Spacing In The Bakken -- October 21, 2024

Locator: 48613B..

Update On Spacing In The Bakken -- March 13, 2023

Loosely speaking, in general, the "standard" drilling unit in the Bakken is now two sections / 1280-acre. 

I don't check the spacing units on all new permits / wells, so I may not catch permits / wells with spacing other than 1280-acre / two sections.

If this is a multi-well pad, most of those wells these days will be 1280-acre spacing. Section line wells are generally double the drilling spacing of the other wells on that pad. 

For example:

• if the majority of wells on a pad are 1280-acre spacing, the a section line well from that pad will generally be a 2560-acre spacing well.
• if the majority of wells on a pad are three sections / 1920-acres, a section line well from that pad will generally be a 3840-acre spacing well. 

Again, in general, but there will be exceptions, and I will often miss them.

One can generally identify a section line well by the legal name of the well. 

Not yet the norm, but more and more Bakken wells are going to be extended long laterals, "three-mile" laterals; three-section spacing / 1920-acre spacing.

MRO "Converts" A Planned Overlapping 2560-Acre Spacing Unit Back To Two Standard Bakken 1280-Acre Spacing Units -- September 2, 2022

A reader and I both noticed this case from the September, 2022, NDIC hearing dockets.

We both thought it interesting.

After looking at the graphics, it makes perfect sense, especially considering these are MRO wells.

• and this is very, very good news for small mom-and-pop mineral owners in the area

Case, not a permit:

29567, MRO, Killdeer-Bakken, i) terminate an overlapping 2560-acre spacing unit, sections 4/5/8/9-145-94; ii) reduce the setback to 250 feet for the two 1280-acre spacing units, sections 5/8- and sections 4/0-145-94; Dunn County

The graphics:

Updates Have Been Added To A Recent Post -- May 2, 2021

One of the problems I have with the blog is how to minimize clutter but at the same time not letting new material in the form of updates get buried. 

A reader recently brought DGO to my attention, as well as a comment on DGO from another reader. Since the original post, two additional updates have been added. 

I think the updates are important, but I don't want to bring the updates forward -- the problem with clutter and too many posts -- and that's why I'm simply noting that there are updates and linking the site (as noted above).

The reader brought up an interesting point, one that will stir thoughts / discussions on an old, old subject that was addressed relatively early in the development of the Bakken. 

I'm not going to re-open that argument; there are strong feelings on both sides of the argument. Not being a mineral owner when North Dakota regulators changed the "typical" size of drilling units in the Bakken, I was greatly in favor with what the regulators did. Generally, however, I assume mineral owners were not happy with ever-increasing size of spacing units.

I won't re-open that argument for discussion, but having said that, I still think the NDIC did a fine job of threading the needle. 

The Man Who Bought 60,000 Oil And Gas Wells -- May 1, 2021

Updates

May 2, 2021: the reader continues with this:

Regarding the Bakken/Permian DSU differences ... both were/are one-square-mile 'squares' with the North Dakota regulators prudently expanding to two-square-mil (1,260 square acres) spacing units in the early years.

That single action - going from 640- to 1,280-acre DSUs  - was arguably one of the most crucial acts in boosting Bakken development.

The Permian still employs 640 square acre units - 'leases' being the common description - throughout the state ... as does Oklahoma, Louisiana, Colorado, and virtually every other state (excepting California) west of the Mississippi.

One interesting fact on this topic is the 'mineral rights' / Land Grants that the US government gave to prospective railroad builders in the late 1800s in efforts to encourage them to build new rail tracks. 

These legacy  mineral rights can be seen with the 'checkerboard' holdings in Texas and Colorado, especially, that company investor presentations usually show. [I believe I saw them at one time in presentations relating to North Dakota, also.]

Just as the little-recognized stripper industry plays a significant role in the oil/gas production world, the entire 'land/landmen' arena is almost completely overlooked, while being an extremely influential component of the industry.

May 2, 2021:  the reader who tipped me off to DGO, sent a follow-up:

That DGO outfit is certainly positioning itself as a premiere stripper, but that barely scratches the surface of what is taking place.

