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Scoop-Stack Playbook 2017

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SCOOP/STACK: PRODUCTION FORECAST | September 2017 | 37 from 13 of these wells with 60 days of production history, Newfield reported the wells were outper- forming the company's 1,100 boe estimated average type curve by about 45%. Continental Resources, another of the area's major players, reported in its first-quarter results that its Scoop Springer wells outperformed the 940 Mboe EUR type curve by an average 60% in the first 30 days. Positive results led Continental to expand its presence, with the Sycamore expansion adding about 300,000 net reservoir acres under existing leasehold in the play. The company announced three Scoop Springer wells in Grady County, all of which were outper- forming its historical 940 Mboe Springer type curve for a 4,500-ft lateral in their first 30 to 60 days on production. According to Continental, the wells were completed using the company's latest stim- ulation designs, including increased proppant per foot and tighter stage spacing. Continental said it would increase activity in the Springer in 2017 and plans to complete up to 10 Springer wells during the year. Continental also saw positive results in the Stack, with its Meramec wells flowing between 1,907 and 3,011 boe/d during initial 24-hour tests. Stack pro- duction increased 20% to 29,216 boe/d in first-quarter 2017 compared to fourth-quarter 2016. In March the com- pany had 11 operated rigs in the play, with six rigs targeting the Meramec For- mation in the overpressured oil and con- densate windows and five targeting the Woodford Formation in the Northwest Cana joint development agreement area in Blaine and Custer counties. Devon Energy reported an equally optimistic outlook in first-quarter 2017, pointing to average daily production numbers that exceeded the top end of the company's guidance range by 5,000 bbl/d. The company attributed its production growth in large part to higher completion activity across its Eagle Ford and Stack operations. Devon's contigu- ous Stack acreage is in the overpressured oil window of the play and boasts stacked pay opportunities with potential in the Meramec, Osage and Wood- ford shales. Current efforts focus on the oil-prone Meramec and the liquids-rich Cana-Woodford Shale, where recent well completion design enhancements have continued to improve economics, which the company said are among the highest in its portfolio. Devon said it is on track to deliver its previously announced U.S. oil production growth targets of 13% to 17% in 2017, driven by its Stack and Delaware Basin assets, which are projected to deliver produc- tion growth greater than 30% this year. To achieve that goal, the company will invest nearly 90% of its $2 billion to $2.3 billion capital budget in U.S. resource plays, increasing drilling throughout the year to as many as 20 operated rigs by year-end. Looking ahead to 2018, Devon believes the operational momentum created by accelerated drilling activity in the Stack and Delaware Basin will expand its domestic light-oil production by about 20% over 2017. More than 90% of Marathon's 2017 capital program of $2.2 billion has been allocated to its high-return U.S. resource plays, and a fair amount of this investment will go toward accelerating pro- duction growth in Oklahoma and the Bakken. The company is ramping up in Oklahoma to progress its Stack and Scoop acreage toward full-field devel- opment. Plans are in place to increase activity to an average of 10 rigs in the Stack in 2017, anticipat- ing 80% of the Stack assets HBP by year-end. Drill- ing this year will test Upper and Lower Meramec benches with six to nine Meramec wells per section. 0 30 60 90 120 150 Newfield Exploration Devon Energy Continental Resources Cimarex Energy Mboe/d Marathon Oil Estimated First-quarter 2017 Scoop/Stack Oil and Gas Production, Selected Operators (Mboe/d) Operators have seen positive results in first-quarter 2017. (Data courtesy of Freedonia Group Inc.)

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