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Whales in the B.C. shales
EnCana Chief Executive Officer Randy Eresman is not given to superlatives.
So when he talks about British Columbia’s fast-emerging shale and tight gas resources as a “very hot topic,” it’s time to listen.
Even more than that Eresman and some of his senior executives provided insights — a rare commodity from the big independent, which generally confines itself to hard facts — into what they clearly perceive to be the high-potential plays in the northeastern region of British Columbia.
“We have built sizeable land positions in various emerging shales plays (in both B.C. and the United States) and believe that over time they have the potential to add significant depth to our very strong portfolio of natural gas assets across the North American unconventional fairway,” Eresman said.
Executive Vice President Mike Graham, while conceding the Horn River play, involving a joint venture with Apache, “is a large, virtually untapped natural gas resource that is still in the very early stages of development,” said EnCana, which has been assembling its land holdings since 2000, believes it has access to the “thickest, most prospective part of the play.”
50-100 well completions a year possible Graham said it is possible 50 to 100 well completions can be made every year over an area of 216,000 acres.
He also said that techniques EnCana has developed at its prolific Barnett shale operation in Texas will be applicable at Horn River, with the use of up to 20 wells per horizontal drilling pad reducing costs by 20-30 percent.
He said EnCana is currently drilling and completing four wells in Horn River, following the success of Apache’s three operated wells during the winter.
Graham said that will allow EnCana to develop a more detailed sense of Horn River’s commercial potential for release later this year.
Horn River discoveries EnCana’s enthusiasm for Horn River comes on the heels of the stunning announcements in recent weeks of discoveries in the Horn River shale basin, with Apache hiking its forecast to 9-16 trillion cubic feet from 3.6 tcf just five months ago and EOG Resources disclosure that it may have struck a 6 tcf play.
Further fueling the interest, Nexen said April 22 its drilling programs over the past two winters point to recoverable contingent resources on the Dilly Creek lands of Horn River of 3-6 tcf, assuming a 20 percent recovery factor and based on analysis by third-party consultants.
“There has been a lot of excitement over this play and we are very pleased to be a large part of it,” said Chief Executive Officer Charlie Fischer.
Nexen has accumulated 123,000 net acres of Devonian shale gas play in the past 18 months and holds a 100 percent working interest.
The Dilly Creek area covers about 85,000 net acres and, according to Nexen, has been compared to the Barnett Shale by other operators.
It said the average gross shale thickness at Dilly Creek is about 570 feet, which is almost 50 percent thicker than Barnett.
—Gary Park
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