Wednesday, February 12, 2020

Austin Chalk Update - LA-WEST and TX-EAST

The "big buzz" at NAPE last week in our "little world" was that the Marathon Crowell #2 is producing much better than the initial potential released on SONRIS.  The published test appears to be early in the post-frac flowback.  On SONRIS, a new allowable has been added showing "2300" indicating 2300 bopd.  That's a major improvement from 210 bopd.  Everyone who's been on this blog for years knows that I don't post rumors.  There are many "chat rooms" filled with that.  The facts will always eventually be distributed via the state's regulatory bodies. 

Marathon Crowell #2 (Source: SONRIS)

The rumored rates are consistent with the closest well, the Mcright #11.  In 1997, this well had an initial rate of 1536 bo and 4600 mcf.  Rumored rates are about 50% above this.  The Mcright #11 produced 179 mbo and 0.78 bcf.  Let's hope that the frac impacts a significant amount of matrix porosity.  We'll know a lot more in 90 days about rates, pressure, decline, and water.
Good luck to Marathon! 

I also heard at NAPE that Navidad Resources has had a positive initial test in southern Brookland Field in Tyler County, Texas.  I've not seen an official release for that one.

Let's hope for some significant improvement in commodity prices!
















Tuesday, February 4, 2020

Monday, February 3, 2020

Marathon Crowell #2 Result

The Marathon Crowell #2 completion result is about where I forecasted based on the offset production.  

COMPLETED 1/21/2020 AS AN OIL WELL W/ 210 BOPD; 1650 MCFD; 8200 FTP; 6063 SITP; 1300 CP; 18/64" CK; 3343 BWPD; 94% BS&W; 7857; GVTY 52 API; PERF: 16,157'-22,372'

At these production rates, it's impossible to have positive economics at these DHC/CC costs.  At $1.82/mcf gas, natural gas is a tough place to be.  The gas-oil ratio is much higher than the wells on strike.  The API gravity at 52 is quite a bit higher than the adjacent well to the north (47).  The water cut, as forecasted, is very high.  This will be important to observe over the months to come.

The prior post below provides some extensive details on the area and the outlook for this well.

"Having interpreted the 3D seismic on the west side of the field, I can state that the prolific producers there were always proximal to down-to-the-basin faults where fracture clusters are greatest.  To date, all acres haven't been created equal in this field."
"The Marathon Crowell #2 is on strike with poor to decent producers, but has good producers to the northwest.  Note that the offset wells produce primarily natural gas which is currently selling at $2.83/mcf."
"Both wells will likely be in the 4000 range.  Gas will greatly assist producing from the low porosity and permeability, but at the current market prices, oil is a better strategic and economic target."
"This region of the play in Louisiana illustrates much lower resistivities than seen in the prolific trend of Texas and the LA-EAST in Louisiana.  One reason for that could be higher water saturations in the chalk reservoir.  The field historically produced 13.6 barrels of water to every barrel of oil.  That's an extremely high water ratio.  Disposing of water is expensive and impacts the overall economics. One of the risk factors is that a large-proppant frac could increase the water volumes."  

Monday, January 27, 2020

No News Is.......

Prime Rock's rig, the Ensign 777, had its challenges as I forecasted.  The Crosby 10H-1 took 83 days to reach total depth.  As stated prior, this was an ambitious first well with a long measured depth planned.

Let's hope for a great completion with more oil than projected.  $1.91/mcf natural gas isn't going to help this region of the play.  The rig will be heading back to Marathon to spud their third well.

Prime Rock Crosby 10H-1     Source: SONRIS

"The deeper, more pressured region of the play, will have drilling challenges. Those challenges can be very costly as we saw in Marathon's Crowell #1." 
LAMS Stack & Austin Chalk Blog, November 7, 2019

"These are deep wells with TVD's of 16200' and 15332'.   Both of these wells will be expensive so large volumes of hydrocarbons need to be produced. Marathon proved on the Crowell #1 that drilling in this high pressure environment is very challenging."
LAMS Stack & Austin Chalk Blog, November 6, 2019

"This is a deep, ambitious well on the southern end of Masters Creek Field.  It will test the concepts of depletion, high pressure, and water production."
LAMS Stack & Austin Chalk Blog, October 1, 2019

"Pressure 'is your friend' when producing low perm reservoirs, but it's not easy to drill through."
LAMS Stack & Austin Chalk Blog, March 28, 2019



Source: SONRIS

Source: SONRIS

Source: SONRIS








Monday, November 11, 2019

Video Presentation: Louisiana Austin Chalk & LAMS Stack Play


This is the slide presentation that I recently gave at the New Orleans SIPES Luncheon.




