PNR reports $3.3 billion capex plan for 2014

Pioneer Natural Resources Co. (PNR), Dallas, reported capital expenditure plans of $3.3 billion for 2014, $2.2 billion of which will be used to target the northern Spraberry-Wolfcamp area in the Midland basin of West Texas.

The company expects production growth from continuing operations to reach 14-19%/year from 2013 to 2014 based on planned drilling capital expenditures of $3 billion.

The company is targeting compound production growth from continuing operations of 16-21%/year for 2014-16 and expecting to more than double production by 2018 compared with 2013.

Overall for 2013, the company produced 161 million boe/d, an increase of 12% compared with 2012. PNR attributes the rise to a 35% increase in the Eagle Ford and 19% increase in the Spraberry-Wolfcamp.

The company’s increase in reserves can primarily be attributed to its horizontal drilling programs in the Spraberry-Wolfcamp and Eagle Ford shales.

PNR said it will continue to shift drilling activity in the Spraberry-Wolfcamp from vertical drilling to horizontal drilling, hoping to enhance ultimate resource recoveries.

Northern Spraberry operations

The $2.2 million purposed for the northern portion includes $1.2 million for the horizontal drilling program, $440 million for the vertical drilling program, $400 million for infrastructure additions, land and science, and $100 million for gas processing facilities.

Most of the production growth will occur in the second half as the company ramps up its drilling program from 5 rigs at yearend 2013 to 16 rigs by the end of the first quarter.

The 16-rig program is expected to spud 140 wells this year with an average lateral length of 8,200 ft, with 90% of the drilling program taking place in Wolfcamp A, B, and D interval wells.

The remaining 10% will be Spraberry shale wells—Lower Spraberry, Jo Mill, and Middle Spraberry shales. This well mix could include more Spraberry shale wells if the strong performance of the Lower Spraberry interval wells continues and strong results are delivered from the Jo Mill and Middle Spraberry wells that are expected to be placed on production during this year’s first half.

Southern Spraberry operations

The Southern Wolfcamp joint venture will receive $205 million, including $140 million for the horizontal drilling program and $65 million for infrastructure addition, land and science.

PNR expects to spud 115 horizontal wells this year with an average lateral length of 9,400 ft, an increase of 13% from the average lateral length of 8,300 ft in 2013.

The 2014 drilling program will be focused on the higher return areas in northern Upton and Reagan counties, including Giddings and University Block 2, with two thirds of the wells being completed in the Wolfcamp B interval and the remainder being a mix of Wolfcamp A, C, and D interval wells.

Spraberry overall

PNR is currently operating 11 vertical rigs in the Spraberry field that are expected to drill 200 wells in 2014. These 11 rigs, a reduction of four vertical rigs from 2013, are required to meet continuous drilling obligations.

Full-year 2013 production in the Spraberry-Wolfcamp averaged 79 million boe/d—including the conveyance of 4 million boe/d in May 2013 to Sinochem as part of the southern Wolfcamp joint venture transaction (OGJ Online, June 3, 2013)—an increase of 19% compared with 2012.

Production in 2014 is expected to grow to 95-100 million boe/d, an increase of 21-27% compared with 2013.

PNR is the largest acreage holder in the Spraberry-Wolfcamp, holding more than 600,000 gross acres in the northern portion of the play and more than 200,000 gross acres in the southern Wolfcamp joint venture area.

The company believes it has 10 billion boe of net recoverable resource potential from horizontal drilling across its entire acreage position based on its extensive geologic data and successful drilling results to date.

Eagle Ford operations

The company plans to spend $545 million in the Eagle Ford, including $480 million for the horizontal drilling program and $65 million for infrastructure additions and land.

PNR in 2013 added 300 drilling locations in the liquids-rich area as a result of downspacing from 1,000 ft between wells to 500 ft between wells.

The company plans to drill 45 Upper Eagle Ford shale wells as part of the downspacing program in 2014. Twenty-five percent of PNR’s acreage is expected to be prospective for this interval.

PNR in 2014 expects to drill 110 liquids-rich wells in the Eagle Ford. Full-year production is forecasted to range from 45-49 million boe/d, an increase of 18-29% compared with 2013. For the first quarter, PNR expects to place 26 horizontal wells on production, with production from these wells to be mostly realized in the second quarter.

