The Delaware Basin Playmaker’s Forum, presented by the AAPG Division of Professional Affairs, will be held Feb. 22 in Midland, Texas.
The forum will include presentations given by leading experts from companies who have been successfully operating in the basin. A few of the presentations will be:
- John Polasek of Occidental Petroleum Corp., Oxy’s Interdisciplinary Method to Improve Well Performance and Achieve Profitable Production Growth
- Randall S. Miller of Core Laboratories, Tight Oil Reservoir Targets in the Delaware Basin
- Sarah Rittenhouse and Joanna Fritz of Devon Energy Corp., Generation of a Regional 3-D Pore Pressure Model for the Wolfcamp Formation in the Delaware Basin, New Mexico and Texas
- Donald Burdick of Panther Energy Company II, Building an Asset in Uncertain Times-The Panther Energy Delaware Basin Story
The Delaware Basin is located in the southwestern portion of the Permian Basin, straddling Texas and New Mexico.
Susan Nash, AAPG’s director of innovation and emerging science/technology, explained that it contains numerous vertical pay zones and new underexplored resource and shale plays. In addition, all of the zones can be exploited effectively with pad drilling.
During the downturn in the oil industry, many companies with operations and infrastructure in the basin struggled but are beginning to find their footing once again.
“It’s a place where companies that have invested heavily in gaining expertise in the latest techniques used in shale plays can have tremendous pay-off, as their knowledge allows them to effectively produce a complex stacked play that combines conventional reservoirs with resource plays,” said Nash.
Competition for sweet spots in the area have been heating up and can be fierce, she said.
“In January alone, several massive acquisitions were announced. They included WPX Energy’s acquisition of Panther Energy Permian holdings for $775 million in cash, Noble Energy’s acquisition of Yates Petroleum for $2.5 billion and the record-breaking ExxonMobil’s acquisition of the Bass Family’s Permian assets for $5.6 billion in stock,” she explained.
Today, 105 active horizontal rigs sit in the Permian and the number is expected to increase as companies secure acreage while oil prices are still low and productive leases are still available.
In a place where one acre can fetch as much as $40,000, it’s surprising to discover that companies are willing to pay the price.
“The Delaware Basin is one of the only places in the United States where companies can drill, complete and produce at a relatively low price. In some cases, operators are able to make money even at $25 per bbl.
“With companies able to hedge at $50 per barrel through the second quarter of 2018, it’s all about doing efficient factory drilling and really understanding the reservoir. This involves very detailed geological, geomechanical and geochemical studies as well as typical reservoir simulations. Economics are based on right around 1,900 Boe/d at more than 70 percent oil.
“So, in an environment where most experts do not expect to see oil prices rise much in 2017, the Delaware Basin is a perfect place to test just how low one can go in operating costs.
“If you are one of the companies that has invested heavily in the Delaware Basin, you are going to need to learn from the successful operators. And, you’re going to have to learn fast,” said Nash.
The Delaware Basin Playmaker’s Forum will be a great way to do so.
“The quick, effective knowledge transfer from the engineers and geologists who are doing the hands-on work in the Delaware Basin is the goal of the one day event.”
To learn more about the forum, visit http://aapg.to/delplaymkr.