Noble Energy 'Rapidly Accelerating' 2017 Development

February 16, 2017 Elizabeth Alford

Noble Energy has announced they will raise 2017 capital expenditures to between $2.3 to $2.6 billion, with $325 MM earmarked for the Eagle Ford.

Noble announced fourth quarter and full year 2016 results this week, alongside a 63% increase in 2017 CAPEX.

Eagle Ford Operations

Production for Noble's Eagle Ford assets during the quarter was impacted by an in-field gathering pipeline mechanical issue leading to approximately 3 MBoe/d of curtailments on average during the quarter. Quarterly highlights include:

Sales volumes averaged 46 MBoe/
Drilled fourteen wells to total depth within the quarter
Commenced production on six Lower Eagle Ford wells
Company brought on production its initial operated Upper Eagle Ford well
Two operated rigs and 30 wells drilled but uncompleted at the end of 2016

“Building on our strong performance over the last couple of years, Noble Energy is now rapidly accelerating our pace of development in 2017. In the U.S. onshore business, we are materially increasing the capital allocation to each of our liquids-focused assets in 2017, including the DJ Basin, the Delaware Basin, and the Eagle Ford.”

— David L. Stover, Chairman, President and CEO

2017

Looking forward to the rest rest of 2017, Noble plans to spend $2.3 to $2.6 billion an increase of approximately 63% from 2016 levels. Approximately 75% of the 2017 total capital program will be aimed at drilling and completion activities opportunities in the DJ Basin, Delaware Basin, and Eagle Ford.

Noble Energy’s total U.S. onshore rig count is expected to average more than eight operated rigs for 2017, exiting the year with nine. Currently, the company plans to average one rig program in the Eagle Ford.

The company's Eagle Ford program for 2017 will be focused on Lower Eagle Ford wells in Gates Ranch, with additional plans for multiple Upper Eagle Ford wells.

Pioneer Will Resume Eagle Ford Drilling

February 13, 2017 Elizabeth Alford

Pioneer Natural Resources will spend $95 million in the Eagle Ford Shale in 2017, including plans to complete 20 wells.

In a recent press release, Pioneer reported fourth quarter and full year 2016 earnings, as well as the company's capex for 2017, which included a fourth quarter net loss of $44 million

Eagle Ford Shale Operations

Pioneer will spend $95 million in the Eagle Ford Shale in 2017. $65 million will be set aside for a horizontal drilling program that will focus on Karnes, DeWitt and Live Oak counties.

“Pioneer will resume limited drilling and completion activity in our Eagle Ford asset beginning in the second quarter. We plan to complete and place on production 20 wells during the year, including nine drill and complete wells drilled about a year ago and 11 new wells where we will test design changes expected to significantly increase the recovery.”

— Ken Sheffield - EVP, South Texas operations

Full Year 2016 Results include:

Producing 242 thousand barrels oil equivalent per day (MBOEPD) in Q4
Producing 234 MBOEPD in 2016, a 15% increase from 2015
Reducing production costs per barrel oil equivalent (BOE) by 29% in 2016 compared to 2015
Cash on hand at year end of $3 billion
Total costs incurred during 2016 were $2.4 billion

Pioneer is forecasting production growth in 2017 between 15%-18% compared to 2016. The company plans capital expenditures of $2.8 billion for the rest of the year, including $2.5 billion for drilling and completion activities.

Pioneer plans to spend $95 million in the Eagle Ford Shale in 2017. $65 million will be set aside for a horizontal drilling program that will focus on Karnes, DeWitt and Live Oak counties. The program, which is expected to begin in the second quarter, includes completing nine wells that were drilled in late 2015/early 2016 and drilling and completing 11 new wells.

RRC Prepares for More Oil and Gas Drilling

February 6, 2017 Elizabeth Alford

The Texas Railroad Commission (RRC) is gearing up for increased oil and gas drilling throughout 2017.

Chairman Christi Craddick spent some time in Dallas last week, discussing the state’s oil and gas outlook for 2017 with leaders of the Federal Reserve Bank of Dallas. Craddick says she is optimistic about the industry, but is aware the agency needs to be prepared for growth.

