Reserve estimates in western basins. Part 2: Piceance Basin

This study characterizes an extremely large gas resource located in low permeability, sandstone reservoirs of the Mesaverde group in the Piceance Basin, Colorado. Total in place resource is estimated at 307.3 Tcf. Via application of geologic, engineering and economic criteria, the portion of this resource potentially recoverable as reserves is estimated. Those volumes estimated include probable, possible and potential categories and total 5.8 Tcf as a mean estimate of recoverable gas for all plays considered in the basin. About 82.6% of the total evaluated resource is contained within sandstones that have extremely poor reservoir properties with permeabilities considered too low for commerciality using current frac technology. Cost reductions and technology improvements will be required to unlock portions of this enormous resource. Approximately 2.7% of the total resource is contained within sandstone reservoirs which do not respond to massive hydraulic fracture treatments, probably due to their natural lenticular nature. Approximately 6.8% of the total resource is located in deeply buried settings below deepest established production. Approximately 7.9% of the total resource is considered to represent tight reservoirs that may be commercially exploited using today`s hydraulic fracturing technology. Recent technology advances in hydraulic fracturing practices in the Piceance Basin Mesaverde has resulted in a marked improvement in per well gas recovery which, where demonstrated, has been incorporated into the estimates provided in this report. This improvement is so significant in changing the risk-reward relationship that has historically characterized this play, that previously uneconomic areas and resources will graduate to the economically exploitable category. 48 refs., 96 figs., 18 tabs