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New wolfcamp data

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Re: New wolfcamp data

Unread postby AdamB » Wed 30 Jun 2021, 17:37:10

$this->bbcode_second_pass_quote('mustang19', 'D')ennis is getting destroyed on his blog. Fortunately he has the sport to not delete the replies.


Dennis is a big boy, and unlike you is both published, and capable of defending himself in a logical and reasonable manner.

Run along and go troll him.
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Re: New wolfcamp data

Unread postby dcoyne78 » Thu 01 Jul 2021, 17:43:25

Link to recent Permian projection

https://peakoilbarrel.com/annual-reserv ... ent-720056

46 Gb for URR assumes well completion rate increases from about 350 to 624( maximum level) Oil prices (Brent in 2021 $) are assumed to rise to $80/bo max in Dec 2021 and remain at that level until 2033 then decline to $60/b by 2050, obviously we don't know future oil prices. The USGS mean estimate for the Permian basin (75 Gb from 49 million net acres) is used as the basis for the scenario along with well profiles estimated using data from shaleprofile.com and well completion data and output data from shaleprofile.com.

Projections from Jan 2020 to Dec 2046 ar based on my model and the economic assumptions (fixed well cost of $10 million in 2020$, royalties and taxes at 28.5%, transport cost to refinery of about $4/bo, NGL sold at 25% of crude cost, NG sold at $2/Ncf, I also find well profiles for natural gas from Permian basin wells and assume barrels of NGL per 1000 cf NG produced is at average level for New Mexico and Texas combined.

I assume 200 acres per well for this model with 8500 foot average lateral lenth and 1000 foot well spacing.

Oil pros at POB suggest that spacing is too close and suggest 4 wells per mile or 1360 foot spacing, that would bring each well to 258 acres per well (1360 by 8500 feet). A new model was tried with these parameters, but oil pros still think it is much to optimistic. The new model reduces TRR to 60 Gb (perhaps an F70 TRR based on USGS estimates of Permian basin) and has a URR of 40 Gb.

Link to that lower scenario below

https://peakoilbarrel.com/annual-reserv ... ent-720175
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Re: New wolfcamp data

Unread postby AdamB » Thu 01 Jul 2021, 18:56:29

$this->bbcode_second_pass_quote('dcoyne78', '
')Oil pros at POB suggest that spacing is too close and suggest 4 wells per mile or 1360 foot spacing, that would bring each well to 258 acres per well (1360 by 8500 feet). A new model was tried with these parameters, but oil pros still think it is much to optimistic. The new model reduces TRR to 60 Gb (perhaps an F70 TRR based on USGS estimates of Permian basin) and has a URR of 40 Gb.


And what do oil pros think additional recovery (expressed as the higher recoverage percentage after infill drilling or infill well EUR volume) from infill drilling either of those 2 spacing estimates might be?
Plant Thu 27 Jul 2023 "Personally I think the IEA is exactly right when they predict peak oil in the 2020s, especially because it matches my own predictions."

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Re: New wolfcamp data

Unread postby dcoyne78 » Thu 01 Jul 2021, 19:36:11

One claims a child well will be about 60% of the EUR of the parent and would require much higher oil prices than $80/bo for an adequate ROI, perhaps $150/bo would do it in their opinion. These are guys who own a Working interest in Permian basin tight oil wells. Initially they though they would be able to complete 1200 wells on their leased acres, now they expect perhaps 450 wells will be viable at current oil prices.

The short answer is no additional EUR unless oil prices double.

I have read elsewhere (JPT) that 1000 foot spacing is likely optimal, that was the basis for my initial model, LTO survivor says no way as does Mike Shellman.

The research suggests that anything tighter than 1000 feet will lead to too much well interference. Much depends on the assumed oil price, if we assume a real Brent price of $200/bo in 2021 $ from 2025 to 2040, we would likely get a 75 Gb URR, if we assume the mean USGS estimate is correct, it could of course be too low, if we assumed the F5 estimate was correct (114 Gb TRR) then the URR might rise to 100 Gb to 110 Gb.

I doubt Brent oil prices in 2021 $ will rise to $200/bo for a sustained period (12 months or more), though $120/bo seems possible, it depends in part on the speed of the transition to electric transport, imo.
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Re: New wolfcamp data

Unread postby AdamB » Fri 02 Jul 2021, 01:04:07

$this->bbcode_second_pass_quote('dcoyne78', '
')The research suggests that anything tighter than 1000 feet will lead to too much well interference.


