Eagle Ford Rig Count Flat at 267 - April 6, 2012

April 6, 2012 R.T. Dukes

The Eagle Ford Shale drilling rig count held flat at 267 rigs working after dropping below 270 for the first time since early March. The biggest change was realized in Webb County, where 9 rigs moved out. Webb County hit a peak of 41 rigs running in November of 2011, but the rig count has fallen in step with natural gas prices since. Much of the Eagle Ford formation is liquids rich in the northern part of the county, but almost all other development is natural gas focused. Lewis Petroleum had the biggest change of any of the major operators. The company dropped 6 rigs from 11 to 5. Watching their operated count over the next few weeks will help us determine if this is just one week blip in the rig count statistics or if the company has slowed down in response to gas prices.

Eagle Ford Oil & Gas Rigs

The natural gas directed rig count fell 8 to 67 running this week. That marks the first time we've fallen below 70 gas rigs running in the past year. DeWitt with 19 and Webb with 14 lead the natural gas focused counties. Oil directed activity jumped to 199 rigs and is back near all time highs set in mid-March.

Natural gas prices held almost flat week over week at 10-year lows and are trading at $2.09/mmbtu as of Friday afternoon. That's after trading below $2 intra-day earlier in the week. Oil prices remained flat at $103 per barrel (WTI). Not bad considering the equity market performance during the week.

250 horizontal rigs are running and we have 1 storage well being drilled in La Salle County. Karnes County leads development with 40 rigs. La Salle (39), DeWitt (28), McMullen (26), Dimmit (23), Webb (23), Gonzales (21), Atascosa (12), and Live Oak (11) make up the top Eagle Ford counties.

Devorah Fox, from Mike Byrnes & Associates contributed a great article related to Compliance Safety Accountability in the Eagle Ford. Be sure anyone with a CDL reads here tips and notes.

It was a slow week for news in the Eagle Ford. There was a successful Eagle Ford Job Fair earlier in the week and Chevron-Phillips is breaking ground on a world class petro-chemical plant.

Visit our Eagle Ford Hotels page. We've negotiated discounted rates with hotels that are welcoming the Oil & Gas Industry.

Come back weekly for updates or sign up for alerts.

Drilling Rig Count by Operator

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 formation. 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.

Drilling Rigs by County

Drivers - Be a Compliance Safety Accountability Hero

April 5, 2012 Elizabeth Alford

The Federal Motor Carrier Safety Administration's Compliance Safety Accountability program (CSA) seeks to reduce commercial motor vehicle crashes, fatalities and injuries on the nation's highways. CSA measures safety performance, using inspection and crash results to identify carriers whose behaviors could reasonably lead to crashes. If warranted, a carrier may have to pay fines and can be levied with other civil penalties. Carriers whose CSA scores characterize them as unsafe ultimately can be put out of service and the carrier will have to cease all motor vehicle operations. Also, a driver’s roadside inspection performance can be viewed by future employers through the FMCSA’s Pre-employment Screening Program. Obviously it is in everyone’s interest, the carrier’s and the drivers’, to keep CSA black marks off the carrier’s record.

Driver Performance Counts

Much of the responsibility for safety compliance lies with the carrier. But the driver's performance also plays a big role in how the carrier is graded under the CSA ranking system. Driver performance factors that come into play with respect to a carrier’s CSA score are:

UNSAFE DRIVING

speeding
reckless driving
improper lane changes
inattention

DRIVER FATIGUE

hours of service violations
logbook violations

DRIVER FITNESS

lack of training
lack of experience
being medically unqualified to operate a CMV
lack of a valid or appropriate CDL

DRIVER IMPAIRMENT

alcohol
illegal drugs
the misuse of prescription and over-the-counter medications

These factors are so important to safety that CSA includes these in its On-Road Safety Performance “BASICS,” the Behavioral Analysis and Safety Improvement Categories.

Cargo Must Be Secure

Cargo securement issues can also negatively affect a carrier’s CSA score. Drivers have to guard against:

spilled or dropped cargo
load that shift due to improper securement
overloading
unsafe handling of hazardous materials

Vehicles Must Be Safe to Operate

However, vehicle maintenance issues are also important. CSA tracks 220 maintenance-related violations and around 170 driver scores are also maintenance-related. An out-of-service order doubles the severity of the CSA violation.

