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Daily Report 9-3-2014 - Encana Quad Drills

Posted by bernell on September 2, 2014

(This Page title was date incorrectly as 9-3-2014...I'm sure the title can be changed, but I don't know forgive the error, please)

This is a rumor, but it is a rumor I have heard from several sources. 

I believe it to be true, even though I do not have all of the details on it, yet.

As a little background, some of you may have noticed Halcon is building at least one site already (more rumored) that is designed to drill 2 wells into 2 different large acreage units at the same time.  The one that has been noted most often is the Creek Cottage East and Creek Cottage West, paired units of 1,572.80 acres located between the Horseshoe Hill units and Blackstone 4H in Wilkinson County. Access to the pad for these two wells appears to be off of Whitestone Road via Hwy 24 roughly halfway between Woodville and Centreville.

It appears the plans by Halcon are to set up on this one pad and drill one well north into 1 unit and 1 well south into another unit, thereby gaining the savings of drilling multiple wells while at the same time holding 3,145.6 acres with one drill.

Rumor is for much larger acreage being held by double unit pad drilling by Halcon in the future.

Likewise, EnCana is rumored to be taking a similar approach, though without the aggressive grab for acreage. 

That is, EnCana appears to be setting up to drill 4 wells from 1 pad.  Two wells north into different side-by-side units and two wells south into the same side-by-side units.  In other words, 2 wells per unit, just as was discussed when the idea of 3 section units were offered before the Mississippi Oil and Gas Board.

Now, I'm being told of at least 2 planned "quad" drills scheduled for this year.  One of these is rumored to be scheduled for the Longleaf 29H pad already completed and for a yet-to-be permitted Longleaf 28H unit to its east.  I won't mention the other quad pad at this time since there are pending issues with it.

What is significant about this is that the quad drilling is what we can expect when the TMS enters the full "development" mode...the phase where companies are not worried about holding leases, but rather are most concerned about the efficiency of the drilling and completing operations. 

In this phase, though there may be 40 rigs in the area, there won't be much more rig movement than what there has been with the 9 rigs we currently have in operation here.

Wells will be drilled and fracked and completed faster and at a resultant lower cost. 

These quad drills will, in essence, show EnCana and the world the development phase efficiency of the TMS.

Personally, I'm excited about the idea.  The only selfish negative on it is that I'm not sure EnCana will be as communicative about the success as other smaller companies might be.  We may have to judge the success of these quad drills by the actions of EnCana rather than reported information.

Regardless, I wish EnCana the best of luck in this next operational phase.

What do you think about it?