And what, in your mind, is "too much"? Because in a potentially infinitely variable price environment, one additional barrel at $20,000,000/bbl would be quite profitable, and we aren't talking about any single answer here, but a spectrum of answers based on each well's unique geology. Obviously I exaggerate for effect, but resource cost curves are curves for a reason.

$this->bbcode_second_pass_quote('dcoyne78', '
') Much depends on the assumed oil price, if we assume a real Brent price of $200/bo in 2021 $ from 2025 to 2040, we would likely get a 75 Gb URR, if we assume the mean USGS estimate is correct, it could of course be too low, if we assumed the F5 estimate was correct (114 Gb TRR) then the URR might rise to 100 Gb to 110 Gb.


Don't assume. Calculate the answer for them all, assign probabilities to the prices based on whatever your instinct or someone else's experience tells you, and create answers based on that probabilistic price path.

$this->bbcode_second_pass_quote('dcoyne78', '
')I doubt Brent oil prices in 2021 $ will rise to $200/bo for a sustained period (12 months or more), though $120/bo seems possible, it depends in part on the speed of the transition to electric transport, imo.


I was in industry when we doubted that prices could ever break $30/bbl. Except in the late 70's when doing reserve studies at the consulting firm I was with at the time, we escalated them in future looking price cases when trying to sell LPs. The Secretary of Interior once claimed just that, "never see $30 oil again", in the late 1990's. We've already seen both $150/bbl, and $0/bbl. And the speed of electric transport is a demand side effect, you haven't mentioned building in a dependency of price on demand effects yet, which is entirely a different dimensional complication. " I think electrics will do this to demand, and lessening demand will do this to price". Which then requires a recalculation of supply, as marginal barrels are taken offline, natural decline predominates, and it becomes a race between slowing demand, less supply, and potentially lower prices.
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Re: New wolfcamp data

Unread postby dcoyne78 » Fri 02 Jul 2021, 09:53:12

Adam,

Too much well interference is an amount that reduces new well EUR to a level that is no longer profitable at prevailing oil prices, average well costs, OPEX, transport cost and royalty and tax expenses. I try not to state the obvious.

My scenario uses prices that I believe are realistic. They are fairly close to the AEO reference oil price scenario through 2033, after that I expect transition to EVs to reduce demand and lead to falling oil prices, the price decline I assume is quite conservative (twenty real dollars per barrel in 2021$) over 17 years.

If the USGS mean TRR estimate is correct, then no price (even $20,000 per barrel) would increase URR beyond that point. I don't think $20,000 per barrel is a very realistic estimate. Perhaps $200/bo is possible, but I think an upper limit of $120/bo by 2033 is more reasonable.

If you have an oil price scenario you believe is reasonable, lay it out and I can run it. That basically includes the demand side.

My scenario has prices rise for current monthly average price to $80/b in 2021$) by Dec 2021, flat prices to Jan 2033 and than a decrease in price by 10 cents per month every month through Sept 2059 (end of scenario) all prices are in real 2021 US$, and these are Brent oil prices.
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Re: New wolfcamp data

Unread postby mustang19 » Fri 02 Jul 2021, 13:18:46

$this->bbcode_second_pass_quote('dcoyne78', 'A')dam,

Too much well interference is an amount that reduces new well EUR to a level that is no longer profitable at prevailing oil prices, average well costs, OPEX, transport cost and royalty and tax expenses. I try not to state the obvious.

My scenario uses prices that I believe are realistic. They are fairly close to the AEO reference oil price scenario through 2033, after that I expect transition to EVs to reduce demand and lead to falling oil prices, the price decline I assume is quite conservative (twenty real dollars per barrel in 2021$) over 17 years.

If the USGS mean TRR estimate is correct, then no price (even $20,000 per barrel) would increase URR beyond that point. I don't think $20,000 per barrel is a very realistic estimate. Perhaps $200/bo is possible, but I think an upper limit of $120/bo by 2033 is more reasonable.

If you have an oil price scenario you believe is reasonable, lay it out and I can run it. That basically includes the demand side.

My scenario has prices rise for current monthly average price to $80/b in 2021$) by Dec 2021, flat prices to Jan 2033 and than a decrease in price by 10 cents per month every month through Sept 2059 (end of scenario) all prices are in real 2021 US$, and these are Brent oil prices.


Permian wells do 400k with 1 mile spacing. Your "estimate" requires the entire Permian to produce at the level of prime acerage.

