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Our Projects
Logan County Oklahoma
History and Geology
There are two 320 Acre lots in this opportunity representing North (N/2) and South (S/2) of a one square mile block (640 acres) in Logan County, Oklahoma. SEA has two options, one for the Southern half which is the subject of the funds from this raising, and one for the Northern half which is on extended terms leading into an IPO, providing good potential from the expenditure of further funds from an IPO in this prolific ‘Hunton shale’ oil and gas production area.
The Horsethief #1 horizontal prospect was drilled in August 2006 with a target depth of some 9,000ft. Drilling operations were suspended at 7,800ft when the Operator was placed into administration. The well is designed to extract gas originating from the Hunton and Woodford Shales, which has accumulated extensively in the Clarita and porous Cochrane horizons, which are relatively uniform and gently undulating throughout S2 and N2. A number of successful horizontal and vertical wells have been producing gas and oil in the vicinity of this 640 acre property. Previous volumetric reserves for current gas and oil in place S2 acreage is 7.11 BCFG, and 1.2 MMBO. For N2 the volumetric reserve is 6.75 BCFG and 1.15 MMBO. A horizontal well such as Horsethief #1 is expected to have reserves of 160,000 BO and 1-1.5 BCF. In 1966 a vertical well was drilled on the property to target oil, the Rhodes#1-23 Breaux well, the well produced oil cut water and approximately 1,000,000 cfgd until the volume of water produced made continued production of oil un-commercial for the price and technology available. All gas produced was vented as there was no local infrastructure at that time. Other wells in the locality have also shown similar strong gas production. With today’s technology it is possible to de-water such production zones at a relatively low ongoing cost and get the substantial gas flow to market. Based on mud logs during the drilling of Horsethief #1 to 7800ft, the consulting geologist to the operator suggested the well should produce when completed between 1,000,000 and 1,500,000 cfgd and some 30-50 barrels of condensate, and that there would be little or no decline in production over the first two years whilst de-watering continued.
Drilling and Completion
Horizontal drilling technology has been advancing strongly over the past 20 years, making possible oil and gas plays which had previously not been technically viable. As most productive oil and gas zones within rock beds are laid horizontal to the surface of the earth a vertical bore hole has limited capacity to produce extensive surface contact with the pay zone, horizontal drilling technology allows for extended contact with the pay zone thus providing far more extensive drainage per well and therefore greater commercial production. The drilling to complete this well will be done by a ‘Coiled Tubing’ drill rig, specially designed to drill through and around bends with limited risk of damage to the hole or the rig. Due to the extent of pre-drilling the completion of this well should take no more than 2-3 weeks at a lesser cost than a new start well. Completion will require staged fraccing and the placement of a perforated lining cylinder in the hole with a small submersible pump at the sump point to extract water. An existing abandoned well has been approved for water disposal use near the site of Horsethief #1.
Crockett County Texas
History and Geology
This gas drilling opportunity is located on The Adams Ranch, Crockett County, Texas approximately twenty five miles south of Ozona. The target zone is the ‘Canyon Sandstone’ part of the prolific Adams-Baggett Canyon Sandstone Field.
The so called ‘Canyon Sandstone’ of southern Crockett County are actually Lower Permian Wolfcampian Age sediments that were deposited by Lower Permian Wolfcampian Age seas as they transgressed and regressed along the north flank and northeast flank of the south dipping Val Verde Basin. These deposits extend to the west across southern Crockett County and into the adjoining Terrell County, Texas. Canyon Sandstone gas pays are a series of shallow marine deposits, such as channels, bars and slope deposits that are stacked vertically to develop a thick pay zone sequence at a depth of 4800-5500 feet on the target acreage. Numerous wells have been drilled and produce in this target field. Drilling began in this area of the Permian Wolfcampian Basin in 1973 when a gas pipelines was completed to the area. The ‘Canyon Sandstone’ gas wells were initially drilled on 160-acre spacing. However, it became apparent the wells had a small radius of drainage and spacing requirements were reduced to 80-acre. Subsequently the spacing requirements were reduced to 40-acres, and most recently 20-acres. The obvious result of this is there are many Proven Undeveloped locations (PUD) that are available on the acreage. The wells subject to this offer will be drilled at a spacing of 20-acres, and it is generally accepted that there will be no risk of co-mingling of the gas production zones of influence at this spacing.
