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Craig Cooper

Craig Cooper
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  • Halcón Resources: Solid Second Quarter Driven By The Bakken [View article]
    aA,

    OK, thanks for your comments & clarification.
    Aug 10 08:40 PM | 1 Like Like |Link to Comment
  • Natural Gas Is Far Oversold, Expect A Rebound Soon... What's A Good Play? [View article]
    Steve,

    Impressive use of name calling and condescension. Have a good life.
    Aug 8 08:21 PM | 2 Likes Like |Link to Comment
  • Halcón Resources: Solid Second Quarter Driven By The Bakken [View article]
    aA,

    Would you be kind enough to explain why you believe (high) quartz content is problematic wrt frac'ing & why sandstone reservoirs would be less productive than other formations?

    My experiences have been different. Thanks.
    Aug 8 01:43 PM | 1 Like Like |Link to Comment
  • Natural Gas Is Far Oversold, Expect A Rebound Soon... What's A Good Play? [View article]
    Steve,

    As I've said a number of times previously, while we have a fundamentally different view of most things associated with the O&G industry you're certainly entitled to your opinion. However, I struggle to derive much value from your snarky responses and 'ad nausea' writings, as you call them.

    Just what are you hoping to accomplish with posts such as these? What real value do you think they bring to SA?

    Really, I'm just curious. You constantly criticize those of us with industry experience when we attempt to educate, assist and provide our perspective from long-standing industry experiences for not doing enough for you; whether those inadequacies are in not providing competitive internal company financial data, not submitting an authoritative paper on shale economics or, apparently, hyping unconventional reservoir potential by trying to pass off production rate data from conventional reservoirs as appropriate metrics for the shale / unconventional reservoirs.

    Where are your equivalent counterpoint contributions? The best you've offered are a few cherry-picked things from others and assertions from a few known industry contrarians who, BTW, make a very nice living by being intentionally contrarian.

    Linked peer-reviewed papers, comments & analyses from experts provided by me & others are either ignored or dismissed as biased hype from industry shills. You don't respond in a reasoned, substantive way to direct questions & challenges; rather, change topics / issues to deflect the questions & challenges and then resume the name-calling and criticism of 'the industry'.

    So, given your point of view here, why don't you provide and in-depth analysis of the unconventional reservoir E&P business and its participants to support your sweeping criticisms? That would add a lot of value.
    Aug 8 01:23 PM | 2 Likes Like |Link to Comment
  • Natural Gas Is Far Oversold, Expect A Rebound Soon... What's A Good Play? [View article]
    For shale gas, it's a function of a company's F&D costs vs production rate. Even portions of the Barnett are / have been (long-term) economic @$4 and below for efficient operators (see Holditch, et al 2013). Ditto for Eagleford gas (see Dong, et al 2013).

    For liquids production with associated gas, it's a bonus.
    Aug 5 09:53 AM | 1 Like Like |Link to Comment
  • Penn Virginia: The Correction Creates An Entry Point [View article]
    http://bit.ly/1pAzslg
    Aug 5 09:09 AM | Likes Like |Link to Comment
  • Natural Gas Is Far Oversold, Expect A Rebound Soon... What's A Good Play? [View article]
    My point is that using a play-wide average of any bespoke physical parameter (vs any other single criterion) to gain broad insight or to draw high - level / general conclusions about that play or about a play segment is a reasonable thing to do and is not lazy or dishonest, as you put it.

    I'm not sure why you find that so absurd or preposterous. That approach is firmly supported by probability & statistical theory.

    In your example, immediately above, the pad results contribute to the cumulative distribution of IPs for the entire play and, therefore, are part of one of the play probability distribution functions so should be included in the dataset.

    Averaging only the 8 results from 2 disparate areas and then attempting to draw meaningful conclusions about the play or even about the local play segment is not meaningful nor a value-added activity. Consistently ignoring / not including actual results that don't meet your (subjective) standard will lead to biased and potentially erroneous conclusions which could have tangible (negative) economic / investment consequences.

    It would be fantastic if we could predict with absolute certainty 100% of the time which well locations will / will not meet our standards (whether the standards are IP rate, EUR, decline rate, economic return, cash flow, etc., etc.) however, that is not possible. The best that we can hope to do is to determine which drilling programs will achieve results that fall within an acceptable range of our selected metric with an 80% confidence level.
    Aug 4 01:11 PM | 1 Like Like |Link to Comment
  • Natural Gas Is Far Oversold, Expect A Rebound Soon... What's A Good Play? [View article]
    Michael,

    Accounting for the differences in completion practices, etc. a tally of individual Marcellus IPs will form a frequency - rate distribution pattern that is characteristic of the formation's rock properties. That frequency - rate distribution, by definition, = a probability weighted distribution.

    The Central Limit Theorem tells us that the average of any many - samples distribution is the best single representation of the distribution; in this case, Marcellus IPs.

