EOG Resources has greenlit its Utica oil wildcatting in eastern Ohio to two rigs and one full-time frac spread as finding and development (F&D) costs fall to between $6/boe and $8/boe.

The E&P brought nine more Utica wells on in third-quarter 2024, taking its new-drill dataset in the play to 25 wells to accompany vertical and horizontal control from past drillers’ well logs.

“Oil and [natural gas] liquids performance continues to meet or exceed expectations, demonstrating the premium quality of this play,” Jeff Leitzell, EOG COO, told investors in a Nov. 8 call.

EOG reported in May that the Utica’s oil results “compete with the best plays in America—very comparable to the Permian on a production-per-foot basis, both in oil and equivalent.”

In addition to the Permian, EOG operates in the Bakken, Eagle Ford, Powder River Basin and other Lower 48 plays.

Days to D&C wells in the Utica have been falling—by 29% to drill and by 13% to complete—the operator reported in the call this month.

It made 2 miles of lateral in one day in a recent well, Leitzell said. It also completed 1,900 ft of lateral in one day, EOG reported.

The D&C pricetag in a few years will average less than $650 per treated lateral foot, he added.

To date, EOG has done its delineation with one rig and a part-time frac spread. “We're looking at about a 50% increase in activity. We'll be up to two full rigs and one full frac fleet by year-end,” Leitzell said.

25 wells’ results

The new wells include the single Whitacre that had a 30-day IP of 1,975 boe/d, 55% oil and 80% liquids. (Note: All IP figures from EOG on its Utica wells normalizes lateral length to three miles.)

It was made near two multi-well pads—Timberwolf and Shadow—on the northern end of the roughly 140-mile north-south stretch of volatile oil fairway.

The four-well Timberwolf IP’ed in August of 2023 at 1,000-ft spacing with 2,150 boe/d, 55% oil and 85% liquids. Through the second quarter of this year, it has produced 919,551 bbl of oil, according to Ohio Department of Natural Resources (DNR) data.

The five-well Shadow tested this past June at 700-ft spacing with 2,125 boe/d, 50% oil and 80% liquids. In its first days online, it made 72,022 bbl of oil through June 30, according to the DNR.

Also new is the four-well Wolverine package at 800-ft spacing in the central part of the fairway. These IP’ed an average of 2,950 boe/d, 55% oil and 75% liquids in September.

The spacing test is near the three-well Xavier pad that IP’ed at 800-ft spacing in October of 2023 with 3,250 boe/d, 55% oil and 75% liquids. The Xavier wells produced 822,009 bbl of oil through June 30, according to the DNR.

At the southern end of the oil fairway, the four-well Sable at 800-ft spacing came on in July with 1,425 boe/d, 65% oil and 85% liquids.

It is near the four-well White Rhino that IP’ed this past spring from 1,000-ft spacing with 1,700 boe/d, 70% oil and 85% liquids. Through June 30, it produced 260,509 bbl of oil.

‘A bullish batch’

Tim Rezvan, an analyst with KeyBanc Capital Markets, reported after the call, “While the well results have been strong and consistent … the drilling efficiencies are what really caught our attention.”

He called EOG’s wells “a bullish batch.”

“Results were generally consistent with offset pads in terms of oil cut and total production,” he wrote.

The 800-ft-spaced Sable pad’s IP underperformed its 1,000-ft-spaced White Rhino neighbor’s IP and also had a lower oil cut, he noted.

“But the clear takeaway from this newest batch of results—nine wells on three pads in three distinct areas—as well as all results—25 wells on seven pads in three distinct areas—is that productivity and more than 50% oil skews appear repeatable across much of EOG's footprint,” Rezvan wrote.

He concluded, “The bear case on EOG's Utica assets continues to crumble, in our view.”

F&D leasehold-wide

The F&D projection of between $6/boe to $8/boe is for the volatile oil fairway within 225,000 acres of EOG’s 445,000 net Utica acres, said Keith Trasko, EOG senior vice president of E&P.

“The range represents the expectations for the next two to three years of development,” Trasko said.

“If you back out the science on some of our early wells, we've hit the upper end of this range multiple times.”

For the entire Utica leasehold, the cost is $5/boe when including the black oil window that is updip along the western side and the condensate window that is downdip along the eastern side.

“It also incorporates full field of development,” Trasko said.

As for the decline rate in the volatile oil window, he added, “I'd say we're not seeing anything out of the ordinary. It's a combo play and we see it declines like a typical tight shale well similar to the Eagle Ford,” Trasko said.

Eventually, EOG will move to delineate the black oil and condensate windows. “We're still in the data-gathering phase there.”