Comprehensive Energy Data Intelligence
Information About Energy Companies, Their Assets, Market Deals, Industry Documents and More...
Mancos Shale: Great Prospects Still Ahead
01/16/2018
Mancos Shale - a great natural gas shale reservoir on the border of New Mexico, Colorado, and Utah. It's location closely corresponds to that of San-Juan basin. In 2010 it was first drilled by Williams Co. and is proving to be more promising ever since.
Rosa A and Rosa B wells' production averaged 5 MMcf/d (6.4 MMcf/d) in their first 30 days after being drilled. The location was estimated to hold ca. 60 trillion cf reserves at the time of discovery.
It is located across much of the Rockies including the San Juan Basin, where it ranges from 1,500 to 2,000 feet in thickness.
Since 2012 till 2016 Mancos shale gas production grew to 100 MMcfd from 75 wells. This growth continues making this shale more and more competitive compared to Permian.
“The great thing about the Mancos gas play is that, while there haven’t been a ton of wells drilled, there hasn’t been a bad well drilled,” - Jay Paul McWilliams, President and Founder of LOGOS Resources II - “Everything drilled is north of 5 Bcf, even those drilled in 2010. It’s a true resource play. We feel confident the geology is similar across a large portion of our acreage.”
Drilling depth here is between 4,500 and 5,500 feet total vertical depth with laterals extending 7,000 to 9,000 feet. “That’s why people get excited by bit efficiency—drilling is very forgiving in this area.” - Ian Delahunty (CEO & President of Juniper Resources).
It is also evident from studies and production data that horizontal wells far outperform vertical wells in Mancos.
Mancos natural gas takeaway is supported with a robust gas pipeline infrastructure. Main players here include Kinder Morgan, Energy Transfer Partners, LP, Dominion Energy, Inc and Williams Companies. Their pipeline assets are estimated at 1,078 miles of just the interstate operational lines. See the breakdown in a table below.
Key Interstate Pipeline Owners (Mancos Area)
Kinder Morgan | 593.1 |
Energy Transfer Partners, LP | 318.9 |
Dominion Energy, Inc. | 105.9 |
Williams Companies | 60.6 |
TOTAL: | 1,078.6 |
The Mancos-adjunct segment of the largest of these owners' lines, El Paso, routes natural gas from the San Juan, Permian and Anadarko basins to California, Arizona, Nevada, New Mexico, Oklahoma, Texas and even to northern Mexico. El Paso Natural Gas Company is the principal operator of this line.
The flow from San-Juan (Mancos inclusive) is significant yet no pipeline constraints are in sight. Mancos gathering infrastructure in the area is naturally as developed. Operators to mention are Enterprise Products Partners, LP, UNK, and Williams Companies.
Future of Mancos looks optimistic. However, additional development also requires lots of capital and effort. Even 20% of the basin when developed would require: (1) 13,000 new wells, (2) Capex of ~ $130 Billion ($10 Million/well) to add infrastructure capex of ~ $25 Billion.
A revenue of 390 Billion can be expected from just this development. At that production level (> 5Bcfd) it will exceed the existing pipeline capacity 2.5 times.
Last thing to mention, an active development of Mancos is likely to begin only after expectations about returns from Permian basin operation begin cooling down. At the moment Mancos as well as some other great reservoirs is waiting on its golden hour, which is yet to come.
If you are looking for more information about energy companies, their assets, and energy deals, please, contact our sales office mapping@hartenergy.com, Tel. 619-349-4970 or SCHEDULE A DEMO to learn how Rextag can help you leverage energy data for your business.
Up to $1.5 Billion for Percussion Petroleum in the Permian Basin
Around 25,000 net acres in the Permian are being sold by Percussion Petroleum II, looking to fetch up to $1.5 billion, as some sources bet on rising oil prices to pocket more than double what it paid in 2021. The company spent $375 million plus contingent payments a year ago to buy the bulk of its assets in one of the most prolific crude-producing areas in the U.S. from Oasis PetroleumInc. The oil prices increased to triple digits and buyers wanted to gain a toehold in the basin, whereas backers of private shale companies such as Percussion use it as a chance to exit their investments with big profits. Remarkably, U.S. crude oil futures have grown about 50% to approximately $109/bbl since June 29, 2021, when Percussion closed its deal with Oasis.
Top H1 2022 Permian Producers
The year 2022 brought new opportunities to the U.S. economy in different domains that were not perfectly developed. Oil and natural gas production facilitated economic growth, especially in the Permian Basin.
The Williston Basin is a big area filled with layers of rock that sits next to the Rocky Mountains in western North Dakota, eastern Montana, and the southern part of Saskatchewan in Canada. This area covers roughly 110,000 square miles. Geologically, it's very similar to the Alberta Basin in Canada. People started drilling for oil in the Williston Basin back in 1936, and by 1954, most of the land where oil could likely be found was already claimed for drilling. The Bakken Formation with parts of Montana, North Dakota, Saskatchewan, and Manitoba has become one of only ten oil fields globally to yield over 1 million barrels per day (bpd) since the late 2000s. It is currently the third-largest U.S. shale oilfield, behind the Permian and Eagle Ford. The boom in the Bakken started around September 2008, coinciding with the U.S. housing market crash. The application of new technologies, such as swell packers enabling multiple-stage fracturing, significantly enhanced oil recovery, making the Bakken Formation a key player in the U.S. In 2022, the Bakken oil field saw big improvements in how much oil and gas it could produce. At the start of the year, 27 drilling rigs were working there, more than double the 11 rigs from the start of 2021. Important upgrades included making the Tioga Gas Plant able to process 150 million cubic feet more gas each day, and making the Dakota Access Pipeline bigger, increasing its oil transport capacity from 570,000 to 750,000 barrels every day.
Continental Resources is expanding its operations in the Midland Basin, including taking over some assets that used to belong to Occidental Petroleum. The company plans to use its expertise in exploration in this area.
Equinor and EQT Corporation have agreed that Equinor will exchange its operated assets in the Marcellus and Utica shale formations in Ohio for a stake in EQT’s non-operated interests in the Northern Marcellus formation.