    So, yes, 'the average Marcellus well IP' is a reasonable vs lazy or intellectually dishonest thing to use.
    Aug 4 11:05 AM | 2 Likes Like |Link to Comment
  • Halcón Resources: Solid Second Quarter Driven By The Bakken [View article]
    igmos00,

    Companies left the Bakken, Eagleford, Marcellus & Utica plays during early stages of exploration too so the fact that "many companies have chosen to leave this shale play" at its current stage is not, in and of itself, a benchmark of future potential or a to reason automatically assign it to a high(er) level of risk.

    WRT the 'need to do is produce a string of successes', I believe you significantly underestimate the difficulty encountered in locating and accurately tracking a zone within a rock layer that is, itself, ~1% of the thickness of the overlying rocks and is most likely distorted in a variety of ways.
    Aug 3 12:07 AM | 1 Like Like |Link to Comment
  • Halcón Resources: Solid Second Quarter Driven By The Bakken [View article]
    All shale reservoirs are highly variable and relatively unique; TMS is no different. In addition here, the play is at a very early stage of exploration & production so erratic results should be expected.

    Look for those companies that implement an intelligent drilling program, learn quickly and significantly reduce inconsistent results. The nature of these plays requires evaluation of drilling program results vs results from individual wells.
    Aug 2 06:45 PM | 4 Likes Like |Link to Comment
  • Bakken Oil Production Per Well Declined 11% From 2012 High [View article]
    Up-front costs can be large but when included as part of initial field development plans can be mitigated somewhat. In spite of the increased costs, recent results in the Powder River Basin (van 't Veld & Phillips) indicate that the associated production gains generate accretive positive economic return (incremental IRR 40% in their study).

    Use of EOR methods in shale reservoirs is very new and still evolving, however some early results have improved (estimated) recovery to more than 20% of OHIP (range cited by Tovar et al was 20 - 50% OHIP).

    Historically, EOR methods were applied late in a field's productive life but recently they have been applied much earlier and have boosted production, ultimate recovery and economic returns.

    As with all new & evolving things, progress will likely be uneven with some operators initially losing money while others improve economic return.

    http://1.usa.gov/1AyB0C9
    Jul 30 10:26 AM | 2 Likes Like |Link to Comment
  • Bakken Oil Production Per Well Declined 11% From 2012 High [View article]
    This and similar articles also completely ignore future production via secondary & tertiary recovery methods so are more pessimistic than necessary.

    Typical primary recovery from shale / unconventional reservoirs ranges from 5% - 15% of original in-place hydrocarbons. A great deal of resource remains to be recovered via enhanced methods (aka EOR).
    Jul 30 09:25 AM | 1 Like Like |Link to Comment
  • Penn Virginia: Expanding The Marl Position [View article]
    gullivertx,

    Terms & definitions are typically spelled out in the lease agreement so the lease documentation would be the first place to go for the exact definition of 'beginning of drilling operations'.

    Often the initiation of site preparation (i.e. clearing, pad construction, et al) = the beginning of drilling operations. Also, most lease terms today require sustained activity leading to well spud; i.e. companies are not allowed to merely clear a site in order to indefinitely retain a lease.
    Jul 30 09:16 AM | Likes Like |Link to Comment
  • Natural Gas Is Far Oversold, Expect A Rebound Soon... What's A Good Play? [View article]
    The only thing really preposterous here is your response.

    Because we are dealing with physical systems where outcomes / results (e.g. many rock properties, IP, UR, and the like) are effectively the result of multiplicative events, they occur in nature as distributions that tend toward lognormal. Mode, median & mean (average) differ in lognormal distributions and each has different utility.

    The mean / average = probability-weighted value of an entire distribution so is most appropriate for characterizing the entire distribution with a single number. It is also the only value that is easily 'upscaled' from a single well to a multi-well drilling program so is more appropriate (vs median or mode) for early / mid - stage assessments of potential economic success.

    Ideally, discussion of play (sub-play, region, area, et al) and potential drilling results should refer to an 80% confidence range which would better focus debates such as this and would also enable better comparisons of competitors within a play.

    The papers below are foundational references:

    Campbell, J.M. et al 2001 - Analyzing and Managing Risky Investments; John M. Campbell Publishing Co., Norman, Oklahoma (487 pages)

    Capen, E.C. 1984 - Why Lognormal?; AAPG School: Managing and Evaluating Petroleum Risk, Tulsa, Oklahoma (350 pages)

    Newendorp, P.D. 1975 - Decision Analysis in Petroleum Exploration; Petroleum Publishing Co., Tulsa, Oklahoma (668 pages)

    Speigel, M.R. 1996 - Statistics; McGraw Hill Inc. New York, New York (519 pages)
    Jul 29 02:17 PM | 3 Likes Like |Link to Comment
  • Natural Gas Is Far Oversold, Expect A Rebound Soon... What's A Good Play? [View article]
    These are statistical plays and best characterized via probability distribution functions; P10, P90, Mean.

    The use of Mean / Average to best represent a large population or distribution of any naturally occurring 'thing' sans the probabilistic criteria is appropriate.

    The use of Median in the description or characterization of these plays is inappropriate and may be misleading.
    Jul 29 10:54 AM | 2 Likes Like |Link to Comment
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