Eastern states, unlike the rest of the country, do not have pre-determined, geometric shaped drilling units. In fact, no DSUs exist at all. As a consequence, once a 640 acre holding is 'cobbled together' with willing mineral rights holders, an operator may get state approval to drill.

The shapes of these units (and the total size of contiguous acreage) is all over the place.

One consequence is that scattered, fragmented pads/holdings have little value to the Big Boys.

Enter DGO who was practically given over a dozen producing unconventional wells, engineering plans for maybe 30 more, and about half dozen developed pads which cost around $1 million each to prepare in Pennsylvania. 

The real value, it seems, with this company is that it offers a great outlet for the Big Boys to continue buying/merging without having to bother with the 'crumbs.' 

This is why EQT bought out CVX's Pennsylvania holdings for $735 million when CVX originally paid around $6-$8 billion for the stuff. EQT turned over the fragmented, unwanted producing pads/wells to DGO for peanuts. 

XTO - and others - are following CVX in leaving Appalachia.

Bottom line, consolidation continues apace. 

One consequence is the enormous benefit that some 'Little Guys' may receive. [Comment: again I am posting this to help understand how different plays, like Appalachia, are developed, compared to the Bakken. I assume the Permian is similar to the Bakken, but the Permian being a much older play, probably has some unique drilling unit issues.

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here. 

Original Post

Brought to my attention by a reader. Quite a story. Link to BBC.

So in 2001, aged 32, Rusty bought an old gas well back in West Virginia for $250,000 (£200,000). He raised the money by remortgaging his home.

"It was a small old well, it had been in production for years, but it was like gold to me," he says. "I spent the next four years still also working in the bank, but any spare time I had I'd fly up to West Virginia to work alongside the one well tender that I had back then."

Fast-forward to today, and Rusty's company, DGO, now owns more than 60,000 gas and oil wells across West Virginia, Pennsylvania, Ohio, Kentucky, Virginia and Tennessee, a region called the Appalachia. Employing 925 people it has annual revenues of more than $500m. Some 90% of its operation is natural gas, with 10% oil.

The company's business model is a very specific one - it doesn't do any drilling to find new oil and gas reserves. Instead it buys up old oil and gas wells that bigger producers no longer want, because the initial large flow levels have fallen to low volumes.

He might feel right at home in North Dakota with the dreaded "Bakken decline."

Sometimes It's In The Very Fine Print -- Downspacing In The Bakken -- August 18, 2016

I'm going over the most recent Mike Filloon contribution to SeekingAlpha again. I don't think he mentioned this in his narrative, and I don't think I've seen it elsewhere. Here's the graphic. See if you can spot something fairly significant.

The graphic is from Goldman Sachs Global Investment Research, undated. Besides the obvious multiple formations that are highlighted, note the second bullet:

Middle Bakken and Three Forks-1 zones have been largely derisked. Confidence in downspacing from 320-acre well spacing is key catalyst for more resource credit for the play.

That one line could be interpreted a number of ways. But I think it's pretty clear, based on "downspacing from 320-acre well spacing," that analysts have already factored in 320-acre spacing for the middle Bakken and the first bench of the Three Forks.

I think regular readers of the blog have felt we've "always been there" -- at 320-acre spacing for both the middle Bakken and the first bench. I assume the analysts mean two middle Bakken wells/section and two TF-1 wells/section or eight wells per the standard 1280-acre spacing unit in the Bakken. If so, yes, we've been there for quite some time. (In fact, I already have a tag, "320_Acre_Spacing." See tags associated with this post for similar tags and similar posts.)

The analyst's do not specify "good" Bakken from "better" or "best" Bakken. This seems to imply an average across the basin. In some areas we are well beyond 8 wells in one standard 1280-acre drilling unit. In fact, if we can drill along section lines (in an overlapping 2560-acre unit, for example), the better and the best Bakken should easily be able to support six MB and six TF-1 wells in a 1280-acre unit. With 660-ft spacing, it's more than that.

Just idle chatter. Don't quote me on this. Keep it a secret.

