For mineral owners in the northern Texas Panhandle, there is an exciting new development: Apache Corporation is planning to conduct a seismic survey in the Pennsylvania Canyon Wash formation to see if it is suitable for horizontal drilling. At present, there are parts of the Panhandle that not been fully explored for oil. Apache intends to drill down for the 3D survey. At 9,200 feet deep, the company believes that Canyon Wash would be well suited to the type of drilling that it wants to do.
Apache, headquartered in Houston, Texas, has grown beyond its humble beginnings in Minnesota to become a successful multinational oil and gas company. Today, Apache has $30 billion in capital and offices in the United States, Canada, Australia, Argentina, Egypt, and the United Kingdom. Yet since the company moved its headquarters to Houston in 1992, it has kept an active interest in Texas projects.
Currently, Apache holds a 75% interest in 122,000 fields south of shallow production in the Panhandle field. The area remains mostly pristine, with just 23 penetrations. Apache hopes to start a multi-rig program in 2012 in the area known as the Cimarron Arch. The company’s Bivins Ranch acreage is situated in Oldham, Potter, and Hartley counties. Apache’s partner in the acreage, Gun Oil Company, already completed a vertical Canyon Wash discovery well in Oldham County in March 2010. The well produced 42,000 bbl within the first nine months. Apache officials believe that the latest exploration will lead to wells that could recover up to 343,000 bbl/well -- or 87% oil. Each well would have an estimated price tag of $3 million. Apache may achieve up to 100 drillable locations from 2012 through 2015.
This is welcome news not only for mineral owners in the Texas Panhandle, but also for anyone who cares about energy that is easy to access and affordable. Owners of land rich with minerals could be in a position to lease to the Apache Corporation and other energy companies that come along to explore, thus helping the local economy. The news is also welcome because it means that companies are finally starting to tap additional areas in the United States ripe for oil extraction. Oil and gas interests have been firm in their belief that energy independence begins at home -- but too often, federal regulators and environmentalists have put a stop to meaningful exploration. Meanwhile, some of the sources that are already tapped in the U.S. may be vulnerable to natural disasters (such as hurricanes in the Gulf of Mexico) or to regulators’ overreaction (such as the Obama administration’s decision first to stop, and then the slow walk deep water oil drilling permits following the Deepwater Horizon tragedy). The result is skyrocketing gasoline prices at the pump.
The Texas Panhandle is out of the reach of hurricane weather. Let us hope that that Apache and other energy companies active in the Panhandle are successful in their exploration. As a country, we won’t ever be weaned from Middle Eastern oil until we are producing more ourselves.