Dry Gas Basin Activity Highlights: August 2016

A recent assessment on the Mancos Shale has put the play on par with the mammoth shale gas reservoir in Appalachia—the Marcellus.

A June report by the U.S. Geological Survey (USGS) estimates Mancos’ technically recoverable gas resource within the Piceance Basin contains 66 trillion cubic feet (Tcf).

The new evaluation is a 3,900% boost from the previous 1.65 Tcf estimate in 2003. Since then more than 2,000 wells have been completed in intervals within the Mancos, including the upper and lower Mancos and Niobrara formations.

USGS’ Lower Mancos Tight Gas assessment unit includes tight-gas reservoirs in the Mowry Shale (where present) and in the Mancos Shale above the Dakota Sandstone and also below the Niobrara member of the Mancos Shale. The Lower Niobrara Tight Gas assessment unit includes the basal 250 feet to 400 feet of the Niobrara.

RELATED: The Mancos Shale: Time For Another Look

A 2013 assessment by the USGS on the Marcellus Shale also noted a major increase in technically recoverable volumes in that shale gas play. The report upgraded the Marcellus’ volumes to 84 Tcf from a 2002 estimate of 2 Tcf.

In spite of these upward revisions, low gas prices have cut drilling. For example, the rig count for three other shale gas basins—the Barnett, Fayetteville and Haynesville—are down about 75% compared to previous years.

Given the current environment, the likelihood for operators to continue exploration is low until prices reach about $3.

1. Crescent Point Energy: 7/21/16

Crescent Point Energy Corp. (NYSE: CPG) has proposed drilling up to 3,925 new oil and gas wells in a 155,110-acre Uinta Basin area in Utah's Duchesne and Uintah counties near the town of Myton.

According to IHS, the project consists of the following:

• Drilling up to 3,925 new oil and gas wells;
• Building 863 miles of roads;
• 693 miles of pipelines co-located with the proposed roads;
• 170 miles of cross-country pipelines;
• 400 miles of trunk pipelines;
• Five salt water disposal wells;
• Five produced water treatment facilities;
• 20 central tank batteries;
• Four gas processing plants;
• Eight oil storage areas; and
• Four equipment storage areas.

The Calgary, Alberta-based company's Utah Federal-Tribal Well Development Project is located directly south of the cities of Roosevelt and Ballard and north of the Ouray National Wildlife Refuge. Activities would occur on federal, tribal trust, allottee, state and privately-owned or administered lands and mineral leases in all or portions of townships 5s-19e; 6s-19e-21e; 7s-20e-22e; 3s-1w; 3s-1e-2e and 4s-2e-3e.

The proposed wells would be drilled on up to 2,350 new pads and up to 445 existing well pads. Up to about 1,500 of the wells would be horizontally drilled and up to 500 wells would be drilled as producers and subsequently converted to waterflood injection wells. The remaining wells would be drilled as vertical or directional wells.

Drilling of wells would occur over a period of about 30 years and well productive life is estimated at 20 years to 40 years. Targets to be drilled would include, but are not limited to, the Uinta, Bridger Shale, Green River, Douglas Creek, Castle Peak, Wasatch and Mesaverde formations. Depths of wells would range between 4,700 feet and 10,000 feet.

2. Coachman Energy: 1/21/16

A Mancos well by Coachman Energy Partners LLC has produced 8 million cubic feet equivalent per day (MMcfe/d) from a Piceance Basin site in the Kokopelli Project in Garfield County, Colo.

The well (#14-15-7-21 Federal, Section 21-6s-91w) was tested flowing from 14 stages in the Mancos with a casing pressure of 4,000 pounds per square inch (psi). It was vertically drilled to 13,680 feet.

The discovery has been temporarily choked back to analyze and align gas composition with current delivery systems, according to Denver-based Coachman.

The roughly 2,200-acre Kokopelli Project could potentially host more than 50 vertical Mancos wells in addition to 200 Williams Fork wells. Dejour Enterprise owns a 25% working interest in the multizonal production project.

3. Newfield Exploration: 1/8/16

Newfield Exploration Co. (NYSE: NFX) has staked six super-extended lateral horizontal Wasatch tests from a common drillpad in the Uinta Basin.

The Houston-based company’s projects will be in Section 15-3s-3w of Duchesne County, Utah, with five of the ventures (Ella, Mary, Tom, Gill and Perank) to be drilled north-northwestward and one of the tests (Vernal) to be drilled southward.

