Exploration & Production | Operational Updates | Quarterly / Earnings Reports

W&T Shows Strong Permian & GOM Well Results

Email    |    Print    |    Bookmark

You Need to login first

   |    Thursday,November 07,2013

OFFSHORE - GOM

Deepwater Gulf of Mexico

During the third quarter, we had a natural gas discovery at the deepwater exploration prospect, "Troubadour," in Mississippi Canyon ("MC") block 699, where we hold a 20% working interest. The operator, Noble Energy, has sanctioned the MC 698 "Big Bend" discovery as a single well sub-sea tie back. Long lead time equipment orders have commenced and first production is projected for 2015.

W&T has partnered with Noble Energy in an additional deepwater exploration well during 2013, the Mississippi Canyon 782 #1 "Dantzler" prospect, with a 20% working interest. Noble estimates that the Dantzler prospect could have a targeted resource potential of between 50 and 220 million barrels of oil equivalent. Drilling operations are underway and the well is scheduled to reach total depth during the fourth quarter, with results expected prior to year end.

Ship Shoal 349 "Mahogany" Field

As previously reported, we brought the SS 349 "Mahogany" A-14 exploration well online during July with production from the newly discovered T-sand. The well has continued to show a strong drive mechanism and has produced an estimated 330,000 Boe gross and 275,000 Boe net (75% crude oil) in its first 90 days. The company is making plans to drill another development well to recover the more than 200 feet of net pay uphole from the existing "T" sand completion in the M, N, O, and P sands.

After completion of the A-14 well, we rig conducted a successful recompletion of the A-4 well to a new "P" sand which was brought online during early September at a rate of approximately 1,000 Boe per day gross.

Following the A-4 recompletion, we spud the A-15 deep shelf, sub-salt exploratory well at Mahogany, which targets five separate stacked sands, including the N-sand and O-sand which both saw significant pay in the A-14 well logs. After reaching the first casing point, drilling operations were temporarily suspended for a remedial workover on the A-12 producer. This operation is expected to conclude soon at which time the A-12 will be placed back online and drilling operations will resume on the A-15 well. We project the A-15 well will reach total depth during the first quarter of 2014. Our estimated target reserve potential for this well is between 1.8 million and 6.2 million barrels of oil equivalent and the target initial production rate is approximately 1,400 Boe per day net to W&T after royalties. The value associated with the Ship Shoal 349 field continues to grow with each new generation of seismic data and each new exploration discovery.

Main Pass 108 Field

The B-1 side-track well at our Main Pass 108 field was brought online during August at an initial production rate of approximately 5,700 Mcfe per day gross and 100 barrels of oil gross. Current production is from the Tex W-6 sand, which was the original target sand for the well. The additional pay found in the Tex W-3 sand will serve as a future recompletion opportunity for this field.

Mississippi Canyon 243 "Matterhorn" Field

At our Matterhorn field, we have begun completion operations on the A-5 side-track well, which logged roughly 220 feet of net pay earlier this year. We expect the completion operations to conclude and first production from the A-5 near the end of the fourth quarter of 2013. Prior to the mobilization of the completion unit, the platform underwent various optimization activities and we performed a recomplete on the A-9 well. Together, these activities enhanced production from the field which at the end of October was approximately 5,300 Boe per day, up significantly from last year.

High Island 22 Field

Completion operations and pipeline tie-back for the High Island 21 A-1 well took place during October, and the well was brought on production. The well is producing from the LH-20 series sands. The well discovered six separate pay zones, culminating in a total of approximately 225 net feet of pay. The upper zones will serve as future recompletion opportunities and could result in reserve additions this year.

East Cameron 321 Field

At our East Cameron 321 field, the rig is now on location and has begun operations on our exploratory side-track well. The target initial production rate is approximately 850 Boe per day net to W&T after royalties and is expected in the late fourth quarter. Our target reserve potential for this project is 1.1 MMBoe.

West Cameron 73 #2

The 2012 discovery at our non-operated West Cameron 73 field is still expected to have final pipeline hook-up completed and first production during the fourth quarter of 2013.

Onshore - Permian Midland Basin

Yellow Rose Project / Permian Midland Operations

During the third quarter, we continued to operate two rigs in the Permian Basin at our Yellow Rose field, completing nine new vertical wells (one of which was an exploration well) and one horizontal development well. The third quarter average daily production was 3,944 Boe per day net to W&T after royalties. This is up 63.5% over the average daily production rate in the third quarter of the previous year and is a 6.8% increase over the second quarter average daily production rate of 3,694 net Boe per day net to W&T after royalties. We continue to see strong 30 day average initial production rates from our recent verticals and have continued with our 40 acre spacing tests. As part of our expanded capital budget program, we expect to drill approximately seven additional vertical wells at Yellow Rose during the fourth quarter of 2013.

Recently we spud the first horizontal Wolfcamp B well on our acreage in Martin County. Nearby, offset operators have shown recent success with solid results from lateral lengths just over 4,000 feet as well as lateral lengths of over 7,000 feet. Our initial Wolfcamp B horizontal well has a planned lateral length in excess of 6,000 feet. We expect to complete the well and have results by year end.

The northward expansion and growth in activity surrounding our acreage is reflective of not only the potential, but significant value tied to our current acreage position. Although our current horizontal well is targeting the Wolfcamp B, we will continue to evaluate other potential benches which we may test in the coming months. We continue to collect and analyze detailed data on those formations including log data and core data.

Star Project

At our Star Project in East Texas, we recently spud our fifth horizontal well targeting oil in the James Lime at about 8,500 feet true vertical depth with a planned lateral length of just over 6,000 feet. We expect to complete the well during the fourth quarter. We continue to monitor production from our initial four wells and are closely evaluating the activity of nearby operators in the area.

Outlook

Our guidance for the third quarter and full year 2013 is provided in the table below and represents our best estimate of the range of likely future results. Our results may be affected by the factors described below in "Forward-Looking Statements."