Evaluating Barnet and Woodford feasibility in comparison to USGS assessment.
The USGS released a new assessment this month on reserves for the Woodford and Barnett shales in the Permian Basin. These deeper formations have been increasingly discussed as alternative or supplemental targets to traditional Wolfcamp, Sprabery, and Bone Spring intervals for new development in the Permian, and some larger Permian players like Occidental, Continental Resources, Diamondback, and ConocoPhillips have already started testing these zones. While the USGS assesses that these two formations include 28 TCF and 1.6 billion barrels of technically recoverable reserves across the Permian Basin, TGS interpretation focuses on the core fairways for each zone and benchmarks production profiles and economic returns against the more prolific shallower target zones.
The Barnett Shale in the Midland Basin is much more oily than the legacy Fort Worth Basin Barnett play, where contemporary wells show primarily volatile oil and retrograde gas fluid compositions. Ranging from 100’-350’ thick and depths of 9,000’-12,000’, the core of the Midland Barnett play has substantial pay potential. Figure 1 shows a comparison of the TGS core fairway interpretation with the USGS reserves outlines. TGS interpretation of wells drilled in the last 5 years shows lower well and economic performance compared to Spraberry and Wolfcamp targets. However, a major factor to consider is the significantly reduced water volumes from the Barnett, in stark contrast to other primary Permian targets. Over the last two decades, producing water-oil ratios from across the Permian have steadily been increasing (Figure 3). If this trend continues, the Barnett could be an ideal alternative for operators without favorable midstream water disposal options.
The Permian Woodford is the deeper of the two plays, with core acreage situated on the east flank of the Delaware Basin and Western Central Basin Platform. Figure 4 shows the TGS-interpreted core Woodford acreage in comparison to the USGS assessment areas. The play fairway ranges from 300’-800’ thickness and yields significant gas and condensate volumes (Figure 2). In contrast to the core of the Barnett, the Woodford fairway is more structurally complex and sits in a broader range of depths, limiting the areal extent of potential development and introducing additional risk. The economic upside is also limited by higher D&C costs from increased depth, and a dependence on gas and NGL commodity prices and takeaway capacity.
Both the Woodford and Barnett appear to be increasingly viable alternatives as Permian operators continue to develop, especially as tier 1 Wolfcamp, Spraberry, and Bone Spring targets are depleted. While neither is a golden ticket that can compete across the board, both deeper targets have unique characteristics that may be favorable within specific economic and operational conditions.
Figure 1. (a) Comparison of USGS Barnett play outline with TGS Barnett Core outline and (b) TGS Barnett Isopach Thickness
Figure 2. Well Performance and Economics Benchmarking
Figure 3. Permian Basin water production increasing over the last two decades
Figure 4. (a) Comparison of USGS Woodford play outline with TGS Woodford Core outline and (b) TGS Woodford Isopach Thickness
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