Drilling outside Oklahoma’s core fields

Associated Press

Oil production continues to expand throughout Oklahoma, including in areas outside the state’s two core fields.

The STACK and SCOOP fields are dominated by larger, independent oil companies that include Continental Resources Inc., Devon Energy Corp. and Newfield Exploration, the Oklahoman reported.

But smaller, private companies reported strong results in other parts of the state, such as the Merge between STACK and SCOOP, the Anadarko Basin in western Oklahoma, and the Arkoma Stack in southeast Oklahoma.

“Oklahoma is unique in how many stack interval plays are available,” said Rome Nichols, production manager for LeNorman Operating. “There are 14 different commercial targets in the Anadarko Basin.”

The state’s oil fields have the benefit of being near several pipelines, storage facilities, processing plants and refineries, according to operators. But Oklahoma’s production is still affected by changing patterns in the oil market.

Oklahoma’s production normally goes north to Midwest markets, which are now served primarily by production in Ohio and Pennsylvania. Because of that shift, Oklahoma’s production prices have been discounted as local producers face a higher cost to transport oil and natural gas.

Pipeline projects planned and under construction in Oklahoma hope to open up more capacity to move south and export terminals and chemicals plants along the Gulf Coast.

“Right now, the way the U.S. methane market is situated, the vast majority of producers are paying higher differentials than they’re historically used to just get gas to market,” said Scott Goodwin, vice president of operations at FourPoint Energy. “We’ve seen it just in the last month ease up very significantly. I think it will continue to ease up.”

- ASSOCIATED PRESS