Blue Dragon Energy & Environmental Blog 2.0: U.S. Wildcat Wells at Record Low Levels and Fast Declines of Horizontal Wells Require More In-Field Drilling to Sustain Production

Sunday, November 16, 2025

U.S. Wildcat Wells at Record Low Levels and Fast Declines of Horizontal Wells Require More In-Field Drilling to Sustain Production

Wildcat Drilling

In my career as an oil & gas geologist, I have had the opportunity to work on several wildcat wells. Some were discoveries. Some were “dry holes.” That is the nature of the beast. According to Faster Capital:

“Wildcat Drilling is a process of drilling for oil and gas in unexplored areas. It is a high-risk, high-reward strategy that can lead to the discovery of new oil and gas fields.”

Basically, wildcat drilling is exploratory drilling. In oilfield geology terminology, a riskier wildcat well might be called a “rank wildcat.” A less risky wildcat well will be closer to existing production and might be called a “step out “well.

Exploratory drilling is the main means of finding new oil & gas production and reserves. Of course, success often depends on the soundness of the geological and engineering assumptions made to justify the drilling.

Below is a map of U.S. oil and gas production in the U.S. It is within or near those areas, mostly sedimentary basins, where more is likely to be found with exploratory drilling.

The Faster Capital article notes that new technologies like better subsurface delineation through seismic and other methods, directional drilling, and improved hydraulic fracturing have made exploratory drilling less risky. In general, wildcat drilling is high-risk, high-reward. However, they may also be high-risk, low-reward when dry holes are factored in. In comparison, unconventional resource plays like shale plays that tap hydrocarbon source rocks in continuous accumulations are less risky but still may be very rewarding. They note that conventional drilling is often low-risk, low-reward. I might add that the success of unconventional shale resource plays is due to being low-risk, high-reward. I made the following graphic to summarize these general observations.

Wildcat Drilling Has Been Declining Since the Unconventional Shale Revolution

Curtis Hess of Enverus has posted some short but interesting observations on LinkedIn about exploration and wildcat wells. These are worth sharing, so I will here. The first post notes that wildcat drilling has been down since shale rose to the fore due to exploration mitigation, as can readily be seen in the graph.

The next post explains why exploration is bound to rise again in the near future. There is considerable demand for oil & gas, and that will continue. He notes that the undrilled reserves of each of the major U.S. unconventional oil plays are known, what he calls “placed.” We also know, as the latter part of this post will delineate, that unconventional horizontal plays have higher decline rates, which means more wells, or more accurately, more footage, will have to be drilled to keep production levels steady. He also notes that industry consolidation has made it easier to assess the limits of the unconventional plays.

“The known resource base is largely delineated and controlled by an increasingly small number of operators leaving little room for new entrants.”

These observations suggest that there will be a preferential focus on short-cycle exploration projects, especially unconventional-style plays that have a high degree of repeatability. Even so, the larger companies will likely focus more investment on long-cycle exploration projects.

Horizontal Wells Require More Drilling to Sustain Production

The high-decline rates of horizontal wells are well-known. Initial production is very high for horizontal wells in the first couple of years of production, but as pressure declines, they tend to drop off to a lower production rate that has a lower rate of decline. The graphs below from the Energy Information Administration show this.