Rex Energy (REXX) reported that during the second quarter of 2011, the company is conducting hydraulic fracturing operations on the Steege 1-33H well drilled into the Niobrara Shale. The company expects to conduct similar operation on the Shapley 14-25 well in the third quarter of 2011. This well is also targeting the Niobrara Shale.
Rex Energy has drilled five horizontal wells to the Niobrara Shale and has been tinkering with its drilling and completion techniques. During the second quarter of 2011 conference call, the company disclosed a number of changes used for the Steege 1-33H well.
“We changed the orientation of the lateral on the Steege 1-33H well, changed the liner to plug and perf, and utilized a low pH fluid system for the fracturing. As we have previously mentioned, we want to have a 60-day-plus production history on these wells before we release results so we can have a higher degree of confidence on the decline curves and EURs.”
Rex Energy has 39,000 net acres in the Denver Julesberg Basin that is prospective for the Niobrara. The company expects well costs to be in a range from $3.5 million to $4.2 million.