Common maintenance violations include:

inadequate tire depth
brakes out of adjustment
broken stop lamps or headlamps or other lighting defects
cracked brake hoses
missing or unsecured fire extinguisher

Some maintenance issues can seriously affect the carrier’s CSA score. These are:

defects in the suspension, brake and steering systems
tire defects
lighting defects

The wrong time to find these flaws is during a roadside inspection. Drivers can be CSA heroes by taking their pre-trip inspection seriously and documenting defects that could result in an out-of-service order, so these defects can be repaired before the vehicle is driven again. Not only does this help to ensure a safe working environment for the driver, it also helps to keep the carrier’s CSA score low.

Chevron Phillips - Baytown Petchem Facility to be World's Largest

April 4, 2012 R.T. Dukes

Chevron Phillips announced the company is going forward with a major petro-chemical facility at the Cedar Bayou Chemical Complex in Baytown, TX. The new plant will be the world's largest on purpose 1-hexene plant and will be capable of producing 250,000,000 metric tons (551,000,000 lbs) per year. The announcement follows a release less than two weeks ago that the company will expand NGL fractionation, at the Sweeny Plant in Old Ocean, TX, to 116,000 b/d. An increase in capacity of 22,000 b/d or almost 20%.

Both developments are the direct result of growing feedstock supplies from liquids plays that produce significant volumes of NGLs. We discussed the reasoning behind new fractionation and petchem facilities in more detail in a previous article titled Eagle Ford NGLs Adding to U.S. Supply Growth.

1-hexene isn't in my normal vocabulary, but the company provided the following description.

The new 1-hexene unit at the Cedar Bayou facility will enjoy significant advantages in infrastructure, feedstock availability, and operational expertise. 1-hexene is a critical component used in the manufacture of polyethylene, a plastic resin commonly converted into film, pipe, detergent bottles, and food and beverage containers.

Construction on the petchem plant will begin soon, with a targeted completion date of early 2014. The fractionator expansion will be complete early in 2013.

Read the entire press release at cpchem.com

Oil & Gas Job Fair In San Antonio April 3, 2012

April 2, 2012 R.T. Dukes

Don't forget the Eagle Ford Oil & Gas Career Fair in San Antonio from 11-3 on April 3rd. Ten or more service companies will have jobs on display at the Norris Conference Center on Fredericksburg Road. You can also search for your new career right now at our Eagle Ford Jobs page. Quick Facts:

11-3 Tuesday April 3, 2012
10+ Companies - Chesapeake, Flint, Weatherford, and more
Hiring CDL drivers, Welders, Supervisors, Operators, Drillers, etc

Eagle Ford Area Rig Count at 267 - March 30, 2012

March 30, 2012 R.T. Dukes

The Eagle Ford Shale drilling rig count fell 4 rigs for the second consecutive week to 267 active in the region. This week marks the first time we've fallen below 270 in almost a month. In reality, a few rig difference isn't likely much of a difference at all. In any given week, there area likely 10+ rigs waiting to spud or moving locations. If you haven't been to South Texas lately, consider a day trip to one of the more active areas of the play. We drove through much of the eastern portion of the play on our way to visit the job fair in Robstown on Wednesday. Every town has new buildings, restaurants, and hotels. It's truly an amazing site. The Eagle Ford is providing economic stimulus that is re-shaping the economy of South Texas.

Eagle Ford Oil & Gas Rigs

Natural gas directed rigs fell 1 to 75 running this week. We're down almost exactly 50 rigs from the gas rig peak in October. Over 50% of the active gas rigs are running in DeWitt and Webb Counties alone. Oil directed activity fell for the second week in a row. There are 191 active oil rigs running as of this week.

Natural gas prices have blown through 10-year lows and are trading at $2.12/mmbtu as of Friday afternoon. Oil prices fell a few dollars to $103 per barrel (WTI), as the overall equity and commodity markets fell this week. Keep an eye on the economy in the coming weeks. The economy (demand) is half the equation in determining the oil price. With the first quarter almost under wraps, the S&P 500 isn't sending positive signals. The benchmark index would have been down almost 2% in the first quarter if it hadn't been for significant growth from Apple. Apple single handedly brought the entire index to even over the past three months.

252 horizontal rigs are running and we have 1 storage well being drilled in La Salle County. Karnes County leads development with 42 rigs. La Salle (41), Webb (32), DeWitt (28), McMullen (23), Gonzales (22), Dimmit (10), Atascosa (10), and Live Oak (10) make up the top Eagle Ford counties.

Cal Chapma, PE, contributed an informative article regarding AC-Induced Corrosion on Pipelines. If you're working the midstream side of the business in South Texas, it's a must read.

News from the week included:

If you're traveling to San Antonio soon, be sure to visit our Eagle Ford Hotels page. We've negotiated discounted rates with hotels that are welcoming the Oil & Gas Industry.

Come back weekly for updates each week or sign up for alerts.