Market Snapshot: Montney gas wells increasingly productive due to technological improvements

Release date: 2017-01-25

Since the mid-2000s, natural gas in the Montney FormationFootnote 1 of northeast British Columbia and northwestern Alberta has been developed using horizontal drilling and multi-stage hydraulic fracturing.Footnote 2 The Montney now produces about three billion cubic feet per day (Bcf/d), or about 20% of total Canadian gas production.

Operators have developed the Montney using a manufacturing approach,Footnote 3 including continual application of lessons learned from previous generations of wells to improve productivity and lower costs per unit of gas recovered. As a result, average production profiles from Montney wells drilled between 2008 and 2015 show newer wells having higher peak production rates. Newer wells generally also outperform older ones after peaking. For example, wells drilled in 2008 peaked at an average of 2 300 thousand cubic feet per day (Mcf/d) while wells drilled in 2016 peaked at an average of 3 400 Mcf/d – the highest volume yet, although this is based on limited data.

Source and Description

Source: IHS-CERA

Description: The above graph illustrates the average performance of Montney Formation wells as grouped by the years the wells were drilled (from 2008 to 2016). An average well’s production peaks in the second to fourth month of production, with newer wells having higher peak production rates. Wells drilled in 2008 peaked at an average of 2 300 Mcf/d while wells drilled in 2016 peaked at an average of 3 400 Mcf/d. Although average well production in all years declines steeply after peaking, newer wells have generally outperformed older wells.

Some of the technological improvements increasing production per well across western Canada include longer horizontal legs, which allow a well to be exposed to more reservoir and flow at higher rates; the number of fracture stages in a well can be increased; more fracturing fluid and/or proppantFootnote 4 can be pumped into each fracture stage, meaning more reservoir is “stimulated”; and the well can flow at higher rates. Lastly, advances in geoscience and engineering are increasingly being used to target “sweet spots” with the most productive reservoirs.

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