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Paradox Basin's Gothic Shale Called 'High-Potential Play'

Because of new drilling techniques that allow operators to do more with less, federal officials in Colorado have more than doubled their initial estimate on the number of natural gas wells that could be drilled in the Gothic Shale in the Paradox Basin of southwestern Colorado.

A supplement to a 2007 draft land management plan (LMP) and draft environmental impact statement (EIS) is scheduled to be released on Friday (Aug. 26) by the San Juan Public Lands Center.

San Juan National Forest Supervisor Mark Stiles said new drilling technology led officials to "basically double" the number of wells from the number used when officials first began working on the supplement two years ago.

The supplement analyzed more than 646,000 acres in what is officially called the Gothic Shale Gas Play (GSGP), which extends into parts of Colorado's Dolores, San Miguel, Montezuma and La Plata counties.

The original analysis, completed in 2006 and 2007, had projected that 1,185 gas wells could be accommodated on federal lands managed by the U.S. Forest Service and the Bureau of Land Management.

The revised Reasonable Foreseeable Development (RFD) plan, which relied among other things on projections from drilling multiple wells on single pads, added 1,769 more potential gas wells to the draft. The Gothic Shale, said federal officials, was determined to be a "high-potential play."

"The projected amount of gas to be yielded from the shale gas play over the next 15 years (on federal, state, local and private lands) is estimated to be 2.7 Tcf," officials said. Up to 3,000 new gas wells could be drilled on public lands in the Paradox Basin over the next 15 years under the draft plan, Stiles said.

Among other things, the supplement has revised the oil and gas development projections and the related analysis of resource impacts that were published in the draft EIS. It also discloses the results of the recently completed air quality model, which was based on the new development projections. In addition, the supplement proposes revised standards and guidelines for air quality, and new water standards and guidelines.

No specific drilling proposal was used to complete the supplement.

Some explorers are testing portions of the Paradox Basin, an oil and gas formation that extends into Utah, but there are relatively few that have publicly offered information on gas production development in the Gothic Shale. The U.S. Geological Survey (USGS) has not done any recent surveys of the basin and until recently it said "the only significant production from basin formation was from the Cane Creek Shale in the Lone Canyon field, which was discovered in 1962.

Within the Paradox Basin, USGS scientists determined that the Gothic was one of the several shales that appeared to "have the most potential due to both organic content and thickness."

In 2008 Denver-based Bill Barrett Corp. reported initial well results at its Yellow Jacket prospect in the Gothic Shale (see Daily GPI, Nov. 6, 2008). At the time the company had built a 397,000-gross acre position in the Paradox Basin, which included about 208,000 net undeveloped acres. Bill Barrett's first gas sales from the basin were reported in early 2009 (see Daily GPI, Jan. 26, 2009).

Laura L. Wray of Williams Production Co. provided some insight into the exploration efforts last year at a gathering of the American Association of Petroleum Geologists. The Williams unit partners on about 100,000 acres in the play with Bill Barrett, which operates and holds a majority stake (55%). At mid-2010 the partners had drilled and completed four vertical wells and eight horizontal wells to test the shale.

"Dry gas production in the northern four horizontal wells is contrasted with the wet gas and condensate production from the four southern wells," Wray said. The "Btu values of the gas show this maturity variation also in the two groups of wells that are only 15 miles apart." However, she said then that more work was being done to understand the variability of the play.

The Gothic Shale, she said, "is more accurately described as a laminated, massive mudstone...Efforts are now under way to create greater stimulated reservoir volumes in subsequent wells by adjusting the number of frack (fracture) stages, increasing the volumes of slickwater and sand concentrations pumped, raising the injection rates, and modifying flowback processes."

Initial production rates from the first eight horizontal wells ranged from 200 Mcf/d to "a high of 5.3 MMcf/d," Wray said. The partners then completed a well "with larger volumes of water and sand per stage, and immediately after the frack was completed a drip string was installed. The production results have been very encouraging as seen by a much longer period of sustained production and a flatter decline."

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