Post Tagged with: "DUCs"

DUCs Up

DUCs Up

Almost half the U.S. DUCs are in the Permian The number of drilled but uncompleted wells (DUCs) in seven key U.S. oil and natural gas production regions has increased over the last two years, according to the EIA’s count. DUCs reached a high of 8,504 wells in February 2019, according to well counts in EIA’s April Drilling Productivity Report (DPR). The most recent count, at 8,500 wells in March 2019, was 26% higher than the previous March. Almost half the U.S. DUCs are in the Permian: EIA The number of DUCs has generally increased since the end of 2016, according to EIA and industry stats. Most of the recent increase in the DUC count has been in regions dominated by oil production, especially the Permian region in western Texas… Login or click here to subscribe Username or E-mail Password Remember Me     Forgot Password

Sanchez Energy Produced 80.5 MBOEPD in Q1

Sanchez Energy Produced 80.5 MBOEPD in Q1

Sanchez Energy Corporation (ticker: SN) reported a net loss of $4.8 million for the first quarter 2018, or $(0.30) per share attributable to common stockholders. The quarter included $24.4 million in non-cash mark-to-market losses related to hedging activities, Sanchez said. Production Sanchez had production of ~7.3 MMBOE, or 80,572 BOEPD in Q1 2018. According to Sanchez, the company’s first quarter 2018 production came in below guidance due to weather, natgas takeaway capacity and completions test issues with the Comanche asset. Overall, the company estimates that Q1 production was negatively impacted 3,500 BOEPD. “Post the operational tests, we have transitioned to the exclusive use of slickwater design completions on all of the Comanche properties, and project improved production rates as these wells begin producing hydrocarbons later in the second quarter,” CEO Tony Sanchez III said. “We also returned to a more conservative choke management strategy, which we expect to result in[Read More…]

SilverBow Resources Releases 2018 CapEx and Guidance

SilverBow Resources Releases 2018 CapEx and Guidance

SilverBow Resources, Inc. (ticker: SBOW) recently announced its 2018 capital program of $245-$265 million. For 2018, SilverBow said that total company production is projected to average 175-195 MMcfe/d, an increase of approximately 25-40% from 2017 levels. This projection has been adjusted to include small noncore divestitures in 2017 and the Olmos divestiture planned for the first quarter 2018. 2018 capital program overview 70% of capital expenditures allocated towards drilling and completions Planned addition of second rig in second quarter 30-32 net wells drilled in 2018, compared to approximately 18 net wells in 2017 SilverBow CEO Sean Woolverton said, “Our team did a tremendous job executing on multiple fronts in 2017, including prosecuting a successful delineation drilling campaign, adding over 35,000 high-graded acres to our leasehold position at an attractive cost and increasing our liquidity to approximately $250 million. On the success of our 2017 activities, we have elected to add[Read More…]

Top Five SEC Disclosure Issues for E&P 2016 Annual Reports: Haynes and Boone

Top Five SEC Disclosure Issues for E&P 2016 Annual Reports: Haynes and Boone

Get your DUCs in order Energy attorneys Haynes and Boone recently looked at the top SEC disclosure issues for E&P company 2016 annual reports. The findings from Haynes and Boone appears below. Comment letters issued in 2016 by the staff of the Division of Corporation Finance of the Securities and Exchange Commission (SEC) to reporting E&P companies relating to their 2015 annual reports continue, as in past years, to focus on disclosure issues such as the effects of low commodity prices and proved undeveloped reserves (PUD) conversion rates. However, several new focus areas have emerged in SEC comments that E&P companies should consider when preparing their 2016 year-end annual reports. In particular, the staff of the SEC has asked companies to: Provide additional details regarding drilled but uncompleted (DUC) wells; Explain lower projected development costs as compared to historical development costs and PUD development financing plans; Provide more details on material[Read More…]

$2.3 Billion in Eagle Ford Assets Depart Anadarko for Sanchez Energy

$2.3 Billion in Eagle Ford Assets Depart Anadarko for Sanchez Energy

Sanchez Energy and Blackstone Energy Partners form 50/50 venture to acquire Anadarko Comanche assets producing approximately 67,000 BOEPD (33,500 net to Sanchez) Sanchez Energy Corporation (ticker: SN) and funds managed by Blackstone Energy Partners (ticker: BX) have entered a strategic 50/50 partnership and together they have signed a definitive purchase agreement to acquire Anadarko Petroleum Corporation’s (ticker: APC) working interest in approximately 318,000 gross operated acres in the Western Eagle Ford for approximately $2.3 billion. The acquired assets (155,000 net acres to Sanchez Energy and Blackstone) are primarily located in Dimmit and Webb counties, contiguous to Sanchez’s existing assets. Sales volumes from these properties totaled approximately 45,000 barrels of liquids per day and approximately 131 million cubic feet of natural gas per day at the end of the fourth quarter of 2016, Anadarko reported. The acreage includes approximately 130 gross drilled but uncompleted wells, Blackstone said in a press release. Upon completion of the acquisition, Sanchez[Read More…]

DUCs Haven’t Flown Fast Since April

DUCs Haven’t Flown Fast Since April

DUCs: Mid-Continent Plays See Spike in Drilled, Uncompleted Wells, Declines Elsewhere Bloomberg Intelligence has released its updated counts of drilled, uncompleted wells. Total DUCs were estimated to stand at 3581 on September 1, a decrease of 196 since January and a decrease of 275 since September 2015. Since April however, the U.S. total has held essentially steady, with 6 net DUCs added. While the overall trend in DUCs has been downward since the beginning of 2015, Texas has seen major DUC increases since April, with counts in the Eagle Ford and Permian increasing by 38 and 112. Bakken and Niobrara inventories both peaked in April and have since fallen by 53 and 29. The Woodford continues to attract the attention of drillers hungry for quick cash flow, only adding 6 DUCs since the beginning of the year. The Permian has been the big story this year, with acreage fetching valuations[Read More…]

