Marathon Oil (MRO) issued an update on its oil and gas activity in the Denver Julesburg Basin, where the company is developing the Niobrara Shale in Wyoming and Colorado.
Marathon Oil estimates that Niobrara well will cost an average of $4 million to drill and complete. These wells will produce on average between 200 and 300 barrels of oil equivalent (BOE) per day during the first thirty days of production, and have an estimated ultimate recovery between 250,000 and 300,000 BOE per well.
Marathon Oil reported in a May 2011 investment presentation that the company had 133,000 net acres under lease. During the second quarter of 2011, the company sold a 30% working interest in Niobrara Shale leasehold of 180,000 net acres for $270 million. Perhaps during the earnings conference call, the company will disclose additional details on its current position.
Marathon Oil reported that results from two vertical Niobrara wells have been “positive” and that the company spud its first horizontal well in July 2011. The company plans to add a second operated rig here and drill between eight and twelve gross well in total before the end of 2011.
