Elevator Sub-Basins Draw Interest

Eastern New Mexico Lease Play

While rank exploration in the lower 48 states is becoming as rare as a rainstorm in the desert, some areas in the continental United States remain rarely touched despite their exciting potential for oil and gas reserves.

For one such area, that may be about to change.

A genuine exploration play seems to be gathering steam in eastern New Mexico, thanks to some good old fashioned geologic detective work by professionals at the state's Bureau of Geology & Mineral Resources.

Ron F. Broadhead and his bureau colleagues have developed a new geologic interpretation of the Tucumcari Basin that shows great promise for oil and gas exploration — and based on those findings, several independent companies are staking claims in what would be the basin's first sustained drilling program.

Broadhead calls the basin, which has four discovered but unexploited occurrences of oil and gas, "prime hunting ground."

One reason for the general neglect of the region is the area's Santa Rosa tar sands — briefly produced in the 1930s for road surfacing material — which led to an opinion of some operators that the basin contained only heavy oil in shallow zones, which would never amount to much.

Sporatic activity occurred over the next four decades, but since the early 1980s the basin was dormant until the turn of the century, when Broadhead's 20 years of geologic study in the area attracted attention.

A Lift from the Elevators

So what has the New Mexico Bureau of Mines and Mineral Resources determined that could change the fortunes of the Tucumcari Basin?

Image Caption

Tucumcari Basin, New Mexico, major fault trend.

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While rank exploration in the lower 48 states is becoming as rare as a rainstorm in the desert, some areas in the continental United States remain rarely touched despite their exciting potential for oil and gas reserves.

For one such area, that may be about to change.

A genuine exploration play seems to be gathering steam in eastern New Mexico, thanks to some good old fashioned geologic detective work by professionals at the state's Bureau of Geology & Mineral Resources.

Ron F. Broadhead and his bureau colleagues have developed a new geologic interpretation of the Tucumcari Basin that shows great promise for oil and gas exploration — and based on those findings, several independent companies are staking claims in what would be the basin's first sustained drilling program.

Broadhead calls the basin, which has four discovered but unexploited occurrences of oil and gas, "prime hunting ground."

One reason for the general neglect of the region is the area's Santa Rosa tar sands — briefly produced in the 1930s for road surfacing material — which led to an opinion of some operators that the basin contained only heavy oil in shallow zones, which would never amount to much.

Sporatic activity occurred over the next four decades, but since the early 1980s the basin was dormant until the turn of the century, when Broadhead's 20 years of geologic study in the area attracted attention.

A Lift from the Elevators

So what has the New Mexico Bureau of Mines and Mineral Resources determined that could change the fortunes of the Tucumcari Basin?

The most important finding was that favorable source rocks and reservoirs are present in elevator sub basins, where the depth to Precambrian may exceed 12,000 feet.

"Recent activity has been prompted by recognition that there is potential oil and gas resources in the basin," Broadhead said. "We have done a fair amount of research that indicates there are significant mature source rocks within these elevator sub-basins."

And that is "always the big question in modern exploration," he added. "Do you have a source, do you have a reservoir and do you have a trap?

"Certainly the documentation of thick mature sections of organic rich source rocks in the elevator basins — combined with all the shows that have been encountered over the years and heavy oil in Triassic-age reservoirs — indicate that a significant amount of hydrocarbons have been generated in the Tucumcari Basin," he said.

"That, in conjunction with a virtually wide open lease play where a small company can lease fairly large amounts of acreage relatively inexpensively and a strong gas market makes this region attractive."

Significant Source Rocks

Most recently Broadhead and his colleagues have focused on identifying the potential of source rocks in the Tucumcari — work that has helped touch off the current interest in the area.

According to him, the Pennsylvanian sediments contain the most significant petroleum source rocks.

"Underlying Mississippian strata, although thermally mature, contain insufficient total organic carbon for petroleum generation," he said. "Shallower Permian age and younger sediments either contain insufficient total organic carbon for major petroleum generation or are thermally immature."

The Pennsylvanian shales, however, contain enhanced levels of total organic carbon within the elevator basins. On the shelf areas the shales typically contain 1 to 2 percent total organic carbon, but in the elevator basins they contain 2 to 10 percent total organic carbon.

Thin coal beds also contributed to hydrocarbon generation in the elevator basins. Thermal maturity of the Pennsylvanian source rocks is higher in the elevator basins due to greater depth of burial. In the elevator basins most of the Pennsylvanian section is in the oil window, and in the deepest areas those sections may be in the condensate-wet gas window.

On the shelf areas, Pennsylvanian sediments are only moderately mature to mature and are generally in the oil window's uppermost part. The basin's heavy oil was thought to have been generated in Pennsylvanian source rocks and migrated into basal Triassic sandstones through major high-angle faults that form the elevator basins' boundaries.

After emplacement of the oil, it was biodegraded.

Broadhead cites several analogous occurrences of oil and gas from an elevator basin, including:

  • The Rhombochasm Field, which was discovered in 1989 in the Broken Bone graben on the Matador Arch in central Texas, produces from a similar setting.
  • The Wolf Flat Field, which produces from the southern rim of the Palo Duro Basin.

Independents' Day

This greater understanding of the elevator sub-basins is a big reason why several small independents have flocked to the Tucumcari.

"We have seen, among other things, a large lease play develop in the basin with several companies participating," Broadhead said.

The most currently active companies are Yates Petroleum, Coulthurst Management and Ceja Corp. Other active parties include Ace Petroleum, Roy Barton, Blanco Corp., Caza, CKG Energy, David Petroleum, DMT Energy, Ben Donegan, Ibis Petroleum, Inter-American Corp., Pitch Energy, Charles Reynolds, SDX Resources, Craig Settle, Strata View, Gene Wilson and Xeric, as well as local ranchers and land holders.

"Today large parts of the basin are under lease," he said.

So far three different companies have actually drilled wells:

  • CKG Energy has drilled several wells, and most have reported promising occurrences of gas and light liquids.

    "I don't know what they have established as far as production tests," Broadhead said. "We do know they have flared gas and had shows on the mud logs."

    The wells went to about 7,000 feet in the Lower Canyon.

  • Coulthurst Management in association with Gene Wilson drilled a well and reported good shows, and is now drilling a second well.

    Rig limitations precluded both companies from drilling to the Precambrian.

    "Expect the most mature source rocks to be present in the deeper parts," he said. "Although these wells did not test the lower Pennsylvanian section, it should be favorable."

  • Yates Petroleum has recently drilled a couple of wells, but results have not been released. Other operators will likely follow suit, "particularly if production can be established," Broadhead said. "The wells drilled to date confirm our geologic model."

    The encouraging aspect of this round of activity is the number of operators taking a position.

    "This time we are not dependent on one operator to drill wells," he said. "All these companies are pursuing their own ideas concerning reservoirs and traps, which increases the chances of seeing several wells drilled based on a variety of concepts.

    "That is something this basin has never seen," he added.

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