The Delaware Basin, a western sub-basin of the Permian Basin, is located in west Texas and southeast New Mexico. The industry's focus on oil assets has influenced the resurgence in horizontal drilling activity in the basin targeting the tight sands and organic shales of the Bone Spring and Wolfcamp formations. The Avalon shale represents the organic-rich siltstones in the upper third of the Bone Spring formation.

Chevron drilled the Terra Nemo horizontal exploration well targeting the Avalon shale (~10,000 feet TVD). A robust formation evaluation was conducted which included a vertical and lateral logging suites, conventional core, side-wall core, well-site cutting analysis, and post-drill geochemical analysis of headspace gas, mud gas, and produced liquids. Ultimately, petrophysical logs plus well-site cutting and gas (C1/C5 ratio) analysis were used to identify the optimal landing zone. The Avalon shale shows moderate generation potential and uniformly type II/III kerogen (oil and gas prone). The targeted Avalon zone showed low levels of maturity based on Rock Eval analysis, consistent with incipient generation of liquids. Geochemical parameters (Oil Saturation Index) indicate low levels of liquids concentration throughout the pilot and lateral sections. However, elevated TOC values were observed along the lateral section with varying heavier gas ratios. Changes in the heavier gas concentrations generally correlated with increases in molybdenum, selenium, uranium, and vanadium. Detailed rock-typing was conducted to better understand the relationship of hydrocarbon occurrence with lithology. Tracers were used in the completion with early results suggesting ~75% stimulation efficiency with possible pressure shadows. This correlation of rock type, petrophysical logs, and completion response will be carried forward on future completion strategies as completion designs migrate from geometric to engineered. Imaging logs in the pilot and lateral showed drilling-induced and natural fractures in the target interval, which may have influenced production.