Case Study: The Hess EN-Davenport Wells -- August 30, 2019

Background and purpose of posting: the "original" EN-Davenport well in this area (see graphics below) was drilled in 2008, the early days of the Bakken. After almost eleven years of production this well has produced only 81,000 bbls of oil. Based on notes from readers over the past twelve years of blogging, most readers would suggest that this well is "uneconomic." And yet, Hess did not abandon it. Why? Answer: the company held the lease by production. And, oh, by the way, this is going to be a great well at some point.

Point #2: let's talk. Can we be frank? The original Davenport well is lousy. But there they go again. Hess has permits for a 7-well pad less than 2,000 feet away and the nearest "new" horizontal will be about a thousand feet from the original well. Now either Hess considers the original Davenport well worthy of being replicated, or much more likely, the combination of experience, lessons learned, new completion strategies, etc., --- and most importantly -- what they've learned about the geology -- suggests to Hess they can get some pretty good wells in this area. Remember, Bakken operators now suggest they won't drill a well with a(n) EUR of less than a million bbls of crude oil. And each well "stands alone."

Point #3: ever since the Bakken boom began, there was a lot of talk about "sweet spots," and I bought into that argument. Many years ago, but I never posted my thoughts at the time, I started to think that "sweet spots" in the Bakken were being over-emphasized. Just as I argue that "rigs don't matter" in shale plays, I'm now ready to go out on this limb: "sweet spots" don't matter. I wish I had a date-time stamp for when I first thought that; it probably would have been in 2014 or thereabouts, after seven years of blogging. I'll discuss sweet spots in a later blog in greater depth.

By the way, for newbies, I am the only one who argues that "rigs don't matter"; no one agrees with me based on feedback from readers.

The graphics:

The wells:

• 16928, 82 (no typo), Hess, EN-Davenport-156-94-1003H-1, Big Butte, t11/08; cum 81K 6/19;

• 35522, conf, Hess, EN-Davenport ...
• 35521, conf, Hess, EN-Davenport ...
• 35520, conf, Hess, EN-Davenport ... unit line well;
• 35519, conf, Hess, EN-Davenport ... unit line well;
• 35518, conf, Hess, EN-Person ...
• 35517, conf, Hess, EN-Person ...

Note: it is possible that one or more of these permits will be canceled before it's all over.