Don't Look to the Big Shale Plays for Innovation in Horizontal Multistage Fracturing

Abstract

Guest editorial The good news is that there is plenty of innovation to talk about regarding step-change advances in horizontal multistage fracturing in many of the existing and emerging resource plays. The bad news is that you will not find these being applied in the Barnett Shale. While attending the SPE North Sea and European Area Stimulation Workshop (Berlin, Germany in September 2011) as well as the SPE Horizontal Well Completions in North America Shales Workshop (Scottsdale, Arizona in May 2011), it was evident that a number of emerging technologies are having a dramatic effect on improving ultimate recoveries in a number of plays. The interesting thing, however, is that these innovations are not being used in the so-called “legacy shale plays” (e.g., Barnett, Fayetteville) despite the fact that they are producing only break-even economics at today’s gas prices. You would expect to see aggressive innovation and experimentation in order to produce significant results in changing ultimate recoveries. The production results would suggest otherwise. Results Speak for Themselves At the Berlin workshop, a European producer who was investigating the Barnett to learn shale gas technology, presented a year-by-year production comparison for wells completed in the past five years. By looking at the average 24-month cumulative production from wells completed in each year, which is a pretty good gauge of ultimate recovery, it was evident that things are not improving. In fact, there was no upward trend at all in the data. Since investment continues to be significant in legacy trends, and international companies are investing billions of dollars to become players in shale gas technology, caution should be used in thinking that we have “arrived” in the Barnett. At the SPE workshop in Scottsdale, which specifically targeted shale fracturing technology, the primary “innovation” to be used in the Barnett appeared to be moving from using one perforation cluster per stage a few years ago to three or four clusters in 2011. In essence, there was very little or no change to fracture placement and design. Based upon comments made at both workshops, there appears to be a limited under-standing of what can actually produce a step-change in recoveries. What is a step-change? Increasing recoveries by 25%? 40%? More? The bad news is that you will likely not find process change in the Barnett or Fayetteville and, unfortunately, the industry still looks to the Barnett to understand “how shale gas is done.” So, if you are an investor who has poured billions of dollars into these plays, you may want to exercise caution in thinking that the operators in the Barnett have it figured out. The good news, however, is that there is plenty of innovation going on in other plays that are producing step-changes in efficiencies, reducing water usage, decreasing the time required to fracture treat wells, and greatly increasing ultimate recoveries. The question is then, why are these innovations not being applied in the legacy shale plays?