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Barnett Shale Gains; Practice Boosts Production

Dry natural gas production from the Barnett Shale during the first half of this year increased 6% compared with the year-ago period. Total liquids production was up 7%, mainly on a 12% gain in oil production (see chart). But the Barnett rig count has declined 25% from a year ago. Clearly, producers there are doing more with less, and it's because they have "learned by doing."

The Barnett is a good example of what can be expected from a mature play. The basin's production for the first half (1H) of 201l at 5.35 Bcf/d, outpaced the 5.06 Bcf/d produced in1H 2010 by 6%. The bulk of the gain was in gas well gas.

"You're talking about a play that operators know a lot about now," Ken Medlock, an energy fellow at Houston's Rice University, told NGI's Shale Daily. "The Barnett has been a heavily drilled structure, so people have very good geologic maps, good contour maps. They know where to go."

Medlock is involved in a project in which researchers are examining trends in the country's five largest shale plays. "You look at the Barnett and you can see how development has been occurring, and you can very quickly understand where good wells are and where bad wells are."

That means there are more hits and fewer misses. And the greater production from the successful wells more than offsets declines due to the decreasing number of marginal wells drilled as rigs exit the Barnett for liquids-rich plays such as the Eagle Ford and Marcellus, Medlock said.

"The simple fact that they can hone in on the right places to drill means you are drilling fewer bad wells, so you're cutting off the bottom half of the distribution. Let's say I had to throw 100 rigs at a problem and I'd get x amount of production. Well now since I know where to drill, I can probably cut that number in half and get the same production number."

As producers have gotten better at finding Barnett sweet spots, estimated ultimate recoveries and initial production rates have climbed "pretty much in steady fashion." he said. "So that leads to an increase in rig efficiency.

"You can't really say that they can find the sweet spots as easily in other shales yet because there's a lot of learning by doing that goes on in every shale."

As far as maturity and producer knowledge, the Fayetteville Shale in Arkansas is probably closest to the Barnett, Medlock said. "The Eagle Ford, the Haynesville, the Marcellus, they're all evolving much more rapidly than I would argue the Barnett and Fayetteville did because people have a better understanding of the potential under their feet now. I wouldn't expect it to take very long for those plays to mature in the same way we're seeing the Barnett and Fayetteville."

Besides acquiring better knowledge of the Barnett, the way that producers attack the play has evolved, too. Laterals used to be one-quarter to one-third the length that they are now with single hydraulic fracture stages. "Now you'll actually have 12-14 stages and a lateral that's 10,000 feet or something like that," Medlock said. "You're stimulating a lot more production from a greater area of rock for each well drilled now. So that's also helping."

Barnett producers have now turned their attention to infill drilling with satisfactory results so far, according to what Medlock said he has heard from the field. Transitioning from 80-acre to 40-acre spacing has not led to contamination of fracture zones, which would create a situation where gas from one well can migrate to another. "From what I understand that's not happening. That's another innovation in the field; that's a learning by doing kind of thing," he said.

That bodes well for production growth, too. Medlock admitted that two years ago he would have expected production from the Barnett to plateau at least somewhat. It hasn't yet, but it will, and it will be because of declining interest in the play as producers continue to be drawn to the Eagle Ford and Marcellus and other liquids-rich plays, he said.

"I think the overarching pressure is to move toward the more liquids-rich stuff," Medlock said. "And I think you've kind of worked off all the marginal rigs [in the Barnett], so to speak. So if the gas-oil window stays as wide as it is, you're probably going to have a tough time attracting new rigs for new wells in the Barnett, so you could actually see some flattening for a while.

"I guess the 'X' factor is the innovations in the field...That kind of stuff is tough to predict, but I'd say we're probably near that point now."

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