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Edited: 5d

Oily Stuff News Stuff

The best wells drilled in the Permain Basin HZ shale oil play are behind us now; the heart of the watermelon has been eaten. Whats left after all this stupid exporting nonsence, for America and OUR future, you are not going to like and at some point in the near future you are going to ask yourself ...what the hell were we thinking?!!

16 comments

Comments

glmaddoux

28m

Years after the shale oil is depleted, many truths will come out about the nuances of the basins. The greed factor has out-run the ability of geologists to discern those truths as production is occurring.

For example, up in the Bakken (Divide County just south of Saskatchewan) some of the best production is coming from the thinnest benches, inversely proportional to SoPhiH. Finally, after many wells, it was discovered that the brown dolostone is absolutely full of oil (by flurescence). Not only that but there are more long-chain hydrocarbons than there should be, implying migration of heavy oil into a stratigraphic trap--where it has mixed with LTO.

In most parts of the Bakken it would appear that 800 feet spacings will isolate meaningful communication. However, in certain areas with heavily laminated shale, there are far-reaching communications, whereas in certain areas there is virtual isolation. The Nancy is a big well, sitting pretty as you please between other big wells, and has a pressure of ~3900 psi, near virgin.

There are other weird things being discovered. Large Three Forks wells are depleting the D facies of the Middle Bakken more than the Three Forks. Seems the D facies has the best flow characteristics and depletes first. This is a pretty big story in and of itself. (What really got fracked?)

I'm convinced that this shale oil story is going to be a trail of tears from not taking the time to study what's happening in various sweet spots, and by preservation of the reservoir pressure. All of these basins are being treated as homogenous, and they're not. The Bakken has the large Neesen anticline, the migration story of non-polar heavy oil components from Canada, and many different zones of water cuts (which in the Bakken seem to be inversely correlated with production). It's actually a very complex thing with beautiful geology, being treated like a printing press.

Mike

13h

Approximately 55,000 active HZ wells in the Permian Basin uncoventional shale play drilled since 2013 have produced aound 15 G BO. Thats 273,000 barrels of oil per well. The best wells for estimated ultimate recovery were drilled before 2016 on reasonable, rational spacing. Today. 50% of all HZ wells drilled in the Permian produce 30 BOPD and 140 BWPD, on artifical lift and are declining at the rate of 12% annually.

Then there is this, on the left, which is indeed... staggering.

Think about this chart of the left for a second, aside from the EUR issue and how it pertains to 80G BO of "recoverable resources" in the Permian...

The cost per barrel of shale oil to get it out the ground is more than oil sells for at the moment, with interest expense and dividends. That does not even include paying debt back. Trump drives oil down to <$50 net at the WH. Companies no longer able to borrow money have to STOP drilling wells; they can't afford to drill wells. 50% of 11 MM BOPD of U.S. tight oil disappears in just 18 months. Over 5.5 MM BOPD, gone. What does the loss of 5 .5 MM BOPD do to the price of oil on the world market?

See how stupid this drill baby drill plan was. Shale oil is not conventional stuff that declines 3% per year, if you are not drilling HZ shale oil wells, constantly, you remove a very large volume of oil from the market very quickly. You also destroy a sector of the oil industry that still has $200 B of long term debt, has already pissed off $500 B of debt (2012-2020) and still has tens of billions of dollars of plugging liability and instrastructure to rig down and dispose of.

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蘭五十嵐

Replying to

looks like no matter what the oil price is ,those big company will still drill, I just curios that how many years they can continue do that?

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Mike

I'm told this is a big deal, to ask AI about EUR's in the Permian Basin and the primary answer is something I wrote.

I am trying to sort this shale oil stuff out. Working from the top down from some hypothetical bull shit about technically recoverable resoures that some government funded entity estimated 7 years ago, then trying to make real life fit on p50, or p75 basis, is stupid. The oilfield does not work that way. Nobody has ever been thru anything remotely like production from unconventional shale.

What exactly is the point in qualifying a prediction about the future by saying you are likely to be wrong, then making the prediction anyway, over and over again, one model after another? I can think of no bigger waste of time in all of life. 95% of internet experts analyzing oil and gas these days did not even know the difference between pipe dope and condensate 13 years ago.

The only way to predict the future is with bottom up analysis done as things change, which they do all the time in the oilfield. Why are EUR's falling in core areas is the key to understanding the future. You can't know where you are going unless you know where you've been. Data is just numbers unless you know what they mean.

Mike

MORE ON EUR'S

Hart Publications recently reported two big Dean Formation wells in 2024 along the Martin, Howard, Dawson County lines, supposedly a hot spot for Dean production. FANG drilled two wells in this area that made 250,000 BO in the first 12 months of production each...absolutely gutted they were. Here is Novi chart thru February 2025 for three of the biggest operators in the three county area in the Dean, Wolfcamp A & B, Upper and Middle Spraberry benches. Lower Spraberry was intentionally omitted. Historically this has been area where Wolfcamp A & B outshines the Lo. Spraberry by a signficant margin. These two monster Dean wells had no signicant impact on the area, clearly, though 2025 wells (<10) appear set to have bigger IP60's.

These are production profiles, upper right, NOT EUR's. EUR tracks can be implied by looking at production profiles, little else, and when the DCA is performed in the profile, what methodology is used and what parameters are used in the methodology are important. EUR's are very subjective.

In 2021 the dog dookey poured out of the Midland Basin about 1.5MM BOE EUR's that are going to struggle to make half that even at 6:1 E. Still well profiles tell a story worth listening to.

