Granite Wash Oil & Natural Gas Field - Granite Wash Map

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Granite Wash Oil & Natural Gas Field - Granite Wash Map - Texas, Oklahoma

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What is the Granite Wash Play?    Granite Wash by definition is material eroded from granites and redeposited, forming a rock with the same major mineral constituents as the original rock.  That in simpler terms, means that Granite Wash received It's name from the weathering process that granite underwent over time. 

The Granite Wash Oil Play is geographically quite a large area, located in the Northern Texas Panhandle, spreading to Western Oklahoma and Southwest Kansas.  Oil & Natural gas are found in multiple zones at depths between 11,000 and 13,000 feet.  In certain plays, the natural gas is found as deep as 17,000 feet.  The thickness of the deposition may vary from 1,500 to 3,500 feet. There are currently 3600 Granite Wash wells and 922 Granite Wash Oil Producers. 

Granite Wash is located in the following counties: Beckham County, OK; Greer County, OK; Gray County, TX; Wheeler County, TX; Roberts County, TX; Hemphill County, TX;

Check out the Granite Wash Map Below 

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At current field prices, the Granite Wash Production yields very good rates of return, which is why we see independent companies beginning to converge on the area.  The high liquids content of the gas significantly enhances producer economics. The expected drilling and completion costs range from $5.5 to $6.5 million which is farely low considering the anticipated cash flow profile of the wells. There are currently only a few companies who are pouring significant funds into the Granite Wash oil & natural gas field but that population is beginning to increase and should continue to increase throughout the duration of 2011 & 2012.  The current well-known independents who have a stake in the Granite Wash Field are Apache Corp (APA),  Chesapeake Energy (CHK), Forest Oil Corp. (FST), St. Mary’s Land and Exploration (SM) and Penn Virginia (PVA).

Hogshooter Wash ( Hogshooter Formation ) - The Hogshooter Formation has recently been tested by Apache in Beckham County which produced two oil gushers of over 2,000 barrels of Oil per day.  The Hogshooter Wash could be the next big oil zone next to the Eagle Ford Shale.  It's a bit to early to tell but these two wells were 15 miles apart.  We will update you with any additional hogshooter formation details when we get them.  Check out the company drilling updates at the bottom of this page.

Granite Wash Play - Oil & Natural Gas News:

Linn Energy, LLC (LINE) drilled their second granite wash well and the prospects for big profit are looking very positive.  The well is 60.2 MMcfepd.  This is a much higher IP than both the Eagle Ford and Haynesville plays.  Linn has announced that their Granite Wash budget for 2010 is $53 MM which shows their confidence in the play. 

http://ir.linnenergy.com/releasedetail.cfm?ReleaseID=491038

Forest Oil Corp. (FST) reported that two Granite Wash oil wells delivered higher than expected company estimates.  The Granite Wash wells have an equivalent production rate of 37 million cubic feet equivalent per day 
 
http://www.marketwatch.com/story/linn-energy-announces-602-mmcfe-per-day-horizontal-granite-wash-well-2010-07-22?reflink=MW_news_stmp

Linn Energy, LLC (LINE) announced today that the Black 50-1H Granite Wash well that was drilled earlier this year produced a whopping 60.2 MMcfe per day:
The Company owns a 63 percent working interest in the Black 50-1H well, which tested at a 24-hour production rate of 27.0 MMcf/d of natural gas and 3,190 Bbls/d of condensate at 2,150 psi flowing surface pressure. The natural gas production has a heating value of 1,316 Btu/cf, and when processed, should yield approximately 3,530 Bbls/d of natural gas liquids. Including estimated NGL recoveries and shrinkage associated with processing the natural gas, the Black 50-1H well produced approximately 60.2 MMcfe/d.

"The outstanding results from this second well are considerably above what we expected. We believe this is the highest rate well reported in the Granite Wash trend. The liquids content of over 6,700 Bbls/d represents more than 65 percent of the production stream and we anticipate pay-out on this well in as little as two months. The well is located in an area where LINN has a large concentrated acreage position. As a result, there are numerous follow-up drilling opportunities," said Mark E. Ellis, President and Chief Executive Officer of LINN Energy. "Our operating team has continued to drill horizontal Granite Wash wells in less drilling days and at lower costs than expected. The Granite Wash area is a major component of our drilling program and is expected to provide significant organic growth for the Company."

