I've assembled data from 11 oily unconventional plays across the U.S. to make a comparison with the Tuscaloosa Marine Shale. With only ten completions in the play, we're still very much in the "R&D" and "derisking" phase of this play. To date, well costs have been a popular topic.
The chart below presents well costs vs estimated ultimate recoveries (EUR) for eleven unconventional plays. I've also placed three TMS wells with their actual or AFE costs for comparison. The decrease in costs is occurring and I expect the costs to continue to decline. The AFE of the Weyerhaeuser 60H-1 of $12.1 million is the lowest that I've seen to date. Keep in mind that once this play shifts to "development mode", the use of the resource play hub (RPH) approach, will result in significant cost savings. I've heard that locations are currently costing $1 million. Drilling 4-10 wells from one pad will be very cost effective.
The chart below indicates that for the TMS to have similar "cost to EUR" relationships, the drill costs have to range from $9-12 million with EUR's in the 620-750 MBOE range. Encana has already announced that they believe 730 MBOE is achievable. I understand that one of the TMS operators has $9.5 million for well costs in their 2013 budget.