Source: Devon Energy
As recently as 2007, the oil and gas industry generally considered the Anadarko Woodford to be an unreachable shale field. Its pay zone of 11,000 to 15,000 feet deep was considered uneconomic. Today, this liquids-rich natural gas field is one of Devon’s (NYSE:DVN) most important assets, accounting for a growing percentage of the company’s total reserves.
Devon’s decision to drill an exploratory Cana well in August 2007 stemmed largely from its success in the Barnett Shale of north Texas. The marriage of horizontal drilling and hydraulic fracturing had proven immensely effective in the Barnett. That success led Devon to seek other potential shale plays to experiment with the technology.
But there were challenges to overcome in Cana. The sheer depth of the Anadarko Woodford was daunting. Devon’s experts were uncertain whether the challenges in drilling and fracking at that depth could be overcome. However, the expertise and knowledge gained from other shale plays provided confidence that we could unlock this vast resource.
That first exploratory well in 2007 proved successful, leading Devon to acquire additional acreage. By early 2009, Devon had acquired 112,000 net acres, drilled 10 wells and dubbed this new play “Cana” -- short for Canadian County. Cana’s boundaries grew as Devon drilled additional test wells. The play -- the deepest active shale play in the United States -- now covers about 1,000 square miles. Devon now has about 240,000 acres and is by far the play’s leading producer.
To handle this new supply of natural gas, Devon built a plant capable of processing 200 million cubic feet of natural gas per day. Completed in late 2010, the plant’s capacity can be tripled through future expansion as Cana production grows.
The combined production and processing investment has brought economic promise to a large area of rural western Oklahoma. New businesses have opened to accommodate this economic activity. Property taxes from compressor stations, wells and the gas processing plant are adding essential revenue to local schools and county government.
This localized rebirth of the Anadarko Basin shows no signs of slowing. With an estimated 5,400 drilling locations, Cana will remain a staple of Devon’s portfolio for many years. Devon’s Cana position is estimated to contain 11 trillion cubic feet equivalent in total resource -- nearly equal to 2 billion barrels of oil.
Devon overcomes challenges in liquids-rich Cana
Source: Devon Energy