By the OGJ Online Staff
HOUSTON, June 14 -- Mitchell Energy & Development Corp., The Woodlands, Tex., added 589 bcf of natural gas equivalent to its oil and gas reserves so far this year, company officials said Thursday.
The company's proven reserves are expected to total almost 2.1 tcf equivalent by the end of June, up 38% from the end of 2000. The largest single increase, some 210 bcf equivalent, was the result of successful drilling in the company's largest development program in the Barnett Shale, primarily in Wise and Denton counties in North Texas, officials said.
"The Newark East Barnett Shale is one of the five largest gas fields discovered in the continental US during the past 20 years and is currently the fourth largest producing gas field in Texas," said George P. Mitchell, the company's founder, chairman, and CEO.
Natural gas production from the Barnett Shale has averaged 203 MMcfd through the first 5 months of this year, up 70% from a year ago, he said.
Mitchell Energy holds almost half of the total acreage being drilled in that area. Those holdings provide "maximum opportunity and incentive" to continue increasing both overall reserves and production rates, Mitchell said.
Mitchell Energy has drilled nearly 700 wells in the Barnett Shale since 1990. That activity, along with drilling by other producers, have expanded the area's previously proven limits by more than 50% to cover 120,000 net acres, officials said.
The company plans to drill 1,180 more wells over the next 4 years, with the current 55-acre spacing.
Reserves within the current Barnett Shale area are estimated at 1.6 tcf equivalent. Mitchell Energy has another 110,000 contiguous acres under lease, with probable and possible reserves estimated at 650 bcf equivalent.
The company is concentrating on improving the estimated 8% reservoir recovery rate and extending reservoir limits, officials said. Mitchell Energy is doing infill drilling on five 27-acre pilot programs. Production histories from those pilot programs over the next 12-18 months should determine whether to use that denser spacing, they said.
Mitchell Energy also has another 175,000 acres under lease in several adjacent counties. Officials are optimistic that they will be able to develop a significant portion of that area. But they say improvements in both drilling costs and completion technology are needed to make those areas commercial.