David Pescod: We are with Allen Howard, President and CEO with NuTech Energy Alliance out of Houston, Texas and he’s got some serious expertise in the shale plays. But first, Allen, a little background on NuTech and I hear you are awfully busy these days with the explosion of interest in shale oil and gas…
Allen Howard: That’s correct Dave. NuTech has been in business for 14 years as a company; we have grown it from my kitchen table into a firm of about 100 employees with 55 engineers and 15 geoscientists. We have offices in several places around the world, and we are about to open an office in Canada this year, to be based in Calgary.
NuTech was started with the idea of improving the analysis of reservoir pore space to determine why a lot of the reservoirs that have been logged over the decades have 'worked' – and why others have demonstrated much less obvious productive pay or what we now consider "unconventional" pay. We didn't work the shale reservoirs in the early days of NuTech, but evolved our expertise in the shale market very rapidly starting in 2001. We were just beginning to develop a model for the shale markets, when Devon bought out a portion of Mitchell’s Texas properties to investigate the Barnett shale. Devon brought in NuTech to analyze a fairly select, highly controlled study group of wells in order to crack the shale model and learn how to effectively evaluate shale attributes. These attributes include such things as the shale's brittleness, total organic content ("TOC") minerology, geomechanics, and effective porosity and permeability. These attributes turned out to be fairly predictive of potential productivity in the Barnett Shale, in terms of how it varies over wide areas.
Our initial breakthrough in 2001 arrived with an advancement to our model, called "NuLook Textural Vision") that gave us a full textural look at the pore space within shales or other tight reservoirs.