Marcellus Shale Well Produc on Analysis - Powell Shale Digest

<strong>Marcellus</strong> <strong>Shale</strong> <strong>Well</strong> <strong>Produc</strong>0on Analysis
Will Bracke7
Managing Editor,
Powell Barne7 <strong>Shale</strong> Newsle7er
2010 <strong>Marcellus</strong> Summit: Building a Sustainable Future
October 11, 2010

• About us
Introduc)on
• Weekly online newsle5er since 2003
• Expanded to cover <strong>Marcellus</strong> in 2008
• <strong>Produc</strong>)on research on Barne5
• Research on Haynesville, Eagle Ford
• Couldn’t do <strong>Marcellus</strong> – un)l now

Un)l Now PA Data Confiden)al
• PA law allowed operators to keep
produc)on data confiden)al for 5 years
• Other states require monthly disclosure
• Why other states require disclosure but
not PA?
• Severance tax a big reason why
• Push to change PA law to be more like
other states, s)mulate <strong>Marcellus</strong> interest

PA Disclosure Law Changed
• Sen. Gene Yaw, R-­‐Lycoming Co., introduced
bill to change disclosure requirements
• Yaw’s bill: <strong>Produc</strong>ers must report
produc)on data to DEP every six months
• Bill passed, signed into law in March 2010
• DEP required ini)al repor)ng of data for
one year, July 1, 2009 through June 30,
2010
• Every six months from then on

First Release of Data
• DEP required operators to submit data by
Aug. 15
• All but 18 producers complied
• Data not expected un)l Nov.
• DEP surprisingly released data on Sep. 7
• Data released as Excel spreadsheet on DEP
website

PA Data Differs from Other States
• Full of extraneous info
• No first produc)on month/year
• No last produc)on month
• No monthly data, so no decline curve
es)mate
• Only number of producing days in 365-­‐day
period reported for each well
• No classifica)on of horizontal, ver)cal, etc.
• Significant <strong>Marcellus</strong> produc)on prior to
period reported -­‐ not reflected here

Disclaimer
• Remember: This analysis is only a “snap-­‐
shot” of the 365-­‐day period between July
1, 2009 and June 30, 2010 and therefore
doesn’t reflect the complete history of any
operator or county in the <strong>Marcellus</strong> <strong>Shale</strong>.

The Overall Numbers
• 633 producing <strong>Marcellus</strong> wells in period
• 23 coun)es with at least one well
• Total produc)on: 179,779,048 MCF gas
and 590,110 BO (barrels of oil/condensate
– SWPA only)
• 136,710 total well producing days
• Daily avg: 1,315 MCF/D + 4 BO/D – very
impressive!

Coun)es with <strong>Marcellus</strong> <strong>Produc</strong>)on

NEPA Tops in Period
• 29 of 31 top producers in Bradford,
Susquehanna, or Tioga coun)es
• All top 10 and 14 of top 15 wells are in
Susquehanna or Bradford
• Top well: Chesapeake Clapper #2H in
Susquehanna – 2.84 BCF in only 270 days,
an avg. of 10.52 MMCF/D
• Comparison: Top Barne5 producer with
5.1 BCF -­‐ in five years!

Top <strong>Marcellus</strong> <strong>Produc</strong>ers
Source: The Scranton Times-­‐Tribune

County Analysis
• Bradford tops in daily avg. at 3,436 MCF/D
• Bradford tops in total produc)on at 48 BCF
• Five coun)es – Bradford, Susquehanna,
Washington, Tioga, & Greene account for
90 % of gas produc)on in period (and 75%
of producing wells)
• Washington, Butler only coun)es with
significant oil/condensate produc)on

All Coun)es by Gas Daily Avg.

Top Coun)es by Gas Daily Avg.

All Coun)es by Total Gas <strong>Produc</strong>)on

Top Coun)es by Total Gas <strong>Produc</strong>)on

So How Does the <strong>Marcellus</strong> Compare?

2108 Permits in 2010 Through Sep. 1

950 <strong>Well</strong>s Drilled by Sep. 1, 2010

Recent Rig Count Comparison
DRILLING RIG COUNTS AT MAJOR SHALES
MAJOR SHALES 2Q1O 11-Jun 25-Jun 9-Jul 23-Jul 6-Aug 20-Aug 3-Sep 17-Sep Utilization
Barnett (Core) 67 68 61 64 60 66 64 68 70 99%
Barnett (Non-core) 12 15 16 19 21 20 23 20 20 69%
Total Barnett 79 83 77 83 81 86 87 88 90 90%
Eagle Ford 42 59 63 73 84 90 93 103 100 89%
Haynesville (LA (Core) 111 113 110 108 108 111 105 104 101 74%
Haynesville (LA Non-core) 10 16 13 14 16 15 17 14 19 100%
Haynesville (E. Texas) 59 57 58 58 56 53 51 47 47 87%
Total Haynesville 180 186 181 180 180 179 173 165 167 80%
<strong>Marcellus</strong> (PA) 76 86 85 90 101 94 104 102 103 78%
<strong>Marcellus</strong> (WV) 17 18 17 18 19 20 21 19 24 89%
<strong>Marcellus</strong> (Other) 2 2 1 3 4 5 4 2 3 43%
Total <strong>Marcellus</strong> 95 106 103 111 124 119 129 123 130 78%
Bakken (ND) 73 109 107 111 108 116 111 103 114 82%
Fayetteville 35 41 37 36 33 32 35 30 29 71%
Woodford 27 27 27 25 27 24 22 26 24 89%
Total <strong>Shale</strong>s 531 611 595 619 637 646 650 638 654 82%
Source: RigData - The Unconventional Drilling Report & The Land Rig Newsletter (800) 627-9785 www.rigdata.com

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Conclusions
• Again, only a 365-­‐day snap-­‐shot, but:
• <strong>Marcellus</strong> is not only big, but impressive
wells too – at least in some areas
• Best <strong>Marcellus</strong> wells compare very
favorably to those from other shale plays
• Northeast, Southwest to remain primary
development areas for now
• Next repor)ng deadline: Feb. 2011