Update on the Ouachitas: The potential still exists

John H. Gray
Firebird Inc.
El Dorado, Ark.
Arthur J. Pyron
Pyron Consulting
Pottstown, Pa.

The above authors published an article in 1986¹ that summarized their exploration evaluation of the hydrocarbon potential of the Ouachita Mountains thrust province of Oklahoma and Arkansas (Fig. 1 [21470 bytes]).

The article was the summation of a decade of evaluation of this area's hydrocarbon potential and was published during a major multicompany leasing program.

Most explorationists viewed the Ouachita Province as being at best prospective with its component rocks being negatively affected by low grade thermal metamorphism associated with the tectonic activity and post-thrusting magmatic activity. This combination, along with a projected elevated geothermal gradient, is believed to have effectively destroyed both reservoirs and hydrocarbons.

Since the 1986 publication, a period of exploration and development has occurred in the Oklahoma and Arkansas portion of the Ouachita Mountains play (1987-93). Significant wells have been drilled in both states, and economic production has been established in Oklahoma in Ouachita facies rocks. On trend, oil and natural gas production has been established in Ouachita facies correlative rocks in Texas, Alabama, and Kentucky.

Subsurface and wellbore information, new seismic and remote sensing interpretations, and data from newly established production in and on trend with the play confirm many of the authors' 1986 suppositions.

Throughout this article we will be referring to information gathered from one well, the OXY USA 1A Danville USA, in 33-5n-22w, Yell County, Ark. Announcement of this well location in 1990 started an unprecedented leasing boom in the Arkansas Ouachitas.

While this well was unsuccessful, review of well logs and completion data reveals interesting information on the pre-Mississippian stratigraphic section and suggests how the industry might wish to approach exploration in this area.

Stratigraphic data

Before the 1986 oil price downturn, great interest was expressed in the hydrocarbon potential of the Arkansas Ouachitas, especially since it was an overthrust province and these terranes had proven to be excellent exploration targets during the previous decade.

That hydrocarbon reserves exist at depth under the Ouachita thrust sheets is also a possibility; in this regard, the Ouachita thrust is like the Appalachian and Western thrusts.

Since the 1986 article, we have evaluated the stratigraphic potential of the Ouachita Province via the new data made available through other scientific studies, evaluation of well borehole information, and field trip examination of outcrops. This information has identified or provided supporting detail to the authors' claim that an estimated 50,000 ft of stratigraphic column, which has been folded and thrusted to create the present day Ouachitas, could also host significant hydrocarbon reservoirs.

Specific to this premise is a report issued by the U.S. Geological Survey in 1992. This report is a discussion of insoluble residue and provenance studies on four wells drilled in the Reelfoot rift of eastern Arkansas and southeastern Missouri (Table 1 [12476 bytes]). The Reelfoot rift is a Paleozoic age extensional feature that is a prospective productive basin.

The USGS report suggests that the northeast trending, narrow, linear shaped Blytheville arch may record the shape and original position of a turbidite basin that formed a structural low basinward of a major boundary fault that was active in the Cambrian.

More importantly, these wells encountered a siliciclastic forereef carbonate ramp complex. The authors believe that this complex, including an Arbuckle-Knox age reef, continues on trend to the southwest and is covered by the northward thrusted Mississippian and Pennsylvanian clastic rocks. The possibility that hydrocarbon reserves could exist at depth under the Ouachita thrust sheets should also be considered excellent.

Danville stratigraphy

Review of the stratigraphy of the OXY USA 1A Danville USA well reveals an interesting stratigraphic column that ties quite nicely with the previously discussed USGS data.

This well is the first significant test of pre-Stanley rocks in the Arkansas Ouachitas and revealed an interesting stratigraphy. Formation tops (Table 2 [9368 bytes]) have been reported by Arkansas Geological Commission geologists.

The well log reveals a thick Ordovician section, including a thick carbonate sequence in the Arbuckle equivalent. Review of the compensated neutron-density log shows extensive fracturing in both the Simpson and Arbuckle group equivalents.

The significance is that fractures are present in these deeper formations, and if the rugosity of the borehole (as evidenced by the caliper log) is any indication, then these fractures have not been healed by secondary mineralization. This suggests to us that porosity may be preserved even at depths of 20,000+ ft if the hydrocarbons fill the fracture space.

Geothermic data

Additional investigation of the subsurface via seismic studies has continued since the authors first cited the Cocorp investigation of the Ouachita Mountains.²

One interesting published study is the investigation by Keller et al.³ They indicate that the data support the existence of oceanic or highly extended continental crust overlain by approximately 15 km (approximately 50,000 ft) of mostly Paleozoic sedimentary rock.

They found no evidence to support the concept of shortening of continental crust during the Ouachita orogeny. We believe that this finding is significant because many geologists project crustal foreshortening, and thermal increases associated with rifting or breakup of the crust, as being indirect evidence of an elevated geothermal gradient that would inhibit the preservation of hydrocarbons at depth.

In fact, the greatest dispute created by our 1986 article centered on whether the temperature at depth would inhibit the preservation of hydrocarbons at the reservoir depths anticipated. Other investigators have suggested that the geothermal gradient of the Ouachitas would not allow preservation of hydrocarbons at depth.

Additional information about the temperature gradient present in the Ouachita Province is found in the OXY 1A Danville well. This well had a TD of 20,648 ft and a measured bottomhole temperature of 298° F.

The calculated temperature gradient for this well is 0.014432°/ft. Using industry established temperature regimes, the oil generation window is reached between 200-450° F., while the dry gas window is reached between 392-842° F.

