A lack of gathering and transmission lines in some parts of the country, particularly those in the Utica and Marcellus shales, are leaving wells shut-in longer, and new data presented Wednesday at an oil and gas conference in Cleveland suggests estimated ultimate recovery (EUR) could be significantly impacted as a result.
Although operators can count on a wait time of at least six to eight weeks before well completion and flowback begins, Performance Services Inc. President James Crafton said everything should be done to minimize the time a well is shut-in, from altering strategies at the pad itself to waiting for adequate takeaway capacity. Performance Services is an energy industry consultancy based in Colorado.
"The data set is small, but the observation is compelling," Crafton told a large crowd gathered for a technical conference at the Ohio Oil and Gas Association's annual Oilfield Expo and Safety Conference. "As an industry, we have no choice but to leave wells shut-in, but it's the way you do it that matters."
The topic drew a host of questions and interest from a crowd of executives and others, as more than 600 wells have been drilled in Ohio to date (see Shale Daily, Nov. 19). That number is much higher than at the beginning of the year, but both processing and takeaway capacity is failing to match the rate of development, especially in the Utica, as midstream companies search for egress, face regulatory delays and work as best they can to meet demand in the Appalachian Basin.
In the meantime, exploration and production companies have plowed ahead, opting to drill wells and leave them shut-in for longer periods of time as they wait for pipeline connections.
Chesapeake Energy Corp., for instance, the Utica's largest leaseholder, drilled 377 wells in the third quarter, with 208 of those waiting on pipeline connections or in various stages of completion. Chesapeake had a total of 500 onshore wells backlogged at the end of September (see Shale Daily, Nov. 8). The problem is less severe in parts of the Marcellus where more infrastructure is in place to handle production.
Still, Crafton said a post-fracturing (fracking) delay is harmful in any way. Prolonged shut-ins only make a well's performance suffer, as the proppants and additives used during the drilling process can settle and cause damage to a well's mobility, making it difficult for liquids to return to the surface and decreasing EUR by as much as 27%, according to one data set he presented, compiled from wells in the Utica and Marcellus.
He said tweaks in strategy such as adding artificial lift, or more pressure to a well, can increase "connectivity between the wellbore and reservoir," giving a noticeable boost to return rates.
Crafton also suggested that well construction and "job design," or the timeline along which a well is drilled, fracked, completed and drilled-out makes a difference in the well's return rate, saying there should be minimal delays between each stage of the process.
Flotek Industry Executive Vice President Kevin Fisher echoed Crafton's concerns by noting that thinner solutions and different additives used during the drilling process can affect returns, as well. Solvents and other liquids are being replaced to reduce interfacial tension, as both men called it, so that proppants and additives interact with wet hydrocarbons better and make them flow to the surface easier.
Wednesday's presentation was, in a way, a recognition of the strides the industry is making on the technological front. More production history and continued data analysis are cluing operators into better solutions on how to deal with some of the challenges they face in basins across the country, Fisher said.
"Those of us in the industry liked to think for the longest time that fracking was simple," Fisher said. "It’s more than straight bi-wing fractures when we get below the surface."
Fisher added that improved microseismic mapping is allowing operators to better re-frack wells, increase optimization and slow the decline curve on existing production in some parts of the country.
Furthermore, he said the media and the public have put "the oil and gas industry under intense scrutiny over [its] potential environmental impacts."
The data that microseismic mapping and other tools are creating, Fisher said, shows that aquifers are coming nowhere near close to being contaminated and earthquakes are not resulting from the temporary disruption of underground formations thousands of feet below the earth.