For WPX Energy Inc., success in the low oil price environment requires staying “proactive and opportunistic” regarding the timing of well completions, Rick Muncrief, president and chief executive officer said in a Feb. 25 statement.
“You see everyone in the industry deferring completions, and that’s the thing when I think about being opportunistic. We just have to be careful … make sure we do the right thing; don’t get caught up in a herd mentality,” he said.
The company likely will direct much of its 2015 capital expenditures toward drilling forward in its schedule to give it flexibility to respond when oil prices rise.
In the Bakken, WPX will spend $200 million to $225 million of its anticipated total 2015 capital spending of $675 million to $775 million.
“This capital program considers drilling wells that are currently contemplated to be completed in 2016, yet gives us the optionality to complete in 2015 should we see a more favorable price environment,” said Kevin Vann, chief financial officer. “Also this program is heavily weighted during the first half of the year as we slow down our drilling program from 2014 into 2015.”
In 2015, the company plans a one rig drilling program in the Bakken, down from a five rig program in 2014.
Deep thinking
A slower pace in the oil field will free time for the WPX technical staff to make more rigorous studies of its acreage, and digest results of its completion testing and downspacing program.
WPX has added approximately 200 locations in the basin through an in-field density study, said Clay Gaspar, senior vice president of Operations and Resource Development.
The study is “exactly the sort of deep thinking, yet time-consuming work that we will be able to do in the slower activity during the year of 2015,” Gaspar said. “The team is doing a great job of dissecting every cost component, and are focused on the maximum value solution taking in all of the reservoir inputs as well as the real-time economic inputs, he said.”
Seeking ideal completion
Gaspar said WPX is experimenting with fracturing design and is “searching for that elusive ideal completion.”
One seemingly ideal component in WPX’s enhanced completion design arsenal ― the use of substantially more proppant per well.
In July 2014, WPX finished its first well completion using 6 million pounds of sand on the Ruby multi-well pad, twice the size of its historical Williston completions.
Frack sand isn’t the only proppant WPX is using more of. Despite the higher proppant loads it is using, WPX has no plans to reduce the use of ceramic proppants in its mix for the Bakken, Muncrief said in an August 2014 conference call.
Larger completions in the Bakken are accelerating production and increasing returns for WPX, Muncrief said in a November 2014 conference call.
As more of the high proppant wells come on line, WPX is seeing a hint of the promise they hold, he said. Updated type curves of the actual performance of the company’s larger stimulations exceeded a blended infield curve of middle Bakken and Three Forks wells completed with 3 million pounds of proppant.
Muncrief said the Ruby 31-30HX well exceeded the blended type curve by 25,000 barrels of oil or 53 percent in its first 86 days of production following cleanout, the Alfred Old Dog 30-31HD well beat the curve by 13,800 barrels or 35 percent in its first 67 days and the Morsette 35-26HD well exceeded the curve by 21,700 barrels or 74 percent in its first 47 days.
In some earlier wells, WPX used submersible pumps to maximize production near term; its large stimulation wells have needed no such boost.
“These wells are all flowing naturally, and we’re extremely excited about the productivity,” Muncrief said.
“These wells are all in a fairly close location to each other, so we need to spend a little more time; get a little more data ― but I can tell you that I personally am very interested,” Muncrief said. “And after spending a lot of time in the Bakken, I think that we’re going to continue to like the results.”
Muncrief said it will take time for WPX to test and assess the promise of its advanced completion designs across its Bakken acreage, adding, “I think we’ll have a good idea by year end 2015.”
