by Renée Jean, Sidney Herald
MINOT — Operators have been saying the Bakken is getting better and better, but North Dakota Department of Minerals Director Lynn Helms had the numbers to show it. Not only are today’s wells vastly superior to wells of even two years ago, Helms said during the annual conference of the North Dakota Petroleum Council, but they now have a lifespan that is five years longer.
“Initial production (on new wells) has increased from 1,100 barrels a day to 1,500,” Helms said.
Coupling that with the additional five-year lifespan,that means 25 percent more recovery from every well bore.
The new methods that created better productivity are also creating opportunities for economical refracs of old-school wells even at current prices — an “iteration” Helms called amazing.
An iteration is a successive process in which the next solution is based on the last, but a little bit better than before.
“You are getting more of the reservoir and using no greater footprint than in 2014,” Helms said. “You are still iterating, and it amazes me.”
Helms estimated there are between 8,000 and 8,500 wells drilled with older technology, many of which could be good refrac candidates.
Previous to Helms, a Whiting Oil representative talked about his company’s foray into refracs, and how his company is developing methodologies to determine which wells are good candidates for the process. Prior fracs didn’t use as much sand and had less efficient fractures than what is possible today.
“Data is mounting for why you want to refrac before you do,” Charles Ohlson, a petroleum engineer with Whiting Petroleum Corporation, said.
Those kinds of things mean more opportunities for further reiterations, Helms pointed out.
“There’s just a huge amount of iteration in well design and in well completion that is going on,” he said. “It is far from settled science.”
Helms has developed several scenarios for the lifespan of the Bakken play.
The endpoint of the Bakken shows 65,000 wells and a peak rig count of 150 in 2023. That uses a price of $50 to $60 oil to get there — a price point at which most of the Bakken’s return on investment has been shown to be fairly reasonable, according to state figures shared by Justin Kringstad, with North Dakota Pipeline Authority.
In a slow year such as this, an estimated 2,500 wells don’t get drilled, Helms said. The question is, when will they get drilled? In one scenario, they are drilled in 2035, but what if they are drilled as soon as oil prices pop back up, say mid 2017?
“When I go out and talk to communities and students about their anticipated needs for housing, sewer or water, I tell them to keep the scenario in mind, because this is the scenario that brings back crew camps,” Helms said.
And it also brings revenue for building out infrastructure needs.
In another scenario, oil stays low for longer and only the core of the Bakken gets drilled.
Helms couldn’t exhaust the core in a reasonable time frame without adding more rigs to the model. Even then, it still took 15 years to exhaust the core, showing that the play has plenty of life to make it through the downturn.
Oil in the $50 to $60 range will make the state’s 900 drilled but uncompleted wells highly economic, Helms said, and will ramp up the number of frac crews operating. That number for now is in the range of five to 11. At peak prices, there were 50 frac crews operating in the Bakken.
“Sixty dollar oil makes the Bakken superior to other plays,” Helms said. “Even to the Permian and Eagle Ford. So that is when you will see drilling rigs go back into service.”
However, even then, you still won’t see as many rigs, Helms said, and you can thank iteration for that, too. Today’s rigs are now achieving 25 wells in a year, versus eight or nine in 2009.
“It’s just an indication of what kind of technology is out there,” Helms added.
Multi-well pads, new bit technology, new motor technology, new mud technology — these are all getting their own iterations, improving the efficiency and lowering the costs of getting along in the Bakken.
Drill times are now down to an average of 12 days, with three of that waiting for cement to set.
(Reprinted with permission from the Sidney Herald)