EOG details role of data used for shale production

By Luke Geiver | May 09, 2017

Big data took the spotlight during EOG Resources’ first quarter 2017 update. The exploration and production company often cited as the best amongst its unconventional-focused peers, explained the evolution of its data use and implementation strategies. Sandeep Bhakhri, chief information officer, said EOG has the richest data set on unconventional oil and gas wells in the world, and that the company has found a way to give its global team real-time access to the information. “Data delivery is key to effective decision making,” Bhakhri said. “It has to be available anytime and anywhere through multiple software options.”

Starting roughly 30 years ago, EOG has been working to develop an in-house data collection and distribution system. To date, the operator has created 65 software applications and more than 20 mobile apps allowing completion engineers or executives to view data as it is coming in. On drilling rigs and fracking equipment, EOG has been placing what it calls black boxes on the units to gain data as it is being generated. The company now has 10 energy storage marts with more coming. Geosteering and custom frack designs have benefited the most from the data, Bhakhri explained to investors.

Because of its data usage, EOG has been able to effectively geosteer the drill bit with 95 to 100 percent accuracy in its shale formation assets. The results have been record breaking. In the first quarter, EOG reported an all-time high initial production rate for a Delaware Basin. The Whirling Wind 14 Fed Com #701H registered 5,060 boepd in the first 30 days (another Whirling Wind well also recorded similar numbers). “EOG’s Whirling Wind wells shattered industry records in the Permian Basin,” the company said.

EOG has increased the number of premium drilling locations it controls. Last year, the company began only focusing on wells that could yield 30 percent returns at $50 oil. Now, the number of locations in that category has increased and the oil price needed has decreased to $40/b.

Production for all of EOG’s shale wells continues to increase while operating costs decrease. When asked if the company was burning through its best wells at a time when oil prices continue to be volatile, Bill Thomas, chairman, said that his team believes EOG’s well results will only get better over time despite the notion that it may be drilling its best locations currently. “We don’t think we are producing our best wells in a low oil price environment,” he said. “We think the wells will always get better.”

For the year, EOG intends to run 26 drilling rigs throughout the Permian, Eagle Ford, Bakken and Rockies. The Eagle Ford is currently EOG’s most active operating area, followed by the Permian and Bakken.

In the Delaware, EOG is paying $7.8 million per well. In the Eagle Ford, a well can be completed for $4.5 million and in the Bakken, EOG is paying $4.8 million.