Devon planning 8 more wells

Devon Energy, which has completed two wells in the Tuscaloosa Marine Shale that spans the midsection of Louisiana, plans to have eight more by the end of the year, according to the company’s head of exploration and production.

During a Wednesday conference call with investors, David A. Hager said despite a series of mechanical problems and a short lateral section, the company’s first well had an initial production rate of 186 barrels a day.

“This well is not indicative of what a properly completed long-lateral horizontal well can do in the Tuscaloosa,” Hager said.

The second well is just starting to produce, Hager said.

“We are adding a second rig in the Tuscaloosa in March and expect to have 10 wells down in the play by year-end,” Hager said.

The company has proposed another 880-acre unit in northern Tangipahoa Parish, according to Tuscaloosa Trend blogger Kirk Barrell.

Barrell said Thursday he liked what he heard on Devon’s conference call, and the 10-well program represents “a firm commitment to the research and development phase of the play.”

The Tuscaloosa Marine Shale, which lies 10,000 feet to 17,000 feet or so underground, may contain as much as 7 billion barrels of oil, as well as natural gas, according to a 1997 report by LSU’s Basin Research Institute.

Another company, Encana, recently reported in a filing with the state Department of Natural Resources that a well in St. Helena Parish, completed in November, averaged 784 barrels of oil per day and 309,000 cubic feet of natural gas.

In an interview Thursday with The Advocate, Devon spokesman Chip Minty said the company has not disclosed the amount it will spend to drill its 10 wells.

The Tuscaloosa Marine Shale is still in the exploratory stages, Minty said. The company has 265,000 acres under lease, and Devon is proceeding in a deliberate fashion.

The next stage is evaluating the resource play, Minty said.

“The important thing to know is that it is early. We’re optimistic about the Tuscaloosa Marine Shale, and we have seen reasons to be optimistic about the play,” Minty said.

If Devon continues to see those optimistic signs, the company will move more aggressively to develop its leases, Minty said.