Here we see three companies, including FANG, OXY and SM drilling two big benches in Tier 1/2 area cores (Martin, FANG's 'hood) where 2024 cumm prods. at month 15 were 16% lower than 2023 cummprods. You won't hear too much about this kinda stuff, what you will hear, instead, is that two big Dean completions, of many Dean completions in the area, now open thousands more drilling locations for the future. Which is hooey. But if you don't dig this stuff out then are you are left with is top down EIA projections. Good luck with that.

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Mike

Replying to

This by Berman, for a change, is very much worth reading. It suits my way of thinking, for sure.

https://www.artberman.com/blog/toward-a-conscious-myth-meaning-and-the-sacred-in-a-digital-age/

Douthat sees artificial intelligence as the tipping point of this process. AI doesn’t just replace human capacities—it tightens the existential bottleneck. It accelerates substitution, deepens distraction, and heightens the sense of human obsolescence. Schmachtenberger views AI similarly—not as a neutral tool, but as a force amplifier in a civilizational system already misaligned. It increases complexity without adding wisdom.

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Conway Carriage

Replying to

I don't think I can subscribe to the notion that ai is going to end us all. Especially without someone's "wisdom". Seems to me a bit of a call for modern ai priests. Anyway, since Zog first found fire by whacking flint, it has always been, any invention, becomes yet another tool in the box, undoubtedly to continue into the beyond. Any and all tools are nothing more than providing a handle on power of some kind. Wether blacksmith tongs, electric breakers or bops holding back dragons, they all end up being tools for men to employ in any endeavor, wise or foolish.

George Florinescu

20h

Replying to

First: AI is not intelligence, is more like capricious artificial bureaucracy, capricious artificial patterns, capricious artificial models, and random artificial algorithms( it doesn't give always an algorithm, a model, a pattern or a bureaucracy,, sometimes it just gives an output with increased entropy: i.e."garbage"), and the biggest and riskiest problem is that you don't know which is which. And there is a lot of cost in finding out.

So not only wisdom is unreachable by A.I. but intelligence too...

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Mike

AN HONEST QUESTION FOR PEOPLE SMARTER THAN ME...

In 2021 Saputra etal, here, https://www.mdpi.com/1996-1073/15/1/43, predicted that Permian EUR's would increase with increased lateral length. It does not appear to me that has been the case and I can assume several reasons for that, mostly having to do with well spacing, initial GOR's in overdrilled cores and increasing WOR. Granted EUR's can be very qualatative but it appears, at least to me, longer laterals are actually reducing EUR's. [1]

To quote Cousin Vinny, "does the above statement still hold wata?"

[1]

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Mike

Replying to

I can't even begin to tell you in the Permian as opinions vary mostly based on defintions and desired economics. Pioneer in its last days had upspaced to 900 feet between wells to increase EUR's. Over in the Delaware there is quite a bit of vertical communication in he Bone Springs series, I am told by old friends who worked that. There are some areas in south Eddy and Lea that communicate over 1200 feet apart. Look, its really hard to get the truth on this sort of stuff. Remember to verify where the first take point is in a bench you have to have the deviation report and correct for sub-sea measurements, not very many analysts bother to do that, they just assume operators always tell the truth of where they are going and where they end up.

https://www.sciencedirect.com/science/article/pii/S0920410518310003

6-8 wells per 1 mile section use to be the standard but thats all been thrown out the windown for increased cash flow.

Some folks assume the permeability of mud rock is so poor, the shale so dense its impossible for there to be pressure depletion, or communication. In the old shale oil days, parent wells 2,500-3,000 feet away from a kid getting frac'ed were shut in, packers with pump out plugs run into those wells to prevent communication, or take brief advanatage of it; EOG in the Eagle Ford was notorious for that stuff. I personally watched them blow three rod lift wells up 3,000 feet away with a frac once.

I am sorry I can't be of more help with this question. Entirely different animal but I am always reminded of the fact that the giant East Texas field was developed with something like 33,000 wells, while under proration rules by the TRRC (1933), and it was later determined by multiple SPE papers that the UR of that field would have been greater by 30% with just 17,000 wells.

People get in a big hurry, right?

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Conway Carriage

Replying to

"just assume operators always tell the truth of where they are going and where they end up."

Hahaha. I can tell you with 100% accuracy they don't know themselves. We do a ton of ranging, and meh close enough is par for the course. I might have a clue what to do with the iron, but I don't know the rock, hence my dumb ass questions. What I can tell you is what the engineers think they have down there ain't exactly what they actually have. But close enough to work

Mike

Replying to

Seldom, if ever, do regulatory agencies have the staff, nor care, particularly the TRRC, to plot well profiles to see if laterals stay in zone and seldom, if ever, correct FTP's or first PP's for exact datums below sea level. Steering hands don't always know, engineers indeed don't always know exactly where they are and when they don't they are generally always going to lie to regulatory agencies. Unless you want to repermit the well you simply say you are where you said you would be. The Midland Basin, for instance, with 2,000 vertical feet in many places seperating the Lo. Spraberry from the Wolfcamp B must look like a bowl of noodles with 23,000 laterals in it.

hole in head

Oil production is being affected by low prices and rising costs (including share buybacks and dividend commitments).

For example, Exxon Mobil needs a price of $88 a barrel to meet these commitments (and that's not even considering the impact of new steel tariffs).

https://www.hellenicshippingnews.com/trade-turmoils-oil-market-bite-is-already-leaving-lasting-scars/