“We know from previous downturns that when the oil and gas industry ramps up, it ramps up quickly,” Craddick said. “We must be fully staffed and prepared for an uptick in industry activity. I am optimistic about oil and gas production growth in Texas this year, but look forward to seeing a continued rise in permitting and new drilling reports before we expect a significant shift within the industry. Until then, we will continue to move resources planned for permitting to other areas of the agency as needed.”

Craddick went on to affirm the importance of the agencies role in providing for public safety, explained that oil and gas production accounts for more than 30% of our state’s overall economy.

The Railroad Commission of Texas will be presenting its 2018-19 biennium budget request to legislators as they meet for the 85th Legislative Session. Though the agency is funded mostly by oil and gas activity, Craddick is looking for ways to augment the falling revenue, which has taken a toll on the agency’s personnel department. She said the agency’s number of employees drop from 1500 in the 1990’s to 690 today. The jobs shortage presents a huge challenge for the agency, because the work still has to be done.

The Eagle Ford Rig Count Climbs to 68

February 3, 2017 Elizabeth Alford

**Eagle Ford Operators Put Rigs Back Online**

The Eagle Ford Shale rig count increased again this week, with our data showing 68 rigs running across our coverage area by midday Friday.

In recent Eagle Ford news, Halcón Resources has announced it will sell its Eagle Ford assets (“El Halcón”) to Hawkwood Energy for $500 million.

A total of 728 oil and gas rigs were running across the United States this week, a gain of 27 over last week. 145 rigs targeted natural gas (the same as the previous week) and 583 were targeting oil in the U.S. (27 more than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.) 355 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

Seven rigs in the Eagle Ford region targeted natural gas this week with the commodity trading at $3.06/mmbtu.

61 Eagle Ford rigs were targeting oil with WTI oil prices increasing slightly to $53.80.

A total of 59 rigs are drilling horizontal wells, two are drilling directional wells and seven are vertical.

Karnes County leads this week with 14 rigs in production. See the full list below in the Eagle Ford Shale Drilling by County below.

Eagle Ford Shale Drilling by County

Eagle Ford Shale News

EnerVest Shifts from Barnett to Eagle Ford

Halcón Resources Exits the Eagle Ford

Eagle Ford Rig Count at 65

RRC Facing Budget Challenges

Swift Energy Cuts 56 Houston Jobs

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.

EnerVest Shifts from Barnett to Eagle Ford

February 1, 2017 Elizabeth Alford

EnerVest Energy Partners announced today that it is expanding its Eagle Ford Shale holdings and pulling back from the Barnett Shale.

Houston-based EnerVest Energy Partners have closed on an acquisition of Eagle Ford oil and natural gas properties in Karnes County. The $58.7 million includes 5.8 percent working interest in 9,151 gross acre.

Highlights include:

Eagle Ford and Austin Chalk reserves and drilling opportunities
Estimated proved reserves of approximately 6.4 Mmboe and probable reserves of 1.3 Mmboe, net to EVEP (based on recent strip prices)
22 percent proved developed and 61 percent crude
Current net daily production of approximately 1.0 Mboepd (73 percent crude)
Over 200 economic, scalable and repeatable proved and probable horizontal drilling opportunities
Additional possible drilling locations
Attractive drilling economics at current strip prices
Significantly higher margins and higher cash flow from acquired Eagle Ford Shale properties as compared to the divested Barnett Shale properties (based on recent strip prices)

“We believe that this position in the Eagle Ford Shale affords many attractive, self-funding, near-term drilling opportunities and will increase our crude production by approximately 25 percent in 2017.”

— Michael Mercer, EV Energy president and CEO.

EV Energy Partners is a a publicly traded affiliate of Houston’s EnerVest Ltd. Since 2015, EnerVest has been gobbling up acres and assets in the Eagle Ford including:

May 2016
- Purchased 7,056 net acres from BlackBrush Oil and Gas LP
- The assets include 341 drilling locations and produce 5,170 barrels of oil equivalent per day
April 29, 2016
- 4,198 net acres from affiliates of San Antonio-based GulfTex
- 256 drilling locations
- Produce 8,568 barrels of oil equivalent per day
Fall 2015
- $125 million purchase of Houston-based Alta Mesa Holdings LP’s
- 1,760 net acres with 278 drilling locations and 7.8 million barrels of oil equivalent of reserves
- Producing 2,200 barrels of oil equivalent per day

Learn more at evenergypartners.com