EOG To Plan Number Of Wells Per Year In Eagle Ford Based On Results Of Downspacing Study

In a recent investor presentation that was delivered at the 2013 Credit Suisse Energy Summit, EOG Resources’ Chairman Mark Papa responded to questions about the speed at which their Eagle Ford Shale drilling program will proceed.   In 2012 EOG Resources drilled about 300 wells in the play. Currently the company’s drilling inventory stands at around 3,500 wells, with that number possibly increasing if spacing is reduced to 40 – 50 acres to the well. At the very minimum, the company has at least ten year’s worth of drilling inventory in the Eagle Ford Shale.  EOG Resources is currently conducting down-spacing pilot projects in at least a couple of locations in the Eagle Ford Shale and results from those tests are expected sometime in the first half of 2013. The chairman explained that EOG is in the process of determining the optimum spacing for Eagle Ford Shale wells and inferred that the speed at which their drilling program proceeds will depend in large part on the final outcome of downspacing trials currently being conducted.

pumpjack in Eagle Ford

Above: Two new EFS wells belonging to EOG Resources near Tilden, TX.

A concern for EOG is to not drill too many wells on what could be “too wide of a spacing” and then face a more complicated drilling situation in the future, as “pools of depleted zones” or “pressure depletion zones” are encountered when trying to downspace the field.

It should be noted that when new wells are drilled in an area where both high pressure and depleted zones exist in the same formation, the the task of balancing the weight of the drilling fluid vs.  formation pressure becomes much more complex.  Drilling costs and the number of days required to drill each well also increases. If for example, a well is drilled through a zone of the Eagle Ford Shale which has been depleted by production and then a higher pressure zone is encountered, (where previous fracs did not reach and which has not yet been produced,) a “kick” or sudden imbalance in the drilling fluid could occur. Conversely,  large volumes of drilling fluid could be unexpectedly lost when the drill bit reaches depleted zones lacking normal pressure.

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