Turns Out That Drilling Large Numbers Of Fracking Wells From 1 Pad Was A Bad Idea - But Technology!

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And while those are just three companies that tried to push the limits of fracking technology, the issue of packing too many wells on the same pad could greatly alter the economics of the fracking industry. As I wrote in August 2018, when oil and gas wells are too close to each other, the fracking process can damage nearby wells — a process known as “frac hits.” The result can cost drillers money and greatly reduce the amount of oil they can pump from these wells. Two years after its Fracking 2.0 story, the Wall Street Journal published one titled, “Shale Companies, Adding Ever More Wells, Threaten Future of U.S. Oil Boom.” The article details how packing too many wells on a drilling pad is “turning out to be a bust.”

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Despite the past financial disasters and failure of new technology to deliver profits for frackers, the oil industry's biggest players are now getting in on the game in the prolific Permian oil fields. And the solution to fracking's profits problem — according to the likes of ExxonMobil — is Microsoft. Apparently cloud technology has been the missing ingredient in the Permian. In the past week, Exxon and Chevron have both announced plans for major investments in the Permian Shale, which they promise will deliver large increases in both oil production and profits.

Much like in 2017, current headlines have been touting Exxon’s plans and its partnership with Microsoft to use technology to finally figure out how to make money fracking in the Permian. It appears to be an effective public relations push by Exxon — which was much needed. A year ago Exxon’s poor financial performance was linked to its failure to make a big move into fracking shale for oil. At the time, CNN wrote, “ExxonMobil missed the invitation to America's big oil party.”

While this latest promise of profits from fracking now has some of the world's largest companies behind it, these plans are nothing more than a press release at this point. Which makes this a good time to revisit when Exxon made a big move into natural gas in 2010. Exxon bought natural gas producer XTO for $40 billion, and while the U.S. is producing record amounts of natural gas in 2019, this deal is viewed as one of the worst in the history of the energy industry.

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https://www.desmogblog.com/2019/03/12/shale-oil-drilling-financial-disaster-fracking-3-0