Crude Energy, an independent oil exploration and production company based in Dallas, TX, announced that is nearing completion of a well in Hardeman County, TX.
The announcement comes only a few weeks after the company released a press statement saying that it would begin drilling at its Cottonwood #1H site. Now, nearing completion, Crude Energy is pleased to report positive results from its drilling campaign.
Crude Energy drilled the Cottonwood #1H at a depth of 12,166 feet. It began encountering oil and gas at a depth of 10,497 feet, which continued down to a depth of 11,170 feet. In other words, the oil bearing section of the formation extended for 673 feet. Crude Energy used 3-D seismic imagery to target oil bearing fracture systems.
In last month’s press release, Crude Energy said that they would drill laterally for 2,600 feet. It appears that in the process, the company drilled through 8 fracture systems.
As the company nears completion of the well, it will use a system of fracturing called the Packers Plus QuickFrac system, which allows for a single well bore to fracture multiple stages of the formation. This technology allows for pressure to build up in specific sections of the well, allowing for fracturing to take place in multiple places.
This technique allows drillers to make many different entry points into the rock formation, and have the oil and gas flow out through a single well. As a result, Packers Plus allows for wells to be completed much faster; and it since it can hit multiple areas of the shale, it can extract more oil and gas from a given well in less time. It also allows for less fracking fluid to be used.
Crude Energy’s President Parker Hallam was pleased with the results. “Crude Energy is nearing completion of the Cottonwood #1H. Drilling our operations we encountered oil in multiple layers of the well bore. Time and time again we have demonstrated an ability to single out promising plays and effectively execute our drilling operations,” he said in a statement.
Crude Energy operates in several locations in the United States, but specializes in the Bakken and the Permian Basin in Texas.
Crude Energy’s higher profile assets are located in the Permian. Some of its neighbors include Occidental Petroleum (NYSE: OXY), Pioneer Natural Resources (NYSE: PXD), Apache Corporation (NYSE: APA), and Energen Corporation (NYSE: EGN). Occidental is the largest producer in the Permian, accounting for about 15% of the basin’s production. Pioneer has extensive acreage in the Wolfcamp/Sprayberry plays in West Texas which are fast becoming the most productive. Apache has about 37 active rigs throughout the Permian, targeting several different shale plays. Energen is more of a pure play on the Permian, with more than three-quarters of its proven reserves located in the basin.
Crude Energy is much smaller than these companies, and as such it has sought to drill in lesser known areas where costs are much lower. That has it targeting the Hardeman Basin, a little north of the frenzied activity by Crude’s larger peers.
The Cottonwood #1H project is one example of Crude Energy’s assets in lower cost regions. The Cottonwood #1H project is located on the border between Texas and Oklahoma in the Hardeman Basin. The Hardeman Basin shares some similar geological features with some neighboring basins but has not seen the same level of drilling activity. For example, the Fort Worth Basin to the south has seen a flurry of drilling activity targeting the Barnett Shale. The two regions share very similar geological history, but have been separated by tectonic movements.
Because the Hardeman Basin has great potential, Crude Energy is quietly pioneering the way in this lesser known area.
Crude Energy hopes to build on its success with the Cottonwood #1H well and has plans for other wells in the vicinity.
By. James Burgess of Oilprice.com
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