Noble places first oil well into production

It’s not exactly a gusher, but Noble Energy has placed its first oil well in northeastern Nevada into production.

The well, drilled on Noble Energy’s land position south of Interstate 80 near Deeth, produced 830 barrels of oil in July, the Nevada Division of Minerals reports. The DOM was expecting to have Noble’s production totals for August in coming weeks.

It’s too early to tell if the well and others the Houston-based energy giant is drilling prove to be game-changers for Elko County, but it does prove there’s oil in Noble’s Nevada shale play, says Richard Perry, administrator for the Division of Minerals.

“It opens up a new source of oil for Nevada, one that has previously not been production,” Perry says. “We need some new oil.”

Oil production is nothing new for Nevada — the first oil well in the state went into production in 1954. It was located in Railroad Valley about 50 miles southwest of Ely in Nye County and operated by Shell Oil.

Oil production in Nevada topped out in 1990 at 4 million barrels, and last year the state produced 335,672 barrels. Historically, the oil wells in the state have produced a total of 52.2 million barrels of oil. There currently are seven registered oil producing companies in Nevada: Noble, Western General, Makoil, Inc., Andromeda Oil, Frontier Exploration Company, Grant Canyon Oil & Gas and Kirkwood Oil & Gas/Wesco Operating.

Though the Railroad Valley has become synonymous with Nevada’s modest commercial oil industry, Noble’s efforts may change that perception.

Noble has completed two wells in Elko County and began drilling a third a few weeks ago on its land position about four miles west of Jiggs. The company’s exploration efforts have sparked a flurry of interest in the state from other oil firms, Perry says.

“We are starting to get more interest and activity in northeastern Nevada by companies interested in hydraulic fracturing of existing wells, and we have had inquiries by companies inquiring about drilling new wells about what the regulations are.”

Perry and his staff recently completed a months-long program to define hydraulic fracturing regulations in the state, which were adopted in August. The Division of Minerals oversees oil and gas drilling permits for the state. It issued nine drilling permits to Noble Energy in 2013, which hydraulically fractured its first well in March and fractured its second well in June.

Noble Energy’s communications manager declined to comment on the results of the company’s initial efforts in Elko County. However, Perry expects his four field inspectors to remain busy for the next six to nine months based on current permitting volume for drilling plans.

“It looks like we have quite a bit ahead of us, and our regulations require us to be there when wells are drilled to inspect the casing cement and hydraulic fracturing treatment,” Perry says.


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