Vertical well operators seek options

By Adam Wilmoth
June 2, 2018

Goetz Schuppan said he already has lost 15 older, vertical oil and natural gas wells because of nearby horizontal drilling activity, and he is preparing for much more damage in the near future.

Schuppan is president of Hennessey-based Singer Oil Co., which operates older wells in Kingfisher, Blaine and Garfield counties in the heart of the booming STACK play.

“So far, operators have been putting in one horizontal well per section. Now they’re putting in eight or nine more wells on the same section,” Schuppan said. “Some of our wells that survived before will not survive that kind of onslaught.”

Schuppan spoke Friday at the inaugural annual meeting of the Oklahoma Energy Producers Alliance, a group formed to represent the state’s vertical well operators, which tend to be small or family-owned companies. The group has grown to more than 300 members, most of whom attended Friday’s meeting.

Schuppan blames hydraulic fracturing on nearby new horizontal wells for flooding his decades-old vertical wells with high pressures and large amounts of water. In at least two cases, water and pressure from the nearby horizontal well caused Schuppan’s production storage tank to overflow.

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OEPA embarks on “Lunch and Learn” tour across the state

When we started building OEPA just a year ago, we had one goal: to protect conventional producers in Oklahoma at the state capitol, the Oklahoma Corporation Commission, and in the courts. That goal is the sole mission of OEPA and it is energizing producers and industry friends across the state.
The OEPA Board of Directors has embarked on a “Lunch and Learn” state tour telling those in cities and small communities across Oklahoma about our mission and how we must all work together to ensure a brighter tomorrow for generations ahead. We have been reaching out to those in the oil and gas industry, and even more so- those who are not in the industry on why we were formed, how we were formed, and simply: what we are doing. Not only do we want to hear the concerns of our industry friends and neighbors, but our goal is to attract members and form partnerships with those other likeminded individuals and organizations.
We had our first luncheon in Cleveland, OK last month and were shocked when over 50 people showed up. That told us something. It told us that oil and gas producers around the state are looking for someone to appreciate the problems they are facing. Oklahoma Energy Producers Alliance wants to be that organization to stand up for our fellow conventional producers.
We have already had two more luncheons this week. The first, in Oklahoma City, where we were honored to host all 3 Corporation Commissioners, along with numerous producers and non-industry friends. The second, in Tulsa, where we hosted over 15 legislators along with members of OEPA and prospective members.
Our plan is to have one “Lunch and Learn” per month in different communities throughout Oklahoma. Stay tuned- we are coming to your town soon!

Oklahoma State University research concludes that tax incentives have had no effect on Oklahoma drilling activity.

Oklahoma State University research concludes that tax incentives have had no effect on Oklahoma drilling activity.

“In this paper, we build on this existing literature by examining whether Oklahoma’s severance tax reduction has led to disparate effects for horizontal versus conventional drilling as compared with its neighboring states. These states, particularly Texas, share a similar oil and gas resource potential, which we will use in this paper in order to isolate the effect of the tax policy on development from differences in development due to resource disparities. Our findings suggest that the Oklahoma tax exemption has not increased horizontal drilling activity.” ~excerpt from the study

Read the entire study here. http://bit.ly/2ErwujI

OEPA in Kingfisher

Here are a few of the decline curves plus the bottom hole pressure survey that shows the actual hit in real time.  The well with the pressure survey (Wakeman) actually got “bumped” (our term) from a November, 2015 frac that caused a loss in oil production (30 BOPM to 5 BOPM) (See decline curve), then “hit” in May, 2016 which killed it.  It has partially recovered.

The King-Vieth well was just hit again by another frac, so May oil and gas will be down and water up.

The Perdue 17-2 has seen an increase in production due to the hit.  But, as noted, the expenses have skyrocketed due to the frac hit (We had frac sand in the pump the last time it was pulled).

Steve Altman – Kingfisher County

 

Below are links to documents of the decline curve and the other evidence of loss of production because of horizontal frac jobs:

 

http://okenergyproducers.org/wp-content/uploads/2017/05/Wakeman_1_bottom_052016_Quick-Look.pdf

 

http://okenergyproducers.org/wp-content/uploads/2017/05/Wakeman-1.xls

 

http://okenergyproducers.org/wp-content/uploads/2017/05/Shutler-30-1.xls

 

http://okenergyproducers.org/wp-content/uploads/2017/05/Foster-25-1.xls

 

http://okenergyproducers.org/wp-content/uploads/2017/05/400010-2020-Oltmanns-1.xls

 

http://okenergyproducers.org/wp-content/uploads/2017/05/118900-2020-Thiems-A-1-1.xls

 

http://okenergyproducers.org/wp-content/uploads/2017/05/112600-2020-Marjorie-A-2.xls

 

http://okenergyproducers.org/wp-content/uploads/2017/05/111800-2020-Sherman-17-1.xls

 

http://okenergyproducers.org/wp-content/uploads/2017/05/110700-2020-Perdue-17-2.xls

 

http://okenergyproducers.org/wp-content/uploads/2017/05/104400-2020-King-Vieth-1.xls