Comstock Resources Focused on the Eagle Ford in 2014 - Almost $400 Million Planned

December 18, 2013 R.T. Dukes

Comstock Resources will spend $394 million of the company's $450 million 2014 budget in the Eagle Ford.

The company will spend $264 million drilling 59 gross (40.2 net) wells in the South Texas Eagle Ford, $80 million completing wells in the South Texas area, and $50 million to drill 10 gross (5.6 net) East Texas Eagle Ford wells (Burleson County) for a total of $394 million.

Comstock Resources East Texas Eagle Ford Map

The East Texas Eagle Ford acreage located in Burleson County was acquired from Ursa Resources in late November 2013.

Outside of the company's drilling budget in the Eagle Ford, Comstock will spend $27 million in the Tuscaloosa Marine Shale and $29 million on facilities, recompletions, other capital projects.

As a result of budget allocations, oil production is expected to grow to 11,200-12,600 b/d and natural gas production is expected to fall to ~115 mmcfd.

Read the company's full press release at comstockresources.com

Corpus Christi LNG Plant One Step Closer To Being Built - Cheniere

December 17, 2013 R.T. Dukes

Cheniere's Corpus Christi Liquefaction Project

A proposed Corpus Christi Liquefaction Plant (LNG Export) is one step closer to becoming a reality.

Cheniere signed a 20-year LNG sale and purchase agreement (SPA) with Pertamina for 0.8 mtpa (90 mmcfd). The deal accounts for just 5% of the plant's proposed capacity, so more contracts are needed before the $12 billion project will be financed.

Pertamina will pay Henry Hub prices plus an undisclosed fixed component. The 20-year deal starts with the first commercial delivery of LNG and can be extended 10-years.

Cheniere will need many more commitments of this size or a few larger commitments to make the LNG plant a reality.

Pertamina Could Get Gas From Sabine Pass if that Facility Is Expanded

While it is exciting news for the Corpus Christi Liquefaction project, it doesn't set any thing in stone. If Train 6 (an expansion) of Cheniere's Sabine Pass LNG export facility is approved and permitted, Pertamina's contract will void and the company will enter an equivalent agreement at Sabine Pass.

Watch More

Read the full press release announcing the SPA at

cheniere.com

Penn Virginia Sells Eagle Ford Midstream Assets to ArcLight Capital - $100 Million

December 16, 2013 R.T. Dukes

Penn Virginia Eagle Ford Operations Update - Dec 2013

Penn Virginia is selling its natural gas midstream assets in the Eagle Ford to an affiliate of ArcLight Capital Partners (American Midstream) for $100 million.

The deal includes gas gathering, a gas lift system, 119 miles of pipelines and associated facilities in Gonzales and Lavaca counties.

ArcLight has several active midstream investments and will likely make future acquisitions in the area or sell this to a larger midstream operator in the next five years.

ArcLight Capital has raised over $10 billion for energy related investments since 2001.

H. Baird Whitehead, CEO, stated, "The divestiture of our natural gas midstream assets is the first step in a series of potential divestitures which will reduce our indebtedness, improve our liquidity and fund further investment in our oily Eagle Ford Shale play."

Read the full press release at pennvirginia.com

Eagle Ford Regional Rig Count 267 - Marathon Has 1 Billion BOE in Potential - Dec 13, 2013

December 13, 2013 R.T. Dukes

Marathon Eagle Ford and Austin Chalk Development Plan

The Eagle Ford Shale rig count increased two rigs to 267 running over the past week.

Marathon Oil held its analyst day earlier in the week and released an updated resource estimate for the company's Eagle Ford properties.

Initially, the company thought it would recover 469 million boe in the region and now expects that number is greater than 1 billion boe.

Marathon also plans to co-develop the Austin Chalk and Eagle Ford from pads where viable.

Read the full article: Marathon Oil Increases Its Eagle Ford Resource Estimate to 1 Billion Boe

The U.S. rig count increased 7 rigs from 1,775 to 1,782 running over the past week. A total of 369 rigs are targeting natural gas (6 less than last week) and 1,411 (14 more than last week) are targeting oil in the U.S. The remainder are drilling service wells (e.g. disposal wells, injection wells, etc.). 848 or 48% of rigs active in the U.S. are running in Texas.

Baker Hughes rig count is quoted here. Baker Hughes also releases its own Eagle Ford Rig Count that covers the 14 core counties (229 rigs). The rig count published on EagleFordShale.com includes a 30 county area impacted by Eagle Ford development. A full list of the counties included can be found in the table near the bottom of this article.

Eagle Ford Oil & Gas Rigs

[ic-l]The natural gas rig count increased one rig to 27 running this past week. At this time in 2012, there were more than 60 rigs and in 2011 there were more than 90 rigs targeting natural gas in the area. Don't be surprised if this is the bottom and we see more natural gas rigs in 2014. Natural gas traded up $0.30 this week to ~$4.40/mmbtu on Friday afternoon.

The oil rig count increased one rig to 239 rigs running. WTI oil prices held basically flat on the week at $97/bbl. Eagle Ford light crude traded at $94/bbl on Dec. 11th.

A total of 233 rigs are drilling horizontal wells, 20 rigs are drilling directional wells, and 14 rigs are drilling true vertical wells. Karnes, DeWitt, La Salle, and McMullen counties all have between 29 and 32 rigs running. See the full list of drilling by county below.

South Texas Oil & Gas News:

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Eagle Ford Shale Drilling by County

Eagle Ford Operated Rig Count By Company

SmithBits no longer reports its operated rig count, but we'll have updated number for you from a new source soon. Until then, you can reference our numbers from mid-April. There has not been a significant change in the overall rig count since this date:

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 Baker Hughes 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.

Eagleford Energy - Stratex Enter JV on Zavala County Eagle Ford Acreage

December 13, 2013 R.T. Dukes

Eagleford Energy Matthews Lease Location

Eagleford Energy has entered a joint development agreement with Stratex Oil & Gas on the 2,629-acre Matthews Lease in Zavala County.

Stratex will pay for the completion of the Matthews #1H and assume necessary payments to maintain the Matthews Lease.

Stratex paid $150,000 to the lessors in early December and will pay an additional $150,000 to Eagleford Energy to earn the right to participate in the lease.

Once the well is completed, Stratex will earn a 66.7% interest before pay out and a 50% interest after payout in the well.

The Matthews #1H has already been drilled, logged, and core has been analyzed by Weatherford.

The Matthews #3H and an 80-acre tract around the well are being retained by Eagleford Energy.