South Louisiana: A 'Mature Frontier'

We've Only Just Begun

South Louisiana isn't all drilled up. It's actually a whole new exploration frontier.

Before you scoff, take a look at some of the numbers to support such a seemingly outlandish statement.

A total of 70,200 wells have been drilled in South Louisiana, according to Kim Hemsley, Basin Solutions project director at Schlumberger Holditch-Reservoir Technology (H-RT), but:

  • Only 8.4 percent of these penetrated deeper than 15,000 feet.
  • Just 2.7 percent of the total wells reached 17,000 feet.
  • A minuscule 0.03 percent made it to 20,000 feet.

H-RT, which performed an analysis of the region's production history and potential, arbitrarily sets the boundary between conventional drilling and deep frontier at 15,000 feet.

"Most of these wells are concentrated in a small fraction of the land area there, leaving millions of acres of deep potential virtually untested," Hemsley said. "As a result, South Louisiana can be described as a mature infrastructure sitting on top of a deep frontier basin."

Other industry experts share this opinion.

"I certainly would agree with this assessment," said Charles Corona, manager of South Louisiana exploration at CNG. "When you look at a map of the region that depicts all wells drilled and another showing wells below 15,000 feet, you can really see it's not drilled up at those depths," the veteran South Louisiana geologist noted.

"And that's where we're finding sands of reservoir quality, where you can make good wells."

But don't hold a wake just yet for undeveloped production in old fields and conventional exploration at lesser depths in areas where 3-D has yet to be applied.

"I'm optimistic about South Louisiana in general because of all the 3-D that's been shot," Corona said. "It's intriguing to see areas I've worked all my life and now see what they really look like."

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South Louisiana isn't all drilled up. It's actually a whole new exploration frontier.

Before you scoff, take a look at some of the numbers to support such a seemingly outlandish statement.

A total of 70,200 wells have been drilled in South Louisiana, according to Kim Hemsley, Basin Solutions project director at Schlumberger Holditch-Reservoir Technology (H-RT), but:

  • Only 8.4 percent of these penetrated deeper than 15,000 feet.
  • Just 2.7 percent of the total wells reached 17,000 feet.
  • A minuscule 0.03 percent made it to 20,000 feet.

H-RT, which performed an analysis of the region's production history and potential, arbitrarily sets the boundary between conventional drilling and deep frontier at 15,000 feet.

"Most of these wells are concentrated in a small fraction of the land area there, leaving millions of acres of deep potential virtually untested," Hemsley said. "As a result, South Louisiana can be described as a mature infrastructure sitting on top of a deep frontier basin."

Other industry experts share this opinion.

"I certainly would agree with this assessment," said Charles Corona, manager of South Louisiana exploration at CNG. "When you look at a map of the region that depicts all wells drilled and another showing wells below 15,000 feet, you can really see it's not drilled up at those depths," the veteran South Louisiana geologist noted.

"And that's where we're finding sands of reservoir quality, where you can make good wells."

But don't hold a wake just yet for undeveloped production in old fields and conventional exploration at lesser depths in areas where 3-D has yet to be applied.

"I'm optimistic about South Louisiana in general because of all the 3-D that's been shot," Corona said. "It's intriguing to see areas I've worked all my life and now see what they really look like."

Room to Roam

There's certainly plenty of underexposed 3-D data available for exploring a lot of territory.

During the early 1990s, major new discoveries in such locales as the Lake Arthur complex, Fresh Water Bayou and West Chalkley in southwestern Louisiana's coastal zone encouraged companies working there to begin applying 3-D evaluations over their existing fields.

Many of the early surveys, according to Hemsley, were small, under-resourced and, therefore, poor quality.

Given the complex physical environment of this region, particularly in the transition zone, and the pricey state-assessed permitting fees for seismic data acquisition, 3-D surveys are inherently expensive in South Louisiana. Even so, as the decade progressed, 3-D exploratory success rates offshore together with increasingly higher gas prices triggered a rush to acquire high quality 3-D data there.

