Is it possible to extend a lateral once it's in production?

Hi all - Just a question I had regarding an odd transaction, which has occured near wells we have had in production for 2 years. This is in an area that has very few wells drilled (Marion County, WV Paw Paw District near Fairview) and I've just found out that the operator has purchased a lease, from another operator, of approximately 115 acreas next to our lease but where the laterals end. It may be difficult to visualize but based on where the current wells are and where this newly aquired property is, it appears it would be abandonded. We know other mineral owners and land owners in the area so it doesn't appear they are going to build a well pad somewhere else to access these minerals, so I started to wondered if they could "extend the laterals" so to speak. Is it possible to do someting like this? Remove production casing, drill to extend and then re-case, cement and re-frac the entire leg. Seems like that would be an expensive endevor but I'm not sure it is even possible. Based on our royalty, the wells are still producing at a decent rate. We saw the normal production declines but it's not as if these wells are anywhere near being finished. To take advantage of this new properties, it would extend one of the lateral lengths from 3800 feet to over 7000 feet and no doubt extend the others pretty significantly. So is this possible?

The only other thing I thought of is that they could be going from mineral in other strata such as Upper Devonian or Utica (would have to be 11k or 12k feet down). The original 2 wells were completed in 2012, the operator has permits for 2 more wells which they have started (verticals drilled). With these 2 new permits they are also making massive upgrades to the well pad, expanding it on 3 sides and other associated site work such as erosion control. Not sure what is up, but it seems odd that they would do this additional well pad work to only drill 2 more wells, which were in the original plans and they had plenty of room to accomodate.

Appreciate any feedback, Thanks

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Permalink Reply by Brian Powers on January 9, 2015 at 2:47am

Adam-

I've been involved with many vertical wells that were deepened to access un-drained horizons, but never a horizontal well.

You sentence about midway through the first paragraph of your query captures the technical essence of the challenge: removing casing, drill out to extend, re-running a new production liner/frac sleeves, re-fracing, then cleaning up and returning to production. I've never known cemented casing/liner to be removed other than by milling it out. The mechanical properties of the drained rock near the existing wellbore will likely cause some serious wellbore stability issues even if the liner were removed.

My view is that while it may be feasible to physically perform what you are proposing, in today's pricing environment it would not be economically viable.

Brian 

Permalink Reply by deer spotter on January 10, 2015 at 2:38am

Brian good to read one of your post again. Hope all is well.

Permalink Reply by paleface on January 10, 2015 at 3:34am

 Hi Brian,Thank You for posting that info I have a friend who is in a similar situation where they stopped drilling a unit because his neighbor didn't sign but now he has and was wondering if they could continue to drill the lateral where it stopped. I'll pass your info on to him. 

Permalink Reply by Brian Powers on January 10, 2015 at 7:00am

pf-

extending a lateral that was abandoned before completion may be easier than extending one that has been cased,  stimulated, and placed on production, depending upon what was left in the abandoned open hole section. If small cement plugs are present; it may be a matter of drilling them out, surveying down hole to determine depth, azimuth for orientation,, etc., then drilling on.

Abandoned horizontal open hole sections sometimes collapse , making re-entering them very difficult. In this case, performing an open-hole side-track may be required to drill a new hole parallel to the existing bore.

Brian 

Permalink Reply by paleface on January 10, 2015 at 8:53am

Excellent info Brian Thank YOU.

Permalink Reply by tater on January 9, 2015 at 3:05pm

I leased in this area 4 years ago still haven't heard thing yet but it n nams run just down the road from the well your talking about eqt holds my lease

Permalink Reply by Adam Martin on January 9, 2015 at 3:25pm
Yeah, our property is in Rush Run but my parents live in that area, near Green Lakes, but we know quite a few folks in the area. My dad grew up on the other side of Ann's run. Do you live in the area or just hold acerage and was it a 5 year lease and do they have the renew clause? A few folks who live up Rush Run talked to my dad and they said that EQT has mentioned that they have "big plans" for the area. If you take a look at EQT's quarterly report, they call out our well site, GRT26, and that is an area where they are looking at for Upper Devonian and Utica. Take a look at this report from EQT, pages 13, 15 and 16.

http://ir.eqt.com/sites/eqt.investorhq.businesswire.com/files/doc_l...
Permalink Reply by tater on January 10, 2015 at 2:47am

  I live in the area and yes its a 5year lease with renew clause for 3 more

Permalink Reply by Adam Martin on January 10, 2015 at 3:42am
Well based on what we've heard, EQT plans to develop the area. Good luck to you and hopefully you see some movement.

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