks after the date of the well's first production date (although the test may occur as early as ten days or as late as two months after the first production). While the majority of the wells are likely to have "cleaned up" by the time of the test, some may still have significant amounts of frac fluids flowing back. Chokes and flow regimes (free flowing vs. gas lift vs. pumping) differ from well to well. As a result, the test rate represents an imperfect and "noisy" indicator of the well's early productivity. Further complicating the story is the high variability of decline profiles exhibited by wells in the Mississippian. The bottom line, the correlation between the well's production test rate (or any IP rate, for that matter) and the EUR is imperfect
• latest well data indicates that SandRidge is actively experimenting with open hole completions in the Mississippian. The company used open hole completions in ~60% of the sample's wells that came on production in Oklahoma during the November-December period (18 open hole completions of the 31 wells total, using the Q4 sample data)
• open hole completions in the context of the Mississippian play have attracted significant attention in industry and financial press. There are several valid arguments that make this approach conceptually intriguing as a potential solution for some of the challenges encountered in the Mississippian play. Among the primary benefits quoted is the ability to minimize damage to the fracture-rich carbonate rock from the cementing job. Reduced well cost is another benefit (the approach may be particularly effective in cutting costs in those situations where the log data obtained during drilling indicates poor rock quality and an expensive completion is no longer justified) 

And then this:

However, a detailed review of SandRidge's production test data does not provide clear evidence that the method leads to better well performance.