American Oil and Gas Reporter - PBIOS 2016 Official Program Guide - 109

Permian Basin Reports
depending on the area and zone in which
Concho is drilling.
"We have learned that slickwater and
higher proppant volumes improve productivity and offset incremental costs,"
she reveals. "We have used as much as
2,000 pounds of sand per lateral foot.
We are optimizing our efforts for each
zone in each area. How much sand we
use is based not only on cost, but on
maximizing rate of return."
As an example of what higher proppant
concentrations have meant, Hays points
to two wells in Upton County, Tx., that
averaged peak 30-day and 24-hour rates
of 1,070 boe/d (85 percent oil) and 1,420
boe/d, respectively.
Concho is carrying two-thirds of its
disposal water by pipe, which Hays calls
"a more efficient way of doing business."
The company also has built a 78-mile
water distribution network to move brackish water used for fracturing from one
field to another. Hays says Concho gets
its water from a variety of sources, including nonpotable groundwater and effluent water from the city of Midland, as
well as other sources.
Two years ago, Concho made an investment in an oil gathering line in the
northern Delaware Basin and now it is
making a similar investment in the southern
Delaware Basin. Hays says about 80 percent of the company's oil now soon will
be gathered on regional pipelines that
connect to long-haul pipes carrying the
oil to either Cushing, Ok., or to the Gulf
Coast.
Staying Active
Concho's production from Delaware
Basin horizontals totaled 88,500 boe/d
in the second quarter, up 8 percent over
second quarter 2015. Hays says the company drilled 28 gross wells in the Delaware
Basin: 12 in the Wolfcamp, nine in the
Bone Spring Sand, and seven in the
Avalon Shale.
She reports 24 horizontal wells in the
northern Delaware Basin with at least 30
days of production by the end of the
second quarter averaged peak 30-day and
24-hour rates of 1,100 boe/d (73 percent
oil) and 1,470 boe. The average lateral
length of those wells was 4,879 feet.
Concho also added four horizontal
wells in the southern Delaware Basin in
the second quarter with average peak 30day and 24-hour rates of 1,284 boe/d (77

percent oil) and 1,772 boe. Hays says
the company has focused on developing
the Wolfcamp zone in the southern
Delaware. It also achieved strong results
from a 3rd Bone Spring Sand delineation
well in its North Harpoon area and plans
to complete additional 3rd Bone Spring
Sand wells during the second half of this
year, she mentions.
Since 2013, she notes, Concho has
drilled and completed more than 90 horizontal wells in the Midland Basin. In
the early stages of development, average
lateral length was approximately one
mile. But coming into 2016, Hays says,
the company planned to drill substantially
all wells two miles in lateral length.
"Longer laterals are a key driver improving
the our capital efficiency," Hays says.
She says Concho also has brought its
horizontal drilling program to the New
Mexico Shelf, targeting the Blinebry and
Paddock zones.
"Horizontal drilling is breathing new
life into these legacy Shelf fields," she
affirms. "These are $2.5 million-$3.0
million wells, and we are using slickwater,
closer spacing, and more sand."
Concho added four horizontal wells
in the New Mexico Shelf in the second
quarter with average peak 30-day and
24-hour rates of 472 boe/d (82 percent
oil) and 592 boe. Average lateral length

was 4,655 feet.
Hays says the oil-rich Avalon Shale
in Lea County, N.M., continues to be a
key focus as well. She says the company's
Avalon Shale program has delineated
multizone bench potential targeting both
upper and lower zones within the Avalon.
"At year end, Concho reported 18,000
drilling locations," Hays boasts. "At roughly 200 wells a year, that is a lot of decades
of drilling opportunities. We think a call
for U.S. oil ultimately is a call for the
Permian Basin. We want to be a leader in
providing that oil."
Optimizing Completions
Pioneer Natural Resources grew its
oil production by 12,000 bbl/d in the
second quarter-a 10 percent increase over
the first quarter-driven by its Spraberry/Wolfcamp horizontal drilling program in the Midland Basin. The company
placed 69 horizontal Spraberry/Wolfcamp
wells on production, with 37 benefitting
from its Version 3.0 completion optimization program.
"We are tweaking fluid volumes, proppant concentrations, stage lengths, and
clusters per stage," observes Joey Hall,
executive vice president of Permian operations. "We are defining the upper limits
of water and sand, and the narrow limits

Pioneer Natural Resources is running 13 drilling rigs in the northern part of the Midland
Basin, but expects to increase that to 17 by the end of the year. The company, which
placed 69 horizontal Spraberry/Wolfcamp wells on production, grew its oil production
by 12,000 barrels a day in the second quarter, driven by its Midland Basin program.

OCTOBER PBIOS 2016 109

American Oil and Gas Reporter - PBIOS 2016 Official Program Guide

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