By Eric Fox - August 13, 2012 | Tickers: APC, KOG, LINE, NFX, WLL | 0 Comments

Eric is a member of The Motley Fool Blog Network -- entries represent the personal opinions of our bloggers and are not formally edited.

The exploration and production industry moved to drive down development costs in the second quarter of 2012 through increased drilling efficiencies as the rejuvenation of the United States oil and gas resource base continues.

Extended Laterals

Newfield Exploration (NYSE: NFX) is drilling wells quicker and reported drilling a well in the Williston Basin in 20 days, compared to an average of 35 days in 2011. This well used a super extended lateral with a horizontal length of 11,500 feet, a well design that maximizes recovery of oil and gas and lowers finding and development costs.

Newfield Exploration is starting to drill wells in the Eagle Ford Shale with super extended laterals and estimates that this will improve the estimated ultimate recovery on wells here to 500,000 barrels of oil equivalent (BOE).

Cycle Time

Anadarko Petroleum (NYSE: APC) is decreasing development costs through more efficient drilling across the companys extensive set of onshore plays. Anadarko Petroleum improved the time needed to drill a well by 15% in the Eagle Ford Shale during the second quarter of 2012, and drilled one well in just under seven days.

This improved cycle time was demonstrated in other plays as well with Anadarko Petroleum reporting a 15% reduction in a field in Utah and a record drilling time of just under 3 days for one well here. In the Marcellus Shale, the company reduced drilling costs by 16% on a sequential basis and averaged 20 days to drill a well here in the second quarter of 2012.

Pad Drilling

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Oil and Gas Companies Continue to Cut Development Costs