At FAQs, question #2 (FAQs are not always updated; FAQs have opinions and facts are interspersed and I don't necessarily point that out):

2. How many wells will "they" drill in a section? How many wells in all in the North Dakota Bakken? It is estimated that up to 50,000 wells will be needed for the Bakken Pool. -- current as of May, 2013. The number of wells per section continues to increase. Goldman Sachs has a graphic, 2016, suggesting 320-acre downspacing is the norm in MB and TF-1. Back in August, 2012, the NDIC dockets suggest there would be up to 16 wells in a 1280-acre spacing unit in the "core" Bakken. In the June, 2013, dockets, the "norm" for 1280-acre spacing units seems to be increasing to 10 wells but CLR is moving toward 17, 24, or more wells per spacing units. In late 2013, CLR had pilot projects for 34 wells in a drilling unit of 1280 acres (two sections). And:

In a January, 2013, presentation, the Director, NDIC, suggested that it may take as many as 48 wells/spacing unit to drill out some areas of the best Bakken. At the time he said that, most spacing units were two sections. Therefore, Lynn Helms was suggesting as many as 24 wells/section in the best part of the Bakken which includes productive formations from the middle Bakken through ALL lower benches of the Three Forks.

Idle Doodling On A Saturday Evening -- March 7, 2015

Idle doodling on a Saturday night.

Remember the Hartman wells we talked about just a couple days ago (at this link)?

Some folks have wondered how many wells could be sited in a 640- or a 1280-acre drilling unit in the Bakken. 

Separation of those eight wells: 0.21 miles, or 1110 feet. A drilling unit is 5,280 feet wide, and although it's somewhat circular in reasoning, that 0.21-mile separation is about 20% of the width of the drilling unit: eight horizontals in 20% of the width of the drilling unit.

Thus, even without going into whether the 8 Hartman wells in that graphic represent the maximum number of wells that could go in to that same area (maximum number of wells in all formations/subformation, simple arithmetic suggests as many as 40 wells (5 x 8) could fit into a mile-wide (the standard spacing) drilling unit in the Bakken.

This is not new. I've talked about it at length, first mentioning it some years ago. Long-time readers might recall that in a very early presentation coming out of the Bakken, it was said that it might take 48 wells / drilling unit to completely drill out the Bakken -- obviously this density would only occur in some areas of the Bakken and only if the price of oil supported that amount of drilling.

[This, of course, is not quite accurate because of the fallacy of measuring from the first to the last horizontal, but it's close enough for making a general point.]

But you know, it gets even better. What's the horizontal distance between the two middle Bakken Hartman wells above (3-28H and 10-28H)? Hold onto your hat. The horizontal distance between these two middle Bakken wells is 730 feet. Elsewhere in the Bakken, operators are spacing middle Bakken wells at 370 feet -- half the horizontal separation of the Hartman wells. If you don't believe me, check out the Hess wells in section 16-156-93, Alger oil field. Interesting, huh? The two middle Bakken Hartman wells above are spaced horizontally at 730 feet; Hess wells in the Alger oil field are spaced twice as closely, at 370 feet.

Note: the above example is 1280-acre spacing (it could also apply to 640-acre spacing). But note: additional wells (more than the 40) would be placed in the same geographic spacing unit with the "new" overlapping spacing units.

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It Was Fun While It Lasted

From The Wall Street Journal opinion page:

President Obama may love America, but it would be nice if he also loved a few energy executives who could warn him that a serious public-policy glitch is about to blow up on his watch. Oil is overflowing U.S. storage facilities partly because of the 40-year-old export ban. The wave of bankruptcies and layoffs that many have predicted for the U.S. energy sector may finally be coming, but less because of the distressed price of oil than because producers will have to stop producing if they have nowhere to send their output.

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Time To Move Somewhere Else

From The Wall Street Journal opinion page:

Chicago voters are left to pick between two unappealing candidates who are battling for the measly one-third of the electorate that hasn’t checked out completely. (Voter turnout in the first round was 34%).

On one hand, there’s Mr. Emanuel, who admittedly inherited a financial mess created from the second Richard Daley to hold the mayoral title, but who seems as hapless now as the day he took control. On the other hand, there’s Mr. Garcia, a man who has many progressive dreams and no idea how to pay for them, and whose best quality is simply that he isn’t Rahm Emanuel.