Related Articles

WoodMac: Western Canadian liquids production on upward trajectory starting in 2016

06/19/2015 Wood Mackenzie Ltd. believes the economics of core areas within shale plays in western Canada will yield comparable returns to key producing plays ...

Rosneft, BP sign upstream, downstream agreements

06/19/2015

OAO Rosneft agreed to sell BP PLC a 20% share of Taas-Yuryakh Neftegazodobycha in eastern Siberia for $750 million.

Total sheds stake in German refinery

06/19/2015 OAO Rosneft has completed a deal for the purchase of Total SA’s minority interest in the 11.5 million-tonne/year PCK Raffinerie GMBH refinery, loca...

MARKET WATCH: NYMEX crude oil prices climb back above $60/bbl

06/19/2015 Crude oil futures for July delivery rose modestly on the New York market to settle above $60/bbl in June 18 trading, marking its highest closing pr...

Fossil fuel protestors try to disrupt Natural Gas Roundtable event

06/18/2015 Fossil fuel protestors tried to disrupt a June 18 Natural Gas Roundtable (NGR) luncheon on Capitol Hill where four US House members were describing...

PBF Energy inks deal for Louisiana refinery, logistics assets

06/18/2015 PBF Holding Co. LLC, a subsidiary of PBF Energy Inc., Parsippany, NJ, has entered an agreement with ExxonMobil Corp. and Petroleos de Venezuela SA ...

Gazprom, KMG extend Karachaganak supply contract to 2038

06/18/2015

OAO Gazprom and JSC KazMunayGas (KMG) reported a contract extension to 2038 for supply from Karachaganak gas-condensate field in Kazakhstan.

Zion Oil & Gas makes executive appointments

06/18/2015 Dallas independent Zion Oil & Gas Inc. has appointed Victor G. Carrillo as chief executive officer and Glen Perry as president and chief operat...

Axiall updates plans for Louisiana ethylene project

06/18/2015 Axiall Corp. and South Korea’s Lotte Chemical Corp. have finalized joint-venture plans for the design, construction, and operation of a proposed 1 ...
White Papers

Three Tips to Improve Safety in the Oil Field

Working oil fields will always be tough work with inherent risks. There’s no getting around that. Ther...
Sponsored by

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by
Available Webcasts


OGJ's Midyear Forecast 2015

When Fri, Jul 10, 2015

This webcast is to be presented by OGJ Editor Bob Tippee and Senior Economic Editor Conglin Xu.  They will summarize the Midyear Forecast projections in key categories, note important changes from January’s forecasts, and examine reasons for the adjustments.

register:WEBCAST


Predictive Analytics in your digital oilfield - Optimize Production Yield and Reduce Operational Costs

When Tue, Jul 7, 2015

Putting predictive analytics to work in your oilfield can help you anticipate failures, plan and schedule work in advance, eliminate emergency work and catastrophic failures, and at the same time you can optimize working capital and improve resource utilization.  When you apply analytic capabilities to critical production assets it is possible to reduce non-productive time and increase your yield.

Learn how IBM's analytics capabilities can be applied to critical production assets with the goal of reducing non-productive time, increasing yield and reducing operations costs.

register:WEBCAST



On Demand

Cognitive Solutions for Upstream Oil and Gas

Fri, Jun 12, 2015

The oil & gas sector is under pressure on all sides. Reserves are limited and it’s becoming increasingly expensive to find and extract new resources. Margins are already being squeezed in an industry where one wrong decision can cost millions. Analyzing data used in energy exploration can save millions of dollars as we develop ways to predict where and how to extract the world’s massive energy reserves.

This session with IBM Subject Matter Experts will discuss how IBM Cognitive Solutions contribute to the oil and gas industry using predictive analytics and cognitive computing, as well as real time streaming for exploration and drilling.

register:WEBCAST


The Alternative Fuel Movement: Four Need-to-Know Excise Tax Complexities

Thu, Jun 4, 2015

Discussion on how to approach, and ultimately embrace, the alternative fuel market by pulling back the veil on excise tax complexities. Taxes may be an aggravating part of daily operations, but their accuracy is crucial in your path towards business success.

register:WEBCAST


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected