American Oil and Gas Reporter - PBIOS 2014 Official Program Guide - 131

Permian Basin Reports
Upstream

ter. With Texas' drought, we are trying not
to use any potable water."
Because of that, Pioneer has an agreement to purchase effluent water from the
city of Odessa, eventually acquiring
120,000 bbl/d as that project ramps up.
"We are in similar negotiations with the
city of Midland," Dove mentions. "That
likely would include an upgrade to the
city's treatment facility. The Midland deal
could be 240,000 bbl/d of effluent water."
He says Pioneer is doing other things
to tackle the water issue, such as looking
at other nonpotable and brackish water
sources. Pioneer is building a high-tech
water system using sophisticated remote
telemetry, which Dove says will give his
company the ability to move water from
one operating area or source to another as
needed.
Pioneer, which is expecting to move
into its new headquarters in Midland in
November, also owns its own brown sand
mine near Brady, Tx., the closest source
of frac sand to the Permian Basin.
"We are mining 750,000 tons of sand
a year, and we are upgrading our mine at
Brady to add another 1 million tons a year,"
he says.
Dove also notes that bringing electricity to remote areas and finding more
people, as well as housing for those
workers, are critical needs as Pioneer
continues to ramp up its Permian operations. He adds that Pioneer and its principal partner, Atlas Energy, see the need to
build a new, 200 million cubic-feet-a-day
gas processing plant every 12-18 months
to keep up with the company's growth. Pioneer will have five gas processing plants
in the region with a total capacity of 855
MMcf/d by the end of 2015. Condensate
is being injected back into the crude oil,
according to Dove.
Turning To Horizontal
Pioneer has 7,000 vertical wells and
more than 300 horizontal wells producing
across the Permian Basin. Dove says the
company is running nine vertical rigs to
meet continuous drilling obligations, but
that number will come down to six next
year as Pioneer moves to more horizontal
completions.

Midstream

Downstream

Pioneer Natural Resources has
24 horizontal and nine vertical
drilling rigs operating in the Permian Basin. Most of the company's vertical drilling is Wolfberry
wells, which commingle the
Spraberry and Wolfcamp formations, although President and
Chief Operating Officer Tim Dove
says in most cases the company
drills on down to the Strawn or
Atoka zones. Pioneer's horizontal program is divided between
the Spraberry/Wolfcamp in the
north and its Wolfcamp joint venture with Sinochem Petroleum in
the south.

Most of its vertical drilling is Wolfberry wells, which commingle the Spraberry and Wolfcamp formations, although
Dove says Pioneer is drilling below the
Wolfcamp to either the Strawn or Atoka
zones in most cases. The vertical wells produce 70 percent oil and account for 40 percent of Pioneer's total production and 50
percent of its proven reserves.
Its horizontal program is divided into
two operating areas: its northern Spraberry/Wolfcamp acreage and the southern
Wolfcamp Joint Venture area. Pioneer
has 16 rigs operating across its 600,000
(gross) acres in the north, primarily
drilling off three-well pads targeting the
Wolfcamp A, B and D, and Lower
Spraberry zones.
However, Dove says Pioneer also is
testing horizontal drilling in the Jo-Mill
and Middle Spraberry zones. Additional
zones such as the Clear Fork, Wolfcamp
C, Atoka, Barnett and Woodford also
may be tested horizontally in the coming
years.
He says Pioneer is trying to drill
10,000- to 11,000-foot laterals, noting that
lessons learned in the Eagle Ford in
South Texas are being brought to the company's Permian Basin horizontal pro-

gram. Pioneer's completion optimization
program includes experimenting with fluids, more proppant per foot, cluster spacing, and more clusters per stage.
"We were very pleased to see a 20-30
percent increase in estimated ultimate
recoveries by optimizing our completion
techniques in the Eagle Ford," Dove exudes. "We have taken that same team into
the Permian Basin. It takes about 150 days
to bring these three-well pads on line, so
we will know more by the end of the year."
Dove recalls that in early 2013, Pioneer initiated a two-year horizontal
Spraberry/Wolfcamp drilling program to
delineate the northern part of its Spraberry acreage by drilling a highly successful
Wolfcamp B well in Midland County, Tx.
It then announced two additional successful wells in Midland and Martin counties,
which highlighted the Wolfcamp Shale potential the company now is exploiting
across its entire northern acreage position.
Meanwhile, in May 2013, Dove says
Pioneer closed a joint venture transaction
with Sinochem Petroleum, a subsidiary of
the diversified global conglomerate
Sinochem Group, to sell 40 percent of its
interest in 207,000 net acres of its horizontal Wolfcamp Shale play in the southern
OCTOBER PBIOS 2014 131

American Oil and Gas Reporter - PBIOS 2014 Official Program Guide

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