TM, I look forward to the time when Ultra has a chance to use those tax credits! It will certainly be a great day when this past year's price slide gets reversed.
As to what I found out about Ultra's wells after the initial two year steep decline rate. There aren't any with a two year history yet. SHB 13-23 (Ultra's first well) went into production 2/97, and is currently producing 2.75 MMcfd. However, this well had been shut-in for a period so has not had a two full years. On the plus side, it is not showing the typical steep decline rate. Neither is the recently completed SHB 13-14. SHB 15-21 began producing 6/97, and is currently flowing at 1.9 MMcfd. These were the only wells mentioned in an email from Ultra.
The next six months or so should show an increasing number of wells with at least two years of production. Hopefully several of them will show 2+MMcfd flows after two years because then they will have 18+ years of high revenue ahead of them. As I recall in a news release about a year ago, Ultra and Halliburton thought they were at a point where the technology was developing to slow the decline rate. It seems to me that if the Initial Production is really high to begin with (for example, Mesa 15-8, IP of 16.1 MMcfd) and the well gets choked down to, say, 2-3 MMcfd, then the well should produce high numbers for a longer period because the pressure is not being depleted. Does that make sense, Traveling Man?
BTW, has anyone else looked at the opening page at Ultra's site and noticed gross acreage has changed from 350,000 to 275,000? How long has the smaller number been there? Any opinions? The explanation I've heard is that the missing 75,000 acres represent leases that were allowed to lapse while the company concentrates on areas such as Mesa and the Anticline. Michael Watford intends to concentrate on Development now instead of Exploration. Can hardly fault that strategy!
GAtwater |
