Eagle Ford Rig Count Remains Steady

December 5, 2015 Elizabeth Alford

The Eagle Ford Shale rig count remained steady this week, ending with 88 rigs running across our coverage area by midday Friday.

In recent Eagle Ford news, the Texas economy got some good news this week with new data revealing an increase in the production index and a steady unemployment rate.

A total of 737 oil and gas rigs were running across the United States this week. 192 were targeting natural gas (three more than the previous week) and 545 were targeting oil in the U.S. (10 less than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.)333 of the rigs active in the U.S. were running in Texas.

Baker Hughes reports its own Eagle Ford Rig Count that covers the 14 core counties. The rig count published on EagleFordShale.com includes a 30 county area impacted by Eagle Ford development. A full list of the counties included can be found in the table below.

Eagle Ford Oil & Gas Rigs

Natural gas rigs in the Eagle Ford are at 12 this week as natural gas prices dropped, trading at $2.19/mmbtu, a $.46 decline from the previous week.

The Eagle Ford oil rig count remained to 76 with WTI oil prices ending the week at $41.71, an decrease of $1.24. A total of 79 rigs are drilling horizontal wells, two are drilling directional wells, and seven are vertical rigs. Karnes County leads the region in development with 20 rigs this week. See the full list below in the Eagle Ford Shale Drilling by County below.

Eagle Ford Shale Drilling by County

Eagle Ford Shale News

Swift Reports Strong Third Quarter

RRC’s Porter Warns Against Radical Environmentalist Ideology

EOG: Eagle Ford is Top Performer

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.

Swift Reports Strong Third Quarter

December 3, 2015 Elizabeth Alford

Chesapeake Released 2015 Q1 — Swift Q3 2015

Swift Energy reports strong third quarter in the midst of the current industry 'energy storm'.

During a Q3 earnings call, Swift Energy executives reported an adjusted net loss for the third quarter of 2015 of $33.1 million, compared to $2.5 million net income during the same quarter of 2014. Production averaged 2.87 million barrels of oil equivalent (“MMBoe”), above the high end of the Company’s guided range of 2.77 to 2.82 MMBoe.

“We actually have one of the best safety records in our history as relates to 2015. Swift Energy Company is doing everything it can to reduce its costs and improve its performance, and focus on its balance sheet and liquidity.”

— Terry Swift - President and CEO

Swift's Eagle Ford Operations

During Q3, swift completed eight wells in Webb County and drilled five operated development wells, four in Webb County's Fasken field and one in McMullen County in the the AWP area. The Company's average drilling well cost in Fasken for the quarter was $2.2 million compared to $2.4 million in the second quarter of 2015. The company also reduced completion costs in Fasken to $3.4 million compared to $3.8 million in the second quarter of 2015.

Swift also boasted a new enhanced completion design in Fasken during the quarter, which includes 40% more proppant than previously completed wells. Additionally, the Company's first Upper Eagle Ford test was completed in Faskenwith a 32 stage frac job and 15 million pounds of proppant. Early results from this well are encouraging and in-line with the Company's expectations.

Other Third Quarter Highlights

Designed and executed a newer enhanced completion technique, which includes increasing the size of the frac job to approximately 2,000 pounds of sand per lateral foot
Secured and have begun using an additional 30 million cubic feet a day of capacity out in the Fasken area, which is producing at the 190 million a day capacity rate
Successful cost reduction initiatives including reduced costs for drilling wells in Fasken from $2.4 million to $2.2 million
An inventory of several hundred high grade Eagle Ford locations
Total firm capacity of 190 MMcf per day to support continued development of the Eagle Ford in its Webb County acreage

RRC's Porter Warns Against Radical Environmentalist Ideology

December 2, 2015 Elizabeth Alford

Texas Railroad Commissioner, David Porter pleads with the Attorney General to engage the war on fossil fuel.

