Hart Energy researchers completed interviews with nine industry participants, including four oil and gas operators, one seismic equipment representative, one seismic service provider, one completion consultant, and two wireline service providers. Several survey participants were located in the Permian Basin. Interviews were conducted during first week of December 2014.

Part I. – Survey Findings

Among Survey Participants:

  • Basic Wireline Logging Reported as Most Common Method a Downhole Data Acquisition [See Question 1 on Statistical Review]. Wireline logging remains the most common method of downhole data acquisition. Some respondents also mentioned sidewall coring, chemical and radioactive tracers, and microseismic. In addition, respondents said but the percentage of wells using more advanced data acquisition is rising slowly. Microseismic is used to occasionally tweak completions methodology, but is not reported as common among respondents. Respondents mentioned that 3D Seismic shared data is often used among area producers. A seismic service provider reported an increase in the percentage of well completions utilizing 3D seismic for reservoir characterization and microseismic monitoring of completions to enhance production techniques.
    • Completions Consultant in Permian Basin: “We are extremely experienced with logging and analysis of data from all regional sources. We use as much data acquisition as the operator is comfortable paying for. Basic Triple Combo logs are used at least on pilot holes. Some clients use some microseismic to tweak our frac methodology, but in our area many operators depend on our analysis of an abundance of production in proximity to design effective, but cost efficient completions.”
  • Triple Combo Logging Suite Tops Data Acquisition Choices [Question 2 on Statistical Review]: The Triple Combo Logging system was cited most often as the software used for data acquisition among respondents. Quad Combo, Full 8 Sonic, and ThruBit Logging were also mentioned. Most respondents reported using open-hole gamma logs on the horizontal lateral as part of the frac design process.
    • E&P Company Completions Manager: “We like to use ThruBit logging during drilling and then pull an open-hole gamma log on the horizontal to do our frac design. We now use that with the new NCS sleeve system to get superior results with our recent completions.”
  • Open-Hole Dominates Logging Techniques [Question 3 on Statistical Review]. Seven of nine respondents estimated a percentage of open-hole logging vs. cased hole logging. On average, 78% of wells logged use the open-hole technique and the other 22% is cased-hole logging. Some respondents said that not every well is logged in an effort to save costs. However, pilot holes throughout a field are often logged to get a good understanding of the geology.
    • Mid-sized Wireline Service Provider: “We see far more open hole logging run by clients. Most run an open hole gamma on the horizontal lateral at least. Some only log the vertical pilot holes."
  • Majority of Operators Report No Permanent Wellbore Instrumentation [See Question 4a, 4b, and 4c on Statistical Review]. Four operators reported they do not do permanent instrumenting of wellbores. Two respondents said there are a few operators who do, but the practice is rare due to the high expense involved. One respondent said fiber optics for use in fully instrumenting a wellbore can cost up to $500k with very little opportunity to obtain a good ROI.
    • Permian Basin Service Provider: “Some have installed the fiber optics like a capillary tube strapped to the casing throughout the wellbore to utilize full instrumentation during the ongoing production phase. The cost is high and the technology has not matured to the point to give a good ROI on the cost. At this point it is rare.”
  • Downhole Data Collection Costs Range 1% to 4% [See Question 5 on Statistical Review]. Among four operator respondents, downhole data acquisition costs were 1% or less. These four operators reported they rarely or never use microseismic. However, the use of microseismic is growing and many industry players believe the technology may increase. A microseismic service provider remarked it costs an average $100k-$150k for each well monitored with microseismic. Since every well is not typically monitored, this cost can be averaged among wells on a pad or in close proximity to add 3% to 4% to total data acquisition costs per well.
    • Mid-sized TX Operator: “Wireline logging is still our most common data acquisition tool. The data portion is only around $10,000 per well. Most wireline cost is for the ‘per stage’ cost for perf guns and setting plugs. Data acquisition usually runs us less than 1%.”
    • Seismic Service Provider: “Mid-size to larger operators who move into a manufacturing phase utilizing multi-well pads often want a microseismic monitoring of at least one well per pad. The $100-150k that microseismic costs can then be cost averaged among multiple wells to keep the data acquisition cost to around 3% or 4% of the completions budget.”
  • Some Use of 3D Seismic for Reservoir Characterization [See Question 6 on Statistical Review].Two of four operators reported they are currently using 3D seismic in their current projects. One seismic equipment representative said that often several operators in a joint venture will often jointly obtain 3D data for a region. A seismic service provider said the use of seismic data acquisition seems to be rising in spite of the current drilling environment. Many respondents discussed the need to be even more efficient with completions and production in a down market to keep their operations profitable.
    • Mid-sized Operator: "We usually try to share the cost of 3D seismic with several operators in our area. We are considering utilizing microseismic downhole monitoring to perfect our frac design going forward."
    • Mid-sized Seismic Service Provider: “We see many operators becoming interested in increasing their completions efficiency by utilizing both 3D and microseismic to enhance their overall ROI."

