Mature shale plays offer up to 90% of additional recovery for refracs

Refracs are making a remarkable resurgence, particularly in mature plays like the Eagle Ford and Bakken, as operators seek to maximize returns from their existing assets, S&P’s global oil podcast explored. With initial recovery rates from shale wells typically ranging from 7-10%, refracs offer a compelling opportunity to access significant untapped reserves. Industry experts suggest that refracs could potentially increase EUR (Estimated Ultimate Recovery) by up to 70% in the Eagle Ford and more than double production in the Bakken, highlighting the substantial upside potential of this approach.

Technological advancements, particularly the shift from "bullhead" fracs to mechanical isolation methods, have dramatically improved the economics and predictability of refracs. These new techniques allow operators to target virgin rock between existing fractures, potentially yielding production rates comparable to new wells at a fraction of the cost. With refrac expenses estimated at $4-5 million per well compared to $7-8 million for a new drill, the economic case for refracs is becoming increasingly attractive, especially as core inventory in prime acreage depletes.

However, the refrac trend is not universal across the industry. Companies facing core inventory exhaustion are more likely to pursue aggressive refrac programs, viewing them as a superior alternative to developing lower-tier acreage. Major players like Devon Energy and Marathon Oil (prior to being acquired by Conoco) have announced plans for about 25 refracs each in the Eagle Ford this year.

While the sample size remains relatively small and results variable, the potential impact on supply is significant. Estimates suggest that sustained refrac activity of 150 wells per year in both the Eagle Ford and Bakken could add nearly 200,000 barrels per day of incremental oil production over five years, presenting both opportunities and challenges for production forecasting and market dynamics.