Clayton Williams Energy suffers Q2 loss, refocuses on Delaware Basin

Clayton Williams has oil and gas production of 13.6 MBOE/d

Clayton Williams

Mel Riggs, President of Clayton Williams Energy Inc.

Clayton Williams Energy, Inc. announced a Q2 net loss of $73.8 million, with a plan focused on the development of its 65,000 net acre position in the southern Delaware Basin.

Production costs in Q2 were $19.2 million versus $23.1 million in Q2 2015 due to lower oilfield service costs and reductions in production taxes. Production costs on a BOE basis, increased 6 per cent to $13.81 per BOE in Q2 2016 versus $13.02 per BOE in Q2 2015.

Clayton Williams plans to continue utilizing one rig in Reeves County for the remainder of 2016. With recent improvements in average drill times to 29 days, spud to spud, the company now expects to have drilled ten wells by the end of the year, with seven wells on production and three wells in various stages of completion.

The company currently expects total oil, gas and NGL production for fiscal 2016 to average between 13,300 and 13,900 BOE per day, representing an increase of approximately 1,000 BOE per day from the company’s prior guidance estimates.

Capital expenditures for 2016 for Clayton Williams currently expected to total approximately $105.5 million, up $36 million from prior guidance.

General and administrative expenses for Q2 2016 were $13.6 million versus $11.3 million for Q2 2015.

Delaware Basin Operations

The Company has drilled and completed two wells in Reeves County to date this year, the Lowe 26 #1H and the Collier 34-51 #1H. The Lowe 26 #1H was completed in May with a 4,600-foot perforated lateral in the upper Wolfcamp A section using a hybrid frac encompassing 1,800 pounds of sand and 43 barrels of fluid per lateral-foot.

The peak 30-day production from this well averaged 1,158 BOE per day (74% oil; 13% NGL), significantly higher than the 732 BOE per day peak 30-day average of the previous 25 Wolfcamp A wells drilled prior to 2016.

The Collier 34-51 #1H was completed in mid-July with a 6,300-foot perforated lateral in the lower Wolfcamp A section using a slick water frac encompassing 2,250 pounds of sand and 70 barrels of fluid per lateral-foot.

This frac design utilizes tighter spacing of clusters and stages and increased volumes of proppant and fluids in an attempt to contact more reservoir rock and create a more complex, high density fracture network closer to the well bore.

“The Collier 34-51 #1H marks our first completion in Reeves County using the slick water frac design, and although this well is in the early stages of flow-back, production has averaged just over 2,100 BOE per day for the past seven days. We are obviously encouraged by these preliminary results and are excited about the potential impact this completion technique may have on our Delaware Basin operations,” said Mel G. Riggs, president of Clayton Williams.

Ph: 432-978-5096 Website: www.mapleleafmarketinginc.com Email: miketi@mapleleafmarketinginc.com

Ph: 432-978-5096 Website: www.mapleleafmarketinginc.com 

 

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