In with the horizontal, out with the shallow
The number of vertical wells drilled in Western Canada continues to fall
It’s no secret that the combination of multi-stage fracturing and horizontal drilling technology has opened up vast pools of previously hard-to-reach oil in Western Canada. Junior and intermediate companies are rapidly deploying the new techniques in resource basins bearing familiar names like Cardium, Pekisko and Viking, where the prize is a treasure chest of so-called tight oil trapped in dense layers of rock.
ARC Financial chief energy economist Peter Tertzakian says the rapid deployment of new drilling techniques today mirrors the arrival of rotary drilling that replaced cable-tool derricks in the early 1900s. “Horizontal drilling is nothing new and was first embraced meaningfully in the early 1990s,” he writes in the Calgary Herald. “For the most part the technology suited only a niche market with the substantially higher cost of drilling being unjustifiable for broad application.”
Higher commodity prices, combined with improvements in digital sensing equipment, instrumentation and the aforementioned rollout of fraccing techniques, have changed that. Two interesting charts below show the dramatic uptick in horiztonal wells drilled since the early ’90s and the corresponding drop in vertical wells plumbed in southeast Alberta.