Additional Anecdotal Information/Quotables:

  • Seismic Service Provider: “The companies that have utilized 3D and microseismic in their well designs have been very consistent with their results. This continues to increase in importance in today’s market.”
  • Mid-sized Operator: “We don’t run logs on every well, but we scattered pilot wells around our acreage and ran an open-hole log on each one to characterize our geology and plan our wells.”
  • Completions Consultant: “We are currently using data acquired for each client well, along with an enormous body of knowledge among our 19 consultants, to analyze each completion we design. We use every tool the client will make available to maximize our results. Our recent recommendation for use of the newer sleeve systems that gives complete control and feedback from every fracture point has allowed us to consistently increase production 20% to 40%.”

Part II. Statistical Review, Logging/Data Collection

Total Respondents = 9 [Oil and Gas Operators= 4, Seismic Equipment Representative = 1, Seismic Service Provider = 1, Completions Consultant = 1, Wireline Service Providers = 2]

1. What kinds of data are operators collecting? (Some respondents gave more than one answer.)

Wireline logging: 9

Chemical tracers: 4

Coring, sidewall: 3

Gamma logging: 3

Seismic/Microseismic: 3

2. What wireline logging suites are operators typically running in horizontal laterals? (Some respondents gave more than one answer.)

Triple Combo: 6

Quad Combo: 1

Full 8 Sonic: 1

ThruBit Logging: 2

3. In percentage terms and looking at the market as a whole, what would you estimate is the approximate marketshare of openhole versus cased-hole logging?

Open-Hole Logging Cased-Hole Logging

100 % 0%

60-70% 30-40%

75% 25%

70% 30%

75-80% 20-25%

75% 25%

80% 20%

No response No response

Avg 78% 22%

4a. Are operators instrumenting wellbores? If so, what types of instrumentation is being used? Is it all wells or only a sample of a few wells?

No: 5

Rarely: 1

Not many doing permanent instruments: 1

No response: 2

4b. If so, what types of instrumentation is being used?

Two respondents mentioned fiber optics were being used occasionally. However, it is often cost prohibitive with few benefits. One respondent believes the technology has not yet matured for land wells to a point of sufficient ROI.

4c. Is it all wells (100%) or a sample of only a few wells?

Respondents report only a few sample wells are permanently instrumented due to the high cost and sub-par ROI.

5. What is the percentage impact on well costs of downhole data collection efforts? (4 operators only responded)

Percentage Comment

Very small percentage Basic Wireline log and no Seismic

Small percentage No response

Less than 1% One well only logged per pad

Less than 1% Cost is ~$10k per well for logs

*One service provider reported that microseismic can add $100-150k to a completion (~10% of total well costs).

6. Are operators employing 3D seismic to guide developmental programs in unconventional resource plays? Do you use seismic for reservoir characterization? (4 operators only responded in full)

Comments: Responses:

Some do, we don’t currently/3D of our area is well known: 1

Our company uses 3D seismic on all acreage: 1

We share 3D seismic in area acreages/have not yet used microseismic: 1

Do not use seismic: 1

*Several operators often share 3D costs for consultants and rental equipment, according to a seismic service provider

**Another seismic service provider reported many clients are seeing increased value in using data to increase their efficiency.