In a recent letter to Texas Attorney General, Ken Paxton, Commissioner Porter used inflammatory language to urge Paxton to take action against the forces that want to weaken the energy industry. Using terms such as 'radical environmentalist ideology', 'witch hunt', 'dangerous radicalism' and 'religious zealotry', the Commissioner worked to convince Paxton that they needed to act in order to protect:

The state’s natural resources
The economic vitality of the energy industry
Hundreds of thousands of Texas jobs
America's energy independence

In the letter, Commissioner Porter accused presidential hopeful, Hillary Clinton, of prompting New York's Attorney General to aggressively go after ExxonMobil last month. He cited this as one example in a trend to engage in a sort of climate change witch hunt and an effort to limit free thought and speech.

“General Paxton, you have taken a rock-solid stance against federal overreach and dangerous radicalism posing as policy. I encourage you to be wary of similar efforts in Texas, so that together we can continue protecting our state’s natural resources, as well as the economic vitality of the industry that produces these resources, employs hundreds of thousands of Texans and paves the way for American energy independence.”

— Commisioner Porter

Texas Economy Receives Good News

December 1, 2015 Elizabeth Alford

The Texas economy got some good news this week with new data revealing an increase in the production index and a steady unemployment rate.

Related: Texas Economy Declines

It's no secret that the prolonged oil downturn has been devastating to some producers and communities who rely heavily on oil and gas activity. Earlier this month, Comerica Bank reported the Texas region's consumer confidence index was 101.2 in November 2015, down 12.4 percent from October 2015, and 15.5 percent lower than one year ago. But there is some good news.

In a recent survey conducted by the Federal Reserve Bank of Dallas, business executives expressed optimism regarding future business conditions. The index of future general business activity rose three points to 7.3, and the index of future company outlook rose six points to 16.2. The survey also revealed that factory activity across the state of Texas increased for the second consecutive month in November.

Through October, the Texas’ unemployment rate held steady at 4.4 percent, with unemployment in urban economies being particularly low:

Austin: 3.3%
San Antonio: 3.7%
Dallas: 3.9%
Houston: 4.6%

“Labor market indicators reflected a notable rise in November. The employment index posted a double-digit increase to 11.6, its highest reading since August 2014. Twenty-four percent of firms noted net hiring, while 12 percent noted net layoffs. The hours worked index also rose sharply to a high not seen in more than a year, coming in at 9.9.”

EOG: Eagle Ford is Top Performer

November 30, 2015 Elizabeth Alford

EOG Resources announce third quarter results showing the Eagle Ford is the company's highest return play.

During a Q3 earnings call, EOG executives reported a Q3 net loss of $4.1 billion, compared to third quarter 2014 net income of $1.1 billion. The company has worked to position itself for a strong 2016 by cutting costs including spending 17% less for lease and well expenses, reducing the cost to move oil by 11 % and reducinggeneral and administrative costs by 6%.

CEO Bill Thomas said the company is right on track with its 2015 game plan that focuses on the five objectives:

Maximize return on capital invested
Improve well performance through technology and innovation
Achieve significant cost reductions through sustainable efficiency gains
Take advantage of opportunities to add drilling inventory
Maintain a strong balance sheet

“I am pleased to report we’re right on track with our plan, we have maximized return on capital invested by directing capital to our best plays, the Eagle Ford, Bakken and Delaware Basin. We are having a record year of well productivity improvements and cost reductions. In the Eagle Ford after five years and three resource upgrades to this world class play, we are still excited about the learning and the technical progress we make every quarter.”

— Bill Thomas, CEO

EOG's Eagle Ford operations proved to be company's high return play. Highlights include:

High density completions to 95 percent of the Eagle Ford wells planned for the year
Actively testing tighter well spacing in the lower Eagle Ford with stacked-staggered "W" patterns
Increased the amount of acreage held by production to 91 percent of EOG's 561,000 net acres in the Eagle Ford oil window.
Gonzales County: completed the Phoenix Unit #4H and #5H with average initial production rates per well of 3,815 Bopd, 415 Bpd of NGLs and 2.8 MMcfd of natural gas.
McMullen County: completed the Naylor Jones Unit 26 #1H and #2H in a two-well pattern with average initial production rates per well of 2,650 Bopd with 150 Bpd of NGLs and 1.0 MMcfd of natural gas.