Local Republicans—the few of us willing to admit our party affiliation in public—couldn’t script a more depressing outlook if they tried.

In a city that is perilously close to bankruptcy, besieged by waves of violence and facing an uncertain future, the two factions fight it out over whether pension contracts should be extraordinarily generous or simply generous.

What will happen in the April runoff is anyone’s guess. The lesson for Chicago residents like me is that maybe it is time to move somewhere else.

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Book Review: Chasing Lost Time

Jean Findlay

c. 2015, 351 pages

From The Wall Street Journal: A Proustian Character.  While translating “Remembrance of Things Past,” C.K. Scott Moncrieff was spying for the British in Mussolini’s Italy. From the review:

The supreme figure in the annals of modern translation is C(harles). K(enneth). Scott Moncrieff (1889-1930), the translator into English of Marcel Proust’s monumental seven-volume novel A la Recherche du Temps Perdu. When C.K. Scott Moncrieff began his translation in 1919, Proust, who died in 1922, was still correcting the typescript for “La Prisonnière,” the fifth volume in his vast novel. Scott Moncrieff began translating the novel without knowing how long the completed work would be. Roughly, it turned out, a million and a quarter words and more than 3,200 pages, the whole dealing with some 2,000 characters. Scott Moncrieff spent nine years translating Proust, while simultaneously working on translations of Stendhal, Pirandello and (from medieval Latin) the letters of Abelard and Heloise.

Later:

Translations, like lovers, the old saw has it, are either beautiful or faithful, but they cannot be both. In his translation of Proust, Scott Moncrieff went, without hesitation, for the beautiful. Jean Findlay, in her elegant and even-handed biography of Scott Moncrieff, who was her mother’s great-uncle, does not intricately examine the character of her ancestor’s translation. “Chasing Lost Time” does provide a single example of the difference between it and the more literal 2003 translation of “Swann’s Way” by Lydia Davis, one of the six translators who did a recent English version of Proust’s novel for Viking. Here is the last sentence in a paragraph rendered by Ms. Davis: “He [Charles Swann] brushed anxiously against all those dim bodies as if, among the phantoms of the dead, in the kingdom of darkness, he were searching for Eurydice.” Scott Moncrieff’s version of the same sentence runs: “Anxiously he explored every one of these vaguely seen shapes, as though among the phantoms of the dead, in the realms of darkness, he had been searching for a lost Eurydice.” Among other touches, Scott Moncrieff has added the penultimate word “lost,” which does not appear in Proust’s French text. This is known as taking liberties, and the question before any reader is whether they are liberties worth taking.

And more:

Scott Moncrieff seems to have backed into translation, which was to be his literary legacy. One day in a London bookshop he discovered a student copy of the Chanson de Roland and, despite not having Old French, set out to translate it into English. In doing so he discovered that the key to creating a translation that seems natural and even beautiful was assonance, the repetition of vowel sounds in non-rhyming syllables. The sound of a translated text, its cadence, he felt was of primary significance. Once he began his Proust translation, his regular procedure was to read aloud to friends his Englished version of the novel to get a feel for its sound. In this he would have agreed with Robert Frost, who wrote: “The ear is the only true writer and the only true reader.”

Near the end:

Of his own French, Scott Moncrieff remarked: “I know comparatively few French words and no grammar—so when I come to the most frightful howler, like the German musician on whose score a fly alighted, ‘I play him.’ ” Yet he turned out a translation of Proust that most Proustolaters—this reviewer among them—find unsurpassed and probably unsurpassable. The polyglot Joseph Conrad, a friend of Scott Moncrieff’s, held that he preferred his English translation to Proust’s original. Virginia Woolf wrote to Roger Fry that reading Scott Moncrieff’s translation was for her, in Ms. Findlay’s paraphrase, “akin to a sexual experience,” and she apparently lifted a number of his English phrasings for To the Lighthouse. George Painter, Proust’s best English biographer, called it “a masterly recreation of the original.”

