Human Interest Story: Keenan, Apache, Alpine High Oil Field -- January 8, 2017

August 22, 2022: see update here.

Data points from the Alpine High article below:

• oil: 3 billion bbls in Alpine High vs 5.2 billion bbls in Eagle Ford
• 75 trillion cubic feet of gas; 3 billion bbls of oil
• = 15 billion boe
• EOG leased more than 600,000 acres in Eagle Ford for "hundreds of dollars/acre"; later Eagle Ford acreage valued / sold at $35,000 / acre
• 350,000 acres in southern Reeves County
• Apache leased for average $1,300/acre (Permian now goes for $30,000 / acre)
• "discovery well" in Alpine High: Spanish Trail 55 1H
• November, 2015
• off County Road 318, just outside Balmorhea
• 10,767 feet down, 4,326 feet horizontal (almost identical to a middle Bakken short lateral
• "embedded" in clay? clay does not fracture well
• two years to study how to recover oil
• no infrastructure in the area yet 

Staggering global riches of natural gas (the numbers keep increasing). From an earlier post:

Top five countries:

• Russia: 6,000 trillion cubic feet
• Iran: 1,000 trillion cubic feet
• Qatar: 900 trillion cubic feet
• Turkmenistan: 600 trillion cubic feet
• US: 350 trillion cubic feet
• #11: Australia: 152 trillion cubic feet (as of January, 2014). (See this post.)
  

Now, let's go back and re-run the numbers that were posted earlier:

• that recent huge Mediterranean natural gas find: 30 trillion cubic feet; this was said to be biggest natural gas find ever in the Mediterranean
• Barnett, revised USGS figures: 53 trillion cubic feet
• Utica, newly revised figures: 782 trillion cubic feet
• Marcellus, EIA revised estimates: 65 trillion cubic feet, "proved" reserves
• Bakken/Three Forks, USGS estimate: 7 trillion cubic feet
• Qatar: 800 trillion cubic feet, wiki, conversion

Other recent stories on natural gas reserves

• Marcellus: 480 trillion cubic feet of technically recoverable gas, Penn State geoscientist 

Comments regarding natural gas reserves

• for me, it's hard enough getting my hands around billions of bbls of oil; it's almost impossible for me to get a feel for trillions of cubic feet of natural gas
• proved reserves are based on price of recovery, confusing matters from year to year
• estimates are just that, estimates (and often inflated for "certain" reasons)
• watch for this gotcha: sometimes reported in trillion cubic feet; sometimes in trillion cubic meters (35 cubic feet = 1 cubic meter; not trivial)
• for me it comes down to two things:
• any discovery over 30 trillion cubic feet natural gas is staggering, worth reporting
• "we" aren't going to run out of natural gas any time soon

Original Post

Very, very interesting human interest story sent to me by a reader. I received it some time ago (December 30, 2016) but delayed in getting it posted, sorry.

This is the story of how a retired geologist discovered one of the biggest oil finds in the continental US this past decade: the Alpine High oil field.

[Steve] Keenan [retired geologist] and [Roberto] Alaniz [chief geologist] became intrigued by a section along a southern strip of Reeves County. The rest of the industry didn't think much of it. More than 100 wells had failed before Apache arrived, drilled by storied explorers like Oklahoma's Chesapeake Energy and Houston's Petrohawk Energy.

Petrohawk once owned half the oil rights in the area, said Floyd Wilson, the company's former CEO and current chief executive of Halcon Resources, another Houston oil company. But it didn't know quite what it had. "We didn't even have a clue those plays were there," Wilson said.

Oil companies largely avoided southern Reeves County. Most believed rock in that part of the Delaware was too deep and too hot to hold oil. In addition, as seas filled the basin millions of years ago, they deposited clay, which doesn't fracture well to let out oil and gas.

More:

Apache hired Keenan in April 2014, and Keenan opened a San Antonio office. Colleagues from EOG, including geologist Sara Reilly, 37, soon joined him. "I wanted to work for Steve again," she said.

Keenan's team started slowly, helping to improve existing wells and prospects, and operating other wells in the western half of West Texas' Permian Basin, called the Delaware. Keenan and chief geologist Roberto Alaniz, 67, a long-time colleague, had never worked in the Permian. But they liked the Delaware, with its deep underground basin that trapped organic material - the building blocks of oil - as seas rose and fell millions of years ago.

More:

In November 2015, the state approved the drilling of Spanish Trail, off County Road 318 on the edge of a lake outside the sleepy town of Balmorhea. Apache broke ground in January, drilling 10,767 feet below the surface, then turning 4,326 feet horizontally, according to state records..

One night a month later, a field report arrived in the inbox of Tim Samson, a 34-year-old geologist. Samson looked, then looked again. Spanish Trail had hit clear, sweet crude in a reservoir 2,000 feet thick more than a mile below the surface. .

Apache found something else there, too - something Keenan won't talk about, for fear of revealing the secret of Alpine High. But, whatever it was, it told him every well in the play would strike oil.

Much, much more at the link.

The big takeaway for me: there's a lot more to all these plays, including the Bakken, that we don't yet know about.

And the coolest thing: I had already placed "Alpine High - Apache" at the sidebar at the right.