So it can be dismissed as asinine but you obviously don't care.
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Re: New wolfcamp data

Unread postby mustang19 » Fri 02 Jul 2021, 15:51:52

$this->bbcode_second_pass_quote('AdamB', '')$this->bbcode_second_pass_quote('dcoyne78', '
')Oil pros at POB suggest that spacing is too close and suggest 4 wells per mile or 1360 foot spacing, that would bring each well to 258 acres per well (1360 by 8500 feet). A new model was tried with these parameters, but oil pros still think it is much to optimistic. The new model reduces TRR to 60 Gb (perhaps an F70 TRR based on USGS estimates of Permian basin) and has a URR of 40 Gb.


And what do oil pros think additional recovery (expressed as the higher recoverage percentage after infill drilling or infill well EUR volume) from infill drilling either of those 2 spacing estimates might be?


https://www.aogr.com/uploads/content/w10-2_fig_2.jpg

Any overlap pretty much totally destroys any overlapping output.
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Re: New wolfcamp data

Unread postby mustang19 » Fri 02 Jul 2021, 18:00:04

People get confused overlap vs spacing. Wells can be next to each other and not interfere at all. It's the overlap that matters and it gives much worse results than just spacing.
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Re: New wolfcamp data

Unread postby AdamB » Sat 03 Jul 2021, 00:13:11

$this->bbcode_second_pass_quote('dcoyne78', 'A')dam,

Too much well interference is an amount that reduces new well EUR to a level that is no longer profitable at prevailing oil prices, average well costs, OPEX, transport cost and royalty and tax expenses. I try not to state the obvious.


Same here. So why did my comment on oil being worth $20,000,000/bbl skip right on past you as a demonstration that do you REALLY want to talk about TOO MUCH well interference? I'm effectively at mining costs at this point.

There are several reasons why the "shale revolution" happened, and one part of it was price. A price that could be seen decades earlier (reserve studies in the late 1970's at the consulting firm I was working for were escalating their future scenarios to $100/oil), but instead people pulled the CYA paragraph you just wrote as their defense for lack of imagination on a basic, obvious and completely reasonable future.

$this->bbcode_second_pass_quote('dcoyne78', '
')My scenario uses prices that I believe are realistic.


What does your limited view of "realistic" today have to do with your lack of imagination about what can happen tomorrow? I know you are familiar with far more than basic stochastic modeling, why won't you apply that to your model?

$this->bbcode_second_pass_quote('dcoyne78', ' ')Perhaps $200/bo is possible, but I think an upper limit of $120/bo by 2033 is more reasonable.


And what does "reasonable" have to do in the future? Is $200/bbl possible? Of course it is. Oil can be TAXED to that level, let alone all the myriad of future events that could drive it higher. Can it be far lower? Sure it can, we've already seen $0/bbl within the past 18 months.

$this->bbcode_second_pass_quote('dcoyne78', '
')If you have an oil price scenario you believe is reasonable, lay it out and I can run it. That basically includes the demand side.


Run them all. Crash the price of oil, create a supply side future. Skyrocket the price of oil, create a supply side future. Do everything in between. And then present that data in such a way as to demonstrate the sensitivities to those changes, effectively you'd be calculating the price elasticity as part of that output.
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Re: New wolfcamp data

Unread postby AdamB » Sat 03 Jul 2021, 00:15:11

$this->bbcode_second_pass_quote('mustang19', '
')Permian wells do 400k with 1 mile spacing.


Run along child, the adults are speaking.
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Re: New wolfcamp data

Unread postby AdamB » Sat 03 Jul 2021, 00:28:04

$this->bbcode_second_pass_quote('mustang19', 'P')eople get confused overlap vs spacing.


I've never in a career heard reservoir engineers use the word overlap as a substitute or euphemism for well interference. Or production engineers. Or drilling engineers. Or managers. Or landmen. Or GIS folks. Or well tenders. Or secretaries at oil companies. Or the janitors.

Please name "the people" you are referring to. Besides yourself of course.
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Re: New wolfcamp data

Unread postby mustang19 » Sat 03 Jul 2021, 13:43:44

$this->bbcode_second_pass_quote('AdamB', '')$this->bbcode_second_pass_quote('mustang19', 'P')eople get confused overlap vs spacing.


I've never in a career heard reservoir engineers use the word overlap as a substitute or euphemism for well interference. Or production engineers. Or drilling engineers. Or managers. Or landmen. Or GIS folks. Or well tenders. Or secretaries at oil companies. Or the janitors.

Please name "the people" you are referring to. Besides yourself of course.


Well I posted a graph.