A long, long time ago, in my original blog on the Bakken, I discussed the Moncrieff translation; it was a great post. But that post, like many other great posts was deleted in a moment of insanity back in 2009 or thereabouts. Nice to see the Moncrieff story surfacing again.

I kept a copy of Proust's novel by my bedside for many years, reading a little big every night, but never got through it. Maybe I will start again.

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A Note to the Granddaughters

Trader Joe's opened February 20, a couple of Fridays ago, near here, in Southlake, TX. I rode my bike past the store on opening day but did not go in. There were three uniformed policemen directing traffic into and out of the area; temporary barriers were going up and coming down based on available parking in the two-story parking structure.

I did ride by the following day and did stop in for a few minutes. It looked like all the other Trader Joe's I've been in. It's about the same size as the one in Rancho Palos Verdes (on the coast), California, and the one in Rancho Palos Verdes (on Western Avenue) but if I recall correctly, significantly smaller than the new one in San Antonio, Texas, in Alamo Heights.

We stopped by again last night; it was the first time my wife saw it. She loved it; she looks forward to many return visits. It was not a bit busy last night -- a nice experience. I had forgotten how really "unique" their offerings are. It fills a niche that will not compete directly with (HEB) Central Market across the street or the new Fresh Market in the same general area. I had also forgotten how really competitive the prices are at Trader Joe's.

There are no police directing traffic at this particular Trader Joe's any more. By the way, the two-level parking garage is very subtle, and very much like what I see periodically in California. The upper level is slightly above street level, and the lower level is slightly below street level, and "open" to passersby. The store itself is exactly even with the second level. There appears to be more than ample parking.

Parking was an issue that the city required Trader Joe's to address when navigating the permitting process. 

John Kemp/Reuters On Spacing

A reader alerted me a an excellent John Kemp/Reuters article on spacing.

The article begins:

North Dakota's leading oilfield operators hope to squeeze much more oil from its shale formations by drilling wells closer together - a bold experiment that could raise ultimate recovery by billions of barrels if it succeeds.

Oil and gas wells drain hydrocarbons from a fairly large area, although it is impossible to know the exact extent since the field cannot be observed directly. This poses a tricky problem for operators and regulators.

Drill wells too close together and they interfere with one another, draining oil and gas from the same parts of the formation and reducing their efficiency. Drill wells too far apart, and some valuable oil and gas will be left behind in parts of the formation not near enough to any well bore to be recovered.

The article provides a nice overview of spacing in various states.

A huge "thank you" to the reader for sending me this link.

It is interesting to note that the Bakken as a laboratory continues to move quickly. Re-read the third paragraph in the Reuters story linked above.

Now note this, from an earlier post:

EOG initially drilled wells every 640 acres in its Parshall field in Mountrail County, ND, but recently has been drilling every 320 acres. The initial results showed not only higher production rates from the newer infill wells, but improved recovery from the initial wells.

Unconventional means just that: unconventional.

The Bakken continues to be THE laboratory for tight oil and unconventional oil. Go Bakken. 

Spacing In The Bakken -- Idle Chatter Once Again -- But It's So Much Fun

Back on June 23, 2012, the MDW poll asked the question whether a mineral owner would prefer 640-, 1280-, or 2560-acre spacing, or does it even manner with regard to the Bakken boom? I don't remember the results but I seem to recall it was something like 70-30 with the vast majority preferring smaller spacing units.

I am not a mineral owner, so I don't have a dog in that fight, but I was asking the question from the perspective of a 65-year-old male with a desire to see at least one well on "his" land ("his" mineral rights) before he began his Long Rest.

Again, this is just idle chatter. There is no "right" answer.

But this is why I asked.

Now, remember, once there is production in any one well in a spacing unit, there is no urgency to drill another well in terms of losing the lease. If the operator has a producing well, he may or may not be inclined to drill another well any time soon. It is very possible that any mineral owner with just a few mineral acres might be lucky to see one well on his "land." Based on comments, some folks have waited a lifetime for a well on "their land."

In the original post, I included the section and the permit numbers, but I thought that might make it too personal. For that reason, I have removed "identifying data" so as not to bring in the current "owner" of that section.

