Coalbed methane production from the Cherokee basin in southeast Kansas and northeast Oklahoma appears to be dropping from peaks in 2008 in Kansas and 2006 in Oklahoma.
Peak CBM production for the entire basin was 63.3 bcf of gas in 2008, aggregated state figures show.
CBM output peaked in 2006 at 18.9 bcf from the Oklahoma portion of the basin and in 2008 at 49.1 bcf from the Kansas portion of the basin (OGJ, Feb. 8, 2010, p. 33). Oklahoma demarcates the south line of Township 12 North, or roughly along a line between Sallisaw and Checotah, Okla., as the boundary between the Cherokee and Arkoma basins.
State geological surveys estimated 2009 Cherokee basin CBM production at 47.98 bcf in Kansas and 12.1 bcf in Oklahoma. Both figures are down from 2008 output. A projection based on first quarter Kansas figures put the state's Cherokee basin CBM output at 42.9 bcf for 2010.
The figure summarizes CBM output for the entire Cherokee basin.
If an annual production decline of 12% (the approximate long-term decline rate of a Kansas CBM well; see Newell, 2010) is applied to this maximum combined output year of 2008, future production would take on the form of the lightest gray histograms presented on the right side of the figure. This decline is essentially a worst-case scenario assuming no new wells were drilled after 2008.
Lesser collective rates of decline are thus more realistic because CBM drilling will no doubt continue in the basin, and this added production will partly offset the declines. It could reverse the declines if sufficient new drilling occurred.
For purposes of comparison, 10% and 8% decline rates are also presented on the figure.
By 2020, assuming a collective 10%/year decline, cumulative CBM production for the entire Cherokee basin would be 740 bcf. Cumulative production at the end of 2009 was 370 bcf.
The Oklahoma data are considered conservative because workovers of old wells are not included because post-1994 workover wells may have non-CBM production.
Some operators are not giving up on CBM operations in the basin.
PostRock Energy Corp., Oklahoma City, said it is the basin's leading operator in terms of acreage, infrastructure, production, and reserves and is the only vertically integrated operator there.
At the end of fiscal 2009, PostRock had 86.8 bcf of estimated proved net reserves and held more than 500,000 net acres with production coming from nearly 400,000 net acres. Its fiscal 2009 production averaged 55.3 MMcfd from 2,822 gross gas wells, nearly all of them operated.
The company held acreage in Greenwood, Woodson, Allen, Elk, Wilson, Neosho, Chautauqua, Montgomery, and Labette counties, Kan., and Washington, Nowata, and Craig counties, Okla.
The company provides its own frac, workover, and cementing services and operates 2,173 miles of gathering system with 85 MMcfd of throughput capacity.
PostRock estimated drilling, completion, and hookup costs at $125,000/well on 160-acre spacing for a well near the existing gathering system and $170,000 for a well that requires expansion of the gathering system.
PostRock also has assets in the Devonian and Marcellus gas plays in the Appalachian basin.
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