I have rights and a lease agreement in Divide Co with a well recently starting production. I read on line that the well cost 6 million to put in. How long can one expect a well like that to produce?
Hi Anna,
Typically the reserve life of a new well is anywhere between 35-50 years. That being said with hyperbolic decline of shale wells, I would expect that 2/3-3/4 of the production will occur in the first five years of production. The wells in Divide Cty tend to have a bit higher water cut so their decline is also a bit flatter than further south in the play. Hope this helps!
Can they go in and frac a well after it has slowed down in production
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Technically, yes they can. They don’t often do it (so far). In the future, that may happen more often.
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Related to decline; what effect , if any, is caused by the well being shut in? Well in question T163N R98W in Divide county. The cost of gas collection erased the funds from the oil production. Since they can not flare, they shut in down. A rational decision in my mind. I have not found any info on what this does to the quality of the well. Will it need to be refraced?
I cannot speak for this particular well or the decisions of the operator as I do not know its history, field management story or any of those many details.
But I can pass on some lessons learned from my career as a production geologist. A wise engineer once told me that we are not in the “oil & gas business”; we are in the “pressure” business. The gas is what brings the oil to the surface in an oil well if it is “flowing” under its own power and not being pumped. If we produce too quickly, we leave too much oil behind. Think of the explosive power of a champagne bottle if shaken and the cork popped. A lot of liquid comes out, but the rest (in fact, quite a lot) stays back in the bottle.
We had a well that we deliberately shut in from time to time. The shut in time allowed the reservoir pressure to recharge slightly and enabled the well to produce for years past its original predicted life because the pressure was monitored and allowed time to rest and recover. (Kind of the like the Sabbath if some of you can relate to that idea.) The well would come on a bit stronger after its resting time and deliver nicely for a while. It would then decline for a new normal decline. It would get to a certain point and we would shut it in again, over and over for years.
Given the gas price and pipelines in the area, this may be an economic decision for the operator-short term or long term, I cannot say. They think larger scale than just one well. Whether they frac again will depend upon the age of the well, cost of the re-frac (very expensive) and quite a few other variables. Their goal is to make money without spending too much money.