San Antonio Commercial Real Estate Gets Eagle Ford Boost

The San Antonio commercial real estate market is already doing better than last year and one of the influencing factors is the increase in oil & gas industry activity from the Eagle Ford Shale. Chesapeake Energy opened an office recently and Baker Hughes plans a 400 person office southeast of the city. Those are two of the largest deals, but many more will follow as service companies and producers move closer to manage their South Texas Eagle Ford operations. The Eagle Ford rig count in the 30 county area we watch was 227 rigs as of last Friday, August 19. As operators continue delineating their acreage, there's no indication that will change dramatically in the near future.

While the market isn’t experiencing a boom, commercial real estate in San Antonio is starting to rally.

“San Antonio has been spared, we’re doing fairly well,” said Kim Gatley, senior vice president and director of research for NAI REOC. “And now we’re starting to see some traction of improvement. We’re starting to see an uptick, an improvement in the market.”

Another helping hand is expected to come from the energy sector, Gatley said. As activity associated with Eagle Ford shale starts to heat up, she anticipates more businesses moving to the Alamo City.

“Just when you think things can’t get any worse, they get better,” said Terri Rubiola, a vice president at DH Realty Partners. “It’s already better than last year, and we’re optimistic that it will continue to get better.”

Read the entire news release at mysanantonio.com

Propane Frack Test in Maverick County - Jadela, Gasfrac, Packers Plus

A propane frack or LPG frack was completed yesterday by Jedela Oil Corp in conjunction with Gasfrac and Packers Plus in the Eagle Ford Shale of Maverick County, TX. Watch for results from this well as it will be an early indicator of whether or not propane fracks can provide upside to current economics in the Eagle Ford Shale. LPG (liquified petroleum gas) or propane fracks will also gain more interest if the drought continues in South Texas. In a few cases, we've heard of operators drilling $500,000+ water wells to ensure delivery of hydraulic fracturing fluids. While the process is often referred to as a "propane frack", an "LPG Frack" is more correct. The fluid is usually more than 90% propane, but will include ethane, propylene, butane, and some heavier hydrocarbons. A few of the benefits of LPG fracks versus hydraulic fracturing completions include: 

• LPG's are more compatible with the formation's gas
• Quicker completions, with no flow back water
• Reduced formation damage
• Costs savings where water isn't abundant

Jadela Oil Corp. (CA:JOC), GASFRAC Energy Services Inc. (CA:GFS) and Packers Plus Energy Services Inc. are pleased to announce that on August 21, 2011, Jadela completed fraccing its El Indio #1-H well into the Eagle Ford shale formation on its property located in Maverick County, Texas. Jadela used a Packers Plus StackFRAC(R) Open Hole Multi-Stage completion liner system and fracced the well using propane/butane and sand instead of water. GASFRAC provided the pumping horsepower and its stimulation technology in conjunction with Jadela's operational expertise.

Jadela has not tested the well. Testing will occur this week and it is expected that the well will be shut in pending construction of the propane recycling equipment and well site facilities. Jadela is in the process of outsourcing the construction of a pipeline, permanent battery equipment and the pipeline hookup to a 6" inch pipeline close by operated by West Texas Gas. The well was drilled and completed on a "tight hole" basis and as such specific well information is not available to the public at this time.

Read the full news release at jadelaoil.com

Eagle Ford Shale Housing Gets a Creative Touch

Eagle Ford Shale housing needs have left very few beds open for those looking to move in to South Texas to take advantage of oilfield jobs. Several companies are stepping up to creatively meet the housing needs of South Texas. From Cotulla to Carrizo Springs and Three Rivers, man camps are popping up for oilfield workers. These new camps aren't the trailer parks you are used to. The newest facilities have onsite chefs and sport game rooms and workout facilities. When you consider the population density of some of the counties where the Eagle Ford is booming, the area will need more hotels, motels, RV parks, and rental properties than many could have imagined a few years ago. If you need to book a hotel or simply find a place to live, check out the Eagle Ford Shale housing and lodging page to browse and book a room today.