For the actual presentation, follow this link to the New Orleans SIPES website.  

Thursday, November 7, 2019

Significant Events

Two significant events have come to light this week. First, Equinor has acquired a 25% working interest position in Marathon's project.  Equinor has acreage near the Texas state line. This joint venture provides some more financial strength to Marathon's efforts.  In today's market, joint ventures make a lot of sense.

The disappointing news of the week is that Prime Rock's Crosby 10-1 well is stuck as of the early week's report on SONRIS.
11/6/19: DRLD 12-1/4" HOLE TO 14901; STUCK; BACKED OFF @ 14755' & WORKED STUCK PIPE; UNSUCCESSFULLY.

This ties into my discussion from yesterday and my post on the regions of the play.  The deeper, more pressured region of the play, will have drilling challenges.  Those challenges can be very costly as we saw in Marathon's Crowell #1.

The map below is from my SIPES presentation from a couple of weeks ago. It compares a variety of attributes from the four "quadrants" of the play: LA-EAST Updip, LA-EAST Downdip, LA-WEST Updip, LA-WEST Downdip.


Wednesday, November 6, 2019

Drilling Activity Update


With activity shifted to the LA-WEST region of the Austin Chalk Play, it's a good time to "drill deeper" on the new drilling locations.  Both the Marathon and Prime Rock wells are in the southern and deeper portion of Masters Creek Field.  The map below depicts their locations along with the historical Austin Chalk producing wells.  Marathon had a successful re-drill of the Crowell location in 52 days.  Prime Rock is now drilling the Crosby 10-1.  These are deep wells with TVD's of 16200' and 15332'.  



The next two maps depict cumulative BOE bubble maps across Masters Creek Field.  The larger circles represent the best historical producers.  These maps reveal localized "sweet spots" across the field.  Having interpreted the 3D seismic on the west side of the field, I can state that the prolific producers there were always proximal to down-to-the-basin faults where fracture clusters are greatest.  To date, all acres haven't been created equal in this field.



The next two maps depict the cumulative production of oil and gas for each well. The Marathon Crowell #2 is on strike with poor to decent producers, but has good producers to the northwest.  Note that the offset wells produce primarily natural gas which is currently selling at $2.83/mcf.

The Prime Rock Crosby 10-1 has a nearby well that produced 4 bcf and 1 mmbo.  Most of the other wells on strike are marginal producers.  Both of these wells will be expensive so large volumes of hydrocarbons need to be produced.



    


The maps below represent gas/oil ratios (GOR) for the historical production across the field.  Both wells will likely be in the 4000 range.  Gas will greatly assist producing from the low porosity and permeability, but at the current market prices, oil is a better strategic and economic target.







This region of the play in Louisiana illustrates much lower resistivities than seen in the prolific trend of Texas and the LA-EAST in Louisiana.  One reason for that could be higher water saturations in the chalk reservoir.  The field historically produced 13.6 barrels of water to every barrel of oil.  That's an extremely high water ratio.  Disposing of water is expensive and impacts the overall economics. One of the risk factors is that a large-proppant frac could increase the water volumes.  

The low DLogR values from the Passey equation indicate low total organic carbon (TOC).  It is my belief that the production at Masters Creek Field is derived from a deeper source rock in the Lower Cretaceous or Jurassic.  Large faults served as migration paths into the Austin Chalk.  

The average porosity compares very well to the current results in southwestern Giddings Field.










These two wells will be watched closely for the LA-WEST and downdip portion of the play.  Marathon proved on the Crowell #1 that drilling in this high pressure environment is very challenging.  Good luck to both companies!