Regional Spotlight: Wolfcamp Shale
Regional Spotlight: Wolfcamp Shale
Tim Pish and Rebekah Killian, Scotia Waterous March 1, 2012
The Permian-age Wolfcamp shale is a well-known source rock present throughout most of the Permian Basin. There has been interest in this shale as a reservoir in both the Delaware and Midland basins.
In the Delaware Basin, it is currently being targeted with horizontal wells and is commingled with Bone Spring sands (Wolfbone vertical wells). In the Midland Basin, the combination of Wolf-camp and Spraberry (Wolfberry) has been one of the most active plays in the U.S.
Significant recent Wolfcamp activity has also occurred in the southern end of the Midland Basin, in portions of Crockett, Irion, Reagan, Schleicher, and Upton counties. In this area, several companies have acquired large acreage positions and have drilled promising horizontal Wolfcamp shale wells.
Geology. The Wolfcamp in the southern part of the Midland Basin may have been overlooked initially, as geological interpretations suggested it was located on the Ozona Arch rather than part of the Midland depositional basin, inferring a thin or absent Wolfcamp section. This, coupled with the fact that most operators acquired log data only over zones of interest, steered operators toward the thicker section to the north.
Recently, operators such as Approach Resources Inc. have developed a detailed geologic model based on myriad technical data that suggests the area was indeed part of the southern Midland depositional basin, and contained a thick Wolfcamp section.
The Wolfcamp shale in the southern Midland Basin consists of a series of laminated black shale and argillaceous limestone. Published TOC (total organic content) values range from 2% to more than 10%, with Ro values that place it in the peak oil generation and early gas generation windows.
Most operators are targeting the upper portion of the Wolfcamp, which is 900 to 1,100 feet thick, at depths of 5,500 to 8,000 feet. Porosity ranges from 4% to 12%, with low permeability enhanced through abundant natural fractures. Published key mineral compositional data indicate a mix of approximately 25% carbonate, 25% clay and 36% quartz.
Besides being a horizontal target, the Wolfcamp lies above traditional Permian Basin targets such as the Canyon, Strawn and Ellenburger, and below the Clearfork, setting up potential multitarget vertical wells or recompletion opportunities.
Active companies. Several companies have been aggressively accumulating acreage in the southern portion of the Midland Basin Wolfcamp shale trend over the past few years. The University of Texas lease sale, held in September 2011, was very competitive, with acreage in Upton, Crockett, Reagan, Irion and Schleicher counties receiving the most bids and record high values for the area. Several leases went for $4,000 to over $5,500 per acre.
Some of the key companies in the play include Approach Resources, BHP Billiton (Petrohawk), Concho Resources, ConocoPhillips, Devon Energy, El Paso Corp., EOG Resources, Forest Oil, HighMount E&P, and Pioneer Natural Resources.
Drilling activity. The Wolfcamp is typically broken up into an upper and lower section, and sometimes further, depending on the operator. Although nomenclature differs, most operators target two intervals within the upper portion for horizontal laterals. This leaves a thick Lower Wolfcamp section that may also be prospective; in fact, one operator has tested the Wolfcamp C interval (Lower Wolfcamp).
The Wolfcamp shale has similar compositional characteristics to other existing shale plays and has benefited from a relatively short learning curve in terms of drilling and completions. In general, average lateral lengths have increased from approximately 3,600 feet to over 7,400 feet, and the number of frac stages has climbed from seven to 15 to more than 25 in just one year.
EOG Resources has drilled the most wells in the play and has shown the most improvement in well results.
The company has pushed its drilling and completion practices, drilling 7,000-foot-plus laterals with 35-plus frac stages. Well costs, derived from several operators, for 7,000-foot laterals and 20-plus-stage fracs are reportedly $5.5- to $7.5 million.
Operators have noted a direct correlation between lateral length and average 24-hour peak initial production (IP) rates. Rates have increased from approximately 300 barrels of oil equivalent (BOE) per day to more than 1,000 BOE per day over the past year. Three of EOG's latest wells have had maximum IP rates of just over 1,450 BOE per day. El Paso's recent 7,500-foot lateral with 25 frac stages had a 24-hour IP of 1,393 BOE per day.
Three recent wells drilled by Approach, with lateral lengths between 7,400 and 7,800 feet and 23 frac stages, had 24-hour IP rates between 800 and 1,044 BOE per day. Approach expects estimated ultimate recoveries (EURs) to be some 450,000 BOE (for a 7,000-plusfoot lateral with 20-plus frac stages). Pioneer expects similarly drilled wells to have EURs between 350,000 and 500,000 BOE.
—Tim Pish and Rebekah Killian, Scotia Waterous, 713-437-5048
For details on assets on the market, see A-Dcenter.com.
- April 2014
- March 2014
- February 2014
- January 2014
- November 2013
- October 2013
- September 2013
- August 2013
- July 2013
- June 2013
- May 2013
- April 2013
- February 2013
- January 2013
- December 2012
- November 2012
- October 2012
- September 2012
- August 2012
- July 2012
- June 2012
- May 2012
- March 2012
- February 2012
- January 2012
- December 2011
- November 2011
- October 2011
- September 2011
- April 2011
- March 2011
- February 2011
- December 2010
Combined Resources Group
Your exclusive agent for Combined Resources Group (CRG).
We believe Combined Resources Group (CRG), an affiliate of Champion Group, has been one of the most active sponsors of oil and gas drilling partnerships in the U.S. since 1986.