The Number of DUCs in the U.S. Climbs in October

The Number of DUCs in the U.S. Climbs in October

The EIA reported the number of uncompleted wells rose for the first time since July The Energy Information Administration (EIA) released its monthly Drilling Productivity Report Monday. The November report forecasts that both oil and gas production in the United States will decline by 20 MBOPD and 94 MMcf/d, respectively, and also noted that the number of drilled but uncompleted (DUC) wells in the country rose for the first time since July last month. The agency started tracking the number of DUC wells in it September report, showing the count declined month-over-month from July to August, and again from August to September. The November report shows that DUCs increased for the first time since the EIA started tracking the information from September to October, however. The total number of uncompleted wells rose by 58 month-over-month, primarily in the Permian, where 85 wells were drilled but left uncompleted, bringing the area’s[Read More…]

DUC Estimates – 5,031 Wells Await Completion: EIA

DUC Estimates – 5,031 Wells Await Completion: EIA

The total number of DUCs is declining, but remains elevated Along with its monthly Drilling Productivity Report (DPR), the EIA released a supplement today which estimates the number of drilled uncompleted wells (DUCs) in the seven key oil and natural gas producing regions covered by the agency’s broader drilling report. The number of DUCs has been declining over the past few months, but it remains well above levels seen prior to the late-2014 price crash. Current EIA estimates show DUC counts as of the end of August totaling 4,117 in the four oil-dominant regions and 914 in the 3 gas-dominant regions that together account for nearly all U.S. tight oil and shale gas production. In the oil regions, the estimated DUC count increased during 2014-15, but declined by about 400 over the last 5 months. The DUC count in the gas regions has generally been in decline since December 2013.[Read More…]

DUCs Flying Every Which Way

DUCs Flying Every Which Way

Trends suggest that operators are using their DUCs as a more capital efficient means of tapping production, rather than using them to grow production For the past year, discussions in the oil and gas industry have been focused on asking what role drilled uncompleted wells, or DUCs, will play in the industry’s recovery. Most analysts have predicted a rapid reduction in DUCs as soon as prices swing back into more favorable territory, bringing production back up very quickly. But is that really how it will work? In its Mid-Year Global Energy Outlook, Bloomberg Intelligence has made a case that the picture is more complicated than that. The report shows that while overall DUCs levels are holding steady under current prices, diverging trends are emerging. What County are YOU Looking at? Many counties in the same play or sub-basin show differing trends in their aggregate DUC inventory levels. Often companies operating[Read More…]

Reasons for Not Completing a Well

Reasons for Not Completing a Well

Drilling but not completing wells–why is it done? The uncertainty of the last year and a half surrounding the oil and gas industry has given rise to a multitude of different rationales about industry practices. Rig counts have been dissected, production levels followed, and any data point that could possibly be related to oil and gas has been factored in. Big data all the way down to minutia has become conversation points for oil and gas observers. Among the most mystifying data points being processed is the inventory of drilled but uncompleted wells–DUCs. Drilled but uncompleted wells (DUCs) have garnered a lot of attention, and for good reason. They represent a massive source of uncertainty regarding price direction and U.S. supply, and their overall impact is completely unknown. Some argue they are overhyped because of logistical and economic barriers, while others believe they will bring about a gusher of supply at[Read More…]

Whiting Pushes IRRs Above 40% with Williston Drilling Agreement

Whiting Pushes IRRs Above 40% with Williston Drilling Agreement

Whiting plans to exit 2016 with 30 DUC wells, as opposed to 74 Last week, Whiting Petroleum (ticker: WLL) announced that it entered into a wellbore participation agreement that will increase the number of completions on the company’s Williston acreage. WLL’s private partner will assume 65% of the drilling and completion costs in 44 gross Williston Basin wells to be completed this year in return for 50% working interest. The activity is expected to take place in the second half of this year, leaving Whiting’s full-year production estimates largely unchanged at 134.2 MBOEPD at its midpoint. The agreement with a private party will help Whiting reduce its drilled uncompleted (DUC) wells in the Bakken to 30, from approximately 74, by year-end. An analyst note from Raymond James today estimated that even looking at the current strip pricing, the returns to Whiting on the deal are favorable. “By our calculations,” read[Read More…]

Oil Price Recovery Would Take 18 Months if it Started Today – Continental Resources VP

Oil Price Recovery Would Take 18 Months if it Started Today – Continental Resources VP

An Oil & Gas 360® exclusive interview with Kirk Kinnear, vice president of crude logistics and hedging at Continental Resources Market volatility has crude oil prices making huge swings, both up and down, with markets reacting to even just a hint of production cuts with a 10% spike in the price of U.S. benchmark WTI crude oil. Many are predicting when prices will recover, and to what extent, with estimates landing across a wide spectrum. “Our studies indicate that the length of the decline is a pretty good indicator to the length of the price recovery,” said Continental Resources (ticker: CLR, ContRes.com) Vice President of Crude Logistics and Hedging Kirk Kinnear. “Right now, we look to the summer of 2014 as the beginning of the decline, so you have at least 18 months if the price recovery started today before you see that reinvestment. It’s going to take a while.”[Read More…]