Karnes County Accident Worst in 20 Years

June 9, 2015 Elizabeth Alford

An accident at an Encana Corp well last month is still wreaking havoc on a small area of Karnes County.

In what the county sheriff is calling the worst environmental disaster in more than 20 years, the well blow-out displaced numerous families and left trees, fields, roads and houses covered in oil.

The clean up effort is proving costly and has included resurfacing more than half a mile of roadway of FM 792. Encana is also making a full environmental assessment of the area including bringing in veterinarians, soil testers and arborists.

“More than two weeks after the accident, a line still separates green and lush vegetation nurtured by recent rains from brown trees and grass that were soaked by condensate and natural gas. Leaves on the trees and bushes are black and remain coated with a slick oily substance.”

— The San Antonio Tribune

Encana spokesman Doug Hock confirmed that there are five households that are still not able to return home and another couple of unoccupied homes that are not yet accessible.

Texas Earthquakes: The Verdict is Still Out

June 8, 2015 Elizabeth Alford

The Texas Railroad Commission is publicly questioning scientific evidence that links fracking to earthquakes.

Last Friday scientists met with Railroad Commissioner Ryan Sitton and other officials for a technical discussion about the science behind a recent study that links fracking and earthquakes.

The peer reviewed study led by researchers at SMU concluded that earthquakes in the north Texas communities of Azle and Reno were likely triggered by the wastewater disposal methods used by fracking companies. This common process is to inject the saltwater waste through high pressure methods deep into storage facilities underground.

During the meeting, SMU geophysics professor Heather DeShon reaffirmed the findings stating that "You only need a pressure change of 1.5 PSI to trigger an earthquake on a critically-stressed fault line,"

During the meeting, the scientists also asked Commissioner Ryan Sitton for a list of things that would be helpful for further studies including:

Requiring disposal well operators to provide bottom hole measurements would be very helpful in their research.
Getting saltwater disposal volume and pressure data on either a monthly or quarterly basis instead of yearly

“I have not reached the conclusion that oil and gas activity is the causal factor,” said Craig Pearson, the Railroad Commission’s staff seismologist. “While we remain concerned about seismic activity in the state, we still haven’t had a hearing where we’ve had a definite case made that a specific operator is associated with any specific earthquake activity.”

Eagle Ford Oil Rigs Fall Below 100

June 6, 2015 Elizabeth Alford

Eagle Ford Rig Count — Eagle Ford Rigs Fall This Week

The Eagle Ford Shale rig count fell 11 this week to 114 rigs running across our coverage area by midday Friday.

In recent Eagle Ford news, the Texas Railroad Commission released its latest statistics showing the state’s oil and gas production continues to impress, with the Eagle Ford leading the way.

Eagle Ford Oil & Gas Rigs

Natural gas rigs in the Eagle Ford fell by seven to 19 this week and natural gas prices traded at $2.59/mmbtu, a decrease of $.06 from the previous week.

The oil rig count decreased by seven to 95 with WTI oil prices continuing to inch upwards this week to $59.13, a decrease of $1.08. A total of 112 rigs are drilling horizontal wells, zero rigs are drilling directional wells, and two are vertical rigs. Karnes county leads Eagle Ford drilling this week running 20 rigs, while LaSalle (18) and Webb (17) following closely. See the full list below in the Eagle Ford Shale Drilling by County below.

Eagle Ford Shale Drilling by Count

Eagle Ford Shale News

Eagle Ford Shale and Mexico: An Important Partnership

Eagle Ford Shale Drives Carrizo’s Q1

Repsol Moves into the Eagle Ford

What is the Rig Count?

The Eagle Ford Shale Rig Count is an index of the total number of oil & gas drilling rigs running across a 30 county area in South Texas. The South Texas rigs referred to in this article are for ALL drilling reported by Baker Hughes and not solely wells targeting the Eagle Ford formation. All land rigs and onshore rig data shown here are based upon industry estimates provided by the Baker Hughes Rig Count.

Eagle Ford Shale and Mexico: An Important Partnership

June 4, 2015 Elizabeth Alford

There are billions of gallons of shale oil waiting to be fracked in Mexico and for the first time in generations, the Mexican government is opening up its oil and gas fields to foreign investors.

Mexico passed historic energy reforms last year in hopes of boosting lagging production and have set the stage for greater collaboration between businesses that operate in the Eagle Ford Shale and Mexico.

At last week’s Eagle Ford Consortium held in San Antonio, speakers talked about ways that businesses on both sides of the border might tap into the opportunities that are connected to the new energy reform laws.

“Mexico is interesting to energy companies operating in Texas - and around the globe - because it has something for everyone - deep water, shallow water, onshore conventional and unconventional shale fields.”

— Carlos Garcia, Lewis Energy Group

It is estimated that there are billions of barrels of potential resources in what is often called, ‘Mexico’s Eagle Ford Shale’. This hidden volume will require hydraulic fracturing to get it out of the ground and Mexico will look to partner with Texas businesses to get the job done.

There has already been some movement to create the important infrastructure:

In April, Mexico’s state power company(CFE) announced it had initiated an aggressive construction campaign that includes $3.3 billion to be spent on 12 natural gas and electricity projects.
Petróleos Mexicanos acquired funding to complete the construction of the pipeline Los Ramones II for an estimated $900 million.

Eagle Ford Shale Drives Carrizo's Q1

June 3, 2015 Elizabeth Alford

Chesapeake Released 2015 Q1 — Carrizo Oil 2015 Q1

Carrizo Oil announced its first quarter earnings and reveal a production growth driven by activity in the Eagle Ford

Eagle Ford Highlights

Carrizo’s first quarter activity in the Eagle Ford includes 23 gross operated wells waiting on completion. These wells equate to potential crude oil production of more than 7,500 barrels per day. For the same period, the company drilled 14 gross (12.2 net) operated wells during the first quarter, and completed 16 gross (14.5 net) wells. Crude oil production from the play was approximately 18,700 Bbls/d for the quarter.

“We remain focused on cost savings in the current environment, and continue to make good progress on this front. Currently, we have achieved drilling cost reductions of more than 10% and completion cost reductions of nearly 25% from late 2014 levels, putting us ahead of the forecast we provided in January.”

— S.P. "Chip" Johnson, IV, Carrizo's President and CEO

Q1 Highlights:

Oil Production of 21,373 Bbls/d, 42% above the first quarter of 2014

Total Production of 34,595 Boe/d, 30% above the first quarter of 2014

Loss From Continuing Operations of $21.5 million, or ($0.46) per diluted share, and Adjusted Net Income of $6.4 million, or $0.14 per diluted share

Adjusted EBITDA of $101.8 million

Raising 2015 crude oil production growth target to 18%

Carrizo currently has 81,000 net acres with mineral leases and leasing activities located primarily in La Salle County with smaller positions in Atascosa, Frio, and McMullen Counties.