Carrizo Expects The Eagle Ford To Drive Oil Production Growth Higher

Carrizo Oil &Gas Eagle Ford Well Pad Map
Carrizo Oil &Gas Eagle Ford Well Pad Map

Carrizo Oil & Gas raised oil production growth guidance from 28% to 40% earlier in the summer due to improving well results in the Eagle Ford.

The company also raised second quarter oil production guidance from ~9.800 boe/d to ~11,000 boe/d. That represents and increase of more than 12%. There were a few factors that led to the increase:

“Key drivers of the outperformance have been flatter-than-expected decline rates from new wells in a number of areas, successful results from artificial lift installations and less well downtime than expected.”

Oil production is outperforming expectations, while gas and NGL production is coming in at the high end of guidance. Carrizo increased its company-wide growth target from 6% to 10% for the year.

Carrizo is running three rigs in the Eagle Ford, one in the Niobrara Shale, and one in the Marcellus Shale. Along with production guidance, Carrizo increased its capital spending plans by ~$35 million to $530-540 million in 2013.

In the Eagle Ford Shale, Carrizo is increasing planned 2013 drilling activity by three wells as a result of increases in drilling efficiencies, and increasing planned completion activity by 35 net frac stages primarily for lease management purposes.

Read the full press release at crzo.net

NuStar Planning Eagle Ford Oil Pipeline Expansion - Open Season Started

NuStar Energy Eagle Ford System Map
NuStar Energy Eagle Ford System Map

NuStar Energy has launched a binding open season to determine interest in an expansion of the company's Eagle Ford Shale - South Texas oil system. The expansion will add as much as 100,000 b/d of capacity moving oil to the company's Corpus Christi North Beach facility.

NuStar spent $425 million to acquire assets from TexStar Midstream in late 2012 and those assets will be part of the expansion.

The expansion between the company's Gardendale Terminal in La Salle County and Corpus Christi will be conducted in two phases:

  • Phase 1 - Will add 35,000 b/d of throughput available in the 3rd quarter of 2014
  • Phase 2 - Will add 65,000 b/d of throughput available in the first quarter of 2015

The expansion will raise total capacity in the system to ~200,000 b/d. NuStar is making 90,000 of the 100,000 b/d expansion available to shippers.

The open season continues through noon on August 30, 2013

Read the full press release at nustarenergy.com

Hours of Service “Merry Go Round”

Running Clock
Running Clock

On July 1, 2013, hours of service (HOS) regulations went into effect that had been published by the Federal Motor Carrier Safety Administration as a final rule in December of 2011. The implementation was despite a lawsuit that was submitted by American Trucking Associations, a lawsuit that’s still pending.

Read the first part of this two part series in the article Riding the Hours of Service "Merry Go Round"

To recap, as of July 1, 2013 commercial drivers are only allowed one 34-hour restart per seven days. Further, they must take an additional three-minute break when driving for eight consecutive hours. This must include two periods between 1 a.m. to 5 a.m. home terminal time and may only be used once per week.

We are midway through the month of living with the changed HOS regulations. The pros and cons of the changes are debated every day. Among the complaints are that the changes are costing the entire trucking industry millions of dollars to implement and further that they reduce drivers’ pay. Overdrive magazine reports that Dave Osiecki, of the American Trucking Associations, stated the rules for the break do not take into account the extra time it takes for drivers to find parking and get out of the truck. (Osiecki is ATA’s senior vice president for policy and regulatory affairs.)

Getting Some Official Guidance

On July 11, the FMCSA published revisions to guidance that had been first published in 1997. The revisions are intended to help drivers implement correctly the July 1 changes regarding taking mandatory breaks every eight hours on duty.

In short, the clarified guidance states conditions that must be met to log meal and other routine stops made during on-duty hours as off-duty break time:

  1. “The driver is relieved of all duty and responsibility for the care and custody of the vehicle, its accessories, and any cargo or passengers it may be carrying.
  2. During the stop, and for the duration of the stop, the driver must be at liberty to pursue activities of his/her own choosing.”

