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Anadarko estimates net resources of 500M to 1.5B barrels oil equivalent in Colorado Wattenberg field

Anadarko Petroleum Corporation provided an update on its Horizontal Niobrara and Codell drilling program in the Wattenberg field (Wattenberg HZ) of northeastern Colorado. To date, the company is producing from 11 horizontal wells within the Wattenberg field boundaries, with each well achieving strong initial rates and high liquids yields.

Based upon the early results of Anadarko’s program in the Wattenberg field, we are confident the liquids-rich Horizontal Niobrara and Codell opportunity provides a net resource potential of 500 million to 1.5 billion BOE (barrels of oil equivalent); and it’s located right in the heart of one of our existing core areas.

Our activity, which has primarily targeted the Niobrara formation within the Wattenberg field boundaries, has achieved high liquids yields and excellent well performance with average initial production rates of about 800 BOE per day. The value of this resource is further enhanced by our extensive mineral ownership throughout the Land Grant that provides royalty revenue on both operated and non-operated activity. Our strategic acquisitions of and access to midstream assets in the region that include operated infrastructure, takeaway capacity, NGL (natural gas liquids) processing, and the White Cliffs Oil Pipeline provide us with an additional economic advantage. We expect the alignment of our assets, coupled with future investments in expansion opportunities, will continue to enhance field recoveries, access to premium markets and robust margins.

—Anadarko Sr. Vice President, Worldwide Operations, Chuck Meloy

Wattenberg HZ Program Highlights
Future drilling locations: 1,200 - 2,700
Estimated ultimate recoveries (EURs): 300,000 - 600,000 BOE per well
Net resources: 500 million - 1.5 billion BOE
Initial well costs: $4.0 - $5.0 million
Liquids ratio: ~ 70%

Anadarko’s best horizontal well to date, the Dolph 27-1HZ, demonstrated an initial production (IP) rate of more than 1,100 barrels of oil per day (BOPD) with more than 2.4 million cubic feet of natural gas per day (MMcf/d), resulting in an estimated EUR of better than 600,000 BOE. The Dolph well also paid out in less than four months.

Anadarko is the largest net producer in the liquids-rich Denver-Julesburg (DJ) Basin at more than than 70,000 BOE per day. The company holds interests in more than 350,000 net acres in the Wattenberg field, and operates more than 5,200 existing wells with an average working interest of approximately 96%, and an average net revenue interest of approximately 88%.

As part of its ongoing program, Anadarko will be conducting extensive tests to define the optimum spacing and lateral lengths for the Niobrara and Codell formations. The company also plans to increase the Wattenberg HZ drilling program to seven rigs by the end of 2012, while increasing the number of horizontal wells drilled during the year to approximately 160 from about 40 in 2011.

The results to date demonstrate the Wattenberg HZ program is among the most cost-efficient development projects in our US onshore portfolio, and with initial wells averaging payouts of 10 months, we expect it to quickly become a self-funding, significant cash-flow generator.

Outside the Wattenberg field, we’re also exploring additional liquids-rich horizontal opportunities where we hold another 550,000 net acres in the greater DJ Basin and 360,000 net acres in the Powder River Basin. Each area is prospective for the Horizontal Niobrara, as well as other horizons that we will evaluate over time.

—Chuck Meloy

Comments

HarveyD

Good news for USA to reduce Oil imports. Another 20 like this one could make a difference.

Dave R

Yeah - 20 of them might make a _small_ difference.

500M barrels is less than a month's supply in the US.
1.5B barrels is less than 3 months supply in the US.

So 20 of these fields would get us somewhere between somewhere between 2-6 years of oil.

That's barely a scratch in the surface.

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