Random Look At Some Wells That Came Off DRL Status Just As The Price Of Oil Plummeted -- January 22, 2015

I think this is really cool. Maybe it means something, maybe it doesn't. You decide.

Look at the production profiles of three recent BR wells:

27059, IA/1,320, BR, Denali 21-4TFH 2NH, Johnson Corner, 4 sections, t9/14; cum 6K 11/14;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	11-2014	0	0	0	0	0	0	0
BAKKEN	10-2014	1	0	349	1	2	0	0
BAKKEN	9-2014	12	5539	5187	6562	19733	16760	2943

27061, IA/2,088, BR, Denali 21-4MBH 3NH, Johnson Corner, 4 sections, t9/14; cum 14K 11/14; 

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	11-2014	0	0	0	0	0	0	0
BAKKEN	10-2014	0	0	0	0	0	0	0
BAKKEN	9-2014	27	14388	14388	29376	29086	8883	20136

27060, IA/1,872, BR, Norman 21-4MBH, 2SH, Johnson Corner, 4 sections, t9/14; cum 14K 11/14;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	11-2014	0	0	0	0	0	0	0
BAKKEN	10-2014	0	0	0	0	0	0	0
BAKKEN	9-2014	8	14215	14215	6330	27698	11275	16403

The four wells on this pad have all been completed. There is a lot of activity in this section and on a neighboring pad, one-third mile away, they are drilling (and possibly fracking) four more wells. So the fact that these three wells (and the fourth well) have identical production profiles could simply be due to operational reasons. So, in a few months we will come back and take another look.

However, with the slump in oil prices, it certainly begs the question.

In the process of updating the wells that were on DRL status in 3Q14, I came across what seems to be an inordinate amount of wells that appear to be choked back significantly or taken off-line completely. It's hard to believe they are all choked back or taken off-line for operational reasons. Some examples:

• 26448, 58, Newfield, Hovland 150-99-26-35-2H, South Tobacco Garden, t5/14; cum 3K 11/14; -- considered completed; but no evidence this well has been fracked
• 21374, 2,263, Statoil, Barstad 23-14 4TFH, Alger, t9/14; cum 6K 11/14;
• 21373, 2,451, Statoil, Barstad 23-14 5H, Alger, t9/14; cum 8K 11/14;
• 21375, 2,516, Statoil, Barstad 23-14 6TFH, Alger, t9/14; cum 8K 11/14;
• 27575, 2,474, Statoil, Barstad 23-14 8H, Alger, t10/14; cum 8K 11/14;
• 27085, 1,560, BR, Norman 34-33TFH, Johnson Corner, 4 sections, t7/14; cum 14K 11/15;
  
• 27137, 1,872, BR, Denali 21-4MBH, Johnson Corner, 4 sections, t7/14; cum 5K 11/15;
• 26799, 693, Hess, SC-Tom-153-98-1514H-4, Truax, t9/14; cum 33K 11/14; 

Look how low the cumulative production numbers are despite huge IPs. The last one with 33,000 bbls in two months looks good until one looks at the production profile:

26799, 693, Hess, SC-Tom-153-98-1514H-4, Truax, t9/14; cum 33K 11/14;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	11-2014	30	6595	6526	3034	10202	9947	255
BAKKEN	10-2014	30	8177	8653	4109	14240	13663	577
BAKKEN	9-2014	29	17932	17306	10018	30815	22126	8689

The Bakken is known for a steep decline rate and perhaps that's all it is for that Hess SC-Tom well, but again, it begs the question. Even for a Bakken well, that decline well looks suspicious.

Break, break.

Wells that go to zero production are being taken off-line for a reason, generally for operational reasons associated with pad drilling.

However, wells that have huge decline rates (out of the ordinary for even the Bakken) suggest they are being choked back for reasons other than operational constraints (flaring, takeaway constraints, pricing). 

And look at that Newfield well with an IP of 58. It's no longer on DRL status suggesting the operator considers the well completed and yet there is no indication that the well has been fracked.

Break, break.

Whether these wells are taken off line for operational reasons or whether they are being choked back for whatever reason, think about it: in November, 2014, oil production in North Dakota hit another record despite wells not being as productive as they could have been.

I was updating 3Q14 wells that had been on DRL status. I had only updated a handful of wells, and yet it seemed well out of proportion to have so many wells choked back or taken off line.

Just an observation.

I could be very, very wrong. But it certainly seems interesting on so many levels.

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Malagueña Salerosa, Chingon  

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