Energy Analytics

Southern Delaware – The Children Need Space

byEnverus

Well results in the southern Delaware Basin degraded severely in recent years. Although early parent well delineation presented enticing recoveries, as operators tightened well spacing and introduced child well drilling, meaning a second, third or even fourth well in close proximity to the original one, oil recoveries and economic returns suffered. Compared with the northern Delaware, degradation with tighter development is more severe in the southern region due to geologic differences – the highly faulted and fractured nature of the subsurface results in more intense well interference.

Figure 1 demonstrates the magnitude of this interference. Enverus identified a tightly spaced infill development where three wells were put on production at the same time (co-completed) in the Wolfcamp A, a zone commonly targeted by E&Ps, about eight months after an existing well in the section was placed on production. In this case, well interference spanned the entire development. The immediate child well is forecasted to recover 50% of the legacy producer, and the second and third wells are on track to recover 57% and 75%, respectively.

How can operators combat the high likelihood of well interference? The solution requires sacrificing inventory. Enverus analyzed a group of 11 Wolfcamp A pilots to determine that infill developments must be spaced ~1,760 feet away from legacy producers to avoid child well degradation and maximize project-level net present value. The southern Delaware undoubtedly holds challenges, but when child well drilling is avoided and wider spacing is prioritized, value can be generated for both operators and investors.

FIGURE 1 | Recoveries and Economics of a Tight Infill Development in Southern Delaware

 

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