The One Sweet Spot That Continues To Drive Permian Growth
The Bone Spring formation has been one of the most prolific shale plays in the Permian in recent years and continues to drive production growth.
The Bone Spring formation has been one of the most prolific shale plays in the Permian in recent years and will continue to drive the Permian basin’s shale production growth, the U.S. Energy Information Administration (EIA) said on Wednesday.
Before hydraulic fracturing, Bone Spring was a target for conventional oil. After the introduction of fracking and horizontal drilling across U.S. shale plays, production from the Bone Spring formation has risen significantly, and it is now one of the fastest developing unconventional plays in the United States, the EIA said in a report on the Permian’s Wolfcamp and Bone Spring shale plays.
According to the EIA, the Bone Spring formation is a highly attractive unconventional oil target for drillers because it has many pay zones and high total organic carbon (TOC).
With fracking, more than 4,000 horizontal wells have been drilled in Bone Spring over the past decade.
The EIA estimates show that the number of producing wells in the Bone Spring jumped from just 436 wells in January 2005 to 4,338 wells in the middle of this year.
Moreover, the drillers, thanks to the advance in technology and to increased experience, have managed to increase well production at the Bone Spring for the first six months of operation. Average initial daily crude oil production per well was 67 barrels per day (bpd) back in 2005. This average production per well for the first six months of operation jumped to 770 bpd this year. Average natural gas production per well for the initial six months has also jumped—from 0.1 million cubic feet per day (MMcf/d) in 2005 to 1.6 MMcf/d in 2019, EIA said.
Bone Spring’s average monthly production was 0.6 million barrels of crude oil and 1.7 billion cubic feet of natural gas per day in August 2019, according to EIA data.
Last year in December, the United States Geological Survey (USGS) said that whopping 46.3 billion barrels of oil, 281 trillion cubic feet of natural gas, and 20 billion barrels of natural gas liquids are now believed to lie untapped in the Wolfcamp Shale and overlying the Bone Spring Formation.
Bone Spring is considered a premium play by shale producers such as EOG Resources, which said in its Q3 results release that its drilling locations in Wolfcamp M and the Third Bone Spring “are highly economic at a flat $40 oil price and flat $2.50 natural gas price.”
By Tsvetana Paraskova for Oilprice.com