re: Tuscaloosa Marine Shale oil well sets record (for TMS) - 1540

I think Goodrich has toyed with the idea of going back and reworking some of those wells

Interesting article on a blog about Halcon's view of the TMS. Floyd Wilson with PetroHawk is credited with helping discovering the Eagle Ford thinks TMS is the next big thing

Kirk Barrel's blog

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Total Prod bbls Time (Days)
BOE 1H 50,861 (856)
Joe Jackson 4-13H 39,001 (2120)
Horseshoe Hill 10H 101,042 (666)
Anderson 17 H #1 135,217 (583)
Anderson 18H #1 158,934 (574)
Ash 31H #1 13,238 (285)
Ash 31H #2 57,678 (281)
Joe Jackson 4H-2 34,137 (437)
Anderson 17H #2 73,502 (194)
Anderson 17H #3 42,057 (184)

Crosby 12-1H #1 138,545 (332)
Smith 5-29H #1 72,008 (190)
CMR-Foster Creek 20-7H 29,487 (117)
Huff 18/7H #1 6,635 (34)

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These are the results of the MS Wells from Goodrich and Encana through January of this year. From the MSOGB files. Obviously some great disparity and as mentioned all things revolve around cost.

From what I read and understand, and I could very well be understanding incorrectly, some of the better wells in the TMS have a decline curve a little better than the Bakken wells and better than the average EFS well. It is obvious that there are more losers thus far than winners, but what does the future hold? Somebody is gambling on it.

Maybe those on this board that work and understand the patch can help us neophytes understand this a little better. Some of the wells have had problems causing shorter laterals and such.

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some of the better wells in the TMS have a decline curve a little better than the Bakken wells and better than the average EFS well

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Maybe a steeper decline but much, much higher IPs in the Bakken. The Crosby 12-1H would just be another well in Bakken country.

ETA- to put it in to perspective, one of the early Bakken discovery wells flowed naturally for +6 years and cum'd over 1,200,000 bbls during that time

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Thats a lot of.....cumulutive production

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Yup... I just looked it up, and it's +1.4MM bbls now. It's already a $100MM well. It was drilled in late 06. This will be +2,000,000bbls before it's all said and done.

Here is the well info for any doubters.

Current Operator: PETRO-HUNT, L.L.C.
Current Well Name: USA 2D-3-1H

ETA: I just reread the initial post... that well cum'd all over the place

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The TMS doesn't have to be as good as the Bakken. Just good enough to profitable.

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But they aren't profitable. The other thing with the Bakken is it's a no miss proposition. You are going to hit on every well, it's just a matter of how much.

TMS has a higher failure rate than success at the moment.

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TMS has a higher failure rate than success at the moment.

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You are correct, that is what we are all seeing. Hopefully with more wells and a more money it can be figured out.

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But they aren't profitable.

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As a cumulative group I believe you are dead on, but from what I have read and can extrapolate 3-4 of the wells are on their way to being profitable, I just wonder if they will get to be profitable quickly enough. That is roughly 15-20% of the wells drilled thus far, and obviously that will not cut it for an area or play. Thus far these are not Bakken type wells, as is pointed out.

There have been some fairly forward and positive statements released in conference calls and in earnings calls. None guaranteeing assured positive results. But lots of optimism nonetheless. And the previous has been done by not one or two, but now by about four decent, or at least decently perceived, companies.

While the tone to investors has been of guarded optimism, it has been an optimistic tone. That leads me to believe that those running these companies believe they have some decent odds , and maybe they are wrong, that they can make the TMS commercially viable.

I hope it does because it would be a very good thing for that area of LA/MS.

LINK

New article from Seeking Alfa on Halcon. Fairly interesting. They make it sound so easy, I just wish it was.

Petreaux:
I am not sure if I am seeing the whole article and you are only seeing part of. Conveniently, the bottom line economics are not discussed in this article. I also have problems at times with Seeking Alpha articles, but for whatever reason I was able to read this one, I think as I don't get the "subscribe to see the rest of the article" message.

The one paragraph that stood out to me was this one, not that I fully understand it, but to an amateur it sure sounds good:

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Finally, Halcón provide its 605Mboe "base case" type curve which is representative of the average well it expects to drill across its holdings. The curve is based on analysis of 6 wells in the play using current industry standards and then "normalized" to a 7,200 foot lateral. As shown below, Halcón expects an IRR of 40% at $12MM well cost and $90 oil. Significantly, the graphic shows that Halcón's has an average of 66% working interest across its TMS holdings, with an average royalty interest of 22% and net revenue interest of 51%

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I guess the big key there is the 605MBOE of oil, as no TMS well has come close to that yet. From my rough calculations and SWAG on decline curves it would take the Crosby well about 5 years to reach that, if it ever does. And the Crosby well is the best in the area supposedly. I don't know, I hope for the best.

I appreciate your insight and commentary into this, helps us laypeople understand things a little better.

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Latest Goodrich presentation

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Interesting to see how much the IR in their presentation differ from those reported by the state