Scenic region valuable to many interests

Finding the Right Balance at Pinedale

American Association of Petroleum Geologists (AAPG)

If flashy exploration prospects are the racehorses of the industry and big development projects the show horses, the Pinedale and Jonah fields would have to be called work horses.

These greater Green River Basin, tight-sands fields produce natural gas abundantly, primarily from the Upper Cretaceous Lance Formation and Upper Mesaverde Group.

They stretch across more than 125 square miles of brush-covered plains in southwest Wyoming.

The forested, mountainous land to the north and northwest is a horse of a different color.

And because of that, operators in the region have added a new chapter to the book on how the industry and the environmentalists can get along.

“Over the last several decades there have been exploratory efforts there, but it’s been harder and harder to get in and do that,” said Tom Doll, state oil and gas supervisor for the Wyoming Oil and Gas Conservation Commission.

“Most of this (exploration activity) is on federal minerals within the Wyoming Range, a mountain range northwest of the Pinedale Field,” he said. “This is a pretty pristine area.”

Both environmentalists and sportsmen have opposed development of the mountain front area, which includes the Bridger-Teton National Forest and thousands of acres of recreational land.

“Recently, there was the Wyoming Range Legacy Act signed by President Obama that put about 1.2 million acres of that land aside and not available for leasing,” Doll said.

Then in January, the Forest Service announced it would not authorize oil and gas leasing on 70 square miles of the Wyoming Range.

Plains Exploration and Production Co. (PXP) in Houston explores northwest of Pinedale, in an area where it has existing leases.

In an unusual move, PXP has offered to “retire” some of those leases, an arrangement it reached with the Wyoming Sportsmen for Fish and Wildlife and the Wyoming Outfitters and Guides Association.

It hopes to create a separation between the exploration area and the more environmentally sensitive recreation areas.

They Did It Because …

PXP explained its decision to retire some of its leases in a statement prepared for the EXPLORER:

“PXP spent more than two years working with a wide variety of stakeholders to review concerns about the proposed development and identify ways to minimize resource impacts.

“This led to a collaborative effort and a comprehensive framework that maximizes multiple use opportunities in PXP’s federal lease acreage, preserves the legitimate interests of sportsman in the lease area, promotes conservation principles and minimizes the environmental footprint of the development to the greatest extent possible.

“Our proposed agreement represents a historic opportunity to facilitate the addition of over 28,000 acres of habitat to an area currently protected by the Wyoming Range Legacy Act and establish a buffer between an area of the Wyoming Range and oil and gas activity east of the Wyoming Range.

“As part of the agreement, PXP has agreed to fund $6 million over the life of the project to conduct important wildlife studies, monitor air, ground and surface water quality, and establish a fund to benefit local communities impacted by the development agreement.”

Lease retirement is possible in this case because it was authorized as part of the Wyoming Range protection legislation.

“The withdrawal would take place under the Wyoming Range Legacy Act that was passed by Congress and signed into law in 2009. The Act permanently placed 1.2 million acres in the Wyoming Range off limits from future oil and gas leasing,” said Scott Winters, PXP vice president of corporate communications.

“The Act explicitly allows existing leases to be developed but provides companies the option to retire part or all of their lease holdings if they desire,” he added. “Once retired, the lands would not be available for leasing in the future.”

Still Going Strong

According to AAPG Honorary Member John Lockridge, environmentalists have created a “very contentious” atmosphere with the oil and gas industry in the exploration area north of Pinedale.

Lockridge, an independent geologist based in Los Angeles, works with partners in an exploration project north of Pinedale.

“The fact is, our play is not in the Teton Range. It’s in the hill country east of the Teton Range,” he said.

He agreed that the lenticular sands and stratigraphic nature of this area of Wyoming would not indicate horizontal drilling for development.

“The geology is not so much structural as it is totally stratigraphic. There have been very significant drill stem tests,” Lockridge said.

“It’s a significant prospect area,” he added.

Pinedale has its own environmental sensitivity, particularly related to the habitat of the prairie grouse. But no one should doubt that both Pinedale and Jonah will continue to boom, even at current natural gas prices.

“Development continues in both Pinedale and Jonah,” Doll noted. “The activity has been constant over the past year, although the industry is becoming more efficient in drilling the wells.”

QEP Resources Inc. in Denver drills the Mesa Township area of the Pinedale Anticline. Questar, a major operator in the Rockies, spun off QEP Resources as a separate, stand-alone company in 2010.

Through QEP Energy Co., it plans to drill and complete 85 to 100 Pinedale wells this year.

“Nearly all wells will be in the six square mile CDA (concentrated development area) within Mesa Township near the southern border of QEP’s acreage block,” said Dennis Beccue, general manager for QEP Energy’s Pinedale Division in Denver.

QEP has up to 1,300 Pinedale locations remaining on a combination of five- and 10-acre spacing and currently employs five rigs there, according to Beccue.

The company’s completed well cost at Pinedale is about $3.7 million, he said – a significant decrease over costs just a few years ago – and drilling times also have dropped sharply.

“Advances in bit designs, use of oil-based drilling mud and down-hole mud motors, pad drilling with fit-for-purpose rigs, improved well design, consistent drilling crews – and operator experience have all helped bring drilling times down from more than 60 days per well to about 17 days per well or even less,” Beccue explained.

“In addition,” he noted, “advances in completion techniques combined with 24-hour operations have significantly reduced well costs and cycle times.”

Practical Reasons, Too

The Pinedale area’s geology has dictated a characteristic approach to development. Operators drill multiple directional wells from a single pad – and not just for environmental reasons.

Pinedale is one tight-sands gas field unlikely to see much horizontal well development, according to companies that work there

“Total measured drill depths can exceed 15,000 feet with average Lance Pool well depths being 13,500 feet to 14,500 feet, depending on where the wells are located on the anticline,” said AAPG member Tom Meyer, geoscience manager for the Pinedale Division of QEP Energy.

“Since the pay section consists of hundreds of sand bodies that are spread over a 6,000-foot interval, vertical production holes are needed to intersect as many of these sand bodies as possible,” he said “The stacked nature of these pays makes horizontal drilling impractical.”

Production at the Pinedale Field relates to the structural position of the wells, Meyer noted. Wells higher on structure near the crest of the anticline tend to be better producers than those along the flank.

“The Lance Pool reservoirs are comprised of gas-saturated, over-pressured sandstones and siltstones of fluvial-origin deposited in an alluvial plain setting. Due to the nature of the deposition, the sand bodies tend to be small and isolated,” Meyer said.

“The sandstones are also very tight,” he added. “The effective reservoir has porosity ranging 6 to12 percent, with an average of 9 percent. Air permeability at reservoir conditions ranges from 0.0001 to 0.1 mD, with an average of approximately 0.01 mD.”

QEP is developing the field by directionally drilling wells from centrally located pads that can contain up to 52 wells. Multi-well pad drilling lets QEP minimize surface disturbance and allows production facilities for all of the wells on a pad to be centrally located, Meyer said.

In the Pinedale area individual sand bodies tend to be small, with many being five to 10 acres or even smaller.

“The tight character of the reservoir sands and small aerial extent of the sand bodies make it necessary to develop the field on tight density. QEP is currently developing the field on five-acre spacing along the southern portion of its acreage block,” Meyer said.

Tight density also produces a huge portfolio of numerous potential well sites for operators throughout Pinedale.

Regardless of the results of exploration attempting to push development beyond the Pinedale-Jonah borders, these workhorses are likely to remain active for years to come.

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