Weekly update:

price
Source:eia
stock
Source:eia
rig
Source: Baker Hughes

What is DUC? Why is important?

  • What is a DUC? It is a well that has been drilled but is awaiting completion services.
  • Why DUC?why DUC
  • How many DUCs are there in the United States?
    DUC
    Source:eia

    Until May 2018, the DPR (drilling productivity region) had 7772 DUCs. The region includes Bakken, Niobrara, Permian, Eagle Ford, Haynesville, Appalachia and Anadarko.

    2018-06-30 上午11.34.30
    Source：eia

 

Source:eia
Source:eia
  1. The UDC count in Crude oil region keeps increasing until April 2016. From October 2016, there is an obvious DUC count increase of Permian basin which is different compared with other region. Completion crews, water handling, and other infrastructure constraints mean that the Permian’s DUC well inventory is likely to continue to grow and take time to work off.
  2. The DUC count in gas region has generally been in decrease except count in Anadarko. There are 400 counts increase within 8 month from December 2016 to August 2017.
  • Why DUC is important?
  1. As an operator you need to understand where all competitor DUCs are located to make tactical decisions about what assets to buy or sell, which company owned DUCs make sense to bring online, and how much leverage to use with vendors.
  2. For oilfield service companies looking to complete DUCs you need to get there before the competition by identifying which DUCs will most likely be completed based on assumed breakeven oil prices.
  3. For equity and debt analysts, you need to know the most accurate value for E&Ps DUCs inventory to make well informed equity and debt investments.
  4. Like potential energy, the DUCs are there and can be released when the right switches — around prices, capital and available infrastructure and labor — get thrown.
Reference:
1. https://www.bloomberg.com/gadfly/articles/2017-07-19/opec-oil-price-hopes-must-face-u-s-shale-ducs

2. https://energylawtoday.foxrothschild.com/2016/06/articles/fracking/get-your-ducs-in-a-row/

3. https://info.drillinginfo.com/drilled-but-uncompleted-wells-ducs-in-a-row 4.https://seekingalpha.com/article/4132811-permian-basin-duc-wells-112-percent-y-y-backlog-grows-2613-duc-wells