If you are looking for more oil fields in the United States, check out:  Bakken Shale - Eagle Ford Shale - Niobrara Shale

Granite Wash Oil & Natural Gas Map
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Granite Wash Play

Chesapeake Energy CHK - Granite Wash (western Oklahoma and Texas Panhandle): Chesapeake is the largest leasehold owner and producer and the most active driller with approximately 200,000 net acres, an increase of 5,000 net acres from the 2010 first quarter, in the unconventional liquids-rich Granite Wash plays in the Anadarko Basin, which include the Oklahoma Colony and the Texas Panhandle Granite Wash plays.  On its Granite Wash leasehold, Chesapeake estimates it has approximately 200 million barrels of oil equivalent (mmboe) (1.2 tcfe) of proved reserves (based on the 10-year average NYMEX strip prices at June 30, 2010) and 900 mmboe (5.4 tcfe) of risked unproved resources.

During the 2010 second quarter, Chesapeake’s average daily net production of 260 mmcfe (43 thousand barrels of oil equivalent (mboe)) in the Greater Granite Wash play increased approximately 5% over the 2010 first quarter and 80% over the 2009 second quarter.  Chesapeake anticipates operating an average of approximately 12 rigs in the Granite Wash in 2010 to drill approximately 75 net wells.  Due in large part to the play’s high oil and natural gas liquids content, the Granite Wash is currently Chesapeake’s highest rate-of-return play and serves as an example of how the company is implementing a transition to increased drilling activity and production to liquids-rich plays.  Chesapeake increased its drilling activity in the Granite Wash from an average of eight operated rigs in 2009 to 14 operated rigs currently and an average of 16 operated rigs projected for 2011. 

Three notable recent wells completed by Chesapeake in the Colony Granite Wash are as follows:

  • The James 1-33H in Washita County, OK achieved a peak 24-hour rate of 10.0 mmcf and 2,490 bbls per day, or 24.9 mmcfe per day;
  • The Huls USA 1-13H in Washita County, OK achieved a peak 24-hour rate of 13.3 mmcf and 1,780 bbls per day, or 24.0 mmcfe per day; and
  • The Gwendolyn 2-22H in Washita County, OK achieved a peak 24-hour rate of 8.0 mmcf and 1,980 bbls per day, or 19.9 mmcfe per day.

Three notable recent wells completed by Chesapeake in the Texas Panhandle Granite Wash are as follows:

  • The Ruby Lee 104H in Wheeler County, TX achieved a peak 24-hour rate of 25.3 mmcf and 2,920 bbls per day, or 42.8 mmcfe per day;
  • The Dowell 1-31H in Roger Mills County, OK achieved a peak 24-hour rate of 16.2 mmcf and 2,440 bbls per day, or 30.6 mmcfe per day; and
  • The Zybach 2010H in Wheeler County, TX achieved a peak 24-hour rate of 8.0 mmcf and 1,270 bbls per day, or 15.6 mmcfe per day.

July 2011 Update - Granite Wash, discovered by Chesapeake in 2007. Current gross operated production is 420 million cubic feet of gas per day, the most by far in the play.

Apache Corp APA - Apache (APA) Granite Wash & Wittenburg Basin plays - I'll move on now to the central region of Oklahoma to Texas Panhandle. We will more than double our position at the Anadarko wash play fairway to more than 1 million acres or 487,000 net acres through the Cordillera acquisition announced last month. Together, Apache and Cordillera are currently running 17 rigs in the region and will assume operatorship of Cordillera's rigs when the deal closes, which is expected in the second quarter. By closing, we expect to have up to 25 rigs operating on the combined properties. We plan to drill up to 160 wells in the Cordillera acreage alone, principally in the liquids-rich Granite Wash and the Tonkawa and Cleveland oil plays. As a result, in 2012 we expect to increase our annual production from this region by nearly 50% on our continuing operations. This excludes East Texas, which has been divested and represents about 6,000 barrels of oil equivalent per day in 2011.

As announced in the news release this morning, we also added 96,000 acres to our position in the Bivins Ranch area. Our initial exploratory results in the emerging Wittenburg Basin play had been very encouraging, with 3D 30-day production ranging from 107 barrels of oil and 42 Mcf of natural gas per day to more than 1,000 barrels of oil and 800 Mcf of gas per day. We completed a 240 square mile 3D shoot on the property during 2011, which we're using to further de-risk in the 5 future drilling locations. Our breadth and scale across these plays allows us to generate efficiencies to increase the value of our position. In the Granite Wash alone, we've been able to reduce costs $500,000 per well by optimizing our casing design, reducing pump volumes and changing profit type. Across the region, we've implemented a fracture database to allow us to reduce frac size and reduce costs by more than 25%. We will continue to pursue these kinds of improvements as we simulate Cordillera assets into Apache.

