Tuesday, September 19, 2023

Shale Industry pushing the limits when it comes to drilling techniques!

Happy Two-for-Tuesday! 

Did anyone happen to see The Houston Chronicle’s Business Section on September 15, 2023, they reprinted an article from Bloomberg titled, “U.S. oil drillers push the limits sideways – 1 in 5 new wells to rely on horizontal drilling techniques”?  In the article, it goes on to speak about U.S. shale oil producers are testing the boundaries of drilling techniques by not just drilling down several miles but across sometimes as much as three or more miles (think up to fifty football fields).  In the Permian Basin, they are expecting drillers in 2024 to drill one out of five new wells going down three or more miles, then they will be going across several miles in the subterranean horizontal holes, but this technique even two years ago was almost unheard of.   As the shale industry ages one will see more creative drilling which includes drilling zigzags and U-turns which means more money invested to produce and more risk, so costs will increase.  An example of the cost for the new risky wells is a two-mile lateral well can cost upward to $6.5 million and a three-mile one may cost about $9 million.  With the oil getting harder to reach it means the wells will be costlier, so the drilling will be done more and more by the larger companies.  What will all this risk mean for the future of shale industry only the future and wells will tell!  If you would like to read more of reprinted Bloomberg’s article for free on yahoo!finance, please click the link: US Oil Drillers Push the Limits Sideways (yahoo.com).

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We hope you have a wonderful evening and a great rest of your week! 

**Disclaimer: You may be charged a fee to read the Bloomberg’s article. **