American Oil and Gas Reporter - May 2016 - 76

SpecialReport: Mid-Continent Activity Profile
designs, a shift to hybrid completions,
and higher per-well proppant volumes
and increased numbers of frac stages.
Hager says he expects future results
will continue to improve as optimal
landing zones are refined and well designs
continue to advance. He says Devon is
evaluating tighter spacing with ongoing
pilot programs as well.
The company is achieving accelerated
cost savings, Hager continues. Over the
past 18 months, he reports, drilling times
have improved by 40 percent to a record
spud-to-rig-release time of 21 days. With
these efficiency gains, he says Devon is
targeting Meramec costs of $6.0 million$6.5 million a well for standard-length
laterals (2,600 pounds of proppant a foot).
That represents a 20 percent decline in
per well costs since early 2015.
The company is realizing similar successes in the STACK Woodford. Hager
points out that 30-day IPs for the 29 wells
that reached peak rates during the fourth
quarter averaged 1,600 boe/d (52 percent
liquids). Those wells exceeded the company's type curve by more than 30 percent.
He says the results were driven by an enhanced completion design that uses 50
percent higher sand volumes.
Hager adds that Devon expects to run
four rigs (including nonoperated activity)
in the STACK this year, with the majority
of activity focused in the Meramec oil
window.
Devon also ran three operated rigs in
the Cana-Woodford in the fourth quarter,
and achieved significant drilling efficiencies, improving drilling times by 50
percent to a record spud-to-release time
of 20 days, he notes.
Exceeding Expectations
Marathon Oil Corp. brought four gross
company-operated wells on line in the
fourth quarter: two in the SCOOP Woodford, one in the SCOOP Springer, and
one in the STACK Meramec.
Speaking at the Scotia Howard Weil
Energy Conference, Lee Tillman, president
and chief executive officer, announced
that Marathon's first Springer well, the
Newby 1-7H, was performing above expectations with a 30-day IP rate of greater
than 1,000 boe/d (89 percent liquids). It
had 45 percent more cumulative boe in
its first 100 days, compared with other
company wells.
Tillman notes that the Newby 1-7H
used twice as much proppant and utilized
tighter stage spacing than offset wells. A
76 THE AMERICAN OIL & GAS REPORTER

second Springer well, an updip delineation
in Grady County, was scheduled to be
turned to sales late in the first quarter.
Two-thirds of Marathon's Oklahoma
activity is in the overpressured STACK
Meramec, according to Tillman. He says
STACK activity will dominate Marathon's
2016 play as it attempts to delineate the
condensate and volatile oil windows.
Much of its focus area is in Blaine County.
Tillman says Marathon secured an additional 12,000 acres in Blaine County last

year. He says the company hopes to have
70 percent of its STACK leasehold held
by production by year's end.
Marathon's Scheffler 1H9X well in
Blaine County had a 30-day IP of 1,843
boe/d (90 percent liquids). That well has
a 10,105-foot lateral. The Mike Stroud
1-28H well in southwestern Kingfisher
County, just outside Marathon's 2016
focus area, had a 30-day IP of 1,822
boe/d (60 percent liquids) with a 4,263foot lateral, according to Tillman.
❒

'Contrarian' Independents Are
Finding Traditional Success
By Al Pickett
Special Correspondent
Stephen Brunner calls his company's
strategy a "contrarian play."
While much of the U.S. oil and gas
industry is focused on horizontal drilling
in unconventional resource plays, Petro
River Oil is planning three distinctively
different projects, both in the United
States and internationally. The three projects have one thing in common, however.
He says each will employ vertical drilling
in conventional reservoirs, utilizing new
3-D seismic surveys.
"Our strategy evolved over a couple
of years, before oil prices tumbled," explains Brunner, president of Petro River
Oil. "We looked at the resource plays,
and they were so competitive it didn't
make sense to buy a position. We didn't
like the economics of the resource plays,
either, even when oil was $80 a barrel.
We want to be a conservative player and
use modern 3-D seismic to mitigate risk."
A public company, Petro River Oil
owns a 20 percent interest in privatelyheld Horizon Energy Partners LLC. Horizon Chief Executive Officer Jonathan
Rudney also serves as a senior adviser to
Petro River.
"Between Petro River and Horizon,
our technical team members each have
more than 30 years of industry experience,"
touts Brunner, who formerly served president and CEO of Constellation Energy
Partners as well as executive vice president
for Pogo Producing Company.
He says Rudney and other members
of the two companies' technical teams
are former senior executives with such
companies as Royal Dutch Shell, Texaco,

Pogo Producing, and Burlington Resources.
Petro River Oil is using that experience
as it develops several eclectic projects
ranging from California and Oklahoma
to Northern Ireland.
San Joaquin Basin
The San Joaquin Basin in California
is home to four of the largest oil fields in
the country, but Brunner says Petro River
is using new 3-D seismic data to find
areas that may not have been developed
with modern technology.
"Because computer technology is so
much better than even 10 years ago, we
are able to find areas that have not been
exploited fully," Brunner avers. "We are
drilling vertical wells only, which means
our costs are significantly lower. We think
our find-and-develop costs in the San
Joaquin Basin will be less than $10 a
barrel."
Petro River actually has two plays in
Kern County, Ca. One is Grapevine,
which Brunner says Rudney helped discover several years ago while running
with an independent E&P company. The
discovery well was lost as a result of mechanical complications, however, and the
operator was unable to fund redrilling.
That enabled Horizon to assemble a lease
position around the discovery.
The oil is sourced by the Monterey
Shale, and Brunner says Petro River is
acquiring a 27-square-mile 3-D survey
and is targeting the Stevens Sand, which
is located in the heart of the source
kitchen at around 15,000 feet. He claims
the discovery is estimated to contain 7.5
million barrels of oil.
Petro River also has assembled 7,000

American Oil and Gas Reporter - May 2016

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