Swift Energy Company 1996 Annual Report: Growth Through Technology and Teamwork

The Texas Austin Chalk Trend

The second major focus area of Swift Energy’s exploration and development program in 1996 was the Texas Austin Chalk trend, where the Company applies its expertise in horizontal drilling. During the year, Swift drilled seven successful wells to the Austin Chalk, with working interests in the individual wells varying from 25% to 52%. The Company also had small interests in two wells drilled by other operators.

Swift’s horizontal drilling program in the Austin Chalk trend began in 1992 in the Giddings Field in Fayette County, Texas, when the Company participated in two wells. Through 1996, the number of wells drilled in the Giddings Field had increased to 33, with a success rate of 97%. Together, these wells, 19 of which were drilled by Swift, accounted for 3.6 Bcfe (or 18%) of the Company’s total 1996 production and $10.1 million (or 19%) of its total oil and gas sales. The Austin Chalk trend also yielded a large percentage (22%) of the Company’s oil and condensate production for the year.

  Swift Energy's leaseholds in the Texas Austin Chalk trend accounted for 10% of the Company’s 1996 year-end proved reserves.

The second major focus area of Swift Energy’s exploration and development program in 1996 was the Texas Austin Chalk trend, where the Company applies its expertise in horizontal drilling. During the year, Swift drilled seven successful wells to the Austin Chalk, with working interests in the individual wells varying from 25% to 52%. The Company also had small interests in two wells drilled by other operators.

Swift’s horizontal drilling program in the Austin Chalk trend began in 1992 in the Giddings Field in Fayette County, Texas, when the Company participated in two wells. Through 1996, the number of wells drilled in the Giddings Field had increased to 33, with a success rate of 97%. Together, these wells, 19 of which were drilled by Swift, accounted for 3.6 Bcfe (or 18%) of the Company’s total 1996 production and $10.1 million (or 19%) of its total oil and gas sales. The Austin Chalk trend also yielded a large percentage (22%) of the Company’s oil and condensate production for the year.

Located at depths of 10,000 to 14,000 feet or more and having a width of approximately 50 miles, the Austin Chalk trend underlies several Texas counties along the Gulf Coast. The formation is typically less than 1,000 feet thick and contains numerous hydrocarbon-bearing fractures. When a well is drilled along a lateral path through the formation, it can intercept and simultaneously produce from multiple fractures, resulting in high initial production.

To follow the designed horizontal pathways, drilling crews utilize high-tech measurement-while-drilling tools that emit sonic vibrations indicating where the drill bit is in the formation. The locations of the target fractures are identified by Swift’s geophysicists and geologists, who integrate seismic and geological data to create graphical representations of the subsurface. Production is maximized and drilling costs reduced by designing many of the wells to include two horizontal legs drilled in opposite directions from the same vertical well bore.

Since its initial drilling in 1992, Swift has acquired substantial additional leasehold acreage in the area, beginning in 1993 with a farmout and leasehold totaling approximately 8,800 gross acres. During 1995, Swift entered into a joint venture on 19,500 gross acres in the area (the North Fayetteville project). As part of this project, during 1996 Swift conducted its second two-dimensional seismic swath survey in the area, the analysis of which led to the drilling of four 1996 wells and the identification of additional drilling locations for the future.

In 1996, the Company more than quadrupled its net leasehold acreage in the Austin Chalk trend with the addition of approximately 17,000 net acres in Fayette County, 39,000 net acres in Walker County, and 2,000 net acres in Washington County, bringing its total holdings in the trend to approximately 74,000 net acres. During 1997, Swift plans to drill 12 additional development wells to the Austin Chalk trend and to conduct two more seismic surveys in Fayette County.

Also in 1997, the Company plans to drill an exploratory well in Walker County. In addition, it will initiate an extensive two-dimensional seismic swath survey covering 100 square miles in Walker County.

Swift Energy’s drilling program in Washington County began with its participation in an exploratory well that was spudded in late 1996 and will be completed in early 1997.

 
In horizontal drilling, a measurement-while-drilling tool allows the drilling crew to guide the drill bit as it leaves the vertical segment of the well bore and angles out into the horizontal plane at the depth of the target formation. In the Austin Chalk trend, horizontal drilling allows one well to intercept multiple hydrocarbon-bearing fractures, increasing production and cutting drilling costs. Shown here is a portion of a mud log plot of a horizontal well drilled by Swift Energy in Fayette County, Texas. The areas in red indicate where the well’s horizontal leg intercepted fractures containing natural gas and/or oil.


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Last modified: Monday, February 20, 2012 1:52 PM