Remote Logistics isn't the only company trying to make far-flung areas more comfortable.

John Gilmore of the Austin-based Eagle Ford Shale Housing LLC offers fully furnished double-wide trailers that were former model homes.

The big attractions of his Carrizo Springs operation are things such as full kitchens, Wi-Fi, satellite cable and TVs in every room.

“So many people are stuck in FEMA RVs and horrible living conditions,” Gilmore said. “Our idea is to do it a little nicer. Maybe for some of these guys, it's as nice as where they're living at home.”

Bob Zachariah is building a 77-room hotel in Cotulla that will have a pool, spa and playground, 24-hour restaurant with indoor and outdoor seating, lounge areas, a gift shop, multiple meeting spaces, a media room for movie watching and a fitness center.

People will be able to order everything from towels to to-go box lunches from their TVs, and the business center will have fax machines and be like a “miniature Kinko's” so people can ship using UPS. He's working on licensing to be able to offer iPads or something similar.

“Basically, what we're doing is taking a five-star hotel concept that you see in New York or New Delhi or any of the major cities and bringing it down in size and converting it into an affordable hotel,” Zachariah said.

Read the entire news release at mysanantonio.com

Baker Hughes Corpus Christi Office Will Be Operations Center

Baker Hughes is planning a Corpus Christi operations center that will cover 30 acres at Clarkwood Road and Highway 44 in Nueces County. The building will consolidate several Baker Hughes Eagle Ford Shale field offices in the area. The office will add as many as 75 Eagle Ford jobs to the area. The Eagle Ford Shale has created a job boom in Corpus Christi and other larger cities in South Texas. As development expands, the number of job openings looks like it has only one way to go.

A Houston-based oil field services company plans a multimillion-dollar investment that will create 75 new jobs in Corpus Christi — the latest major investment tied to Eagle Ford Shale exploration.

Baker Hughes will pump $20 million into a 30-acre operations center at State Highway 44 and Clarkwood Road, the company and the Corpus Christi Regional Economic Development Corp. announced Friday afternoon.

The 140,000-square-foot facility will consolidate smaller Baker Hughes facilities scattered among several sites across the area, Baker Hughes spokeswoman Kathy Shirley said.

"We actually chose Corpus Christi because we do have operations around that area," Shirley said.

The company will relocate 40 workers to the new site and add 75 jobs.

Positions will include drivers, technicians, salespeople, drilling specialists and field supervisors who will maintain, repair and stage equipment for Eagle Ford field operations, Shirley said.

Eagle Ford Shale Rig Count - August 19, 2011

This week the Eagle Ford Shale rig count is down six rigs to 227 active drilling rigs. The number of natural gas rigs working remained flat at 106, while the oil rig count declined five rigs to 121. Zero disposal wells or injection wells are being drilled at this time. Horizontal rigs account for 201 of the 227 rigs drilling in the South Texas region. The drop from week to week is almost entirely attributable to Atascosa and Wilson counties. No other counties lost more than one rig, while Karnes, La Salle and McMullen counties each added rigs. The uncertainty in the markets and the drop in oil prices over the past couple of weeks could begin to play a factor, but being down five rigs over the past week isn't enough to make any conclusive statements. If the commodity markets stay down, expect the rig count to lag by at least a few weeks and up to three months. Often drilling contracts are in place for a certain number of wells or a specified period of time.

Over the last week, Texon Petroleum announced successful Olmos well results, while Texcom plans an Atascosa County disposal well and Greenhunter acquired rights to build a commercial water facility in Wilson County, TX.

On the corporate front, Loreto Resources announced a JV with Eagleford Energy and we had a merger announcement from ZaZa Energy and Toreador Resources.

Stay tuned each week for an update on the South Texas rig count. Better yet, Subscribe by RSS. 

Drilling Rig Count by County

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 SmithBits and not solely wells targeting the Eagle Ford Shale.

All land rigs and onshore rig data shown here are based upon industry estimates provided by the Baker Hughes Rig Count and/or Smith Service Co's (Schlumberger) Smith Rig Count.