Update - With the recently completed acquisition of Cordillera Energy Partners III, Apache more than doubled its position in the Anadarko wash play to nearly 550,000 acres. The company has increased its exposure to the horizontal Granite Wash, Tonkawa, Cleveland and Marmaton gas condensate and oil plays. Rig count has increased from six at the beginning of the year to the current total of 22 of which 21 are horizontal.

Devon Energy DVN - Devon Energy (DVN) Granite Wash Field - Devon brought seven operated Granite Wash wells online in the first quarter. Initial production from these wells averaged 1,650 Boe per day. The company has an average working interest of 73 percent in these wells.

Range Resources RRC - During the second quarter, the Midcontinent Division focused on the Texas Panhandle Granite Wash and the northern Oklahoma shallow oil plays. Two vertical Granite Wash wells commenced sales during the quarter at combined rates of 4.4 (3.5 net) Mmcfe per day. One additional well is completing with three more scheduled in the play for 2010. In the northern Oklahoma shallow oil play, one horizontal well was placed on production at a rate of 295 (236 net) BOE per day. This well reached only one-half of its projected lateral length, yet has responded with more than 50% of the production volumes associated with the first horizontal test. A second well is currently completing, with three additional wells planned for the remainder of the year.

Linn Energy  LINE - LINN Energy LINE Granite Wash Update - Texas Panhandle-Granite Wash  - LINN continues to deliver strong results from the Granite Wash, where the company is focused on developing high-return, liquids-rich opportunities. In the first quarter, the company had nine operated rigs drilling in the area and completed 14 operated wells. The company currently has 93 operated horizontal wells producing and 16 operated wells drilling, completing or awaiting completion. LINN also owns working interest in 32 non-operated horizontal producing wells with three additional non-operated wells in progress. The company's net horizontal Granite Wash production during the first quarter averaged approximately 137 MMcfe/d.

During the first quarter, LINN drilled its first three operated horizontal Hogshooter wells. These wells were completed in April and are in the early flow-back period. LINN's first well had an initial production rate of 2,454 Bbls/d of oil and 3 MMcf/d of liquids-rich natural gas. The second well had an initial rate of 2,891 Bbls/d of oil 4.4 MMcf/d of liquids-rich natural gas. The third well had an initial rate of 2,125 Bbls/d of oil and 3.4 MMcf/d of liquids-rich natural gas.

LINN's technical team has mapped the Hogshooter interval across the company's acreage in the vicinity of the first three wells. Based on this technical work, the company believes there are approximately 50 additional locations in this area, and LINN owns substantial additional acreage in both Texas and Oklahoma that will be evaluated for Hogshooter potential. LINN is also evaluating other shallow oil-bearing intervals in the Texas Panhandle such as the Lansing, Cleveland and Tonkawa. LINN believes its inventory of shallow oil opportunities will increase in this area. Given the results LINN has experienced to date from the Hogshooter wells, the company plans to shift a portion of capital from the traditional Granite Wash drilling program to focus on the Hogshooter zone. LINN anticipates drilling 12 additional Hogshooter wells in the second half of this year.

In 2012, the company plans to allocate more than 50 percent of its capital spending to the Granite Wash to drill approximately 65 operated horizontal wells and anticipates the program will generate rates of return in excess of 50 percent. The company also plans to participate in 16 non-operated horizontal wells. In addition, construction is underway on a planned 43-mile extension of the company's gathering pipeline, compression and associated facilities, which will provide additional takeaway capacity for Granite Wash production.

Forest Oil FST - Forest Oil (FST) discusses Texas Panhandle - Granite Wash Play - Forest holds approximately 184,000 gross acres (111,000 net) and is currently running 5 rigs in the Texas Panhandle Area.

Since Forest's last earnings release, the Company completed two horizontal Granite Wash wells (94% working interest) that had an average 24-hour initial production rate of 13 MMcfe/d, including approximately 1,400 Bbls/d of oil and natural gas liquids or 64% of total equivalent production.

Additionally, the Company completed one Missourian Wash well (100% working interest) that had a 24-hour initial production rate of 650 Boe/d. This well was completed with a shorter lateral, testing the areal extent of the Missourian Wash interval.

Forest completed its first Tonkawa well during the first quarter of 2012. The Tonkawa well (89% working interest) had a 24-hour initial production rate of 1,640 Bbls/d of oil, 200 Bbls/d of natural gas liquids, and 1.6 MMcf/d of natural gas, for a total equivalent rate of 2,100 Boe/d. Forest has initially identified 63 Tonkawa potential locations, with additional acreage being reviewed for prospectivity.

