Firms amass Avalon, Bone Spring oil acreage

Alan Petzet
OGJ Chief Editor-Exploration

HOUSTON, June 9 -- Unconventional oil plays are drawing numerous companies to amass acreage positions in the Delaware basin in New Mexico and West Texas.

Attracting exploration are the Permian Bone Spring tight limestones and sandstones and overlying Permian Avalon shale in Lea and Eddy counties generally between and south of Carlsbad and Hobbs, NM, and south into Reeves and Loving counties, Tex.

Some of the operators have taken to the lease play in an effort to shift gas-heavy portfolios towards liquids-prone plays.

Several large companies alluded to the plays in first quarter 2010 conference calls. Chesapeake Energy Corp., Oklahoma City, said it had drilled eight Avalon wells and 11 Bone Spring wells on 120,000 net acres in the two states.

Devon Energy Corp., Oklahoma City, said it holds several hundred thousand acres overall in the Delaware basin and continues to lease. And Anadarko Petroleum Corp., Houston, said it controls 170,000 net acres and was running four rigs in the Bone Spring play. Anadarko said one completion flowed at a maximum rate close to 1,200 b/d.

Concho Resources Inc., Midland, Tex., said June 8 it plans its first horizontal drilling in Avalon and Second and Third Bone Spring in this year’s second half. Officials hedged questions about play specifics but said the company has an acreage position it is trying to enlarge.

Bruce Hart described the overall Bone Spring formation as being as thick as 3,500 ft at 8,000-10,000 ft in New Mexico, where 113 fields had been designated in the formation by 1995 (see map, OGJ, July 28, 1997, p. 85).

Contact Alan Petzet at alanp@ogjonline.com.