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The U.S. shale revolution dramatically reshaped the world energy markets. The shale boom was one of the most impressive growth stories, from take off in 2008 to the Permian stealing the mantle from Saudi Arabia’s Ghawar as the world’s highest producing oilfield in a little over a decade. Overall, Reuters has estimated that, “U.S. petroleum production is at least 10-11 million bpd higher than it would have been without horizontal drilling and hydraulic fracturing.’’

Unfortunately, the shale patch has lately been struggling to ramp up production due to a litany of challenges including pressure from investors to boost returns, limited equipment and workers as well as a lack of capital.

But shale giant ExxonMobil Corp. (NYSE:XOM) is now betting that shale producers can double crude output from their existing wells by employing novel fracking technologies.

“There’s just a lot of oil being left in the ground. Fracking’s been around for a really long time, but the science of fracking is not well understood,” Exxon Chief Executive Officer Darren Woods said Thursday at the Bernstein Strategic Decisions conference. Woods has revealed that Exxon is currently working on two specific areas to improve fracking. First off, the company is trying to frack more precisely along the well so that more oil-soaked rock gets drained. It’s also looking for ways to keep the fracked cracks open longer so as to boost the flow of oil.

Luckily, the U.S. Shale Patch won’t have to wait for Exxon to perfect its new fracking technologies. There's already a proven technology for oil producers to return to existing wells and give them a second, high-pressure blast to increase output for a fraction of the cost of finishing a new well: shale well refracturing.

Refracturing is an operation designed to restimulate a well after an initial period of production, and can restore well productivity to near original or even higher rates of production as well as extend the productive life of a well. Re-fracking can be something of a booster shot for producers--a quick increase in output for a fraction of the cost of developing a new well.

While refracturing has never really gone mainstream, the technique is seeing higher adoption as drilling technology improves, aging oilfields erode output, and companies try to do more with less. According to a report published in the Journal of Petroleum Technology, new research from the Eagle Ford Shale in south Texas shows that refractured wells using liners are even capable of outperforming new wells despite the latter benefiting from more modern completion designs.

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Refrac makes a lot of sense in the current inflationary environment. Back in April, Texas shale producer Callon Petroleum Company (NYSE: CPE) revealed that frac sand, drill pipe and labor costs have increased drilling and well-completion service costs ~20% Y/Y.

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Another key benefit: re-fracs do not require additional state permits or new negotiations with landowners. They are also less disruptive to the environment because well sites already have road access.

I wouldn't take this above statement to be 100% true. If there is new surface disturbance (including but not limited to a new temporary water line for frac), there may definitely be new negotiations with the landowner, and if that landowner is the Federal Government/BLM, a temporary water line easement/permit is usually required.

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Despite these seemingly clear benefits, it's surprising that refrac remains a fringe tech in the U.S. Shale Patch. Norwegian energy consultancy Rystad Energy has estimated that out of all the U.S. horizontal well stimulations performed through September, out of the 8,900 total stimulations from January to September, only 200, or a little over 2%, were refractured wells. The vast majority were in the Permian Basin spanning Texas and New Mexico and involved wells drilled before 2018. Rystad estimates that the count will rise to ~400 refracs by year’s end, or a little over 3% of total completions and comparable to last year’s final tally of 409 refracs.

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Nevertheless, Barba is optimistic that the U.S. Shale Patch will shift toward higher rates of refracturing in the not-too-distant future for one key reason:

“We are seeing higher recovery factors on refracs--cumulative oil plus the estimated ultimate recovery (EUR) of the refrac--than we are in new wells.”

LINK

There's certainly lots of recompletions going on in the shale areas; however, I agree that strategy isn't being fully used. I do wonder what the net long-term benefit is to re-frac vs. EOR/secondary recovery on the production side.

Re-frac wouldn't require necessarily the infrastructure that EOR does, but does the re-fracturing of rock multiple times through the same wellbore have a negative long-term affect for EOR possibilities?

Maybe one of the downhole baws on here might be able to provide some info on my question?