So, then look at section xx-1xx-9X, in the xxxxx oil field. There is one producing well in that section, #xxxxx, spudded back in 2008 - 2009 time frame on 640-acre spacing. And that's the only well that's been drilled in that section all these years. So, if the original owner had 640 mineral acres in this section, he had at least one well, with royalty checks from one well. And royalty checks which have been decreasing significantly after that first year or so: from 9,000 bbls of oil per month back in April of 2009, to 2,000 bbls of oil per month in October, 2012.

But, then, wait, what's this? Another check, and another check? Sometime between 2009 and 2012, section xx-1xx-9x became part of a 4-section spacing unit. And two more wells, sited in other sections, are providing royalties because they are part of 2560-acre spacing unit. So, now this gentleman who was kinda hoping for just one well before his Long Rest is now bragging about three wells from which he is collecting royalties.

And, not only that, there are seven more permits/wells in that 2560-acre spacing unit that will be drilled in the next six months or so. By the end of 2013, this gentleman can brag about his nine wells. And only two will actually be sited in his section where his farmstead is. All because of that 2560-acre spacing.

Granted, there are other issues like lease bonuses, and percent of each well. But right now, this snapshot in time for this 65-year-old gentleman, he has one producing short-lateral well that was drilled in 2009. If there had been no change in the spacing unit size, it's very possible that's all he would have for the next 'umpteen' years.

Again, with 640-acre spacing, this gentleman has a single producing well, and that's it. With 2560-acre spacing, he will soon be receiving royalties from nine (9) wells. If he's also the surface owner, it's even better: seven of these nine wells will not be on his land. Smile.

Overlapping Spacing Units

This seems to be the hot topic for enquiring minds.

I am probably missing something but this seems pretty straight forward: "each well is its own well." Each well is its own industry.

An existing well on 1280-acre spacing will remain a well on 1280-acre spacing regardless of future wells, future spacing.

That's all one needs to know, assuming it is accurate. I don't own minerals and haven't read the rules and the definitions, but that seems to be the gist of what I am hearing, reading elsewhere.

Having said that (that's all one needs to know), it begs the question: can there be multiple spacing units affecting the same acre. For example, we have seen 1280-acre spacing on top of 640-acre spacing. A year from now, could we see 2560-acre spacing on top of the 1280-acre spacing? I don't know why not. I would assume there needs to be a way to identify which spacing unit a proposed well will be defined. For example, assume there is an overlapping 1280-acre unit on a 640-acre unit, and a new operator wants to drill a new well in that section. Will there be a way to identify a well based on its name / legal description whether it's a 640-, 1280-, or a 2560-acre well, or something else?

Spacing in the Bakken -- A Random Note

An interesting spacing unit:

• 19794, 446, EOG, Ross 34-0533H, Alger; t6/11; cum 80K 7/12; 4-section spacing (2560-acres; 2,704 acres to be exact)

The horizontal cuts across four sections, hitting the SW quadrant of section 5; the NE quadrant of section 6, hardly anything but the far SW corner of section, and the NE quadrant of section 33. The spacing is four section (2560-acres). That means a mineral owner in the far NE corner of section 34 is participating in this well, just as much as the mineral owner in the NE quadrant of section 6. With 640-acre spacing, a lot of mineral owners would be waiting for their well to come in.

Others will see it differently, of course.

Regardless of your thoughts on the spacing, it is what it is, and it is very, very interesting.

When I see some of the questions folks ask at other sites regarding mineral rights, all I can say is I am so glad I don't have any mineral rights. I know that doesn't make sense, but ...

Spacing -- Liberty 24-2531 -- #20557 / #21225 -- Unusual Spacing Size/Shape -- The Bakken, North Dakota, USA

Updates

April 8, 2012: This is interesting but trivial. Just some housekeeping. The well in question: 20557, was mis-named by the original poster. It should have been Liberty 24-2531W, not Liberty 24-2531H. In fact, #20557, Liberty 24-2531W permit was canceled, never drilled. Its sister well was drilled just a bit to the east, #21225, Liberty 24-2531H. So the discussion below has been updated to correct the file number and the name of the well.

