The Permian basin has been the industry’s bright spot regarding drilling activity in recent months. With many US basins continuing to lose rigs, the Permian has seen positive rig counts and increasing M&A activity since 2Q 2016.
“Nearly 70 rigs in the Permian Basin have returned to operation since early May and current horizontal drilling activity in West Texas and New Mexico is comparable to the levels observed in 2Q-4Q 2015,” according to the Oil & Gas Financial Journal.
Operators in the Permian are undoubtedly taking advantage of the low day rates, but more importantly they are gaining efficiency, cutting costs, and mitigating risk by utilizing pad drilling and completion operations.
“Pad drilling enabled the industry to employ factory-like economies of scale to shorten cycle time and increase rig productivity so that hydrocarbons are brought to market more quickly or, in the case of batch completions, in greater volume,” said DrilliingInfo.com.
A key aspect of this operations type is the ability to share surface costs for the pad across multiple wells. To accurately capture and report these costs, any reporting system would need the ability to associate wells with a pad location and perform custom cost allocations from pad to well level. So when pad drilling first started gaining popularity, WellEz listened and adapted to the industry’s changing needs.
“Back in 2013, when operators in the Eagleford and Marcellus started to adopt Pad Drilling, we worked closely with some of our key clients in both regions to develop a system that allows users to track cost and activity at the pad level, while allocating those costs through various percentages to each well on the pad,” said Matthew Mott, senior technical account manager at WellEz.
The improvement to the system was released shortly before the market downturn, when many operators suspended all drilling activity. But when the Permian showed signs of life, WellEz was ready.
“Our operators in the region are able to take advantage of a reporting system that fits the way they need to operate,” Mott said.