EOG's Rattlesnake Pad Has Record Production Results
EOG Resources' (EOG) recent results in the northern Delaware Basin have been fantastic. The production of southern Lea County wells have been better than anywhere else in the US. These results are a sign of things to come, as wells continue to outperform. Two locations in the Rattlesnake pad produced more than 500 KBO in 12 months. The two newer locations are on pace to outproduce the first two wells in this pad.
Source: Welldatabase.com
EOG results are reliable as it has duplicated production at four locations. The high pressured geology seems better than Midland. This could be due to depth and/or natural gas content of the interval.
Source: Welldatabase.com
On a BOE basis, EOG's Rattlesnake average type curve shows a second month spike that decreases significantly in the fifth month. This was probably due to the well being shut in as production rises to almost 80 MBOE in month eight.
|
Month |
Oil |
Gas |
Water |
BOE |
|
1 |
22234 |
41454 |
48848 |
29143 |
|
2 |
97258 |
185853 |
191560 |
128234 |
|
3 |
72908 |
143337 |
135099 |
96798 |
|
4 |
63893 |
127293 |
112861 |
85108 |
|
5 |
19758 |
40721 |
39466 |
26545 |
|
6 |
44246 |
89792 |
162020 |
59211 |
|
7 |
38282 |
74337 |
99101 |
50671 |
|
8 |
58103 |
117395 |
129100 |
77669 |
|
9 |
50998 |
106514 |
115246 |
68750 |
|
10 |
23612 |
47776 |
48506 |
31574 |
|
11 |
19032 |
38368 |
38525 |
25426 |
|
12 |
15966 |
31725 |
39553 |
21254 |
|
Total |
526,289 |
1,044,563 |
1,159,884 |
700,382 |
Source: Welldatabase.com
The type curve for the first year is over 526 MBO.
Source: Welldatabase.com
The Rattlesnake total production has reached 1.77 million barrels of oil.
|
EUR: |
526,288.50 |
|
|
Months: |
12 |
|
|
Selling Price: |
$40 |
|
|
Initial Capital Expense: |
($7,600,000.00) |
|
|
Lease Operating Cost: |
($5,262,888.00) |
|
|
Total |
NRI |
|
|
Total: |
$21,051,540.00 |
$16,841,232.00 |
|
Total |
NRI |
|
|
Total: |
($12,862,888.00) |
($12,862,888.00) |
|
Total |
NRI |
|
|
Total: |
$8,188,652.00 |
$3,978,344.00 |
Source: Welldatabase.com
The economics of the Rattlesnake pad has a net of just under $4 million in year at $40 oil. This increases to $7 million with revenues from natural gas.
|
EUR: |
526,288.50 |
|
|
Months: |
12 |
|
|
Selling Price: |
$50 |
|
|
Initial Capital Expense: |
($7,600,000.00) |
|
|
Lease Operating Cost: |
($5,262,888.00) |
|
|
Total |
NRI |
|
|
Total: |
$26,314,425.00 |
$21,051,540.00 |
|
Total |
NRI |
|
|
Total: |
($12,862,888.00) |
($12,862,888.00) |
|
Total |
NRI |
|
|
Total: |
$13,451,537.00 |
$8,188,652.00 |
Source: Welldatabase.com
Using an oil price of $50/bbl, oil revenues increase to more than $8 million, or $11 million with nat gas. The total for the Rattlesnake pad is $44 million.
Suntrust has promoted this area, with good reason. It could be surmised, southern Lea and northern Loving is unique. If correct, other operators in the area like RSPP, APA, APC, XOM, RDS, and CXO have upside. The Delaware has seen much less traffic than other basins like Midland. This is why the Delaware could have more upside than other plays. EOG's results seem to show other operators have upside with respect to well design. Going forward, we would expect other operators to see production per foot improvements closer to EOG.
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