WorldWide Drilling Resource

New Life for an Old Oil Field? Compiled by Amy White, Associate Editor, WorldWide Drilling Resource ® Range Resources, the first company to drill the Marcellus Shale, is hoping for new payoffs from an old gas field in a different area. Range Resources recently made a $4.4 billion deal for Memorial Resource Development Corporation, and a previously unnoticed formation known as the Cotton Valley Formation, is central to the purchase. It is a conventional gas field near the U.S. Gulf Coast, the kind many onshore drilling contractors have vacated since Range Resources helped revolutionize Pennsylvania’s Marcellus Shale with modern hy- draulic fracturing techniques. The Cotton Valley Formation is a tight gas play covering 220,000 acres of leases and drills stretching from East Texas to the Florida pan- handle. The Cotton Valley has been drilled for decades, with the first wells dating back to the 1930s. The ancient sandstone formation’s high- pressure spots in Louisiana and Texas include four different, thick- producing layers, along with high pressure which helps production. More than 21,000 vertical wells have been drilled into the play, and these wells have displayed long-lived, predictable production outcomes. Although it is primarily a natural gas play, some oil has also been produced. Located in northern Louisiana, Terryville Field is part of the Cotton Valley. According to analysts, it has proven to be as competitive as the top Marcellus producer, and others in Appalachia. Terryville’s success is part of an overall national trend of employing modern hydraulic fracturing to stimulate production in old fields. Memorial has been using horizontal drilling, and reported wells last fall with 30-day initial production averaging more than 30 million cubic feet per day. Continued drilling success could position gas wells in the Cotton Valley among the best U.S. onshore gas wells of all time. Economic factors are nudging gas drilling contractors in the direction of Louisiana as the boom in the Northeast faces setbacks. As of May 2016, Louisiana had more operational gas drilling rigs than any other state, just two years from a low point when Louisiana had about half as many rigs as Pennsylvania, and about a fifth as many as Texas, according to Baker Hughes, Inc. A lot of gas demand is currently com- ing fromMexico, and from export terminals and industrial development along the Gulf Coast. Announcing the deal with Memorial, Jeff Ventura, chief executive, said Range Resources has gained a strategic advan- tage from its new option to produce and sell gas from a location in close proximity to these new sources of demand. Editor’s Note: In between our print issues, the WWDR Team prepares an electronic newsletter called ws h E-Ne Flas . Based on readership, this was the most popular E-News Flash article of the month. Get in on the action and subscribe today at: www.worldwidedrillingresource.com 20 AUGUST 2016 WorldWide Drilling Resource ® Watch for the 2017 WWDR Marketing Guide Exciting News Coming!