An average of four dry holes are drilled through a giant field before the discovery is recognized, according to AAPG Sidney Powers Medalist Robert M. Sneider.
Are the same statistics true for discovering and developing an unconventional resource play?
Testing an unconventional resource play concept is much different than testing a conventional play concept. Conventional plays can be tested by purchasing a relatively small acreage block – in the United States 1,280 acres might be sufficient. Conventional well tests in the United States usually are vertical, and depending on depth could cost $500,000 to $4 million to drill and complete. Four million dollars would be a very inexpensive test for an unconventional resource play.
Wells to test unconventional resource plays are usually horizontal and have multiple hydraulic fracturing stages. They can cost many millions of dollars. Well costs depend on where they are, how deep they are and how many hydraulic fracturing stages they require. One company reported that recent Bakken development wells cost an average of $8 million, with an average recovery of 660,000 BOE. Also, unconventional resource plays require large lease blocks to make the effort worthwhile – 10,000 to 100,000 acres is not uncommon.
The high well and land costs might tempt one to think that drilling a single well with enough science is enough to prove or disprove an unconventional resource play concept – but history doesn’t bear that out. That also assumes engineering plays a minor role.
The Barnett Shale play took 20 years to get off the ground. Mitchell Energy had the patience to drill many dry or marginal test wells before the play was successful.
Many AAPG members, especially those working U.S. basins, are searching for unconventional resource plays. They must gather enough data to convince their management or an investor to buy their play concept.
How much data is necessary?
What is overkill?
Those questions are important, because it takes money – and just as importantly, time – to gather all the data. One has to ask questions such as:
Do we need 3-D data? How much 3-D data?
Do we need source rock data? What kind of source rock data, i.e. richness maturity, mineralogy?
Some questions might be difficult to answer without drilling a test well, which is why more than one well usually is necessary.
These are interesting times. Not many people 10 years ago thought that we would consider a rock with nanodarcies of permeability a reservoir, but now we do. I heard an engineering professor from a major university say that as a result of the shale gas play our basic concepts of the reservoir have changed forever.
AAPG also is changing. The AAPG (you and I) is endeavoring to create new publications, BULLETIN articles, short courses and workshops that supply members with data, technology and concepts from all over the world that we can apply to our area of interest.
One example of a new AAPG project is the Unconventional Resources Technology Conference, or URTeC, created by former AAPG Executive Director Rick Fritz. It will help give members critical information they need for creating or evaluating resource plays.
The conference is a joint project of AAPG, SPE and SEG, and will be held in August 2013 in Denver. It is the first of its kind among the three societies and is designed to provide a true interdisciplinary program on current potential resource plays in the United States and around the world.
A call for papers has been issued for the inaugural URTeC – with a Nov. 15 deadline – for those who might want to be involved as a presenter.
The three technical program co-chairs are AAPG Honorary Member and past president Steve Sonnenberg, with the Colorado School of Mines; AAPG member Ken Beeney, with Devon Energy; and Luis Baez, with BG Group.
Make plans to attend now.
What do you think?
Please let AAPG know. Also, please share your ideas with the rest of AAPG by presenting and publishing papers.
In doing so, you’re keeping both science and AAPG alive and vital in the world’s energy future.
Edward A. â€œTedâ€� Beaumont, AAPG President (2012-13), is an independent consultant with Cimarex Energy