"An Overview of Mid-Continent Oil & Gas Activity and Industry Trends"
Tracy Lenz founded Pecan Tree Oil & Gas, LLC, in early 2020. She has over 16 years in the industry with over 14 years of experience analyzing and evaluating oil & gas properties in Texas, Oklahoma, New Mexico, Louisiana, North Dakota, Utah, Colorado, Kansas, and the Gulf of Mexico. Tracy is a Licensed Professional Engineer in the State of Texas (PE# 132654) and is a Certified Mineral Appraiser by the International Institute of Mineral Appraisers (IIMA #2020-06). She received her Master of Science in Petroleum Engineering from the University of Southern California and Bachelor of Science in Petroleum Engineering from the University of Texas at Austin. Tracy started her presentation by explaining the difference between conventional and unconventional wells, which are wells that are fractured to reach the hydrocarbons in the source rocks. There is still a significant amount that can be recovered. Tracy showed maps of where wells have been drilled in last three years in the mid-continent area of the U.S. and showed where the most valuable assets are, the Permian Basin is Texas is one of those locations. She informed us that it costs around $7 million to drill an unconventional horizontal well and each such well usually provides $9-14 million in revenue. Tracy showed us the location of Keystone pipeline and proposed location of Keystone XL. She also had maps showing the location of crude pipelines in the U.S., which transport around 80% of oil in the U.S. There are no oil pipelines to east and west coasts. Tracy showed the numbers on exports and imports of oil. The U.S. is a net exporter of petroleum products not just oil. Since we are producing lighter oil now, the U.S. refineries are not set up to process this thinner oil. Thus, we import thicker oil that can be refined more easily. Most of the oil imported is from Canada, only a small amount is from Russia. Tracy also showed where gas pipelines are located in the U.S. She believes that pipelines are safest vs RR and trucks. She also discussed how the location of federal lands can affect drilling. One her maps shows federal lands overlaid with basins of production. The biggest overlap is in southeastern NM - part of Permian Basin. Finally, Tracy showed us geologic maps and schematics of how horizontal drilling works in stacked plays such as the Permian Basin. What an information and interesting talk!!