Midland and Delaware Basins: an in-depth, multi-disciplinary analysis aimed at both technical and investment communities

Abstract

The expansive Greater Permian Basin contains the Midland, Delaware, Val Verde and Marfa sub-basins. While each of these sub-basins holds varying degrees of oil and gas development potential, the Midland is mainly responsible for jumpstarting recent drilling activity. During the 1950s, production from the Wolfcamp and Spraberry Formations began in the basin. Since then, activity has fluctuated with the price of oil and advent of technologies. During the past 6 years, increase in activity has drastically accelerated during the “Shale Gale,” as horizontal drilling and hydraulic fracturing techniques have become more efficient and cost-effective. This presentation focuses on the structural and stratigraphic history of the Midland and Delaware Basins. We shared data and analyses from our internal assessment of what is driving the Wolfcamp, and Spraberry/Bone Spring plays. Our evaluation included hand-declining over 9,000 wells’ production curves, conducting geologic analysis and defining multiple type curve areas. The study encompasses geology, geography, performance and hydrocarbon content of each hydrocarbon bearing zone with industry activity. The Midland and Delaware Basins were primarily filled by sediments from the surrounding highlands. Midland Basin wells show a higher GR and lower Resistivity responses towards the basin center and away from the Central Basin and Eastern Shelf platform-supported margin. This is indicative of sediments becoming finergrained away from the stable margins. In the Delaware, the basin becomes gradually shallower to the South, while the 3rd Bone Spring Carbonate thickens into the basin. This thickening corresponds to some of the best returns noted in our Type Curve Analysis. After splitting the Midland and Delaware Basins into 45/70+ type curve sub areas (respectively) we view the Midland Basin break-even threshold at $38 and the Delaware is $30 per barrel oil for a 10% return.

AAPG Datapages/Search and Discovery Article #90343 ©2019 AAPG Southwest Section Annual Convention, Dallas, Texas, April 6-9, 2019