Replies to This Discussion

Permalink Reply by leo bishop on December 6, 2009 at 11:23

STM does not have any Partners that i know of in SA

Permalink Reply by Cheerleader on December 6, 2009 at 10:10

Jerry Smith nice MOTHERLOAD cheer!!!

Permalink Reply by Charlie Duke on December 7, 2009 at 13:04

How do you find where this is located. It would be nice if GPS coordinates were included in description. I'm new here and sure would like to know the locations of these new permits. 5.1 miles NE covers a lot of area. Any help would be appreciated.
Oh by the way, I just received my new copy of Popular Mechanics in the mail and in the tech section they noted in simple terms the horizonal drilling in the Haynesville Shale deposits. It noted that Chesapeake Energy expects to have 40 rigs up in 2010.

Permalink Reply by ALongview on December 7, 2009 at 13:23

Charlie,

http://webapps.rrc.state.tx.us/DP/initializePublicQueryAction.do

http://gis2.rrc.state.tx.us/public/

One of these is for permits the other is for searching the survey maps.

Permalink Reply by Cheerleader on December 6, 2009 at 20:12

Does anyone think this is unusual that SM appears to be drilling their first horizontal/wildcat without an experienced partner? Unless it isn't their first. In that case, where are the other horizontal wells????

Permalink Reply by ALongview on December 7, 2009 at 5:00

They are actually a very capable company. They have logged and tested a Haynesville vertical after drilling a very so-so horizontal in southern Desoto Parish without much science according to them. They are vey cautious now so as to "get it right". They have a wonderful land position most of which came on the cheap through aqusition and early leasing. Almost all of this stretch of land has siesmic already done as well. This could be the "company changing" area for them right now. They have horizontal experience in other shale plays. Are they the first choice driller? Probably not, but they are very capable of drilling on their own. I think partnerships are sometimes formed for experience and other times for financial reasons.

Permalink Reply by Cheerleader on December 7, 2009 at 11:18

ALongview,
Thanks for your opinion.
I can only find one St Mary horizontal well and that is in the Granite Wash for 17mmcf. I think the partner was Anadarko. Regardless, they definitely had a partner. Nice well, but again they had a partner. I just do not see any experience in drilling horizontals and that is a concern. Apparently, according to the SM web site, the vertical siesmic has been accomplished and they are now working on horizontal siesmic. I just do not want any OG, with a cavalier attitude, drilling to hold up land. Particularly when the leases are aquired for pennies without depth clauses. Why not partner with an experienced company?

Permalink Reply by ALongview on December 7, 2009 at 11:55

This is just from last quarters filing. They have a partner in the granite wash and eagle ford as well as other areas but have been the operator on many wells. They have drilled plenty to be the operator in the Haynesville but have been successful in securing many quality partnerships...Anadarko and Apache are two...so who knows. As far as a cavalier attitude, I would classify St. Mary as a very prudent operator and a very well run company who will err on the conservative side almost every time. They will focus on the area for Haynesville production to hold acreage as long as the price of gas is there to support it. If the results are consistently at or better than their own estimates of 12mmcfd-16mmcfd IP in San Augustine then they will drill Haynesville wells.

Eagle Ford shale – Since its last update, St. Mary has drilled and completed an additional 3 horizontal wells on its 100% working interest acreage in South Texas with sufficient production history to provide a meaningful update.





· The Galvan Ranch 1H (SM 100% WI) was spud in early June and was drilled to a vertical depth of approximately 8,500 feet. The well had an effective lateral of 5,005 feet and used a 17 stage completion. The well had a maximum seven day sales average of 8.0 MMCFED. This well is the farthest south of any of the wells drilled to date and has 1,000 BTU/SCF gas with essentially no condensate yield.


· The Briscoe Apache Ranch 1H (SM 100% WI) spud in mid-July, and was drilled to a vertical depth of approximately 7,900 feet. The well had an effective lateral length of roughly 4,000 feet and used a 14 stage completion. The well had a maximum seven day sales average of 7.1 MMCFED. The Apache Ranch well was drilled south of our first well in this program, the Briscoe G 1H, and north of the second well in this program, the Galvan Ranch 1H. Consistent with the Company’s expectation, the well has a richer stream of gas at approximately 1,200 BTU/SCF.


