OGJ Chief Editor-Exploration
HOUSTON, Nov. 3 -- Talisman Energy Inc., Calgary, said it has more than doubled its acreage position to a combined 350,000 acres in the Pennsylvania Marcellus and British Columbia Montney shales and is restructuring its North American operations into shale and conventional business units.
Talisman said it is positioned for a major increase in Marcellus drilling in 2010 and plans to move parts of its Montney shale play to commercial development at the beginning of the year.
The company defines Tier 1 as top quality acreage with an expected full cycle breakeven of $4/Mcf. It has added 170,000 acres in the last few months through a combination of acquisitions and swaps for $570 million (Can.).
In the Marcellus, Talisman expects to end 2009 at 70 MMcfd. Production exceeds 50 MMcfd, compared with 5 MMcfd at the start of 2009 after commercial development began in late 2008.
The company’s last five Marcellus wells have estimated ultimate recoveries of 6 bcf/well, and it has hiked its average assumption for EUR over all Tier 1 acreage 17% to 3.5 bcf/well. The 2009 wells have average 30-day initial production rates of 4.5 MMcfd, and the last six wells flowed 5 MMcfd or more.
Marcellus drilling and completion costs are down to (US) $4.3 million/well.
The company’s 214,000 highly contiguous net acres in the Pennsylvania Marcellus are centered on Bradford and Tioga counties. Its 180,000 Tier 1 acres have 1,800 net well locations and a full-cycle breakeven of (US) $4/MMBtu. Land acquisition costs averaged (US) $3,250/acre.
Meanwhile, the company has 270,000 net acres in the Montney shale, of which 166,000 acres are considered Tier 1 with 3,000 net well locations. Land acquisition costs averaged $3,500/acre (Can.).
The 2009 focus has been in the Greater Groundbirch, Greater Farrell, and Greater Cyprus areas. Talisman expects to complete 20 pilot wells this year, including 11 horizontal wells. The company expects a full-cycle breakeven of $4/Mcf (Can.) but is not providing guidance yet on drilling and completion costs, initial potential rates, or EURs.
Contact Alan Petzet at email@example.com.