by coffeeguyzz » Sun 02 Nov 2014, 02:06:33
rockman, great questions all, and while I am far from an authority in answering you, I will do my best.
The furious 'land grab' in the Bakken in the years 2008-2012 overlapped with the similar rush in the Eagle Ford. EOG - described as 'owning' the Parshall - was heavily involved in both areas. The upfront outlay of capital to the mineral rights owners was substantial, although the $300/acre cost in 2009 in EF pales with the current market valuation of well over $20,000/acre.
EOG, like all the other operators, had 36 months, essentially, to produce hydrocarbons of go bye bye. Thus the massive amount of drilling in what often times were less than optimal long-range (productivity/EUR-wise) conditions. (And these were frequently the wells used by predictive analysts to forecast long range, field-wide ultimate recovery numbers.)
When the Parshall was protected by the HBP leases, they turned their main attention and resources to the EF where they say they will not develop any well/area with less than a 60%/yr return. I am sure you realize how preposterously high that number is historically in this industry, but that is their stated intent.
So, back to the sweet spot, Parshall field. I just checked the ND dmr site and it looks like there are about 4 rigs currently drilling. (The nearby Sanish field, also a mega sweet spot, has double that number.)
No one but the suits at EOG can definitively say why they are holding off further production/development there, but my educated guess is that there is still a fair amount of evaluation/uncertainty as how to best proceed. The pace of technological advance has been truly stunning these past few years ... 93 stage frac job (on one run, no less) with a CT rig, inter-well spacing of 500 feet or less, increasing amounts of varying and evolving types of proppant, and on and on.
EOG doesn't have to develop this sweet spot, rock, and I guess they won't until they feel confident that they have the best way of proceeding.