I have done a lot of reading, but have not really found the answer to my question. As I read articles , I see that the oil companies are wanting to recap their investments on drilling and fracking a well in the first year of the well production. But, I am not sure how Long the wells actually produce. I have read that after the first year the companies cut production down to 25% of the first year. Does anyone know how many years the well will produce? Some articles say that the well only produces for one to two years. Is this correct, or does anyone know?
Unless there is a mechanical problem, most wells will produce for much more than 1-2 years.
It's a moving target that is very much dependent on oil and gas prices. Without hiccups, a well might produce for 30+ years.
Thank you for our response. I believe that it is only profitable to pump oil if the market price is above $50.00 a barrel . I was having difficulty finding any information on the life span of a well, thank you for your clarification .
Ms. Parker, the operators get tax breaks for low producing wells that they might otherwise plug. The operator may only produce a well 1 day a month, just pumping out what has slowly migrated to the wellbore. There must be tens of thousands of wells producing less than ten barrels a day nationwide. I think they are mostly old depleted wells. A well could straggle along, 1 barrel a day average or less for decades, sometimes produced at a loss because the operator must produce to maintain the lease and there is the possibility that your well could be reworked or other produceable formations exist and the acres still have value worth holding. Every well is different and nobody can predict what a well will do. I often say that the measure of a well is how much wealth it produces before it is plugged and abandoned. I can't think of a better yardstick than that.
The well I was wondering about just went into production last month in the Eagle Ford Shale in McMullen county. There is no real history for me to compare in the area, As far as the life span of the well since the area is so new to production.
Most of the studies I have seen are estimating 20+ years on Eagle Ford wells, with a 70% drop in production within the first year. It can vary widely, though.
Thank You for the information.