Replies to This Discussion

Permalink Reply by tony allen on August 15, 2012 at 7:50

Les B,

Mr. Mueller states that the oil is selling for $105 and the gas will sell for $5.50. The 30 day rate of 350 bbls and

3.7 mmcf generates a monthly income of $1.7 million. What kind of decline curve would make this well economic and based on that decline curve what would be the EUR?

Permalink Reply by Skip Peel - Mineral Consultant on August 15, 2012 at 8:09

Good questions, tony.  Maybe you should send Les B. a message and invite him to this discussion.

Permalink Reply by tony allen on August 15, 2012 at 8:25

Thanks Skip, I will send him a message. Did you see the post that Tribo made about the Q&A part of the webcast? I can't find that post,it must have been deleted, did you read the part about Mueller saying they would add about 20k more acres? I did not here any Q&A in the webcast.

Permalink Reply by Skip Peel - Mineral Consultant on August 15, 2012 at 8:32

Richard posted two discussions on the same subject.  I suggested that he delete one of them so we could keep all the responses together in one thread.  The Q&A comes after the presentation and a transcript will be available later today I suspect.  At least that's the way it usually works. 

Permalink Reply by obed w odom on August 16, 2012 at 4:40

Whenever the meeting adjourns to the so-called "breakout room" for further discussion, it seem that this further discussion is not included in the transcript, so Tribo's account may be all we get from the breakout room.

Permalink Reply by Tribo on August 16, 2012 at 10:12

There was only one other question asked about the BD during the Q&A but I walked in as he was finishing his answer and didn't catch it. I think it was regarding fracs. I have followed this board for quite a while but never posted before yesterday so please excuse my inexperience. I can't find my discussion in the LSBD list, only in "My Discussions"' did I post it incorrectly? That's how I ended up posting twice. How do I move it over here so Tony can get it?

Permalink Reply by Skip Peel - Mineral Consultant on August 16, 2012 at 10:19

You can cut-and-paste the response from any other discussion into a Reply box in this discussion.

Permalink Reply by Les Bamburg on August 15, 2012 at 19:28

Tony, using $10MM well capex and initial production from above I have the following:

 

For a reasonable decline rate (50% 1st yr) - 78% ROR & ~ 401 MBO EUR

For a more severe decline rate (83% 1st yr) - 21% ROR & ~ 167 MBO EUR

Permalink Reply by tony allen on August 16, 2012 at 3:56

Thank you for your time and effort Les.

Permalink Reply by tony allen on August 16, 2012 at 4:26

It seems we need a decline rate of 50% or an increase in production to make this attractive to SWN. When you did the math on the EUR did that include the gas production? If not, how would that change the economics? Do you think SWN would continue to allocate capital to the play if they saw an average decline of 83%? It seems they can get a better ROR in other plays.

Permalink Reply by Les Bamburg on August 16, 2012 at 6:13

Tony, the economics included the natural gas and associated NGLs ut the EUR value was only the oil volume.  By the way I used $5/Mcf and $100/Bbl flat for pricing.

 

Regarding ongoing capex, a lot will depend on SWN's view of the risk and consistency of the wells across their acreage position.  As you pointed out the LSBD must compete for capital with the Fayetteville and Marcellus Shale plays.

Permalink Reply by oil field trash on August 18, 2012 at 1:54

is the 3.7mmcf the flow rate after the flowback was completed. Or was this the opening rate before well was cleaned up. I'm a welltester myself and have tested alot of wells in the Fayetteville. I'm now in the Marcellus shale in PA. Most all the wells in Fayetteville i have tested drop to around 1mccf or lower. But my work was for Cheseapeke and BHP Billiton. Not sure if SWN is doing somthing diffrent.