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Jean Marie keeps growing Miles of carbonate sands now sport gas estimates as high as 10 tcf Don Whiteley Petroleum News Contributing Writer
A natural gas play that 10 years ago would have been written off as uneconomic is rapidly becoming the hottest play in the Western Canada sedimentary basin. Thin carbonate sands called Jean Marie continue to be delineated over hundreds of square miles in Northeast British Columbia and are now sporting gas-in-place estimates as high as 10 trillion cubic feet.
Just how big it might be depends on whether you talk to the British Columbia Energy Ministry, The Canadian Gas Potential Committee, or EnCana Energy, the lead player among several companies now tapping into the play. While they may differ on the top end, all agree that it’s bigger than anyone thought possible even as recently as two years ago.
“It’s a huge play and it goes for hundreds of miles literally,” says Mike Graham, EnCana’s senior vice president, Foothills Region. “You just step out and it keeps growing. It looks like its gas charged right from the NWT right into the Rocky Mountains. It keeps growing.”
Graham says EnCana has bumped up its resource estimates, on its own Greater Sierra lands, from an original 5 tcf of gas in place and 2.5 tcf recoverable to 6.5 tcf in place and 4 tcf recoverable. For the entire formation, gas-in-place “is north of 10 tcf,” Graham said. Ministry still analyzing data The British Columbia Energy Ministry’s Carmine Vertone says he’s heard EnCana’s 10 tcf estimate, but isn’t prepared to put his own estimate out there yet because the ministry is still analyzing data.
It’s big,” he said. “It’s becoming one of the bigger producers. It’s not just the Greater Sierra — but it’s a multitude of plays in Jean Marie. Look at it as a huge blanket of sand spread hundreds of miles across.”
Vertone, who is also British Columbia’s representative on the Canadian Gas Potential Committee, said the Committee is in the middle of a major study designed to quantify the Jean Marie resource. Gas Committee Senior Analyst Rob Woronuk confirmed that, and said the committee hopes to have its conclusions ready by 2005.
“There’s no doubt the numbers will go up,” Woronuk said.
Other companies with Jean Marie interests include Penn West Petroleums and Canadian Natural Resources Ltd. Vertone said that, besides the Greater Sierra lands, activity is now taking place at Helmet, Gunnel, Midwinter, and Sahtaneh. Helmet was the original Jean Marie play which proved the effectiveness of horizontal drilling techniques developed in the late 1990s.
“They are all in the same area in the northeast corner towards Ft. Nelson,” he said. It extends into Alberta and into the Northwest Territories. It’s a huge blotch.” EnCana expects to increate production from Greater Sierra EnCana’s Graham said the company is now producing 250 million cubic feet of gas per day from Greater Sierra, and expects that to grow by at least 10 percent per year over the next few years.
“We’ll be over 340 million a day by 2004, and 400 million a day by 2005,” he said. “Over the next five years, we plan to drill 200 wells a year, split 50-50 between summer and winter operations. It’s an enormous program.”
All agree that the Jean Marie sands have this new-found production potential for three principle reasons: high gas prices that are expected to stay that way, advances in both seismic and drilling technology, and steadily declining costs.
“We’ve been relentless on our costs, driving them down so you’ve got a resource that you can turn into a reserve through lower costs and higher prices,” Graham said. He also credits the provincial government with its highly competitive royalty scheme and its commitment to develop infrastructure in support of the drilling operations. Challenge to determine resource numbers Woronuk says the Gas Committee, which has a reputation for being conservative, has an interesting challenge ahead in determining what kind of resource numbers it will ultimately place on Jean Marie plays.
“In normal plays with small pools, as the pools get smaller, they become less economic,” he said. At some point there’s a cut off. We’ll give you the distribution of pool sizes and each company will have its own version of the economic cutoff.
“But you can’t do that with continuous sands like Jean Marie — it’s almost like there’s just one pool and it’s a great big one. Sections are economic, and other sections aren’t. It’s not easy to say what the cutoff should look like. It’s like the Milky Way; clusters of stars but lots of dark matter. If you count that too, you get a misleading idea of the universe.”
Regardless of where the gas committee lands in its determinations, Jean Marie sands have already added significantly to British Columbia’s resource estimates, pushing them from 50 tcf to a range of 53 to 55 tcf. If EnCana’s view of the potential holds true, they’ll go higher still.
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