Bakken Shale Evolves To Lower Cost Slickwater Completions

Synopsis

Slickwater continues to dominate market share, even in former gel markets such as the Bakken Shale as operators remain focused on cost reduction.

On a performance basis, gel has clear benefits on longer laterals over the long-term. However, with cost control the name of the game, even former gel markets like the Bakken are witnessing the evolution to lower cost slickwater treatment.

Like a majority of domestic markets, the Bakken has seen completion methodology fall into a predictable recipe. Stage spacing, for example, fell to a little more than 200 feet on average in this survey, down from more than 300 feet among respondents 90 days ago.

A few operators still employ spacing beyond 300 feet but are adding more perforation clusters. One operator is reducing stage spacing to 150 feet and employing cemented sliding sleeves to pack more stages along the lateral.

Hess Corp. (NYSE: HES) recently completed a well using cemented sliding sleeves on 50 stages and is evaluating results in a highly watched test.

Halliburton (NYSE: HAL) has grabbed the top spot in well stimulation and also leads the Bakken in remedial work, according to respondents to Hart Energy’s Heard In The Field survey. Still, remedial work, such as refracture stimulation, remains a low percentage of activity—less than 3% of completions according to survey participants.

Bakken operators are slowly increasing well density on pads. Although the average currently is six wells per pad, unchanged from February, a few operators are doing up to eight wells per pad while some existing pads with fewer wells are likely to see additional laterals added in the future.

Zipper fracks represented 40% of completions, essentially unchanged from 43% in February, and reflect a focus on cost saving among operators. Sand volumes increased to 8.5 million pounds per lateral in this survey compared with 7.5 million pounds in February.

Watch for the next Heard In The Field report on the Bakken downhole completions market in August 2016.

Part I. – Survey Findings

Among Survey Participants:

• Slickwater Completions Most Common
  [See Question 1 on Statistical Review]
  ​Five of eight respondents reported that slickwater is most common in the region and another two continue to do hybrid completions. Another consultant uses gel with ceramics on his wells, but said very few clients are using his method now, even though these wells show better results.
  • Mid-Tier Operator: “Most use slickwater and white sand here now. The results show it benefits to use gel and ceramics, but costs are a big consideration now.”

• No Changes Expected In Near-Term
  [See Question 2 on Statistical Review]
  ​All respondents expect few or no changes in the near-term. Sand volumes and methods are reportedly staying the same on horizontal wells in the Bakken.
  • Mid-Tier Provider: “There are many who prefer gel and ceramics, but not at this price. We only see slickwater and sand on most jobs now.”

• Spacing Between Frack Stages Averages 213 Feet
  [See Questions 3a, 3b, 3c on Statistical Review]
  ​Spacing ranges between 150 feet to 250 feet in the play and averages about 213 feet. Six of eight respondents have kept spacing about the same this year. One reported recently testing spacing to about 300 feet. with more perf sets. Another respondent using sliding sleeve is spacing stages 150 feet. apart.
  • Mid-Tier Operator: “Most designs set spacing between 200 feet to 225 feet now on Bakken wells. On a 10,000-foot lateral, we use about 45 to 50 stages.”

• Plug And Perf Most Common Fracking Technique
  [See Question 4 on Statistical Review]
  ​Seven of eight respondents reported that plug and perf completions are the standard fracking technique in the Bakken. One respondent continues to do sliding sleeve jobs for Bakken clients, but acknowledges they have slowed considerably in the current environment.
  • Top-Tier Service Provider: “The plug and perf slickwater frack with large volumes of white sand continues to work well. Since gel and ceramics cost more, they are rarely used at present.”

• Refrack Still Small Percentage Of Frack Work
  [See Question 5a and 5b on Statistical Review]
  ​Respondents reported that the actual implementation of refrack is limited to rare events. Halliburton is reported as the doing largest volume of new fracks, refracks and remedial stimulation in the play.
  • Mid-Tier Operator: “Halliburton has maintained top market share in new wells, but has the lion’s share of remediation as well.”

• Multi-Well Pads Average ~5 Wells Per Pad
  [See Question 6 on Statistical Review]
  ​The average number of wells reported per pad is about five. Reports ranged from four to six wells per pad in the region.
  • Mid-Tier Operator: “Six wells per pad is most common, but we have seen some do more, others less. Pads with four or five wells may see an additional well added later.”

• Zipper Fracks Account For 40% Of Completions; Solo Fracks Account For Remainder
  [See Question 7 on Statistical Review]
  ​The percentage of zipper frack completions reported among respondents is 40%, slightly down from the 43% reported in February. The remaining 60% of wells are fracked using the solo frack on one well at a time and are more common now due to the slower pace of completing wells. One respondent uses solo frack only with coil fracks.
  • Top-Tier Operator: “Zipper fracks still save time and money when an operator chooses multi-well completion.”

• Sand Remains Most Common Proppant
  [See Question 8a and 8b on Statistical Review]
  Natural sand continues to be the most common proppant in the region. and averages about 8.5 million pounds per well, up somewhat from the 7.5 million pounds reported in February. A total of 95% of proppant used in the Bakken is natural sand. Ceramics are used in 5% of the wells completed.

• Three Or Four Perf Sets Per Stage Most Common
  [See Question 9a and 9b on Statistical Review]
  Six of eight respondents reported three to four perf sets per stage with enhanced horizontal completions methods with little expectation of change. One operator, however, reported testing longer stages with four to five perf sets per stage on 50% of completions. Also, one respondent uses shorter sleeve stages and coil frack exclusively.

End Survey Findings

Survey Demographics

H A R T E N E R G Y researchers completed interviews with eight industry participants in the downhole completions segment in the Bakken region. Participants include four sales professionals with frack companies, one completions consultant, one equipment supplier and two representatives for E&P companies. Interviews were conducted in early to mid-May 2016.

Part II. – Statistical Review

Downhole Completions

[Bakken Shale]

Total Respondents = 8

[Fracking service providers = 4, Completion consultant = 1, Equipment supplier = 1, Operators = 2]

1. What common practices are used in your area for completions?

2. Do you see that changing over the next three to six months?

3a. Is spacing between stages closer now than a year ago?

3b. What is the average distance between frack stages in your area?

4. What fracking technique is most common in your area?

5a. Looking at the number of total frack jobs in your area, what percentage is new fracks and what percentage is refracks?

5b. Which fracking company in your area is doing the most new frack work?

5c. What company is doing the most refracks in your area?

6. What is the average number of wells being completed per pad in your area?

7. What percentage of fracks drilled from pads are zipper fracks vs. individual solo fracks?

8a. How much proppant (in pounds) are you using per well?

8b. On a percentage basis, how much proppant in your area is used by type?

9a. How many perf clusters are typical between stages?

9b. Is that more or less than six months ago?

End Statistical Survey