Pioneer Natural Resources Co.’s first horizontal Wolfcamp Shale well in Martin County, TX, — the Mabee K #1H — has been placed on production with an initial rate that the company called “strong,” and an analyst following Pioneer said confirms prospectivity in the county.

The Mabee K #1H well had an initial 24-hour peak natural flow rate of 1,572 boe/d with 77% oil content, Pioneer said. The well was completed in the Wolfcamp B interval utilizing a 27-stage hybrid fracture stimulation over a perforated lateral length of 6,671 feet. The initial flow rate “compares very favorably” with that of the DL Hutt C #1H well, Pioneer’s first horizontal Wolfcamp Shale B interval well in Midland County, TX, the company said.

“The strong initial production rate from the Mabee K #1H well further demonstrates the prospectivity of Pioneer’s gross 900,000-acre Spraberry/Wolfcamp leasehold position, which holds an estimated net resource potential for the company of more than 4.6 billion boe,” said CEO Scott Sheffield. “We have seven horizontal rigs running in the southern part of the play, where the company has its joint interest agreement with Sinochem [see Shale Daily, Jan. 31], and we are increasing our horizontal rig count in the northern part of the play from one rig to five rigs during the second quarter.”

The DL Hutt C #1H well had an initial 24-hour peak natural flow rate of 1,693 boe/d with 75% oil content. The well utilized a 30-stage hybrid fracture stimulation over its longer perforated lateral length of 7,380 feet. When normalizing the lateral length of the Mabee K #1H well to the longer lateral of the DL Hutt C #1H well, the comparable 24-hour peak rate for the Mabee K #1H well would have been higher than the DL Hutt C #1H well at 1,739 boe/d, Pioneer said. The Mabee K #1H well is about 30 miles north of the DL Hutt C #1H well and 50 miles north of Pioneer’s first two horizontal Wolfcamp Shale B interval wells in the Giddings area in Upton County.

“All in all, [the Mabee K #1H flow rate is] an important data point as it confirms prospectivity in Martin County and should help derisk [Pioneer’s] northern acreage, which totals over 600,000 acres,” said Wells Fargo Securities analyst Gordon Douthat. “While one well doesn’t make a play, initial results have been positive in the north, and with further success, we see upside potential from type curve revisions and acreage derisking.”

Wells Fargo includes a $27/share credit to the company’s net asset value for its northern Wolfcamp horizontal potential, Douthat said in a note. “Conservative assumptions” for the area are estimated ultimate recoveries of 500,000 boe and initial production rates of 850 boe/d with 25% or the acreage prospective.

“Additional rigs are expected to be added in both the southern and northern parts of the play next year,” Sheffield said. “This significant ramp up in drilling activity will allow us to continue to add substantial net asset value as we further delineate multiple prospective horizontal targets across our large acreage position, including the Wolfcamp, Jo Mill and Spraberry shale intervals.”

Pioneer’s drilling results in the Spraberry Trend have led the company to shift a significant portion of 2013 drilling activity from vertical drilling to more capital-efficient horizontal drilling, it said recently (see Shale Daily, May 6).