Living with the Law

[ic-r]Here are a few helpful tips to make sure you are operating within the guidelines of the new rule:

  • Time management is the key to your success. Allow yourself plenty of time to get to your destination. Use your breaks wisely and efficiently to maximize your driving time.
  • Trip planning is critical in maximizing your driving time. Schedule your stops for fueling, dining, showering and resting at convenient locations that will have the least distractions that might take more of your time than you would like.
  • Vehicle inspections are very important. Do not overlook possible component failures while you’re in route to your delivery destinations. Take care of components showing signs of failure before leaving to avoid costly and timely repairs away from your home terminal.

The regulation are here to stay for now, well at least for now, so we have to do whatever we can to be efficient and safe on our roadways while operating within the rules.

Eagle Ford Oil Output Surpasses 600,000 b/d In May

Eagle Ford Shale Well Map
Eagle Ford Shale Well Map

Eagle Ford oil production crossed 600,000 b/d for the first time in May 2013. Initial reports to the Texas Railroad Commission total more than 580,000 b/d. With revisions and late reporting almost every month has been revised upward by 30,000-50,000 b/d.

The U.S. produced 7.3 million b/d of crude oil in April, so the Eagle Ford accounts for more than 8% of all oil produced across the country. The Eagle Ford is quickly gaining on other shale plays and will likely match and surpass Bakken production sometime in the next two years.

Gas production from the Eagle Ford has held relatively flat. The Eagle Ford has averaged a little more than 2.1 Bcf/d of natural gas production so far this year.

As of July 3, 2013, a little less than 4,000 oil wells and almost 1,700 gas wells were producing from the Eagle Ford. More than 10,000 permits have been issued in the play since 2008.

Remember, liquids reported by the TX RRC are measured at the wellhead. Additional condensate and natural gas liquids will be gathered further downstream in separators and processing plants. Industry analysts estimate the Eagle Ford is producing closer to 900,000 b/d of crude oil, condensate, and NGLs.

Grand Opening For Koontz McCombs Workforce Housing Property - Thursday, July 25th in Dilley - Press Release

Sendero Ranch Grand Opening Invitation -  300 px
Sendero Ranch Grand Opening Invitation - 300 px

Award-winning commercial real estate firm Koontz McCombs has announced the grand opening of Eagle Ford Shale’s newest workforce housing community, Sendero Ranch in Dilley, TX.

Located in the heart of the fast-growing Eagle Ford Shale, the grand opening party is scheduled for Thursday, July 25th from 6pm-9pm and will feature cocktails, hors d'oeuvres and live music from highly acclaimed San Antonio musician Thom Shepard. All industry executives are welcome to attend and complimentary accommodations may be provided with advanced notice (24 hours notice). Kindly RSVP online HERE or call 830.220.1670.

esponding to oil companies’ demand for higher quality housing for their on-site employees and contractors, Koontz McCombs developed Sendero Ranch with the same high standards, attention to detail and quality-of-life amenities for which they are known in all their developments and construction projects.

Historically, workforce housing standards have been quite low, contributing to poor health and high attrition rates for workers. With the North American shale-gas boom in full swing, and expectation of continued growth over the next 20 years, companies are scrambling to provide affordable, quality living conditions for temporary and permanent field workforce, allowing them to attract and retain the skilled staffing they need.

Koontz McCombs is leading a paradigm shift away from the previously accepted low standards of workforce housing.

“We’ve worked very hard to create top-tier private communities with the “home away from home” feel”, says company representative Loren Gulley. “We take great pride in providing the highest quality living standard in the market. It gives us great satisfaction that our clients and their people are happy, healthy and safe.”

The new Sendero Ranch is a gated community with on-site management, private driveways, covered porches, flat-screen cable TV, high speed internet, maid service, recreation and laundry facilities. The Dilley location also offers commercial and industrial lots ranging in size from 1.3 acres up to 50+ acres available for sale, lease, or build to suit.

About Koontz McCombs

The firm of Koontz McCombs was formed in 1997 by Bart Koontz and Red McCombs to pursue the creation of distinctive, high quality properties throughout the state of Texas. Today, Koontz McCombs is a respected leader in commercial and multi-family real estate, producing high profile properties in San Antonio, Austin and Houston. With two locations in the Eagle Ford Shale oil and gas formation, Koontz McCombs has developed the Sendero Ranch properties in centrally located Dilley and Pearsall, available for daily, weekly, monthly and yearly rental. For more information, please visit www.senderoranch.net or call Loren Gulley directly at 210-841-9262.

The article above was published through EagleFordShale.com’s press release distribution service. Learn more about Eagle Ford Advertising Here.