Southwestern Provides Brown Dense Update (8/2/12)

"Southwestern has approximately 563,000 net acres targeting the Lower Smackover Brown Dense formation in southern Arkansas and northern Louisiana. The company has drilled four wells in the play area to date and is currently drilling two wells.  The company’s first two wells, which were completed earlier this year, are currently shut-in for testing. The company’s third well, the BML #31-22 #1-1H located in Union Parish, Louisiana, was drilled to a vertical depth of approximately 10,400 feet with a 4,300-foot horizontal lateral and was completed with 19 successful fracture stimulation stages in June. After 41 days of flowing up casing, this well’s highest 24-hour producing rate to date was 421 barrels of 50o API oil per day, 3,900 Mcf of high Btu gas per day and 836 barrels of water per day (43% of load recovered to date) with a calculated flowing bottom hole pressure of 5,700 psi on a 24/64-inch choke. The well was shut-in on July 27 in order to perform a pressure build-up test. The company believes that it will begin selling both oil and gas from the BML well in the fourth quarter of 2012. The oil pricing the company is receiving from this area is at a premium to WTI due to the geographic location of the play, and analysis of the gas shows a Btu content of approximately 1,220 per cubic foot, so it is expected to receive a premium to NYMEX gas prices due to the richer gas liquids. The company’s fourth well, the Johnson #21-22-1 #1 located in Union Parish, Louisiana, was drilled to a vertical depth of 10,507 feet in July. Like in the BML well, this well also encountered unusually high pressure within the target formation. The company plans to complete this well vertically in August, but the well will be able to be re-entered as a horizontal well in the future. The company has also commenced drilling on the Dean 31-22-1E #1, located in Union Parish, Louisiana, which is currently drilling at approximately 8,325 feet. This well is planned to be drilled to approximately 10,450 feet and be completed vertically. The company is also drilling the Doles 30-22-1H #1, located in Union Parish, Louisiana, which is currently drilling at approximately 6,375 feet. This well is planned to be drilled to a measured depth of approximately 17,300 feet and is currently designed to be completed with a 6,000-foot horizontal lateral."

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Replies to This Discussion

Permalink Reply by North LA on August 3, 2012 at 16:51

Here is a transcript from today's conf call for those interested.

http://seekingalpha.com/article/780611-southwestern-energy-manageme...

Permalink Reply by Sarah Randolph on August 4, 2012 at 5:07

Thanks North La. 

Permalink Reply by robert edwards on August 5, 2012 at 16:58

skip, i think you are right in the fairway.  it has not been totally discovered yet, but swn is narrowing the gap.  maybe that fairway will be in union parish

Permalink Reply by Skip Peel - Mineral Consultant on August 6, 2012 at 2:36

Sure looks that way at this time, robert.

Permalink Reply by Bradley McWilliams on August 6, 2012 at 13:29

Just so that all know it's there to look at, but SWN has posted a new "Investor Presentation". You can get the link right on there home page, but it doesn't really have anything new in it other than whats been discussed here. 

One thing it does have of interest, though not related, is a chart showing US electricity consumption for the last 20 years or so.  Kind of interesting that it's on a steep incline until 2008, then reverses to a steep decline, minus a year or so of climbing again from 2010 to 2011.  Just a sad statement on the lathargic economy we have these days.

Permalink Reply by PJ on August 7, 2012 at 9:33

guys this "chat" is why I joined the blog. you guys know stuff about O & G. Thanks for slogging through when the comments are personal and not useful to the purposes of the blog. Keep it up.

Permalink Reply by Les Bamburg on August 9, 2012 at 18:08

From reviewing the transcript from the recent analyst call it is apparent that Southwestern does not yet have sufficient information to identify the core area of the LSBD play nor determined how much of the play area can be economically developed.  The same would be true for other operators in the LSBD play.

 

Remember that in the early days of the Haynesville Shale operators had vastly different play outlines and had not identified some areas such as the Shelby Trough.  The same was true in the Barnett Shale where no developement occurred south of Fort Worth until several years after the northern core area drilling was initiated.   

Permalink Reply by Aubrey C. Sanders, Jr. on August 10, 2012 at 7:02

Les B,

A very enlighted and enlightening appraisal. Your contributions to this site are much appreciated.

Permalink Reply by GoshDarn on August 10, 2012 at 7:32

Just like you, Mr. Sanders, it has never appeared as though Les B. was posting on GHS to make money off of the members (e.g., off of the naive landowners who are new to all of this).  Les B.'s honesty and integrity has always been topnotch.

From day one, his analysis has been quite objective and above reproach.

Plus, his ego hardly ever gets in the way, since he seems never to have much to prove in an attempt to garner the limelight.  Instead, he sticks to the facts . . . with the obvious intent of helping others and also helping the Great State of Louisiana from whence he was born, grew up, and went off to study at a La. state college.

Permalink Reply by Skip Peel - Mineral Consultant on August 10, 2012 at 7:50

The first wave of Haynesville Shale wells from the Greenwood-Waskom Field in the NW to the Red River - Bull Bayou Field in the SE all found commercially productive shale.  And all the early blob maps included that continuous area.  The variations in the maps were on the periphery. 

In four years of active participation on GHS I have never made a remark that could be judged negative regarding an area and then made an offer to option minerals in that same area. 

Permalink Reply by robert edwards on August 10, 2012 at 16:54

very well said.

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