The Company experienced production curtailments in the Texas Panhandle Area related to a downstream NGL plant outage and to third party compression issues, which together resulted in a reduction of net sales volumes of approximately 9 MMcfe/d during the quarter. The plant outage was due to a NGL storage facility leak at the Oneok Medford plant, which resulted in a reduction of Forest’s net quarterly sales volumes of approximately 6 MMcfe/d. The production curtailment associated with the plant outage has been fully restored. An additional 3 MMcfe/d of the curtailment was associated with third-party high line pressure issues. In order to reduce this curtailment, Forest has installed loop lines, compression, and has transitioned a portion of its production in this area to a new gas gatherer.

SM Energy  SM  - SM Energy currently has three operated drilling rigs in its Granite Wash program, which are focused on the shallower, more liquid rich washes. The Company has allocated between $60 million and $70 million for its 2012 operated program in the Granite Wash.

Penn Virginia PVA - Penn Virginia (PVA) Granite Wash – ( Chesapeake Energy CHK Partner ) - During the fourth quarter of 2011, one (0.5 net) non-operated Granite Wash well was drilled in the Mid-Continent. Our full-year 2012 guidance includes up to seven (2.3 net) new Granite Wash wells. In addition, during the first half of 2012, we plan to drill one (0.5 net) horizontal well to test the Viola Limestone, which is an oil prospect.

Cimarex Energy  XEC - Cimarex Energy (XEC) Granite Wash Update - Other first-quarter 2011 Mid-Continent drilling included 5 gross (2.8 net) Granite Wash wells. Recent notable 30-day average production from these wells include the George 17-5H (61% working interest) at 8.6 MMcfe/d, George 17-6H (61% working interest) at 8.0 MMcfe/d and the Kephart 1-4H (91% working interest) at 6.5 MMcfe/d.

Newfield Exploration NFXGranite Wash – Production in the Granite Wash in early 2012 reached a record high of 215 MMcfe/d gross, or 143 MMcfe/d net. The higher than anticipated production was driven by well performance and the completion of wells drilled in 2011 and deferred into 2012. The Company does not expect to drill any additional dry gas wells in the Granite Wash play in 2012.

Plains Exploration & Production PXP - Plains Exploration PXP Granite Wash Update -  In the Texas Panhandle asset area, PXP has 5 drilling rigs operating in the Granite Wash trend and expects to continue this level of activity through 2011. Second-quarter daily sales volumes averaged approximately 13,620 BOE per day net to PXP, or 52% higher than first-quarter 2011 and 139% higher than the second-quarter 2010. Average daily sales volumes are expected to increase to approximately 17,000 BOE net per day by year-end 2011. During 2010 and early 2011, PXP built 15 production handling facilities and related infrastructure in order to support the rapid growth in sales volumes that PXP is now reporting.

Unit Corp UNT - Unit Corp (UNT) Granite Wash Update - In the Granite Wash (GW) play located in the Texas Panhandle, Unit had first sales on five horizontal wells during the third quarter. Unit’s average working interest in these wells is 79%. Of the five new wells, one well was completed in the GW “A”, three in the GW “B”, and one in the GW “C1” zone. The average 30-day rate for these five wells was 7.2 MMcfe per day. For the first nine months of 2011, Unit had first sales on a total of 14 new GW horizontal wells with an average 30-day production rate of 6.5 MMcfe per day consisting of 15% oil, 36% NGLs and 49% natural gas. The average ultimate recovery for a GW horizontal well is estimated at 4.1 Bcfe with an average cost per well of $5.5 million. Unit anticipates operating three to four Unit drilling rigs in the Granite Wash during the remainder of 2011, which should result in a total of 19 operated GW wells during the year at a projected net cost of $85 million.

Cabot Oil & Gas (COG) - Cabot Oil & Gas is drilling just north of the Granite Wash in Beaver County, OK.  This area is called the Marmaton Shale - Last quarter Cabot announced its initial success in the Marmaton Shale. Since then, Cabot has participated as a non-operator in seven Marmaton wells in Beaver County, Oklahoma. The Company's working interest varies from two to 37.5 percent in the non-operated wells. Thus far, the best performing wells have experienced peak 24-hour rates of 1,338, 792 and 589 Boepd respectively, with one of these most recent wells having a 10-day average of 1,056 Boepd. Overall the wells consistently were drilled and completed for less than $3 million per well. "Clearly, this productivity encourages us to allocate capital here for our 2012 plans," said Dinges. "Presently, we are moving an operated rig to the area in anticipation of having one rig there for 2012, in addition to one in the Eagle Ford

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