Penn Virginia Acquires Eagle Ford Acreage in Gonzales & Lavaca Counties

October 4, 2012 R.T. Dukes

Penn Virginia acquired 4,100 net acres in Gonzales and Lavaca counties for $10 million. Working interests owners and joint venture partners will acquire portions of the acreage, so Penn Virginia position will only increase by 3,000 net acres. The company now has 40,100 gross (30,000 net) acres targeting the Eagle Ford.

The acreage is comprised of 3,200 net acres in Gonzales County and 895 net acres in Lavaca County. The acreage in Gonzales is adjacent to company's development area and the acreage in Lavaca was referred to as "complementary". The company expects it acquired 30 potentialEagle Ford drilling locations in total.

Penn Virginia reports 54 wells are on production in the Eagle Ford, with over 200 potential drilling locations. The company has targeted the volatile oil window and reported initial production rates of more than 1,000 boe/d per well. The company has an 83% working interest in its Gonzales acreage and a 57% interests in its Lavaca County acreage.

Stallion's Kenedy Office is Open for Business in the Eagle Ford

October 3, 2012 R.T. Dukes

Stallion's new Kenedy office opened earlier in the summer and includes an 80 person man camp. The 50-acre super-yard is one of several locations the company has in South Texas servicing the Eagle Ford Shale. Stallion now has locations in Carrizo Springs, Tilden, Victoria, and Alice. The company has expanded quickly over the past few years to answer the call for various oilfield service needs in the area.

Operators look to Stallion to provide not only a comprehensive set of wellsite and production services but also deliver well-trained and safety conscious service technicians. The new facility is also home to an 80-man camp used to provide onsite accommodations for the Company’s service personnel.

Stallion provides a range of oilfield services, wellsite support, completion, production and logistics services for oil and gas exploration and production companies, drilling contractors, and other service companies. Services offered include South Texas workforce accommodations, production and fluid logistics services, surface equipment rental, wellsite construction, solids control services, and communications with wellsites.

Read more about Stallions South Texas offices and services at StallionOilfield.com

The new yard is located at 308 Private Rd., Suite 1125; Kenedy, TX 78119

Eagle Ford Railroad Traffic on the Rise in South Texas

October 2, 2012 R.T. Dukes

Eagle Ford railroad traffic is on the rise. Operators are moving crude past pipeline bottlenecks, and moving frack sand and other products in to continue development.

The Hondo Railway, 30 miles west of San Antonio, serviced about 1,500 railcars per year on 13,000 ft of track a few years ago. The Railway terminal now serves 15,000 railcars per year and has expanded to 80,000 ft of track.

This year, an estimated 15,000 railcars will move through Hondo Railway LLC's 175-acre property — many of them carrying fracking sand bound for drilling operations in the Eagle Ford Shale formation.

The Hondo Railway isn't alone either:

What started at 1,600 feet of track has grown to 130,000 feet of track. Gardendale Railroad moves a mix of oil field commodities.
“The root of everything is sand,” Cundiff said. “We hadn't had any activity there in 15 years. We've gone from that beginning to 25 miles (of track) in just under 24 months.”
And at Port San Antonio, the East Kelly Railport is adding 15,000 feet of track to the existing 20,000 feet of track.
Spokesman Paco Felici said the rail port went from moving 2,594 railcars in the 2010 fiscal year to 4,556 railcars in the 2011 fiscal year.

The Port of Corpus Christi's rail expansion shouldn't be forgotten either. The port is adding the capacity to handle 100,000 railcars per year.

Oil & Gas Jobs in South Texas Are Abundant

October 1, 2012 R.T. Dukes

Oil and gas jobs in South Texas are abundant. From gate guards to industry sales reps and engineers, there's a flood of new people running the roads of South Texas and more open positions than companies can find qualified people for. The Eagle Ford Shale oil boom has added oil and gas jobs in South Texas at a rate no one could have predicted.

Pioneer Natural Resources, an Irving, Texas-based driller, has hired 400 people in the South Texas area in the last two years, says Joey Hall, vice president in charge of Pioneer's South Texas Asset Team.

About 75% or a little more of Pioneer's workers are located in the field and contractors employ another 1,000 people who help build rigs and move crude.

The story is similar for Conoco who added more than 500 jobs between its Texas plays and North Dakota's Bakken Shale. Over 50% of Conoco's hires were engineers, but most jobs in the field don't require a college degree.

About 15% of the 54,000 new jobs expected in the Eagle Ford shale by 2021 will require a college degree, and a little more than 10% will require direct experience in the energy business, Tunstall said.

Read more in an article from South Carolina's wltx.com.

Eagle Ford Regional Drilling at 274 Rigs - Sept 28, 2012

September 28, 2012 R.T. Dukes

Eagle Ford Shale drilling fell five units over the past week to settle at 274 running in the region and the oil rig count held near its record at 227 rigs active. During the week, Matador Resources released well production results from its Eagle Ford wells to date. The company's average well has a perforated well length of 5,090 ft, was completed with 18 frac stages, and produced 1,103 boe/d initially (859 b/d and 1.5 mmcfd). Read more in the article Well Results from Matador Resources Eagle Ford Operations.

Natural gas saw a significant jump as contracts rolled into October. Gas was trading at just over $3.30/mmbtu on Friday afternoon. That's more than a 10% increase from last week at this time.

Eagle Ford Oil & Gas Rigs - New Oil Rig Count Record 217

The number of natural gas rigs running fell to 43 this week. That's another new low for everyone keeping count. Rigs are moving to oily targets for the foreseeable future, but if natural gas prices continue a rise that could very well change. The oil count held near its record with 227 rigs working the region. Just one less than last week.

One water well is being drilled in Bastrop County, while Karnes, Leon, and McMullen counties all have disposal wells being drilled, respectively.

Henry Hub futures were trading at ~$3.30 on Friday afternoon. That's a $0.40 increase from last week. Spot prices rose considerably, but not quite as much trading at ~$3.00 to end the week.

WTI was trading at ~$92/bbl Friday afternoon. That's the lowest point in the past two months. With elections and international turmoil, I don't believe many people have conviction about the oil market. Eagle Ford crude priced at $101/bbl on the 27th of September. Light crude and condensate in the area traded at $88.50 and $87.50, respectively.

There are 252 horizontal rigs running in the region. The four counties leading development are Karnes with 39 rigs, La Salle with 37, Dimmit with 29, and McMullen with 28. Webb (26), Gonzales (22), DeWitt (18), Atascosa (15), and Frio (10) round out the top Eagle Ford counties.

News items this week included:

Be sure to visit our South Texas Oilfield Job Listings to search openings and come back weekly for updates or sign up for alerts.

Eagle Ford 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.

Eagle Ford Oil & Gas Rigs - New Oil Rig Count Record 217

Eagle Ford Rig Count by Operator

What is the Rig Count?

Eagle Ford Shale Drilling by County