American Oil and Gas Reporter - PBIOS 2016 Official Program Guide - 116

Permian Basin Reports
typical 2nd Bone Spring Sand well is 60
percent oil, 17 percent NGLs, and 23
percent natural gas, according to Helms.
EOG completed nine wells in the second quarter in the 2nd Bone Spring with
an average lateral length of 4,500 feet
and an average 30-day rate of 1,500
boe/d, of which 155 bbl/d was NGLs
and 1.4 MMcf/d was natural gas.
Starting Over
Midland-based Tall City Exploration
II LLC is preparing to return to the Permian Basin. It announced in May that it
had closed a $300 million equity commitment from private equity firm Denham
Capital. That investment follows the sale
of exploration and production assets by
Tall City Exploration, also a Denhambacked company, for more than $1.2
billion between November 2014 and November 2015.
"We started in 2012 with acreage in
Reagan and Howard counties in the Midland Basin," recalls Vice President of
Operations and Engineering Gary Womack. "We drilled all our acreage in less
than two years. We sold the Reagan
County piece to American Energy Partners
in 2014, and sold the Howard County
acreage to Surge Operating in 2015."
Now, Tall City Exploration II is looking
to acquire acreage. "We are looking for

stacked pays," Womack details, "and not
only in the Midland Basin. We are looking
at the Delaware Basin, where in some
ways, there is even more potential."
He says he expects Tall City II will
acquire acreage in both the Midland and
Delaware basins, adding that the company
could be drilling within 90 days after
purchase.
He acknowledges there has been a
big change since 2012-13 when Tall
City's original incarnation was active.
"The parcels available in the Midland
and Delaware basins are much smaller
now," Womack observes.
Prices for acreage in stacked Wolfcamp
pays can reach more than $30,000 an
acre, he says.
"But you can justify it with six benches
to drill," he exclaims. "With pilot pads,
and companies drilling 200- to 250-foot
stage spacing instead of 300-foot, and
lateral spacing as little as 180 feet, things
really have changed."
Commenting on improved stimulation
techniques, Womack says Tall City used
to pump 1,200 pounds (of proppant) per
foot. "Now, if you are not pumping 2,000
pounds per foot, you are being blown
away by the competition," he allows.
"Companies are using more water, too.
And they are experimenting with gel
fracs, although probably 90 percent of

The estimated ultimate recoveries of Laredo Petroleum's recent
Permian horizontal wells have exceeded type curves by 30 percent. Key drivers behind the
improved productivities are integrated earth modeling using all
available data to land laterals in
the best possible target zone,
and optimized completion designs, including pumping greater
volumes of proppant per foot of
stimulated lateral.

116 THE AMERICAN OIL & GAS REPORTER

the wells are being completed with slickwater fracs."
Womack says he is excited to be
preparing to jump into the Permian Basin
fray again. He expresses surprise that
acreage prices haven't dropped along
with commodity prices. But, he surmises,
"If you can drill an economic well at
$40, you can justify it."
Outperforming Type Curves
Integrated earth modeling, coupled
with continual completion optimization,
is allowing Laredo Petroleum's horizontal
Permian Basin wells to consistently outperform the company's type curves, according to Chairman and Chief Executive
Officer Randy Foutch.
"The earth modeling work is focused
on collecting and interpreting all available
data so we can increase the economics
of every well we drill," points out Foutch.
He adds, "We have gathered significant
core information, seismic, electric logging
and other data, and have participated in
joint ventures, including a massive study
with the Gas Technology Institute. We
are trying to land the lateral in the best
possible point in each zone, so the entire
lateral produces the most production after
we fracture. Integrating good data into
an earth model helps us make better decisions."
Combined with optimized completions,
including increasing the volumes of proppant pumped per frac stage, Foutch reports
Laredo's approach has resulted in its
more recent wells exceeding type curves
by 30 percent. As the company has gained
experience, he says it has experimented
with using more sand and water, as well
as changing frac stage spacing.
"We started with 1,000 pounds of
proppant per foot of lateral when we
drilled our first horizontal well in 2009,"
he relates. "We have tested 1,400, 1,800,
and even 2,400 pounds per foot. We have
seen good results by using more sand,
but it does cost more. We still are trying
to determine what the optimum amount
of sand is for the best results over the life
of the well."
Foutch cites the company's ability to
drill more footage in less time as one of
the ways in which Laredo has improved
efficiencies significantly. "Two years ago,
a rig could drill nine horizontal wells
with an average lateral length of 7,500
feet in a year," he says. "That is 60,000-

American Oil and Gas Reporter - PBIOS 2016 Official Program Guide

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