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Bringing Waxy Back - Uinta Basin Waxy Crude on a Roll as Gas Takeaway Constraints Are Dealt With

The Uinta Basin in northeastern Utah, which may be the quirkiest production area in the Lower 48, is firing on all cylinders. Production of the basin’s unique waxy crude is at an all-time high, the natural gas takeaway constraints that had threatened to limit growth are being resolved, and demand for waxy crude is on the rise. In today’s RBN blog, we’ll provide an update on the Uinta, where the crude looks and feels like shoe polish and is trucked and railed — not piped — to market. 

We admit it, we’re energy geeks, with soft spots not only for giant production areas like the Permian, the Marcellus/Utica and the Bakken, but also for offbeat locations like the Uinta Basin, which is well-known in refining circles (especially Salt Lake City but also in parts of the Gulf Coast) for its trademark waxy crude. Waxy crude may be as hard to handle as porcupines and as tough to transport as giraffes — more on that in a moment — but its medium-to-light API gravity (32 to 36 degrees for the “black wax” variant and 38 to 44 degrees for the “yellow wax” type), super-low sulfur content (0.01%), low acid content (TAN, or total acid number, of less than 0.1%), and low metals and nitrogen content make it highly desirable to an increasing number of refiners.

As we said last year in You Waxy Thing, Uinta producers for many years relied on conventional vertical wells, often stimulated with massive acid jobs or water flooding. Over the past 10 years, however, producers have been turning to horizontal drilling and multi-stage hydraulic fracturing — and with more and more success. Like unconventional producers in other plays, Uinta E&Ps have been drilling longer and longer laterals (~10,000 feet is now standard and 3-mile laterals were recently tested), ramping up the intensity of their hydraulic fracturing, and multiplying the volumes of frac sand used. Most important, perhaps, they have identified — and zeroed in on — over-pressured areas in the basin’s Uteland Butte play (blue-shaded area in Figure 1) that offer very favorable initial production (IP) rates and slower decline curves.

Uinta Basin and Its Key Sub-Areas

Figure 1. Uinta Basin and Its Key Sub-Areas. Source: RBN 

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