Do you know if the high perm affects the seam stability in a lateral?
Apparently yes, though it's still early days and we're trying to draw conclusions from a handful of wells. I think it's less the perm itself than the fact the perm (cleating and fractures) is a reflection of a complex stress regime which definitely affects the stability of laterals and the direction you can safely drill them in.
High perm laterals are also a problem because you will face a increased risk of total lost circulation. It just doesn't really seem to be worth the bother of drilling laterals in high-perm fields when you already have access to the fracture network with verticals.
Also, you run into legislative issues running horizontal steel liners in laterals because of the problems for potential future longwall mining, even in areas currently considered too deep to mine.
In ESG's areas, though, stacked multilaterals are a great idea. The majors are already planning pilots in other areas in Qld and if they significantly out-perform vertical frac wells, expect to see many more of them.
ESG Price at posting:
90.0¢ Sentiment: Buy Disclosure: Held
