New spear bit increases unconventional shale play drilling efficiency 22%
Unconventional shale plays are usually unprofitable due to geological conditions making extraction difficult. With the rise of hydraulic fracturing, natural gas prices suffer from oversupply and lack of demand, which creates a need to reduce operating costs and increase efficiency. Recently, Smith Bits released a new spear bit specifically for unconventional plays that are dubbed “Spear PDC (Polycrystalline diamond compact) bits”. These bits are designed with improved body geometry and hydraulic enhancements, engineered to minimize blade packing, improve cutter cleaning, and increase rate of penetration (ROP).
According to Smith Bits, typical unconventional shale applications create a poor hydraulic environment with high mud weights, low flow rates, and a bit hydraulic horsepower (HIS) of less than 0.5. Smith Bits implemented their bit with taller blade, a shale evacuation channel around nozzle ports, and a smaller profile for the bit body, which have improved the drilling process. The company has had 5,000 test runs for lateral sections in unconventional shale plays since 2011. The lateral test runs ran up to 79 feet per hour (fph), compared to the median performance of 65 fph, an increase of 22%.
Some companies that would benefit largely from this would be onshore drilling companies like Trinidad Drilling (TDG), Nabors Industries (NBR), Pioneer Drilling (PDC) and others, since their services are further required within this market. Also ETFs that track Oil and Natural Gas Services such as iShares Dow Jones US Oil Equipment ETF (IEZ), Oil Services HOLDRs (OIH), PowerShares Dynamic Oil & Gas Services (PXJ), and SPDR S&P Oil & Gas Equipment & Services (XES) will see better returns as well due to increased activity and profits, thus overall industry performance.
Article Glossary
(1) Drill Bit- The item placed at the end of the drilling string used in drilling into the earth. They cut and chip small pieces of rock as the pipe rotates and it is the mechanism that cuts into the ground layers to reach the gas deposit or to cut a core sample.
(2) Mud Weights- The mass per unit volume of a drilling fluid, synonymous with mud density.
(3) Flow Rate- The well production or injection rate.
(4) Hydraulic Horsepower- A measure of the energy per unit of time that is being expended across the bit nozzles. It is commonly calculated with the equation HHP=P*Q/1714, where P stands for pressure in pounds per square in., Q stands for flow rate in gallons per minute, and 1714 is a conversion factor necessary to yield HHP in terms of horsepower. Bit manufacturers often recommend that fluid hydraulics energy across the bit nozzles be in a particular HHP range, for example 2.0 to 7.0 HHP, to ensure adequate bit tooth and bottom-of-hole cleaning (the minimum HHP) and to avoid premature erosion of the bit itself (the maximum HHP).
(5) Shale Evacuation Channel- Pathway for drilled material to escape
(6) Nozzle- The part of the bit that includes a hole or opening for drilling fluid to exit.
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