Drilling and Completion
Lithographically the Wolfcampian sandstones are generally a fine to very fine grained light coloured angular to sub angular fairly well sorted very calcareous sandstones and can grade into very sandy limestone, as such they tend to be less permeable (considered ‘tight’) than other formations and require ‘stimulation’ of the seam to enhance permeability and increase gas flow. Hydraulic fracturing or ‘fraccing’ is a term for injecting high pressure fluid laden with clean sand into the seam. This process causes pre existing fractures to split and open up whilst the sand grains form ‘props’ to maintain the newly opened fractures. The fluid in the well is then pumped out, this reduces the hydrostatic or ‘confining pressure’ until the pressure of gas in the seam is greater and the gas begins to flow. Water will continue to flow into the well at a slower rate from the seam and would eventually stop the flow of gas, to counter this small amounts of detergent is trickled to the base of the well which allows for a gas/water mixture (foam) to rise to the surface which is separated in a separator tank.
Brownwood County Texas
History and Geology
The west Thrifty Field was developed in the 1930’s there are currently 67 producing oil wells in this field, there has been over 8 mmbo produced to date. The West Thrifty Field lies within the Bend Arch-Fort Worth Basin Province in north central Texas. The most important and prolific reservoir rocks in the Thrifty Field are The Ellenberger Group, Marble Falls, Fry Sands, and the Lower Pennsylvanian Caddo Limestone; source rocks include The Upper Devonian Woodford Formation, and the Mississippian Barnett Shale. The Lower Pennsylvanian Caddo Limestone is a prolific hydrocarbon producer in the Bend Arch area and will be the target zone of this re-entry well. The Caddo Limestone porosities and permeability tend to be low. Fracture stimulation is generally required in the Caddo Limestone of the Bend to produce economically viable combined oil and gas flows. A typical Caddo Limestone well in the Bend might produce 10-20 bopd and 75-150 mcfgd. Well Open Hole and Bond Logs for the #2C well, and other nearby wells have been assessed by a senior well log analyst for SEA. The report indicates the presence of commercial quantities of hydrocarbons at the upper zones of the Caddo Limestone at a depth of some 1700-1800ft depth.
Completion
The Operator of the field is primarily concerned with secondary retrieval of oil from the Ellenberger wells through water flood technology, however this well was plugged above the Ellenberger before the current operator took control of the leases. The current Operator will re-enter the well and isolate the Caddo Limestone in the areas identified by the log analyst and complete a water/sand fracturing on the Caddo Limestone strata, this will give the well which is fully equipped and hooked up to separator tanks and compression units a second productive life. Based on the success of the new production SEA and the Operator under the ‘Area of Mutual Interest’ terms of the participation agreement will make an economic evaluation of further similar commercial development of wells in the vicinity.
Lavaca County Texas
History and Geology
This opportunity lies in the Upper Texas Gulf Coast in an area of Lavaca County which is characterized by gently southeast dipping faulted monoclines in the Miocene, Frio and Vicksburg horizons. The deeper horizons at the Yegua and below are trapped on northeast-southwest orientated faulted anticlines. Production has been established in the Miocene, Frio, Vicksburg, Yegua, Wilcox, and Edwards formations. Recoveries have been very good, and for the most part have been gas-condensate. The area of interest will be gas condensate. The main target reservoirs will be the Frio sand at 2230 feet deep and the Yegua at 4670 feet.
In 2000 a well, Fitch#1, was drilled on the property, this well targeted the Yegua sands at a depth of 4670 feet. Fitch#1 was highly productive for 1 year after intercepting the Yegua horizon and produced nearly 0.178 BCF of gas in that year alone before abruptly discontinuing and being subsequently plugged and abandoned. One theory is that the rapid rate of gas production without proper choking may have drew water from the water table locally to the well point and plugged the well in what is known as a ‘water plug’, the management of the well in this way may be further explained by the commercial environment in 2000 when gas prices were much lower. It has not been possible to confirm this theory with the previous operators, water plugs are invariable permanent.
Drilling and Completion
It has been estimated from available data including neutron density logs that the Fitch#1 well now abandoned has possible reserves in the Frio sands at 2230 feet of possibly 1.1 BCF, and the Yeguna at 4670 depth would have a remaining 4.82 BCF of a total prior 6.6 BCF. The operator intends to drill out the upper plug of the Fitch#1 well to the Frio sands, apply a new neutron density log and subsequently perforate and complete the well for production. This approach is cost effective due to the pre-existence of well lining and collar, no stimulation is required due to the permeability of the sands. Following the initial well SEA may continue to participate in the development of the whole 366.2 acres, which will be primarily targeting Yegua, however following decline or any adverse local geology each well will have a secondary target in the upper Frio sands.