Original Post

Over at the best Bakken discussion group board on the web, "wormy" has asked a great question:

•  how will they work out the spacing for #20557, Liberty 24-2531W? [corrected]

We are going to start seeing a lot more spacing issues going forward. Older wells in the Bakken are generally spaced at 640-acre, 1280-acre, and more recently 2560-acre.

But now, we see that new wells are going in where Bakken wells already exist, and operators are asking for new spacing rules for some of these wells. A term you will be seeing more of in the ND hearing dockets: overlapping.

In the specific case above, it appears the NDIC is yet to determine the proper spacing for this well (at the NDIC site, the spacing is noted to be: ICO).

Link here here to FAQ #53: With regard to spacing, what does ICO mean? ICO = Industrial Commision Order. The driller requests an unusual size or shape for a spacing unit. Requires an NDIC hearing for approval.

The well was spud in section 25.  It cuts diagonally across that entire 640-acre section, and then cuts through the northeast quadrant of section 36 in the same township before ending in section 31 of the neighboring township, in the southwest quadrant of that section.  All three sections that the horizontal traverses are currently spaced at 640 acres.

Common sense suggests 1920-acre spacing, in an "L" configuration, which means mineral owners as far away as the southwest corner of section 36-151-91 will participate. One could argue that a 2x2 2560-acre spacing unit would also be appropriate based on other 2x2 2560-acre spacing units.

Drilling a 2 x 2 2560-Acre Unit -- Continental Resources -- The Bakken, North Dakota, USA

Updates

Later: see comments. It's been pointed out that the horizontal "pattern" is not "efficient." It has been generally accepted that the direction of fracture varies from location and is similar within the same spacing unit. This proposed "new" configuration goes against that "rule." If CLR goes ahead with this proposal, we may see how valid this "generally accepted rule" or how important it is.

Original Post

How Continental Resources will drill a 2 x 2 2460-acre unit:

A huge "thank you" to RJ for sending me the graphic showing how CLR plans to drill out a 2 section by 2 section 2560-acre unit. This is very different from a 1 section x 4 section unit in which the pad will be placed midway between the four sections, with four horizontals going in one direction, and four horizontals going the very opposite way (or 6 to 8 going one direction, and 6 to 8 going the other way).

By the way, the technology is awesome. I'm sure you can do this on a PC, but on the Apple it was seamless. The graphic above was sent in a format not recognized by the system; simply adding ".jpg" to the graphic and the "blogger" application recognized it. (Unfortunately I can't get rid of that vertical line, but not a big deal.)

Look at the efficiencies a 14-well pad will provide, least of which is one road to one pad, as opposed to 14 roads to 14 individual pads. CLR introduced the Eco-Pad to the Williston Basin just a couple years ago. Things are moving quickly in the Bakken.

Random Discussion on Spacing Units in the Bakken -- The Brooklyn Oil Field, North Dakota, USA

Much has been discussed elsewhere regarding size of spacing units in the Bakken. If you go to that link, you can search for other discussions regarding size of spacing units.

So this is of interest:

March 28, 2012, NDIC hearing dockets; Case No. 17195:  

Application of Continental Resources, Inc. for an order amending the field rules for the Brooklyn-Bakken Pool to create two 2560-acre spacing units comprised of Sections 14, 23, 26 and 35; and Sections 18, 19, 30 and 31, T.155N., R.98W., Williams County, ND, authorizing the drilling of multiple horizontal wells from said well pad within each 2560-acre spacing unit; eliminating any tool error requirements and such other relief as is appropriate.

All spacing units in the Bakken-Brooklyn are currently 1280-acre, according to the NDIC GIS map server; and all units are currently held by production (Continental Resources), including the eight sections noted above in case no 17195.

Unless I am missing something CLR is not asking for larger spacing units as "a land grab" to hold leases by production. The horizontals will continue to be long horizontals (two sections) but mineral owners in any of the four sections will benefit from a successful well.  Obviously CLR can put 8 - 16 wells on one pad with 4 - 8 wells going south and 4 - 8 wells going north.

