Tuesday, February 1, 2011

Petrohawk's 2010 Operations Update (Including Mid-Bossier Shale)

Petrohawk Energy released its 2010 operational update this morning.  The company is working very hard to retain all of its viable Haynesville leases in this difficult pricing environment.  In 2010, the company participated in 351 new wells, 101 operated and 250 non-operated.  The company is running 16 rigs, but that number should shrink to seven by mid-year 2011.  Petrohawk expects to drill 57 wells in the first half of 2011 and 37 in the second half of the year.  The company has three frac fleets on retainer and had an inventory of ten wells awaiting completion as of year end.

Petrohawk is making progress on its lease retention strategy and expects to complete the program in 2012, even after reducing rig count mid-2011.  By the end of 2011, the company expects to have held 280 operated sections and 590 non-operated sections, leaving 25 operated sections and 120 non-operated sections to complete the program in 2012.

The company recently completed its initial full section development program in Sec. 8/Township 14/Range 11 in Red River Parish.  Petrohawk and another operator (QEP Energy, I believe) drilled and completed six wells alongside an existing Petrohawk completion from 2009 (I think the existing completion was Sample et al 8 #1; Serial #239051; 22.071 MMcf/day IP on 24/64" choke at 7,951 psi).  The wells were brought on in late December 2010 but haven't been reported on the DNR database (I'll make note of them when they do appear).  By my estimation, the six wells are:

  • Sample et al 8 #2-ALT (serial #241527), #3-ALT (#241528) and  #4-ALT (#241529) - Petrohawk operated
  • Rex Young 8 H #1-ALT (#241534) and #2-ALT (#241535) - QEP operated
  • Yearwood 8 H #1-ALT (#241521) - QEP operated

Petrohawk also reported on its Mid-Bossier activity. The company completed one operated well, the Whitney 19 H #1, but it participated in 15 non-operated Mid-Bossier wells.  Five of the non-op wells were in Louisiana (four in the vicinity of the Whitney well) and ten were in Texas.  The four drilled around the Whitney well have estimated ultimate recoveries (EUR) of 9 Bcfe, so they look to be good wells.  Because the company is focused on its lease retention strategy, it will not invest any meaningful capital in the Mid-Bossier until late 2012 and only then if the economics are favorable.

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