Highlights From The Last 4 Months

If you are looking for news on the Cline shale, there is a lot more available on the internet now than there was at the beginning of the year.  Things are obviously heating up.  I thought I'd put together a chronological list of the news, press releases, and company investor presentations that caught my eye over the last 4 months.  I included links to all of my sources.  If you see anything wrong, let me know.

Aug 6 – Devon Energy reports due to “a lot of variability” in their Cline wells, they are reducing the number of rigs committed to Cline exploration.  This was really disappointing news considering that Devon is one of the biggest operators in the basin, and one of the early cheerleaders for the Cline.  A year earlier Devon estimated that the Cline could hold 10 times the recoverable oil in the Eagle Ford, but this announcement cast major doubt as to whether that prediction would hold true. (Source)

September 16 – Laredo Petroleum claims to have the record for highest peak 24-hour IP rate at 2,147 boe/day with their Lane Trust C/E 42-2HL well targeting the lower Wolfcamp, and that they have drilled 15 of the 20 best wells in the Midland basin (based on 24-hour IP rate).  Twelve of these wells produce from three different levels in the Wolfcamp, three produce from the Cline.  Laredo also announces it will test using stacked laterals to produce from the three benches of the Wolfcamp as well as the Cline. (Source) (see graphic below)

Late October –  A major sweet spot in the Midland Basin has immerged.   The rig count in Glasscock county goes from 27 at the beginning of September to as high as 42.   And, though its rig count has stagnated during this period, the sweet spot is thought to include Howard County too. (Source)

October 30 –  Energen announces it has broken the record for 24 hour IP rate with a well targeting the upper Wolfcamp in Reeves county that produced at 2,229 boe/day.  They also signal that their well data in both the Midland and Delaware basins could indicate they hold more potential than originally thought. (Source)

November 4 – Pioneer Natural Resources announces they have brought their first three “Wolfcamp D” (Cline) wells into production with outstanding results.  All three have significantly higher 24 hour peak IP rates than average industry Cline wells leading executives to conclude that Pioneer will exceed the industry’s average estimated ultimate recovery for Cline wells.  One of them leapfrogs Energen’s well to claim highest rate ever recorded by an oil well in the Midland basin.  Pioneer’s E.T. O’Daniel #2H well in Midland county flowed at 3,156 boe/day.  Additionally, this well’s location is significant.  It’s located in Andrews county, which extends the Cline play 50 miles west of the established boundary and could mean that there is more oil in this formation than was originally estimated.  Pioneer also announced exceptional wells in the Wolfcamp, and they plan to double their rigs allocated to the Permian; from 5 to 10 rigs. (Source)

November 7 – Apache reports that in the course of the last year the company has reduced its Wolfcamp and Cline well costs by over $1 million through the use of pad drilling, reduction of drilling time and completion costs, and self sourcing materials. (Source)

Meanwhile, in its third quarter report, Laredo Petroleum announced the company had experience a few setbacks in their operations including some mechanical issues and a fire at the Reagan truck station.  However, it wasn’t all bad news.  They also announced completion of its best ever Cline well with a 3-stream peak 24-hour IP rate of 1,888 Boe/d and a 3-stream 30-day average IP of 1,408 Boe/d.  Additionally, Laredo reported it had begun flowback on its first stacked laterals with results in line with their type curves. (Source)

November 13 – Pioneer Natural Resources announces it has already outdone itself.  In a special news release Pioneer reports bringing its fourth Cline well into production, recording a 24-hour peak IP rate of 3,605 boe/day in their University 7-43 10H well. (Source) (see graphic below)

November 27 - Pioneer Natural Resources announces that the winter weather system that swept through Texas before Thanksgiving significantly impacted its operations.  Laredo Petroleum issues a similar announcement (Source)

Neither Pioneer, nor any other company, has issued a statement about the affects of the current weather system, but it's safe to say that it will have a similar, if not more significant impact as the last one.  Right now we are in our third day of very harsh, freezing temperatures in Lubbock.  As you would expect, there have been reports of auto accidents from icy roads all over west Texas.  Hope your safe and warm wherever you're reading this.

(Thanks to Laredo Petroleum and Pioneer Natural Resources for the graphics, I hope I haven't violated your use policy)