Comstock made a bold move last year to double down on the Haynesville Shale. While the economics of natural gas have not supported the move, as evidenced by a subsequent capex reduction, the drilling success and capital efficiency of these wells (their rationale) have worked out. Here are some excerpts from the earnings report:
Comstock has completed all of its Haynesville shale wells using the Company's enhanced completion design. The average initial production rate of the first five wells of the program was 23 million cubic feet ("MMcf") per day. Three of these wells have been completed since our last report. The Boggess 5-8 #1 well in DeSoto Parish, Louisiana was drilled to a total vertical depth of 11,306 feet with a 7,430 foot lateral. This well has been tested with an initial production rate of 21 MMcf per day. The second well, the Horn 8-17 #2 in DeSoto Parish, Louisiana, was drilled to a total vertical depth of 11,216 feet with a 7,400 foot lateral. This well has been tested with an initial production rate of 21 MMcf per day. The third well, the Harrison 30-19 #1 in DeSoto Parish, Louisiana, was drilled to a total vertical depth of 11,405 feet with a 7,437 foot lateral. This well has been tested with an initial production rate of 24 MMcf per day. Production from the first five extended lateral wells has trended above the expected production for our average 15.6 billion cubic feet type curve.
Several offset Haynesville shale wells have benefited by the recent fracture treatments applied to the four new extended lateral wells. Comstock routinely shuts-in producing wells offset to a newly drilled well prior to a frac to prevent any interference with fracture operations by offset production. After these offset wells were returned to production, the Company has seen a significant improvement in the offset producing wells. Seven offset wells that were shut-in prior to the new well frac treatments saw a combined improvement of 15 MMcf per day. The Company is currently monitoring this offset well production improvement in order to evaluate the long-term benefit to the total reserves to be recovered for these wells.
The Company also announced results for its second re-frac of a Haynesville shale well during the first quarter of 2015. Following the re-frac, the Bagley A #4 well in DeSoto Parish, Louisiana had an initial production rate of 3 MMcf per day, a six fold increase from the 0.5 MMcf per day before the re-frac.