Better than expected DJ Basin production pushes up Noble's sales

By Luke Geiver | September 25, 2017

Better than expected production increases in its DJ Basin acreage has caused Noble Energy to increase its Q3 oil production volumes and sales volumes. Strong performance in the Wells Ranch and East Pony created the increase, pushing production volumes into new guidance range of 126,000 bpd to 130,000 bpd—a 4 percent increase over previous expectations. News of the guidance increase helped raise Noble’s stock by roughly 3 percent to nearly $28. Following the production guidance upgrade, Noble has also increased its full year sales volume expectations to a new range between 342 and 352 mboe/d.

Earlier this month, David Stover, president and CEO told investors that Noble was off to a great start in Q3. Part of the success for Noble has come through its use of data, analytics and cross-play learnings.

The company’s drilling days per well in its onshore assets has dropped into the singe digits. Part of that work stems from the company’s push to stream data into the drilling process. In Houston, the company turned a conference room into a pseudo data room for drilling operations. Using a drilling software, the company was able to display every rig it had operating at one time. Drilling team members from different basins were able to compare bottlenecks or other information from one rig to another in an effort to speed up the process for every new well drilled.

“The ability to share our learnings across multiple opportunities has been key,” Stover said. Using the drilling software and multi-play input, Noble is now making changes or adaptations to its drilling operations in real-time, he said.

The company is also applying multi-basin learnings to its completion processes. Although increased proppant concentrations are considered the main reason for well productivity gains in the DJ and Delaware Bains, Stover said there is more to it than that, including a focus on stage and cluster formation and optimizing flowback activities. “Using data helps with predictive analytics,” he said.

This month marked the first multi-well pad brought online for Noble in the Delaware. The team there completed a three-well pad with one 5,000 foot lateral and two 10,000 foot laterals. The average of those three wells is roughly 300 barrels of oil per day per thousand lateral feet. Later this year, Noble will bring on a second multi-well pad in the Delaware.