Archives of Previous Commentaries

These are commentaries that have been removed. The date is the date the commentary was removed, not necessarily the date it was first posted.

November 21, 2009 (removed):

Recent wells reporting initial production (IP) have been mediocre by some folks' standards, ranging between 500 and 900 bbls/day. For newbies, a bit of background. In the old days, a 100-bopd well was considered a very good well. Then with horizontal drilling and fracture stimulation, we got used to seeing 1,000 bopd-wells and the occasional 2,000 bopd wells, and the not infrequent 3,000 - 4,000 bopd wells. So, "we" no longer get excited with wells reporting less than 1,000 bopd on initial production. But IPs are beginning to mean less and less to those who have been following the Bakken for some time.

Wells reporting initial production of 500 - 900 bopd are very good wells by any standard.

If you don't believe me, look at the RS-Brady well: its IP was 194 bopd. Not even a year old yet, this well has produced 36,111 barrels of oil, and at $70/barrel, this is slightly more than $2.5 million. In less than a year. Bakken wells are said to cost $5 - $6 million each, but one company says their last Bakken development well was drilled in 16 days for a cost of $2.9 million.

And it is not just horizontal wells that are producing some great wells: a Lodgepole well spudded in 1996 that has produced in excess of 4 million barrels of oil so far is a vertical well, and it continues to produce about 7,500 barrels of oil per month (Dinsdale 2-4, Encore). At $70/bbl, that's $500,000 a month, and that well paid for itself years ago.