Hi, I am Nissa Darbonne, executive editor-at-large for Hart Energy. Thank you for joining us. We're visiting today with Steven Jolley. Steven is the Permian Basin technology manager for Halliburton. We just had an onstage discussion here in Midland, Texas at the Executive Oil Conference & Expo. Great conversation on drilling and completion, new formations, new well designs. First, Steven, thank you for joining us.

Steven Jolley: Absolutely. Thank you. Thank you for having me.

ND: Part of our conversation, we were talking about all of the, not new formations, obviously, in the Permian Basin, but other benches if you will, that operators are landing in now in addition to the obvious ones Wolfcamp, so on and so forth. For example, [in the] far northern basin, the Dean, the Harkey over in the Delaware Basin, some Barnett, Woodford, and Meramec as well, in addition, obviously to the Barnett that's just been proven on Central Basin Platform. What are you seeing maybe particularly with the early findings in the Permian Barnett?

SJ: Specific to the Permian Barnett, when you look at the Midland Basin as a whole, there's been a lot of exploration in it. So if you pull up a map of where all of the Barnett wells have been drilled —a few months ago I think it was 30, 40 wells, somewhere around there — and they're kind of all over the place, with the exception of a few core kind of area where you see these wells that have been drilled up in the Andrews section where it seems to be some prolific wells coming on. Operators that have drilled those wells in that area that own that acreage are now putting that into their inventory and saying, ‘Hey, this is an area we're going to focus drilling in the Midland Basin’ specific to their operations because they've found a really good opportunity there in the Barnett and it's deeper than the Wolfcamp, so it's really untouched. Typically, when you complete a fracking oil in a reservoir, you have height growth that doesn't really go downward because there's no lower stress below for it to get to, so it's really untouched and a great opportunity for these operators that own acreage in that area.

ND: Are you talking about the Barnett in the Central Basin Platform?

SJ: No, I'm talking about on the top western side of the Midland Basin around Andrews.

ND: Okay, Andrews, well, that's great news. Also, I understand Marathon, and this was kind of pre the last oil price cycle, was doing some Woodford-Meramec tests in the southern Delaware Basin. I'm not sure the status of their work on that, but have you seen Woodford-Meramec work over in the Delaware?

SJ: I've read articles on it as far as completing none that come to mind on the Woodford-Meramec, but yeah, it's definitely [worth] taking a look. There's some really deep pockets of the Woodford and I think it has some oil, but it has some high gas ratios as well, and so there hasn't been, I think, as much exploration as you hear about the Barnett and proving it up. And maybe it's more still in that exploratory area, trying to find where those areas are. Obviously it takes a pretty high capex the deeper you go below these other formations, and that's why I think the Barnett has been so great is because it's really only 10,500 ft true vertical depth, so it's really not much difference than what you see on the Wolfcamp D or going below that.

ND: And then another new formation, the Harkey, well again, not a new formation, but the Harkey sands, at least in the area of Culberson County, Coterra, for example, is doing this enormous, they call it a row development. This one in particular is called Windham Row. It's a 71 well, 12 section, six DSU [drilling spacing unit] development with 22 of those wells landed in the Harkey overlying the Wolfcamp and the balance of them landed in the Wolfcamp itself. Coterra is a unique situation. They're in a joint development agreement with Chevron in that area. So there is all of this contiguous leasehold to do this, but these high density row type developments, what are you seeing at least on the completion side? I imagine there are incredible efficiencies there.

SJ: Just from an operator standpoint, they're immediately realizing 10% to 15% saving on facilities, pipeline infrastructure and then pad development. I mean, we're able to complete these wells remotely now, and so less pad movements. You can't get more than 24 hours in a day, but you can take other operational efficiencies such as simul-frac, and pump more volume, more barrels in a day than you can. Let’s just say, ‘Hey, I'm pumping continuous for 24 hours, but there's other opportunities to pump more.’ And so that's where we've really changed the operator's mindset on how we complete wells moving forward, especially with a row opportunity like that in Coterra and the technology application that you can run in a row like that to truly understand your reservoir and how it's communicating. There's definitely opportunities to run some type of sensor technology, whether it's fiber optics to wellbore tracer technology, to truly understand how those wellbores are communicating when completed versus your offsets and really understanding that what is the best offset distance. Alright, well these wells are already laid, so I can't change that now, but I can change the volume in my frac and really critique that based on the stage design and stage length.

ND: It sounds like a dream type science project.

SJ: Yeah, absolutely. It's a dream for both. It's a dream for Coterra and a dream for us.

ND: Oh, super. That's great to hear. And then also we'll just touch on this lastly, U-turn laterals have been rolled out in every major basin now the Lower 48, including in the Haynesville now as well, just starting this year. I understand that U-turn laterals, which obviously are drilled where an operator is limited to one section. So instead of, for example, making two 1-mile laterals and the expense of that to make one 2-mile lateral in that section, or possibly even two of them, depending on how the DSU is designed. But I understand that it's come to the point where an operator is looking like, ‘Darn, I'm going to have to buy that leasehold adjacent of mine. My section is just worthless,’ to having this option of saying, ‘I can put a U-turn in this and I understand really no one is having any problems with them.’

SJ: Yeah, that's what it seems. I think there was some hesitance, some risk appetite that was probably put into it to begin with that made operators not completely jump over the fence, probably peak their eyes over and now you have some operators that are just like, yeah, ‘we've got this many stranded sections. This is how many horseshoe wells we are going to do. And not only are we going to do a horseshoe well in that section we're going to do multiple within multiple benches.’ And so that's really changing the conversation on well construction and what we're doing moving forward. But another thing that I've heard of operators doing horseshoe wells is some type of faulty reservoir as well. There might be an opportunity if they want to stay away from faulty reservoir, if it changes the dynamic of a two section area, they'll still go and have the opportunity to do a horseshoe well. But from a surface standpoint drilling there isn't much change, at least from a visual aspect out on the rig site. And then hydraulically on the completion side, there's no difference. You might not complete the curve because it might be right there offset from another section too close. It's right there on the section line. So you're still just completing the two laterals that make the U, so you might just be skipping the actual U part because of section requirements.

ND: Is that a J turn?

SJ: Yeah, well, you would still do the full U, you just skip the completion in the middle.

ND: Okay. Actually, I think I saw one of those in the Permian Basin where the middle was skipped.

SJ: Yeah, I think that's actually common if they don't own the next section or they're close to another wellbore but it's in that other section.

ND: Okay. Well that must've been the reason. The well actually performed better than the one that didn't skip.

SJ: Yeah the production results that I've seen on U-turn wells look very promising if not equal but better.

ND: I understand, because you mentioned faulting earlier, that U-turns really only work — I mean kind of straight laterals, not exclusively as well — but U-turns, you really only want to use those where the target formation is geologically quiet. You mentioned faulting, you wouldn't want to do a U-turn in a section where the target formation is faulty?

SJ: You wouldn't, but if you can avoid it instead of drilling a straight lateral through it, that's the option to go up close to the fault without actually impeding it and then make your U-turn there.

ND: I think it was said to me that a U-turn is more easily applied, for example, in Ohio in the Utica than it would be in Pennsylvania in the Marcellus, because Ohio is geologically quiet.

SJ: Yeah, anywhere you go where the stresses, they're going to be a little easier to deal with. Probably shallower work as well. I'm just spitballing that. I don't know that basin versus the Permian, but I would assume, yeah, they would have lower stresses and that would make it a lot easier to drill through that.

ND: Super. Thank you, Steven.

SJ: Absolutely. Thank you.

ND: And thank you for joining us. Stay tuned right here for more actionable energy intelligence.

Comments