American Oil and Gas Reporter - August 2017 - 82
SpecialReport: Marcellus/Utica Update A Southwestern Energy rig is shown here drilling in the northern West Virginia Panhandle, where the company has Marcellus, Utica and Upper Devonian targets, thanks to a 2015 acquisition. Southwestern says its first Utica well was flowing at 17 million cubic feet a day in April, and has an estimated ultimate recovery of 2.5 billion-3.0 billion cubic feet per 1,000 feet of lateral. result of completion and optimized flowback changes being implemented, he says the average EUR improved by more than 25 percent compared with historical well results in Susquehanna County. Southwestern also placed seven delineation wells to sales in Tioga, Wyoming and Susquehanna counties in the first quarter. The two wells in Tioga County each had an average lateral length of 6,700 feet and an average 30-day rate of 13 MMcf/d. Bergeron says these wells are expected to improve as compression is added. He says the two wells in the western part of Susquehanna County-on acreage acquired in 2015-are outperforming offsets by more than 100 percent and each had an average 30-day rate of 15 MMcf/d. Thanks to the successful results in these areas, Bergeron says Southwestern has derisked approximately 40,000 net acres and plans to continue delineation efforts throughout this year. Dell'Osso says Southwestern has access to multiple high-quality pricing locations through its low-cost, integrated firm transportation portfolio. He acknowledges that Southwestern previously built its northeastern Pennsylvania operations to win in a $4 gas price environment, but says it has chased improvements to make its operations profitable at lower commodity prices. Del82 THE AMERICAN OIL & GAS REPORTER l'Osso says the company has restructured many of its gathering agreements, which in turn has lowered its cost structure. He indicates Southwestern also has used a hedging program to manage and mitigate risk, and to buffer the company against price volatility. Stacked Pays Meanwhile, Southwestern's operations in West Virginia and southwestern Pennsylvania target stacked pays that include the Marcellus, Utica and Upper Devonian formations. "We have nothing west of the Ohio River," remarked Derek Cutright, Southwest Appalachia division leader in June. "The majority of our wells are in the Marcellus. We have more than 300 producing Marcellus wells and three Utica/Upper Point Pleasant wells." Southwestern acquired the assets in late 2014 and early 2015, and has approximately 321,000 net acres and plans to turn 52-60 wells to sales in 2017. "The majority of activity is in West Virginia's northern panhandle, which is liquids rich," Cutright continues. "The Marcellus has about 40 percent gas and 60 percent liquids. As you go south into Wetzel County, it is the reverse: about 60 percent gas and 40 percent liquids. Most of West Virginia is liquids rich. As you move east into Greene County, Pa., you are back into dry gas." The Utica formation, which lies below the Marcellus Shale, is dry gas, according to Cutright. He says Southwestern is in the delineation phase of its Utica exploration to determine what the Utica offers to compete with its Marcellus operations. The company's first Utica well, the OE Burge, was flowing at a flat rate of 17 MMcf/d in April with more than 8,500 psi of pressure. Early results indicate this well is top quartile for the region, with an EUR of 2.5 Bcf-3.0 Bcf per 1,000 feet of lateral. Bergeron claims this type of productivity shows the Utica's potential in the company's estimated 1,400 locations. Cutright explains that Southwestern continues to look for ways to make improvements within its performance strategy of completion optimization, lateral placement and flowback techniques to maximize hydrocarbon recoveries. "We have moved our completion strategy from 1,700 pounds of sand per foot to 2,500 pounds per foot with positive results (about a 20 percent improvement in EUR)," he offers. "We are testing 2,500-3,500 pounds per foot in the liquids-rich wells. In fact, we have tested as high as 5,000 pounds per foot, although we have pulled back from that. We are in phase two of testing with a more intensive completion strategy, and we are seeing a 40 percent uplift." Southwestern placed five wells on line that tested tighter stage spacing and increased proppant loads. Four of them were completed utilizing 140-foot stage spacing and 3,500 pounds of proppant per foot, while the fifth well utilized as much as 5,000 pounds of proppant per foot. The company is continuing to monitor these five test wells to determine longterm performance enhancements, according to Cutright, but early indications are that all five will perform better than their closest offsets. He says Southwestern continues to challenge its completions-optimization team to accomplish more with less cost. A Shift To E&P Much of CONSOL Energy's 153-year history in the Appalachian Basin involved coal mining. But Brian Aiello, director of communications for CONSOL, says the company expects to complete splitting
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