Replies to This Discussion

Permalink Reply by Jack Young on April 16, 2015 at 3:52am

If these wells were choked back, I would agree. There's no evidence from the decline curves that they've been choked back on any sustained basis, however. That applies to all the Shell wells in the area - they behave as a standard decline curve would suggest. My guess is that Utica production may decline a little differently than the Marcellus, but that's something that we won't know for sure until we have a couple years of production data in hand. Watkins 21 is clearly the best Utica well drilled to date locally, so it's the one to watch.

It's also worth remembering that gas production often doesn't peak right away - fraced wells continue to shed water over the first couple weeks of sales since different portions of the formation clean up at different rates, so you may have your peak production the second or third month on line. Most standard decline curves you find posted don't show this, as the build-up data isn't useful for calculating future production, but that might explain why the Watkins 21 may only have peaked in February. It wasn't necessarily choked back the previous month.

Permalink Reply by Tim on April 26, 2015 at 1:58am

Wasn't aware we had 'standard decline curve' data on Utica wells in North Central PA.  

How many wells are there up here?  What are you comparing them against?

Can you include charts in your analysis?

Permalink Reply by Jack Young on April 26, 2015 at 12:04pm

Most people in the business have a standard type curve that they can compare production from new wells against. I won't tell you which one I use, but most of the big players in the Marcellus have included decline curve plots in their investor presentations, and you can pick whichever one you trust. Almost all fracked shale gas wells have fairly similar decline curves - the key variables are the IP, the slope of the decline (always logarithmic) and the constant (production) they decline towards.

If you plot the publicly available production data for the northern PA Utica wells to date, you can see how they compare to an average Marcellus well. (This data is also available for Utica wells elsewhere.) There's nothing unique about the Utica in our area, and the only interesting thing I see evidence of so far is a somewhat steeper decline than what you get with the better Marcellus wells. That wouldn't be anything unusual, however - the Haynesville is similar.

You typically won't find published decline curves that show the pre-peak production accurately, however, and that's just the nature of the way people present the data. So my point above is that any comparisons you make with less than a couple months of data in hand may be of limited value. In this case, only the Gee and Neal wells really have a track record built up that allows for comparison. So if you'd like to make up some charts comparing these two wells to a typical Marcellus decline curve (or Utica) and post those for everyone, please feel free!

Permalink Reply by Tim on April 27, 2015 at 2:24am

Ha, that's a good one.  However, not my 'claim' that these wells behave as a 'standard decline curve would suggest'.  thus, am trying to understand your methodology to such claim.

Was it a mere statement, or did you actually do analysis?

Anyone out there aware of which commercial pipes the neal, gee, and watkins wells are connected into?  If you have capacity numbers for those pipelines, that would be very helpful as well.

Thx

Permalink Reply by Jack Young on April 27, 2015 at 3:44am

How about explaining your last comment before you ask people for more information, then criticize their answers if they aren't what you want to hear.

"However, not my 'claim' that these wells behave as a 'standard decline curve would suggest'.  thus, am trying to understand your methodology to such claim."

Perhaps English isn't your first language?

Permalink Reply by Tim on April 27, 2015 at 7:40am

Appreciate you confirming that is was a mere statement.

anyone have any specifics on the pipelines the neal, gee, and watkins are connected into?  If they are in fact competing for capacity, that would partly explain the lower level of production, and would also make plotting a decline curve a useless comparison.  

Permalink Reply by Jack Young on April 27, 2015 at 8:06am

Always looking for an excuse, aren't you? Why not plot the declines and see if they look natural. If pipeline capacity was an overriding issue, you would see significant seasonal variation, with increased sales at certain times of the year. Anyone who's familiar with the industry can tell that's not what's happening here. But if you want to pretend, be my guest.

Nobody on this forum knows enough about the pipelines up there (what markets they're connected to, who has priority through firm transportation, seasonal operating pressures, what backhaul options are available etc) to answer your question. You'd need to be a T&E specialist with an understanding of the whole pipeline network regionally to be able to make any informed judgments.

I'm fine with you wasting your time on this, but why try to convince others to waste their time too? There's no point advocating a position on this forum without some real knowledge or understanding.

Permalink Reply by JOE REDDING on May 18, 2015 at 4:45am

Jack, the new no's. Are out for Watkins. Can you infer anything from them?

Permalink Reply by Jack Young on May 18, 2015 at 6:06am

Looks like standard decline curve stuff to me. New wells drop faster than older wells and so the Watkins wells fell further over that 31 day period than the other Shell Utica wells nearby. March was a cold month, so I doubt that pipeline capacity changed much in that area - most winter transportation deals run November through March. Next month's production figures could be impacted by the shift to spring markets and pricing, however. So we might see a different picture then. For now, none of the declines we're seeing are unexpected. This month's figures really had no surprises.

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