Production

New Record Well For Continental Resources

Over-pressured Meramec wells in STACK are delivering some of the highest returns across the play. Continental Resources (NYSE: CLR) announced a new record well for the company, the Angus Trust 1-4-33XH located in Blaine County, OK.

The new well produced 4,642 barrels of oil equivalent (Boe) per day in a 24-hour test, comprised of 2,088 barrels of oil (Bo) and 15.3 million cubic feet (MMcf) of natural gas. During this initial production test, the Angus Trust flowed at 5,200 psi (pounds per square inch). Continental has a 78% working interest in the well. The well which spud on January 20th of this year is a multi-section unit comprising Section 4-14N-12W and Section 33-15N-12W.

Interestingly, CLR had previously in 2011 drilled and completed one HZ Woodford well in each of these sections. The Roach 1-4H in Section 4-14N-12W and the Crawford 1-33H were short laterals, neither of which have performed very well.

The Angus Trust well is located immediately north of CLR’s Boden 1-15-10XH in south central Blaine County. The Boden produced an initial 24-hour test rate of 3,508 Boe, 28% oil, at a flowing casing pressure of more than 5,000 psi. The Boden was CLR’s first completion in the condensate window of the over-pressured STACK. In just over a year, the Boden has produced 591,000 Boe, 26% oil. The Boden is currently producing 1,815 Boe per day, 22% oil, at a flowing casing pressure of 2,900 psi.

CLR Recap of Operations in Blaine County

With this new announcement, we decided to look back at CLR’s activity in Blaine County over the last 24 months, which by most metrics, has been the hottest county in Oklahoma during that time period.

  • CLR announced the first Meramec well in the over pressured portion of the STACK back in August of 2015.
  • Since then CLR has completed 23 wells in the Meramec
  • CLR oil inventory overview • ~57 operated units • ~60% operated working interest
  • Average density: at least 8 Meramec wells and 4 Woodford wells per 1,280‐acre unit
  • 47,000 net acres in over‐pressured oil window de‐risked and ready for development
  • 4 unit developments currently drilling
  •  Testing up to 5 wells per zone
  • 11 additional unit developments planned

In the last 24 months, CLR has filed 104 new drilling permits in Blaine County, with the majority of these being Meramec wells. In the same time period, CLR filed 32 new completions.

The Economics and Type Curve for the Meramec

The Meramec shale is one of America’s emerging top tier liquids plays that supports drilling economics on par with the Eagle Ford and the Delaware Basin in the Permian. The average breakeven oil price in the Meramec oil window is estimated to be in the low $30s/barrel, and that goes down closer to the low-$20s when targeting the core of the over-pressurized crude window. The oil production is high gravity 44+ degree API and gas here is typically >1,400 Btu.

Recent extended lateral wells in the over-pressured STACK in Blaine County, Oklahoma, have led Continental Resources to release a new 1.7 MMboe Meramec type curve.

Current CLR Production

CLR currently has 57 HZ wells in Blaine County reporting production.

CLR Key Well Completions

  • Madeline 1-9-4XH IP’d 3,538 boe/d (71% oil)
  • Verona 1-23-14XH IP’d at 3,339 boe/d (70% oil)
  • Boden 1-15-10XH IP’d at 3,508 Boe (28% oil)
  • Ludwig 1-22-15XH IP’d at 2,076 boe/d (74% oil)
  • Ladd 1-8-5XH IP’d at 2,181 boe/d (79% oil)

December Production Exit Rate Revised Higher

As a result of strong production in both North Dakota and Oklahoma, CLR has increased its expected production exit rate for December 2016. The Company now expects to exit 2016 with production in a range of 213,000 to 218,000 Boe per day, compared with the previous guidance range of 205,000 to 210,000 Boe per day. The Company expects to maintain approximately this production level through the first quarter of 2017.

Compiled and Published by GIB KNIGHT

Gib Knight is a private oil and gas investor and consultant, providing clients advanced analytics and building innovative visual business intelligence solutions to visualize the results, across a broad spectrum of regulatory filings and production data in Oklahoma and Texas. He is the founder of OklahomaMinerals.com, an online resource designed for mineral owners in Oklahoma. ☞Email: [email protected]

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