Using the OXY well's measured gradient, the upper limit of the oil window would be reached at 31,000 ft, while the dry gas window would be reached at 58,000 ft. This suggests that if the initial porosity and permeability of reservoirs are preserved by migrated hydrocarbons, then the temperature gradient alone will not negatively effect whether hydrocarbons are present below 20,000 ft in this province.

Data interpretations

Previous studies by the junior author^4-6 show a relationship between the more typical subsurface mapping techniques, economic production, and observed tonal anomalies and crossing lineaments. There is a 75% correlation between economic production and observed tonal anomalies from the remotely sensed imagery.

Previous articles⁷ contained a generalized Landsat map of the Ouachita trend that identified at least 100 tonal anomalies. In this article, we will amplify this discussion by providing analysis of our remotely sensed investigation of the Ouachita mountains areas of Oklahoma and Arkansas, completed in 1987. Exploratory drilling in the area since then can be used to verify the viability of the remote sensing methodology.

The crux of the remote sensing application for hydrocarbons is based on the concept that cap rock, which is identified as the principal trapping mechanism for hydrocarbon reservoirs, is not impermeable as has formerly been thought but instead has an inherent permeability that allows the microseepage of hydrocarbons.⁸

The inherent permeability in seal rock allows microseepage of light hydrocarbons, associated water, radioactive and other minerals from the reservoir. The microseepage manifests itself in surface rocks in a variety of ways, including localized occurrences of light hydrocarbons in soils, radiometric signatures, soil alteration, including increases in iron and nickel, and stressed vegetation. Tonal anomalies identified on remotely sensed multispectral data are related to the microseepage model, are directly related to geochemical haloes, and are indicators of hydrocarbons at depth.

Verification of the viability of tonal anomaly studies can be completed by reviewing the drilling history of an area after completion of the remote sensing study. Such verification has been completed for Gray and Pyron's 1986 study of the Ouachita Province.

Suneson, Brown, Mycek-Memoli9 reported a list of 108 significant natural gas wells drilled in the Ouachita mountains of Oklahoma. Of the 108 wells, 55 encountered significant shows of hydrocarbons.

To further evaluate the tonal anomaly investigation, the authors obtained data from the University of Oklahoma's Geo-Information Systems (Table 3 [27279 bytes] and 4). Table 4 [80731 bytes] represents real time data that verify the methodology and expand on Suneson et al.

Based on this search, 12 of the 108 significant wells had no available records and one other well produced oil for a short time. This may suggest that the reported lease information is wrong, that the lease name has changed, or that the wells had no significant production. Because the history of these wells is questionable, they are omitted from further evaluation. This therefore reduces the number of significant wells to 95. Of the 95, 53 were dry holes not located in tonal anomalies and 42 were productive wells.

To evaluate the productive wells, the authors devised the following economic test. Based on the cumulative production, the authors calculated the valuation by multiplying the cumulative production by an average price of $1.50/Mcf, the average selling price of natural gas during the time period. From 1987-94, the price of natural gas fluctuated from a high of $2.50/Mcf to a low of $1.25/Mcf.

Next drilling/operating costs were calculated based on an average cost of $900,000/well. Some of the leases have multiple wells, so the cost per well is proportionately higher if more than one well is present. Both the valuation and the cost for well installation are used to calculate the return on investment (ROI) using the following industry standard formula:

[Valuation minus cost of well(s)] divided by cost of well(s) equals ROI.

Using the ROI criteria, wells with an ROI of 4:1 are considered economic. This is consistent with typical industry standards.

Table 4 [80731 bytes] provides historic production data for 57 productive wells or leases. This figure represents an increase in the total number of productive wells by 14 wells, a result of multiple wells drilled on leases. The total base of wells includes 53 dry holes, 56 productive wells, one oil well, and 12 wells with no record, for a total of 122 wells.

Using the economic performance criteria and omitting the 13 wells with no production records, as based upon historic production performance, the results are:

53 wells* were dry holes and were not in tonal anomalies.

2 wells* were in tonal anomalies and had ROIs 4:1.

6 wells were in tonal anomalies and had ROIs 4:1.

11 wells were not in tonal anomalies and had ROIs 4:1.

37 wells* were not in tonal anomalies and had ROIs < 4:1.

Given that the tonal anomalies are indicators of hydrocarbons at depth and that the authors would make recommendations based upon the presence or absence of tonal anomalies, as indicated by the (*), this means that their predictions would be accurate in 92 of 109 cases, or 84%.

Significantly, what the economic based evaluation proves is that many of the wells identified by Suneson, Brown, and Mycek-Memoli as being productive were not economic. The reservoirs that initially produced large volumes of natural gas did not sustain production, a phenomenon typical of fractured reservoirs.

Similar data were generated for Arkansas, although on a smaller data base (22 exploratory wells drilled in the Ouachita Mountains). Three of these wells are located outside the main Ouachita Province, 14 wells were not located in tonal anomalies, and five were located in tonal anomalies. Two of those five were drilled to less than 1,200 ft and are inconclusive. All of the wells are recorded as dry holes.

Significantly, after the OXY Danville well was announced the authors reviewed their own remote sensing study. The location is near a tonal anomaly swarm but not inside an area that the authors would consider prospective. The authors predicted that the well would be a dry hole and would encounter fracture porosity. After 18 months, the operator announced that the well had been abandoned as a dry hole.

If these data are representative, the authors' projections on wells drilled since the middle 1980s, subsequent to this remotely sensed data study, were correct on 111 of 128 wells or roughly 87% of all projections. The authors did not have the benefit of detailed seismic studies and were limited to evaluation of unprocessed, nonrectified commercially available Landsat 2 data. Given these limitations, the authors believe that the remote sensing method has value as a predictive tool for explorationists, especially in provinces with little subsurface control.

Next: Analogs to existing production and petrophysical analysis of the Oxy Danville well.