It’s time to review the first six month’s production of subsurface hydrocarbons in the Michigan Basin as most operators have now reported results. The theme of this report is that things aren’t always as predictable as you think and that it’s important to always be diligent in measuring the data because the data can Continue reading Michigan Oil & Gas Production Report January – June 2015
The big news this month is the expiration of permits 60746-60750 & permits 60765-60767 for the State Excelsior extension pads just north of M-72 in Kalkaska Michigan. Calgary based EnCana Corporation originally received these permits in 2013 but they transferred to Houston, Texas based Marathon Oil Corporation when Marathon acquired EnCana’s Michigan assets in 2014. Each of these 8 HVHF permits that expired were estimated to require 23,100,000 gallons of water per completion. All told, that’s approximately 185,000,000 gallons of Michigan freshwater that will not be consumed because these wells will never be drilled.
The expiration of these 8 permits is significant because it’s more conclusive evidence that HVHF in Michigan’s Collingwood formation is not economical for operators between $3/mcf & $4/mcf selling prices. Even if natural gas prices were to return to their 2008 level of $7.97/mcf, the highest price in US history, Collingwood wells would not be profitable wells by a long shot. The energy produced from the 7 wells that did make it to production from the Collingwood formation have demonstrated themselves to be an uneconomical use of Michigan’s freshwater resources for energy production. But, the uneconomical use of Michigan freshwater has Continue reading Michigan Oil & Gas Monthly – July 2015