If shale wells decline approximately 30% per year, their average life would be slightly more than 3 years.
However, because pressure declines over time and depletion of oil, there must be a point where recovery of remaining oil is not cost effective.
At the current price of $40/barrel, how far into the 3rd year would oil production continue? Is 20%? 10%? of existing oil left in the ground?
Peter, Tight gas and shale wells typically decline hyperbolically when plotted on semi-log scale. 1st year declines are commonly 75% moderating with time to rates that are closer to 8-10%. Well life is almost always longer than 3 years. 5-15 years will cover the range that most wells will recover the bulk of their reserves. The shale wells are leaving a lot of oil in the ground – 80-90% in most cases although dry natural gas recoveries can be much greater.
If shale wells decline approximately 30% per year, their average life would be slightly more than 3 years.
However, because pressure declines over time and depletion of oil, there must be a point where recovery of remaining oil is not cost effective.
At the current price of $40/barrel, how far into the 3rd year would oil production continue? Is 20%? 10%? of existing oil left in the ground?
Thank you!
Peter,
You misunderstood my statement. Look at the associated slide. The decline rate of the production base–all wells–is about 30% per year.
Best,
Art
Peter, Tight gas and shale wells typically decline hyperbolically when plotted on semi-log scale. 1st year declines are commonly 75% moderating with time to rates that are closer to 8-10%. Well life is almost always longer than 3 years. 5-15 years will cover the range that most wells will recover the bulk of their reserves. The shale wells are leaving a lot of oil in the ground – 80-90% in most cases although dry natural gas recoveries can be much greater.
Exactly, Tom.
Best,
Art
thank you both!
tom’s explanation answered my questions!