Horizontal drilling permit drought returns to Barnett Shale
The birthplace of the shale revolution is back in the grips of a horizontal drilling permit drought — a situation that’s becoming more frequent.
More than five weeks have passed since any oil company has filed for a drilling permit with the Railroad Commission of Texas for a new horizontal well in the Barnett Shale, a natural gas-rich geological formation that surrounds the Dallas-Fort Worth Metroplex.
There is still one active drilling rig in the shale play, according to the Baker Hughes Rig Count, but the region frequently goes two weeks at a time without a horizontal drilling permit being filed. A five-week horizontal drilling permit drought hit the region in April and May 2019.
Although a February 2013 study by the Bureau of Economic Geology at the University of Texas at Austin estimated that the Barnett has 44 trillion cubic feet of recoverable natural gas reserves, it might have to remain in the ground for financial reasons. With natural gas trading below $2 per million British thermal units on Louisiana’s Henry Hub, drilling and hydraulic fracturing in much of the region isn’t cost-effective.
Oklahoma City-based Devon Energy had long been the region’s top horizontal driller, but it cut activity before selling assets and exiting the shale play in December. Houston exploration and production company Lime Rock Resources has emerged as the region’s top horizontal driller with 21 permits filed last year.
Permian Basin
Irving oil company Pioneer Natural Resources is preparing for a heavy round of horizontal drilling in an area of the Permian Basin known as the Midland Basin. The company is seeking permission to drill 13 wells in Martin County and another two in Midland County. All of the wells target the Spraberry field at total depths ranging from about 8,400 to 11,100 feet.
Eagle Ford Shale
Oklahoma City oil company Chesapeake Energy has filed its first major batch drilling permits in Texas since a fatal accident in Burleson County. Three horizontal wells in Webb County target the Briscoe Ranch field of the Eagle Ford Shale, while two more in Burleson County target the Giddings field in the same formation.
Haynesville Shale
There were no horizontal drilling permits filed in the East Texas shale play, but Nacogdoches-based Dual Production Partners plans to drill a vertical well in San Augustine. The well targets the oil-rich Nacogdoches field down to a vertical depth of 1,300 feet.
Barnett Shale
Despite the horizontal drilling drought, Graham-based Texas Shallow Oil & Gas is preparing to drill a vertical well on its Logan lease in Young County. The well targets the Young County Regular field down to a vertical depth of 700 feet.
Conventionals
There are several saltwater disposal wells being developed in the western end of the Permian Basin known as the Delaware Basin that will require vertical wells to be drilled. APC Water Holdings, DBM Water Services and Solaris Water Midstream plan to develop a combined 14 injection wells to support saltwater disposal in Loving County.