RAGING RIVER’S CHIEF OPERATING OFFICER IS FINDING WAYS TO KEEP COSTS DOWN AND PRODUCTION UP
Ajunior oil producer that’s able to grow its production without taking on additional debt in the current commodity environment probably sounds like the oil and gas industry’s version of a unicorn. But that’s what Raging River Exploration has been able to do, and that’s due in large part to Jason Jaskela. He has led the company’s efforts to optimize production from its core Viking play, and he’s done it while decreasing well costs in excess of 25 per cent. That’s greatly improved Raging River’s internal economics and allowed it to continue to grow despite the depressed commodity prices. “Between $45 and $50 is where we can put up marginal growth,” Jaskela says. “We’re one of the very few that can do that. It’s not astronomical, but we can show a bit of growth.”
Raging River’s cost-conscious ways are embedded in the company’s DNA, Jaskela says. “Ultimately, it comes from Neil [Roszell] – it comes from the top down. We’re a pretty basic and humble group, and we’re aligned with shareholders so we’re spending money like it’s our own dollar going into the ground. If you can go to the street with the best capital costs, and ultimately the best economics, you can do more with your business. So we’ve always strived to be the best. Status quo has never been good enough.” Raging River’s Beadle play is a case study in how the company has created value by testing new approaches and ideas. “Three years ago everybody had written that off,” Jaskela says. “Nobody believed that there was an economic resource there, and now today it’s probably our largest area. It was just by continually getting back in there, pushing technology and finding a way to develop that rock and make it productive.”
One of the ways it’s made that rock more productive has been by optimizing the spacing and configuration of its wells. As a result, while it experimented with densities ranging from 16 to 28 wells per section, it settled on 22 as the best fit for its assets. “We realized, looking at our oil in place, that there was opportunity in some of our lands to develop that further,” Jaskela says. “The longer-term plan for this play in a lot of the acreage is in water flooding, so we tied our in-fill spacing back to what was optimal for future water floodability.” But while Raging River is always testing out new ideas, technologies and approaches in an effort to
reduce costs, it’s tried to avoid loading all of the pain that’s currently being felt in the market onto the shoulders of its service providers. “There’s no benefit for us in bankrupting our service providers. It’s a relationship, and we’re very aware of that. Our service providers are guys that helped us to develop the play. We’ve done it together. So it’s a continual discussion with them.”
It’s also a continual discussion with the members of Jaskela’s own team, one that’s taken him out of the field more often than he might like. “I cut my teeth in coveralls. Operations is my background, so I kind of like going back to my roots. But I don’t get to do it very often any more.” But, he says, learning to delegate and manage a team of employees is all part of being a first-rate executive. “All of us in this office are very technical, and love to do the work. But it’s a transition that has to happen. Everybody in this office, right from Neil down through all of our execs, are all capable of doing the real technical work, and we all love to do it. But at the same time you have to recognize that you have other staff that you need to guide and empower. That’s a big part of it: you have to give them the rope to make their own decisions.” They’ve made some good ones, lately – and it stands to reason they’ll continue to as long as Jaskela is the one feeding them the rope.