· The Galvan Ranch 4H (SM 100% WI) spud in late August and was drilled to a vertical depth of roughly 9,100 feet. The well had an effective lateral length of 5,000 feet and used a fifteen stage completion. The well’s sales rate has been constrained by temporary pipeline limitations. Currently the well is flowing at a rate of 7.0 MMCFED at a flowing wellhead pressure of 3,600 psi. Similar to the Galvan Ranch 1H well, the production from this well is very dry with little condensate.


St. Mary’s first well in this program, the Briscoe G 1H (SM 100% WI), was initially reported to have an average sales rate over its initial seven day flow period of 5.6 MMCFED. Using the same methodology for calculating average production rates as the wells above, the maximum seven day sales average for this well was 6.4 MMCFED.


The well design being used by the Company on its 100% acreage has evolved to one that utilizes a longer lateral and more completion stages. Completed well costs are now estimated to be between $4.5 to $5.5 million per well, depending on well depth.

St. Mary will be completing the Briscoe G 2H (SM 100% WI) and the Briscoe B 1H (SM 100% WI) in the coming weeks. The Company will be adding a second drilling rig in the play during November. The seventh and eighth wells in the program, the Galvan Ranch 7H and Briscoe G 3H (both SM 100% WI) will spud early this month.

In the joint venture acreage north of the Company’s 100% working interest position, St. Mary took over from TXCO as the drilling operator in the JV earlier this year and drilled and completed the remaining three earn-in wells in Phase II of the joint venture with Anadarko Petroleum Corporation. Consistent with the Company’s prior statements, it is clear from the initial flowback results from these wells that this portion of the play will have high condensate yields. Anadarko is installing additional sales infrastructure to facilitate further testing. With Phase II complete, Anadarko will take over full operatorship of the JV acreage and St. Mary plans on participating in Phase III and the subsequent development of this acreage.






St. Mary has leased or optioned 225,000 net acres in the Eagle Ford shale, with roughly 159,000 net acres of operated, high working interest acreage and approximately 66,000 net acres in the joint venture.
Haynesville shale – The Company’s first vertical Haynesville well, the USA BL #1 (SM 100% WI), was drilled and completed in northern San Augustine County, Texas. The well had a maximum seven day sales average of 1.9 MMCFED. St. Mary believes this is a positive development for its Haynesville program. Studies performed by the Company and others in the industry suggest that the potential IP of a horizontal well in the play can be estimated from a vertical well test by multiplying by a factor of six to eight. Recent horizontal wells reported by offset operators have also provided encouraging data points in the area. This well was cored and logged and the Company believes the rock quality is similar to some of the better areas of the play in Louisiana. The second vertical well in the Haynesville program, the Blackstone PB #1 (SM 100% WI), is currently drilling in southern Shelby County, Texas. St. Mary has been shooting 3D seismic over its East Texas acreage and expects to have the data by the middle of the first quarter of 2010.


Marcellus shale – St. Mary has drilled and completed its first two horizontal wells in this program. The wells are the Potato Creek 1H and the Potato Creek 3H (both SM 70% WI). These wells are located in McKean County, Pennsylvania. The Company is currently laying a temporary sales pipeline to test the first well. As a reminder, St. Mary has a total acreage position of approximately 41,000 net acres in McKean and Potter Counties in north central Pennsylvania.


Granite Wash – The Company recently participated as a non-operating partner in a horizontal Granite Wash well on the eastern side of its acreage position. The well, the Hostetter #1-23H (SM 25% WI), is operated by Apache Corporation and had operator-reported production of 17 MMcf of gas and 800 barrels of liquid hydrocarbons per day. St. Mary believes this result is indicative of the resource potential in a number of locations across its acreage postion. The Company plans to move one of the rigs currently drilling in its Deep Springer program to the western side of its acreage position by year end. St. Mary has approximately 31,000 net acres with potential for horizontal Granite Wash development. All of this acreage is held by production.


