The Permian Basin contains multiple unconventional shale and tight-oil formations being developed using a variety of techniques.

The Wolfcamp shale in the Midland sub-basin has been drilled in combination with the overlying Spraberry tight sandstone using vertical wells with multistage hydraulic fractures in a play called the Wolfberry. More recently, operators have been drilling horizontal wells into the Wolfcamp zone with good results. However, controlling costs is the key to making this play viable.

The Wolfcamp shale could end up as one of the largest shale-oil plays in North America. Total organic content (TOC) ranges from 2% to more than 7% in the peak oil and early gas generation windows. Porosity is similar to the Bakken and Eagle Ford shales. In addition to excellent rock properties, the formation is over 1,000 feet thick.

With such favorable attributes, it is not surprising that the Wolfcamp has the highest original oil in place concentrations of all the North American shale-oil plays with 113- to 183 million barrels of oil equivalent per section. This can be contrasted to the Eagle Ford, which contains 27- to 57 million barrels of oil equivalent per section, or the Bakken, which contains 5- to 10 million barrels equivalent per section.

Recoverable oil in the Wolfcamp shale is estimated at 7- to 14 billion barrels.

Why has the Wolfcamp horizontal play only been targeted fairly recently, and how is it being developed? The primary reason vertical wells are so prevalent in the Permian is cost. A vertical well drilled and completed in two or more formations with multiple hydraulic fractures, such as a Wolfberry (Spraberry and Wolfcamp) or a Wolf-fork (Clear Fork and Wolfcamp), generally costs less than $1.5 million.

Though flow rates and estimated ultimate recovery are higher in horizontal Wolfcamp wells, when they were first drilled in 2009, the wells cost $11 million or more. The additional rate and recovery has to compensate for the extra cost, and this has only become a reality now that costs are decreasing to the range of $7- to $7.5 million.

Some cost savings have been realized by moving to pad drilling. One operator, Approach Resources Inc., Fort Worth, is drilling Wolfcamp horizontals for $6 million and believes that $5.5 million is in sight. To reach this target, stimulation costs must be kept under control. About $1 million of the company’s cost savings is being realized by adding water-handling infrastructure and use of nonpotable and recycled water for fracturing.

Optimizing the number of hydraulic fracture stages can also reduce costs. Fewer but better-designed frac stages can result in wells with high production rates at lower cost. These cost-saving techniques may also be used in other shale- and tight-oil plays to improve the economics.

The thick Wolfcamp is subdivided into three members, the Wolfcamp A, B and C benches. In most current wells, the laterals have been landed in the B bench, but the A and C benches are being tested by several operators.

If these results are good, the Wolfcamp will be equivalent to three plays in one geographic area. One scenario envisions wells being drilled from pads to all three benches in a pattern illustrated in the accompanying graphic. If this play takes off, it could become another significant addition to U.S crude supplies.