E&P companies spend millions of dollars scouting locations for, engineering, and drilling new wells. The hope is that those millions of dollars’ worth of planning and analysis result in high returns. Of course, that doesn’t always happen. In low price markets, the stakes are higher than ever.The same high-price wells that used to bring in 50% returns might lose money if they were drilled in the current environment. It’s not enough to be “close enough” to a sweet spot. Perfectly engineering a well doesn’t guarantee good returns either. You need to start with high quality acreage if you want to make money.
How can you be confident that you’re drilling in the best possible acreage? Many subsurface maps provide only rough estimates of acreage quality. Building your own map would take an enormous amount of time and resources and wouldn’t be scalable anyway.
This is where Graded Acreage comes in. The proprietary Drillinginfo Graded Acreage system maps subsurface quality down to the single square mile. By isolating the impact of reservoir quality on production, regardless of how a well was drilled or completed, Graded Acreage provides an accurate look at the subsurface. Visualize where the sweet spots differentiate from the fringe areas. Acreage is rated on a scale of A-J so you can easily compare the relative quality of land across a play.
So what if you find open acreage in “high quality” land. What does that mean? How can you be sure that your expected production will offset your costs, even if you’re in an area that’s deemed high producing?
With Graded Acreage, you can also predict expected production for a given grade of acreage. Benchmark other operators in the area to identify median production and how far above and below average some outliers are performing. Develop drill plans specific for each grade of rock to reduce risk and uncertainty around your expected ROI.
Take a look at how we can help you uncover hidden value when you drill your next well.
What do you think? Leave a comment below.
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