Oil Mini Boom > NorthWest Barnett Shale!

30th June 2012

Oil Mini Boom > NorthWest Barnett Shale!

Posted by blogwriter

Back in 2008, near the height of the natural gas drilling boom in the Barnett Shale, more than 200 drilling rigs operated in the big North Texas field. With the collapse in natural gas prices this year, that number is down nearly 80 percent from its peak.

But not in the northwestern reaches of the field. In Montague, Jack and Wise counties, there is nearly as much drilling activity as in 2008, accounting for half the 48 rigs now in the Barnett.

The reason? There's oil in them there hills, oil that simply doesn't exist in quantity in other parts of the Barnett. That's particularly true in Tarrant County, where the natural gas is "dry" -- with little liquid content.

That's only half the story.

During the first three months of this year, prodded by oil prices that had reached $100 a barrel, producers pumped just more than 19 million barrels of crude oil and condensate from the 24 counties that constitute the Barnett region, according to the Powell Shale Digest's review of Texas Railroad Commission data. (Condensate is a light liquid sometimes produced along with natural gas. It's worth about as much as oil.)

About 8.3 million barrels, or 44 percent of that production, came from the Barnett. The other 10.8 million barrels came from other formations, mostly situated above the Barnett.

At just over 52,000 barrels a day, the area's production is hardly in a league with the state's hottest new field, South Texas' Eagle Ford Shale, which just a few years after its discovery is producing nearly 200,000 barrels a day. But with the price of West Texas Intermediate crude oil still above $80 a barrel and natural gas prices depressed, it's enough to attract attention.

"It's kind of a miniboom in the oil boom," said Fort Worth producer Ray Richey, who has drilled several wells in Wise County this year and expects to drill a few more in the fall.

It's more than "mini" for Montague County Commissioner Jon Kernek. His Precinct 1 covers the southern part of Montague County, where he says at least 90 percent of the drilling in the county is done.

He feels that in his part of the county, drilling is as busy or busier than ever, including the 1980s boom after the 1979 Iranian revolution. Then, oil prices zoomed to record levels and sparked a U.S. drilling boom that didn't end until crude oil prices collapsed in 1986.

As Kernek's comment illustrates, counties west of Tarrant have long had modest oil and gas production.

For instance, one of the wells Richey drilled this year in Wise County is in an area where he said, "there are a few oil wells from the 1960s and '70s." His new well, which was drilled not into the Barnett but into a shallower oil formation, is making about 30 barrels of oil a day, roughly twice his expectation.

Tarrant and Johnson counties are the top two gas producers in the Barnett, yet produce little oil or condensate.

 

 

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