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When it comes to drilling technology, innovation occurs from the consistent refinement of older technologies.
“In the drilling business, you’re either getting beaten on, or beating on people every day to lower costs,” said James Wicklund, Carlson Capital, L.P. Wicklund recently presented at Hart Energy’s 7th Annual Developing Unconventional Gas (DUG) Conference in Ft. Worth, Texas, April 23-25.
Wicklund added, “There’s a constant struggle between E&P and oilfield services. It’s always a question of who is driving returns.”
Wicklund and Robert Banks, executive vice president and COO, Swift Energy, highlighted the recent advancements in drilling and completions technology. Most of these systems have been in existence for some time. Rather than being “new” technology, both Wicklund and Banks pointed out that the advent of shale technology has occurred more in a series of constant refinements.
The biggest deterrent to shale development in its earliest phase was the rapid rates of decline in most fields. “The trick is to lease the core interest first,” Wicklund said. “He who finds the best rock, wins.”
Definitely, the panel agreed that shale development has changed the paradigm for many operators.
Wicklund said, “The latest developments in the shale plays are not derived so much from new technology, but refinements of existing technology.” Areas like infill drilling, well construction (vertical vs. horizontal), extended reach and multi-laterals, and well management have all grown organically through incremental improvements. “Many of these techniques have been in use for decades,” Wicklund said.
Wildcatters as it were, have been the tradition for more than a century. The mode of operation: find a prospect, drill it, and hope for the best. Today’s shale environment has taken on more of a well manufacturing approach. Banks compared shale development to the building of a “resource factory.”
“Our model for a resource play is four distinct phases or time periods, with the first being the evaluation of data capture phase, second being appraisal of efficiency capture, third development and optimization capture, and finally, data capturing and commercial capture,” Banks said.
Technology refinement can only happen in an environment where well construction is done through experimentation with newer advances. As for Swift Energy, rotary steerable systems were adopted early for use in the field. “We also experimented a lot in the earlier time with innovative drilling concepts using rotary steerable systems versus mud motors. By the time we got to more advanced use of the rotary steerable, we really reduced our drilling times by using the rotary steerable system from vertical all the way to the curve to TD in a single run,” Banks said.
Banks also discussed Swift’s early adoption of slick water fracing technology. “Really we were pumping slick water fracs early on. These three to four thousand foot laterals, 11 – 13 stages , low viscosity, pumped 182,000 barrels of fluid per well, lower proppant concentration, mostly 100 mesh 40-70 white sand tail end with a res-encoded sand and very high pump rates,” Banks said.
“By adopting and developing a manufacturing phase in our Eagle Ford acreage, we were able to capture those efficiencies and drive costs down,” he said.
According to Banks, “The bottom line for successful shale development is driven by continuous improvement, embracing technology, and precisely managing all parts of the business.”