As always your posts are a whitenoise.
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Re: New wolfcamp data

Unread postby dissident » Sat 03 Jul 2021, 14:28:25

Why do the mods allow this abusive troll AdamB to pollute this board?

His smarmy drivel is totally content free.
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Re: New wolfcamp data

Unread postby Outcast_Searcher » Sat 03 Jul 2021, 14:51:46

$this->bbcode_second_pass_quote('dissident', 'W')hy do the mods allow this abusive troll AdamB to pollute this board?

His smarmy drivel is totally content free.

Many THANKS to folks like diss and Adamb for pointing out how WRONG folks like Mustang19 are.

As a layman re oil, but a person who follows science and the principles of science and math re reality, it would be very difficult for me to consistently catch him in his nonsense. So for the many folks in my boat, re our careers and oil expertise, again, thank you very much.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: New wolfcamp data

Unread postby AdamB » Sat 03 Jul 2021, 17:34:07

$this->bbcode_second_pass_quote('mustang19', '')$this->bbcode_second_pass_quote('AdamB', '')$this->bbcode_second_pass_quote('mustang19', 'P')eople get confused overlap vs spacing.

Please name "the people" you are referring to. Besides yourself of course.


Well I posted a graph.


So...now you want to demonstrate you can't read either?
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Re: New wolfcamp data

Unread postby dcoyne78 » Sun 04 Jul 2021, 09:44:39

AdamB,

The $200/bo has been run in the past, it comes pretty close to TRR for mean estimate, the zero oil price scenario would result in zero output in the future from tight oil, there are an infinite number of possible future oil price scenarios, running all of them would take a bit of time. See

https://peakoilbarrel.com/permian-basin ... aggerated/
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Re: New wolfcamp data

Unread postby AdamB » Sun 04 Jul 2021, 11:03:54

$this->bbcode_second_pass_quote('dcoyne78', 'A')damB,

The $200/bo has been run in the past, it comes pretty close to TRR for mean estimate, the zero oil price scenario would result in zero output in the future from tight oil, there are an infinite number of possible future oil price scenarios, running all of them would take a bit of time. See

https://peakoilbarrel.com/permian-basin ... aggerated/


You are thinking of this problem to much like a scientist. The answer isn't about absolute precision, think more like an arm waving economist instead. You don't need to run ALL prices to develop the outline of how they change production. Just enough to develop the outline. Turns out when you do this the results aren't unexpected, the model develops more oil and gas, and it develops it quicker. That part is easy, the larger issue is trying to figure out the demand response to accompany it. That one is the trick, what with environmental concerns, claims of action versus the expected reality of it, etc etc.
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Re: New wolfcamp data

Unread postby mustang19 » Sun 04 Jul 2021, 13:05:31

$this->bbcode_second_pass_quote('dcoyne78', 'A')damB,

The $200/bo has been run in the past, it comes pretty close to TRR for mean estimate, the zero oil price scenario would result in zero output in the future from tight oil, there are an infinite number of possible future oil price scenarios, running all of them would take a bit of time. See

https://peakoilbarrel.com/permian-basin ... aggerated/


Only a clown thinks oil companies care about prices. Many times, 2008, 1973, 1980 oil prices spiked and this did nothing to raise production. It's not even physically possible for anything besides eroi to matter.

But as always you have zero understanding of physics or even basic graph reading and don't care.
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Re: New wolfcamp data

Unread postby AdamB » Sun 04 Jul 2021, 15:09:15

$this->bbcode_second_pass_quote('mustang19', '
')Only a clown thinks oil companies care about prices.


Name any clown involved in developing, advocating for, receiving permission to do an oil and gas project and then accomplishing said project in the oil and gas industry that told you this. And then we can compare that to my experience running the production side of a small independent, where we cared about prices (oil and gas) every single day.

$this->bbcode_second_pass_quote('mustang19', '
') Many times, 2008, 1973, 1980 oil prices spiked and this did nothing to raise production. It's not even physically possible for anything besides eroi to matter.


As has been explained to you, and your puppets, neither you, nor oil company people, nor anyone else, ever, has used eroei as the measure of success or failure within the industry. Rockman just mentioned it again the other day. Pay attention to your betters, maybe you can work your way up from child-like troll to more like, pre-teen troll?

$this->bbcode_second_pass_quote('mustang19', '
')But as always you have zero understanding of physics or even basic graph reading and don't care.


Was that one of the ones you can't put in number order, or one you didn't annotate so no one knows what the chart was about, or some other phantasmagorical construct of your midget imagination as you apply it to an industry you know nothing about?
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