This paper examines the profitability of past waterflood infill drilling programs. The project data is from the Texas Railroad Commission files, and includes large carbonate and sandstone reservoirs such as the Wasson (San Andres) Field and the Big Wells (San Miguel) Field. All of the reservoirs were subject of intensive reservoir engineering and geologic study by the oil companies prior to initiation of the infill drilling project. The permeability of the reservoirs averages 8.8 md and ranges from .65 md to 27 md. The porosity averages 10% and ranges from 7% to 18.6%. The depths range from 1220 to 1525 meters with the deepest at 2130 meters.

Because of the large capital cost required for drilling and operating additional wells, it was not clear whether the infill drilling programs had recovered enough additional oil to be good investments. In spite of the variability of external factors such as the cost of wells and price of oil, all of the projects studied obtained at least an acceptable economic return, the average discounted profit to investment ratio was 2.0, and the average incremental oil per well was 15 thousand cubic meters. Most of the calculated rates of return exceeded 30%. The net present value at 15% after taxes ranged from $580,000 to $32 million dollars. Thus these waterflood infill drilling projects have generally been very successful.

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