Horizontal development of Wolfcamp/Cline pushes into easternmost Permian Basin

Many operators are adding the Cline Shale to their unconventional development portfolio in the Wolfcamp play in the eastern Permian Basin with some wells testing as high as 1250 barrels of oil daily. The jury is still out on the comparison of Wolfcamp-only production volumes to Cline-only production volumes to determine which zones are most productive. But the current tactic of commingling Cline production with the Wolfcamp production is providing better production overall.

As the West Texas Permian Basin enjoys its most recent renaissance, one of the liquids-rich plays leading the charge has been the Wolfcamp/Cline Shale. The highly touted Cline Shale has been a difficult Formation to track from an exploration standpoint. Although the Cline is a Pennsylvanian shale, it is referred to by multiple names and is frequently conflated with the shallower Wolfcamp (Lower Permiam age) section. Many operators refer to the Cline as the Lower Wolfcamp or the Wolfcamp D, but the formation is actually analogous to the older Pennsylvanian Cisco.

The Wolfcamp/Cline is being developed throughout the Midland Basin, often in stacked pays along the Spraberry Trend. But the target is also expanding eastward through exploratory horizontal prospects on the Eastern Shelf of the Permian Basin.

Devon/Sumitomo partnership

In late 2012, Devon Energy and Japan's Sumitomo Corp finalized a joint venture agreement in which Sumitomo paid $1.4 billion for 30 percent of Devon's interest in about 650,000 net acres in the Wolfcamp/Cline play. Devon has since been one of the leading operators along the Eastern Shelf. Most of the newly completed wells are being located in Garden City South field, a Wolfcamp/Cline oil accumulation initially contained within Glasscock County. Beginning in 2012, Devon completed a handful of horizontal Wolfcamp/Cline oil wells in Sterling County, which is just east of Glasscock County. The second of these Garden City South field wells-the 1H Virginia City Cole "C"-was tested at 327 barrels of oil, 558,000 cubic feet of gas and 1,417 barrels of water per day. By early 2014, Devon had permitted, drilled and/or completed horizontal Wolfcamp/Cline wells in Sterling, Mitchell, Scurry, Coke, Nolan and Fisher counties. The company's success has pushed the northeastern boundary of Garden City South field by some 70 miles. From late 2012 through early 2014, Devon completed more than 25 horizontal Wolfcamp/Cline wells in Garden City South field. Initial flow rates have ranged as high as 427 barrels of oil per day, with the company's first 26 wells averaging approximately 170 barrels of crude, 200,000 cubic feet of gas and 1,200 bbls of water daily.

Devon's horizontal Garden City South field program

Figure 1 Map of key counties and wells in the Wolfcamp/Cline play expansion. Gray lines show basin outlines for the Midland Basin, Eastern Shelf and Bend Arch on the east. Well spot symbols: ○ = permit ● = oil well

Other operators

In addition to Devon, horizontal Wolfcamp/Cline wells in Garden City South field are operated by a number of companies including Apache, COG Operating, Firewheel Operating, Laredo Petroleum and Oxy USA.

While Devon has been instrumental in expanding Garden City South field, Laredo Petroleum began drilling horizontal wells in the heart of the Wolfcamp play located in Glasscock County in late 2010. The Oklahoma City-based company continues to drill both horizontal and vertical wells in the Wolfcamp/Cline.

The biggest initial potential flow rate reported from a Wolfcamp/Cline well in the Garden City South field to date came from a Firewheel-operated producer drilled in Sterling County. The 41H H&H Ranch well was tested in late 2012 for 1,250 barrels of oil, 1,484,000 cubic feet of gas and 1,736 barrels of water per day from a fracture-stimulated zone at 8104-15,100 ft. During its first year and a half online, the well has recovered nearly 130,000 barrels of crude and 340 million cubic feet of gas.

Given these reported successes, expect to see more Wolfcamp/Cline drilling to delineate the economic extent of the play

Portions of this story have been excerpted from Energy News On Demand.

<p><em>Posted 10 June 2014</em></p>

This article was published by S&P Global Commodity Insights and not by S&P Global Ratings, which is a separately managed division of S&P Global.