QEP finds Q1 enhanced well completion success

By The Bakken Magazine Staff | June 18, 2015

In QEP Resources Inc.’s first quarter 2015 financial and operating results, the company reported a net loss from continuing operations of $55.6 million. The company’s adjusted net loss was $8.7 million, compared with the adjusted net income from continuing operations of $41.1 million for the comparable 2014 period. The decrease was due to lower than average crude prices, natural gas and natural gas liquids, partially offset by higher crude oil volumes, lower production taxes and higher oil volumes, lower production taxes and higher proceeds from realized commodity derivatives.

“Our strong first quarter operational performance, coupled with our premier E&P asset portfolio and solid financial position, demonstrates the flexibility we have built into our business to manage through the current volatile commodity price environment,” said Chuck Stanley, chairman, president and CEO of QEP Resources. “We have significantly decelerated drilling activity to manage through the commodity price trough and we are continuing to actively manage the timing of well completions to take advantage of the contango in forward crude oil and natural gas prices.”

With the slowdown in activity, QEP has focused on providing more efficient operations, which have provided successful results from its enhanced completion designs in the Williston Basin and Pinedale.

The company said it completed three wells in western North Dakota in the quarter utilizing cemented liners with plug and perf completion technology to further evaluate optimum stimulation design. According to QEP, these wells were completed over 50 stages utilizing roughly 1,000 pounds of proppant per lateral foot. While production results are still being evaluated, QEP says early results indicate a modest improvement over prior offset sliding sleeve completions.

“Combining larger proppant volumes with more stages resulted in an average increase in cumulative production of about 75 barrels of oil equivalent in the first 120 days online compared to our original design,” the company said.

QEP began implementing enhanced well completion designs last year and initially switched from pumping roughly 350 pounds of proppant per lateral foot to approximately 825 pounds of proppant per lateral foot over 33 stages. QEP began pumping 1,000 pounds of proppant per lateral foot over 50 stages.

During the first quarter of 2015, QEP continued to work on a pilot program to evaluate high-density infill development drilling on its South Antelope acreage. The company said it drilled and completed a total of four pilot wells spaced at 400 and 600-foot intervals, between existing producing wells, in the Middle Bakken and first bench of the Three Forks. “We also drilled our first well in the second bench of the Three Forks. Flowback on these infill wells began in April 2015 and initial production results are encouraging,” the company said.

At the end of the first quarter of 2015, QEP had 40 gross operated wells awaiting completion in the Williston Basin and four operated rigs running, including three on South Antelope and one rig on the Fort Berthold Indian Reservation. The company expected gross completed well costs in the Williston Basin to average $9.5 million during 2015.