Forest Oil released earnings yesterday and provided an Eagle Ford update. The company's latest Eagle Ford well utilized a new completion design. Forest positioned the lateral in a more shallow section of the Eagle Ford and pumped a smaller, less expensive fracture stimulation. The well came online at 951 boe/d. That's good performance in comparison to the company's past five wells that had average 24-hour IP rates of 482 boe/d. The company is using microseismic monitoring to help determine the best possible completion design. Two rigs are being used to drill microseismic monitoring wells.
SM Energy Q3 Operations Update
SM Energy announced earnings last night (Oct. 31) and provided an operations update. In the Eagle Ford, production grew 32% over the second quarter to 128 mmcfe/d. The big jump was primarily attributable to the Eagle Ford Gathering pipeline that came online in the third quarter. Production was lower than the company expected for several reported reasons: Intermittent downstream constraints, construction related downtime on midstream facilities, and a greater number of wells being shut-in while offset wells were being completed. The company even scaled back drilling plans in the quarter to keep from creating a larger backlog of completed wells waiting for sufficient gathering capabilities.
SM plans to run 5 rigs in the play throughout 2012. Eight pilot areas are currently under development to test downspacing and longer laterals. Data gathered by year end will contribute to development decisions in 2012. Three multi-well pads have been constructed and are expected to lower costs across three wells by $1 million.
On August 2, 2011, SM Energy closed its previously announced sale of approximately 15,400 net operated acres in LaSalle and Dimmit Counties, Texas for cash proceeds of $226.9 million, before certain adjustments. (SM - Talisman - Statoil Reach Eagle Ford Deal)
In the non-operated portion of the EF program, the Company fully participated in Anadarko Petroleum Corporation's drilling program, which operated approximately 10 drilling rigs during the third quarter of 2011.
Read the full news release at sm-energy.com
Anadarko Petroleum Q3 Operations Update
Anadarko Petroleum announced third quarter earnings today (Nov. 1) along with an operations update. In the Eagle Ford, the company grew production to more than 66,000 boe/d, which is almost 50% quarter over quarter growth and up from a just over 25,000 boe/d in the 2010 third quarter. The company operated 11 rigs, with one being a spudder rig. Those 11 rigs commenced drilling 56 wells, while Anadarko brought 37 wells to production.
The Korea National Oil Company (KNOC) owns a 33% in Anadarko's Maverick Basin Eagle Ford assets.
Anadarko exited the quarter with gross production of 66,000 BOE/d, which represents growth of 47% over the 2nd quarter exit rate of 45,000 BOE/d. For the quarter, oil sales volumes increased almost 150% compared to the sam period in 2010.
During the quarter, the company spud 56 wells using 10 rigs and one spudder rig, and achieved first production from 37 wells.
Anadarko initiated delivery to the Copano pipeline during the quarter and now has three main gathering and processing systems available for natural gas delivery.
Read the entire press release at anadarko.com
Enterprise Products Partners to Expand Eagle Ford Gas Pipeline and Processing
Enterprise Products Partners announced plans to expand natural gas pipeline and NGL infrastructure in the Eagle Ford Shale. The developments are in response to demand from operators in the region who are experiencing strong growth. The company estimates current crude oil production is 200,000- 250,000 bbls/d and may ultimately reach 750,000-850,000 bbls/d. Plans will be in service by the first quarter of 2013 and include:
- Additional 300 mmcfd train at the Yoakum cryogenic plant in Lavaca County, TX
- Adding 62 miles of pipeline loops (24 and 30 inch) and compression to add 300 mmcfd of gathering capability
- Y-grade pipeline from Yoakum, TX to Mont Belvieu will be expanded from a planned 20 inches to 24 inches.
The 300 mmcfd train at the Yoakum Plant is in addition to the 600 mmcfd under construction. That will bring total capacity up to 900 mmcfd at the opening of this train. In total, Enterprise Products processing capacity in South Texas will jump from 1.5 bcfd to 2.4 bcfd when the Yoakum plant is fully functional.
"Increased drilling activity in the prolific Eagle Ford Shale continues to create opportunities for Enterprise to leverage its integrated network of midstream assets to provide producers with flow assurance and market choice," said A.J. "Jim" Teague, executive vice president and chief operating officer of Enterprise's general partner. "Each new addition to our growing infrastructure footprint allows us to provide enhanced service options for customers in a more efficient, timely and cost-effective manner.
Read the entire news release at enterpriseproducts.com
Cuero and Yorktown Have Awakened to an Oil Economy
Cuero has grown from the Turkey Capital into a booming oil town. The town of Cuero welcomed the oil & gas industry and has seen several major oil companies open regional offices in the city. Tax revenues have grown more than 30% year over year and for the first time in many years "bonds" aren't the answer to building needs.
Four years ago, Cuero was a community where everybody knew everybody, most people made their money in ranching or farming, and most of the children left as soon as they could.Then everything changed. Although turkey production had left years ago, the town was still the county seat of one of the top cattle producers in the state and prospered compared with most small Texas towns.
Even as industries died, residents tried to make the best of things. Every October wild turkeys race each other down Esplanade Street as a part of the annual Turkeyfest, and the day after the festival ends, Cueroites are hard at work putting together elaborate Christmas light displays for the town's famed "Christmas in the Park."
But, as Eagle Ford Shale became a reality, and slick black crude began gurgling up from below, the town had a new role to play - suddenly, Cuero had power.
Yorktown, while a town of only 2,000, has seen a similar rise in business activity. The city owned RV park has been full for two years and more parks are popping up across the area to provide housing for oil workers. New restaurants are opening and local businesses are growing. The small town is developing an oil & gas industry feel.
"It's a good thing for Yorktown," city administrator Robert Mendez said during a recent meeting of the Friends of the Yorktown Library. "Along with the city council and mayor, we are looking at ways to get our city to prosper. It's a positive outlook."
Read the full article on Cuero Here and the article on Yorktown Here.
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