Shale

Emerging Plays

The Duvernay Shale

The Duvernay Shale came to prominence in 2010 and 2011, when more than $2 billion were spent in auctions for land rights targeting the Devonian shale formation.

The liquids rich play follows the trend set by similar unconventional targets in the United States, such as the prolific Eagle Ford Shale in Texas. Technology advances such as horizontal drilling and multi-stage hydraulic fracturing unlocked the potential of the tight rock.

The Duvernay Formation is of Devonian age, and is the stratigraphic equivalent of the Horn River, the largest shale gas play in North-Eastern British Columbia by gas reserves. The Devonian is considered the source rock for the Leduc reefs light oil play, the discovery of which was one of the defining moments in the Western Canadian oil and gas industry. The Duvernay Shale lies at about 3500 metres vertical depth below West-Central Alberta, significantly deeper than other shale targets currently developed in the Western Canadian Sedimentary basin. Also different from unconventional gas reservoirs such as the Montney and Horn River, the Duvernay shale contains significant amounts of liquid hydrocarbons, including free condensate, in addition to the shale gas, making it more appealing in a market defined by low gas and high oil prices.

Flaring gas

Companies involved in the exploration of the Duvernay Formation include pioneers Celtic Exploration, Trilogy Energy, Yoho Resources as well as large scale operators such as EnCana Corporation, Talisman Energy, Royal Dutch Shell, Husky Energy and Chevron Corporation.

The Duvernay fairway stretches across acreage with comprehensive oil and gas infrastructure, underlying fields with established oil and gas production such as Kaybob and the Pembina field. This constitutes an advantage over other Canadian unconventional shale plays such as the Horn River, situated in underdeveloped remote North-Eastern British Columbia. Access to pipelines and processing plants, as well as proximity to established oil and gas centres provides access to services and can significantly streamline the flow of the product to market.

So then the main challenge is extracting the gas and liquids from the tight rock in an economical way. The Duvernay has an effective porosity of up to 5-7%, and total organic carbon content of up to 3-4%. The thickness of the formation is 150 to 200 meters across the fairway. The reservoir has high initial formation pressure, good for production, but more difficult to drill. The cost of drilling and completing a well in the Duvernay has initially been around $15 million, yielding 2 million cubic feet per day gas with 150 barrels per day of 56 API condensate. There is ample room to decrease drilling and completion cost, improve hydraulic fracturing efficiency and increase production as the exploration progresses and technology is optimized.

Chinook Consulting assists oil and gas companies with field and office geological supervision of operations in the Duvernay liquids rich shale reservoir. Several of our wellsite geologists are specialized in this particular play. Our company has solid expertise related to the specific drilling process of the Duvernay play.


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© March, 2012, Chinook Consulting Services