If nothing else, the oil from all four sections, from the entire 2560-acre unit, can be commingled into one set of tank batteries. It seems this would make the entire operation much more efficient. If trucks are still picking up the oil, one truck can pick up oil from multiple wells; once pipelines are in place, the same thing; one does not have to worry about what oil is coming from which well. Extrapolate this to a unitizing the entire field and one can see the efficiencies. My 2 cents worth. Hopefully someone can provide "professional" insight.

Of course, it goes without saying, all the efficiencies with multiple wells on one pad, but CLR could have done that with the current 1280-acre spacing so that is not an explanation for the request of 2560-acre spacing units.

[August 18, 2012: I missed a big reason why 2560-acre spacing is of value. Heels and toes of horizontal wells must be set back a minimum number of feet from the spacing unit line. If the requirement is 500 feet and the spacing unit is one section (one mile, or 5,280 feet on a side), 500 feet at the heel and 500 feet at the toe = 1,000 feet, or almost 20% of the length of the spacing unit is lost. With 2560-acre spacing, at most the operator loses 500 feet at the toe. Since they are still drilling long laterals, that is 500 feet over two miles (10,560 feet), or less than 5%. This is the reason the operators want larger spacing units with horizontal wells in the Bakken. In one of the polls at the blog I asked whether it was better to have 1280-acre or 2560-acre spacing; the majority said 1280-acre spacing. The majority was wrong.]

1284 Acres on 1280-Acre Spacing -- The Williston Basin, North Dakota, USA

Update

A big "thank you" to all who responded.  The best answer: the earth is not flat.

I was sent the following link: search section, township.

I am very familiar with this link (EarthPoint) but haven't used it in awhile except to check out an example:  when you go to the link, for example, and type in North Dakota, 5th Meridian (for all of the North Dakota Bakken), and then type in T148N-R49W, section 22, you will see that this "640" acre section is, in fact, 617 acres.  Just one more reason why probating minerals is so expensive.

Original Post

NDIC now posts the number of acres "drained" by a particular well. It's a great addition.

Elsewhere, they are asking why a 1280-acre unit has a well that actually has 1,284 acres. I think the "answer" the folks are positing is missing the mark. It seems pretty obvious to me but I will wait to see what others say.

The first response was that the NDIC had made an error. That is certainly incorrect. The NDIC is not in error here.

Trending in the Bakken -- Drilling Deeper in the Three Forks Formation -- The Bakken, North Dakota, USA

This was touched on briefly but needs to be re-emphasized as more and more folks are asking how many wells can be drilled on a spacing unit.

Whiting and Continental Resources provide nice graphics in their presentations. This information comes from the August, 2011, CLR presentation.

This is where CLR is with regard to this issue, slide 9:

• their first ECO-Pad well pair: a Middle Bakken horizontal and an Upper Three Forks 1st Bench horizontal
• the slide, interestingly enough, shows a dialogue box with "multiple fracture stages with a 500' stimulation radius"
• CLR is currently drilling horizontals into the Three Forks 2nd Bench -- 1st test drilling
• in the future, CLR plans to test the Three Forks 3rd Bench and the Three Forks 4th Bench.

CLR has interests throughout the Bakken.

Some of their ECO-Pad results, average IP for four (4) wells):

• Glasoe/Raymo, 940: east Divide county, near Burke; north of Williston
• Kennedy/Miles, 1,377: northeast McKenzie county; ground zero for 2012 activity; the bull's eye
• Arthur/Hegler 1, 1,088: northwestern Dunn county
• Bridger/Bonneville, 745: northwestern Dunn county
• Carson Peak/Morris, 1,948, northwestern Dunn county

Northeastern McKenzie County and east-central McKenzie County will be where the action is in 2012;
Northwestern Dunn County is just south and east of that area

In Montana, it appears CLR is emphasizing northeastern Richland, directly west of Alexander, Watford City area:

• Rognas 2-22H, 1,013
• Tolksdorf 1-1H, 642
• Big Sky 3-35H, 1,163
• Clayton 3-20H, 1,118
• Amestoy 1-6H, 836
• Earl 2-25H, 1,024
• David 2-20H, 831

In this area, CLR has twelve (12) wells planned -- I guess CLR's Montana motto will be " 12 in '12"