The wells include:

• #10-3-3-3W-MW T Ella with a planned depth of 19,590 feet, 10,031 feet true vertical, and will bottom in Section 3-3s-3w;
• #15-10-3-3-3W-MW Mary will be drilled to 19,714 feet, 10,046 feet true vertical, and will bottom in Section 3-3s-3w;
• #10-3-3-3W-UW Tom Q will be drilled to 19,848 feet, 9,758 feet true vertical, and will bottom in Section 3-3s-3w;
• #10-3-3-3W-LW Gill Q will be drilled to 20,502 feet, 10,399 feet true vertical, and will bottom in Section 3-3s-3w;
• #10-3-3-3W-LW Perank T will be drilled to 19,952 feet, 10,391 feet true vertical and will bottom in Section 3-3s-3w; and
• #1-15-22-3-3W-MW Vernal will be drilled to 19,768 feet, 9,128 feet true vertical and will bottom in Section 22-3s-3w.

4. Comstock: 7/13/16

A Comstock Resources Inc.’s (NYSE: CRK) horizontal Haynesville discovery has produced 22 MMcf of gas and 1.23 thousand barrels (Mbbl) of water per day.

The Benson Field well (#1-Alt Jordan 16-21 HC) is in Section 16-10n-14w in DeSoto Parish, La. Production is from acid- and fracture-treated perforations at 11,546 feet to 18,976 feet.

The 19,603-foot well has a true vertical depth of 11,397 feet and bottomed to the south in Section 21. Gauged on a 28/64-inch choke, the flowing casing pressure was 7,190 psi.

Comstock is based in Frisco, Texas.

5. Southwestern Energy: 7/15/16

Three horizontal Fayetteville producers were reported by Seeco Inc., a subsidiary of Houston’s Southwestern Energy Co. (NYSE: SWN) that exclusively operates in Arkansas.

The wells are in Section 36-9n-14w of Van Buren County, Ark., and all bottomed to the northwest in Section 26-9w-14w.

The #8-36H26 J. Edwards is producing 7.32 MMcf/d of gas. It was drilled to 8,530 feet, 4,386 feet true vertical. The well was fracture-stimulated in eight stages at 4,655 feet and 8,456 feet.

About 20 feet to the south, the #7-36H26 J. Edwards was tested in a parallel lateral at 4,718 feet and 9,725 feet and is flowing 6.97 MMcf of gas per day following an 11-stage fracturing. It was drilled to 9,798 feet, and the true vertical depth is 4,359 feet.

The #9-36H26 J. Edwards 9-14 flowed 5.52 MMcf of gas daily following acid treatments and a seven-stage fracturing at 4,800 feet and 8,076 feet. This B-43 Field prospect was drilled to 8,150 feet, 4,314 feet true vertical.

6. Southwestern Energy: 3/3/16

Southwestern Energy announced results from two Marcellus Shale completions in Tioga County, Pa.

The #2H Kohler flowed about 5 MMcf/d during a two-week period. It was drilled to 12,925 feet, 7,247 feet true vertical. Additional information is not available.

In Section 6, Nauvoo 7.5 Quad, Liberty Township, #6H Lepley was tested flowing 5 MMcf/d during a two-week period from a 1,822-foot lateral. The planned depth was 14,087 feet and the planned true vertical depth was 6,920 feet.

Southwestern also continued the delineation of its acreage at #3H Colwell North in Susquehanna County, Pa. It initially produced 4 MMcf/d without compression, according to the company. The Marcellus well was drilled to 13,093 feet and the true vertical depth was 5,486 feet.

7. Banpu Plc: 8/18/16

Banpu Plc, based in Bangkok, has made its first upstream investment, paying Repsol $112 million for a stake in a Marcellus Shale project.

Banpu is acquiring a 29.4% interest in the Chaffee Corners shale gas project located primarily in Bradford County, Pa. In the transaction, Banpu is acquiring 11,000 net acres and 156 Bcf of net proved reserves.

In 2016, Banpu expects its share of the Chaffee Corners gas production to average 21 MMcf/d. There are 62 wells on the acreage in Bradford, with another 14 wells awaiting completion. In addition, there are nearly 200 derisked well locations.

Larry Prado, activity editor, can be reached at lprado@hartenergy.com.