“It’s quiet…Too quiet.” Although the origin of this statement is murky, the meaning speaks volumes; especially in the oil and gas industry of 2015. However, hope is still alive in Oklahoma and that hope would be named: SHALE. And, fortunately for Oklahomans, there is still considerable activity in the SCOOP and STACK plays. The number of active drilling rigs in Oklahoma has been fairly constant at just over 100 rigs the beginning of May thru September according to Baker-Hughes. Operators such as Continental and Newfield are still acquiring oil and gas leases.

The STACK play (Sooner Trend Anadarko basin Canadian and Kingfisher counties) as its acronym suggests in located in Canadian and Kingfisher counties. However, some of the maps I have seen indicate it also is located in Blaine County. This play includes oil and gas-rich shale formations such as the Meramac and Woodford. Production rates on a number of these wells have exceeded 1,000 barrels of energy per day over a 30 day production period.

The SCOOP play (South Central Oklahoma Oil Province) the fairway of which, at least as defined today, is located mainly in Grady, Garvin, Stephens and McClain counties. It was originally known as a Woodford shale play, but over the last couple of years there has been an increasing move into the Springer formation. The Springer formation has been a wonderful surprise out of what was thought to be a strictly Woodford play. In fact, a recent Newfield well was reported at initial production of 1,950 boe and had a 30 day average of 1,220 boe/day with 81% oil. Continental has also had substantial success in the Springer.

A Wood Mackenzie analyst, Brandon Mikael, recently reported that the break-even economics for the SCOOP Springer was $41.00 and SCOOP Woodford at $47.00 West Texas Intermediate Crude. In light of the current oil prices ($44.50 WTI at the writing of this article) those numbers lend much hope for the future. A little upward movement in those prices and these two plays appear to become very profitable.

An interesting new release came out the other day from Continental Resources. Although Continental is planning to reduce its spending by $300 to $350 million from its previously approved capital budget for 2015, indications are that its production growth remains unchanged and is still indicated at 19% to 23% over 2014. The news release also indicates that Continental plans to defer well completion activity except where it has contractual considerations or it accomplishes specific strategic objectives.

Harold Hamm, Chairman and Chief Executive Officer for Continental stated, “We are reducing capital expenditures to protect our balance sheet and to preserve the value of our world-class assets until commodity prices improve.” It looks like the operators in the SCOOP and STACK plays are positioned to wait out today’s low oil prices with an eye on the future.

So, although it may seem quiet in Oklahoma, there is actually a lot going on. Will Rogers once said “Never miss a good chance to shut-up” and with that I will close. I hope you and yours have a great month.