The most ambitious single program to come out of this was the Schlumberger Geco-Prakla Transition 2000, which grew to over 3,000 square miles of data that covered 2,000,000 acres.

"By creating such a high-quality regional dataset, we hoped to give the industry its first serious look at the untapped deep potential in South Louisiana," said Doug Elrod, business development at Geco-Prakla.

The ensuing downturn in the industry put this exploration exercise on hold.

Now, however, as exploration and drilling slowly rev up once again, there's likely a huge audience soon to be clamoring for a look at these data. The hydrocarbon production potential is tantalizing.

Some 50 fields have been discovered in South Louisiana's hydrocarbon-rich Miocene-Oligocene section that have produced more than 500 Bcf of gas, according to Hemsley. Sixteen fields produced over one Tcf, with four of these giving up more than two Tcf.

Only time will tell if these numbers can be duplicated by imaging and drilling previously untapped deep structures.

Impressive results from early activity, however, hint of possible vast finds that await the drill bit.

Confidence Builder

One relatively new discovery based on the recent 3-D data is the UPR Etoufee Prospect in Terrebonne Parish. The initial well reached 19,270 feet total depth and logged a gross pay interval of more than 260 feet starting at 18,500 feet.

Total reserves for the well could be more than 50 Bcfe, according to the company.

The prospect has the structural extent and pay thickness to potentially contain several hundred Bcfe of reserves. A second well is drilling there.

"Fresh Water Bayou and Etoufee and others have shown big, thick stacked sands with all of the right engineering parameters down deep," Hemsley said, "and the deeper reserves seem to be more productive on average. The deep, thick geopressured sands produce like gangbusters."

But a note of caution comes from one industry geologist who has prospected this region for a number or years.

"The bottom line is that 3-D is imaging deep structures and high pressures that 2-D couldn't do adequately, and many deep structures will be found," said Dan Smith, a Houston-based independent/consultant, "but you must have reservoir rock as well.

"There are a lot of trends in South Louisiana where you don't have the sands deep, or if you do, they're not good producers, so a lot of this region is hard to play deep," Smith said.

"On the other hand, in a trend like the Rob L-Operc, the whole trend is known for good, deep reservoir sands that produce well," he added, "so you can go there with a great deal of confidence."

Room for Independents

The recent spate of big-company mergers and such has caused a spin-off of lots of properties that are being snapped up by the not-so-big oil finders. So the opportunity exists for smaller companies and the independents to drill the lion's share of future wells.

And the 3-D data needed to adequately explore and exploit these properties may, for the first time, be affordable to most all who need them, thanks to an entrepreneurial prospect generator in Lafayette, La.

"As an independent, my problem is that I have to have 3-D to prove up a prospect and sell it, but I can't afford it," said Frank Limouze, manager of View Seis Partners, "and yet I can't afford not to have it."

To remedy this dilemma both for himself and lots of other prospectors, Limouze approached seismic data owners a year ago with a whole new business model to allow him to market their 3-D data to independents and small operators. Marketing data via the model would give these clients controlled access to small amounts of data for a modest down payment, or "viewing fee," as Limouze calls it.

"The bulk of the money, or the real expense, is deferred until some big event takes place, like spudding a well, purchasing a significant lease or something like that," he said. "The real value is I'm putting data in the hands of people on their own, or very small companies, who are the real creative generators in this business."

He noted that in the long term his new business model also will give the seismic companies a better return on their investment.

Although Limouze is focusing his efforts on the players who likely would concentrate their activity in the shallower plays, he is openly optimistic about the deep section potential.

"It seems with each step forward in technology, like acquisition or processing, we somehow add significant reserves to the reserves base, and depth is in one degree another step forward," he said. "In South Louisiana, we've long since passed the idea of no pay below pressure, so it's a matter of the companies moving forward and taking those risk steps of drilling the deeper, more expensive wells for the return that lies there.

"I think we're poised on the edge of significant new drilling activity and discoveries both shallow and deep in South Louisiana and the Gulf Coast as a whole."