Worker experience key for shale drilling success

In the race to be the fastest driller in the shale, workers’ experience has mattered more than cutting-edge technology, an analyst’s report said Tuesday.

Companies with experience in a shale play have the greatest advantage over competitors when the play is  first being drilled, according to the report issued by Tudor, Pickering Holt & Co. Nabors Industries was one of the first drilling companies in the Williston Basin in Montana, and was able to maintain the largest market share because of its workers’ experience and the infrastructure and logistics systems it had developed.

Companies that arrive first to a new shale play have been faster drillers and grab the largest share of the market, even after others arrive, the report said.

Getting in first seems to be an advantage that lessens over time.

For example, when contractors first started drilling in the Eagle Ford shale, the slower contractors took as much as 16 more days to complete a well than competitors. But that gap dropped to two days over time, the report said.

Tudor Pickering anticipates that as unconventional drilling matures as an industry, technology advantages will play a bigger role in the competition.

“The low hanging fruit (learning curve) has been picked and we believe industry will need to turn toward other sources for additional well cycle time improvements,” Tudor Pickering wrote in the report.