Goodrich Eagle Ford Shale Acquisition

Goodrich Petroleum diversifies outside of the ArkLaTex Basin. The company is very much gas weighted and this deal adds a liquids/oil component to the company's drilling inventory.  Goodrich paid $59 million (~$1,700 per acre) for 35,000 acres in the Eagle Fors Shale in La Salle County and Frio County.

"The company plans to acquire an average 70% leasehold interest in roughly 50,000 gross (35,000 net) acres within the oil window of the Eagle Ford Shale play in La Salle and Frio Counties, Texas for roughly $59 million ($15mm cash, $44mm carry)."

"The company expects to spud its initial Eagle Ford Shale well later in the second quarter and run 1 - 2 rigs in the play during the second half of the year and currently expects to spud 7 - 8 Eagle Ford Shale wells during 2010. Jefferies & Co. believes this 'will come primarily at the expense of [Goodrich Petroleum’s] Cotton Valley program, which had $46 million earmarked for '10 for a seven well program.' ”

"Jefferies believes the company enters the Eagle Ford at an attractive price. The price 'comps well versus Petrohawk's recent acquisition in overpressured De Witt County at $3,000/acre, Petrohawk’s joint venture with Swiftin McMullen also at $3,000/acre as well as BP's JV with Lewis (private) estimated at $4-5,000/acre. On the other hand, HK also bought into their normally pressured Red Hawk position in Zavala County for $200/acre."

Read the full news release at ogfj.com

Anadarko - KNOC Joint Venture In The Eagle Ford - $1.55 Billion

Anadarko - KNOC Eagle Ford Map 2011

Anadarko and KNOC have reached an agreement for a $1.55 billion JV in the Eagle Ford. KNOC's payment will be made in the form of a cost carry paying 100% of Anadarko's 2011 development costs in the basin and 90% thereafter until the $1.55 billion is exhausted.

Under the terms of the agreement, KNOC will receive approximately 80,000 net acres in the Eagle Ford and approximately 16,000 net acres prospective for the Pearsall Shale.

KNOC also earns the right to participate with a 25% working interest in associated gathering systems and facilities.

“This transaction demonstrates the substantial embedded value of our Eagleford acreage position assembled primarily in the higher-margin condensate window of the play, while further enhancing our capital efficiency in a tax-effective manner,” Anadarko President and Chief Operating Officer, Al Walker said. “We have expanded our midstream infrastructure and established various service agreements concurrent with our drilling pace in the Eagleford Shale, leading Anadarko to become the largest producer in the play during the fourth quarter of 2010. As a result, almost all of our completed wells are on line, with approximately 75 percent of our sales volumes comprised of liquids. As announced in February, we plan to further accelerate the value of this play by increasing our operated rig count from nine to ten early in the second quarter of this year.”

Energy Transfer Partners to Construct Two Eagle Ford Shale Pipelines

Energy Transfer is stepping up to deliver Eagle Ford Shale capacity.  ETP is adding 500 mmcfd of capacity through two pipelines in that originate in Webb County and DeWitt County Texas.

"The 50-mile, 24-inch Dos Hermanas Pipeline will have a capacity of approximately 400 million cubic feet per day. The pipeline will originate in northwest Webb County, Texas and extend to the Partnership's existing Houston Pipeline rich gas gathering system in eastern Webb County, Texas. The pipeline is expected to be completed by December 2010. As part of the project, approximately 6,000 horsepower of compression will be added to the Houston Pipeline system."

"The initial phase of the Chisholm Pipeline will consist of approximately 83 miles of 20-inch pipeline extending from DeWitt County, Texas to the Partnership's LaGrange Processing Plant in Fayette County, Texas. The pipeline will have an initial capacity of 100 million cubic feet per day, with anticipated capacity expansion exceeding 300 million cubic feet per day. The project will utilize existing processing capacity at ETP's LaGrange Plant. After processing, the residue volumes will be transported on the Partnership's Oasis Gas Pipeline system. This phase of the pipeline is expected to be in service by the second quarter of 2011."

Read the full press release at EnergyTransfer.com

Chesapeake - CNOOC Reach Eagle Ford JV Agreement

CNOOC-Chesapeake reach an agreement whereby Chesapeake will sell a 33.3% stake in its 600,000 Eagle Ford Shale acres to CNOOC for $2.16 billion ($10,800 per acre).  CNOOC will pay half upfront and carry 75% of development costs until the other $1.08 billion is paid.

Chesapeake Energy Corporation (NYSE: CHK) and CNOOC Limited (NYSE: CEO; SEHK:00883) today announced the execution of an agreement whereby CNOOC International Limited, a wholly-owned subsidiary of CNOOC Limited, will purchase a 33.3% undivided interest in Chesapeake's 600,000 net oil and natural gas leasehold acres in the Eagle Ford Shale project in South Texas. The consideration for the sale will be $1.08 billion in cash at closing, subject to adjustment. In addition, CNOOC Limited has agreed to fund 75% of Chesapeake's share of drilling and completion costs until an additional $1.08 billion has been paid, which Chesapeake expects to occur by year-end 2012. Closing of the transaction is anticipated in the 2010 fourth quarter.

The assets are located principally in the counties of Webb, Dimmit, LaSalle, Zavala, Frio and McMullen, and are located primarily in the oil window (~85%) and the wet gas window (~15%) of the Eagle Ford Shale and in the dry gas window of the Pearsall Shale.

Read the entire press release at chk.com

Statoil - Talisman JV buys Enduring Resources Eagle Ford Acreage

Statoil agrees to 50/50 joint venture with Talisman Energy and moves to buy 97,000 acres from Enduring Resource's for $1.325 billion (>$13,600 per acre).  Statoil is expanding its US onshore operations outside of the Marcellus Shale and gaining exposure in the coveted Eagle Ford Shale.  Statoil is also paying Talisman $180 million (~10,000 per acre) for a 50% interest in 37,000 acres currently held by Talisman. Talisman's existing acreage was acquired through the acquisition of Common Resources' acreage in early 2010 for $359 million (~$10,000 per acre). The partnership now holds 134,000 acres in the Eagle Ford Shale. The partnership's Eagle Ford Shale acreage now spreads across DeWitt County, Karnes County, LaSalle County, Live Oak County, and McMullen County.

"Norwegian oil firm Statoil is expanding further its shale gas operations in the United States, saying on Sunday it has created a joint venture with Canada's Talisman to acquire acreage on the Eagle Ford prospect in Texas for $1.325 billion.""In 2008 Statoil acquired a 32.5 percent stake in the Marcellus Shale project from Chesapeake., a holding covering 1.8 million acres in the Appalachian region of North-East America."

"Statoil said mastering shale gas technology, such as horizontal drilling or hydro-fracking, is key to the growth of international oil companies in general and Statoil in particular."

Read the article at reuters.com