Woodford Shale – St. Mary recently completed drilling operations on the last well in a planned simul-frac pilot. Four offset wells will be completed near an existing well in a 320 acre half section. This pilot and the previously announced simul-frac pilot on 128-acre spacing are aimed at determining the optimal spacing for future development. The Company expects to have the wells in the current pilot completed by the end of 2009. The leasehold in this play is almost entirely held by production and St. Mary has no operating rigs running in the program due to lower natural gas prices.


Bakken/Three Forks Sanish – St. Mary picked up an operated drilling rig in the Williston Basin in September. The Company plans to test the Bakken and Three Forks Sanish formations on its Bear Den acreage, which is southwest of the Nesson Anticline





in eastern McKenzie County, North Dakota. St. Mary also plans to test the Three Forks Sanish formation in Divide County, North Dakota.
Wolfberry Tight Oil – Two operated rigs are currently operating at Sweetie Peck in the Wolfberry tight oil play, which is up from zero rigs earlier in the year. During 2010 the Company will be evaluating the potential of 20-acre downspacing in the play.


Rocky Mountain Oil Property Divestiture – The Company is currently marketing a package of non-core Rocky Mountain oil properties in Wyoming and North Dakota. These assets will be monetized to help fund the continued development of the Company’s strategic resource plays and to increase focus on resource play opportunities. These properties have current production of roughly 3,000 BOED and the marketing firm has estimated proved reserves for the package to be approximately 20 MMBOE (93% oil). The data room is set to open on


Read more: http://www.faqs.org/sec-filings/091102/ST-MARY-LAND-and-EXPLORATION...

Permalink Reply by Cheerleader on December 7, 2009 at 14:32

ALongview,
I am not doubting their expertise with a vertical.
You said, " If their results are consistently at or better than their own estimates of 12mmcfd-16mmcfd IP in San Augustine then they will drill Haynesville wells."
Where did you get these figures? Are these figures based on general IP for vertical Haynesville wells or Horizontal? And/or are these figures based on projections based on the proximity of the Kardell well?? I think the new SM well is approximately 3 miles north of the Kendall.
I would love to see an IP larger than the Kardell! I wish St. Mary the best in drilling this well!! I would love to see San Augustine break every one of it's own records, one right after the other. SAN AUGUSTINE IS THE MOTHERLOAD!!!!!

Permalink Reply by RBH on December 7, 2009 at 13:15

st mary's latest Investor presentation-: (FYI, St Mary has drilled plenty of horizontal wells-Eagleford Shale, James Lime,
Marcellus Shale)

http://www.stmaryland.com/Investors/BofA%20NYC%2011-17-09%20-%20pre...

Permalink Reply by RBH on December 7, 2009 at 13:22

in St Mary's Operation Update: 11/02/2009 ST. MARY PROVIDES OPERATIONAL UPDATE; UPDATES PERFORMANCE GUIDANCE FOR 2009
http://stmaryland.com/news/index.htm

St Mary owns all 100% of 1st vertical Haynesville Test-USA Bl #1-san augustine 7 day sales rate 1.9 MMCF/day and 2nd Haynesville (also a vertical well) Blackstone PB #1--Shelby; St Mary shooting #D seismic over it's E Tx position and expects results mid 2010..so the vertical wells are delineating their acreage for all of the pay zones..including the Haynesville

They also said Industry rule of thumb-apply factor 6 to 8 to estimate potential IP of Horizontal Haynesville versus vertical IP well

Permalink Reply by James L. Williams on December 7, 2009 at 17:37

The factor is mostly just the ratio of the rock volumes being drained for the two well types, and depends on factors like the thickness of the pay zone, the effective frac radius, the length of the lateral, and the number of frac stages. For a 240 ft. thick pay zone, a 5000 ft lateral, a 330 ft. effective frac range, and 10 stages, I get a ratio of about 8 from a quick back-of-the-envelope calculation. If the pay zone was 1000 ft thick it might be more cost effective to drill a vertical well than a horizontal well. I'm an aerospace engineer rather than a petroleum engineer, so my reasoning may be flawed.

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