Eagle Ford Shale Rig Count Decreases by Six to 265

July 21, 2014 Kirk Eggleston

The Eagle Ford Shale rig count decreased by six to 265 rigs running across our coverage area by the end of last week.

In recent news, Penn Virginia Corp. announced in July of 2014 that it will acquire ~13,125 (11,660 net) Eagle Ford acres in Lavaca County, TX for $45-million. The transaction will bring the company’s total Eagle Ford position to 142,500 (101,800 net) acres. The newly acquired assets are located next to the company’s Shiner area. Officials estimate ~150 gross potential drilling locations from the acquired acreage, most of which will be prospective for the Upper Eagle Ford Shale.

The U.S. rig count decreased by four to 1,871 rigs running by the end of last week. A total of 315 rigs were targeting natural gas (four more than the previous week) and 1,554 were targeting oil in the U.S. (nine less than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.). 888or ~48% of rigs active in the U.S. were 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 (212 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

The natural gas rig count increased by one to 10 rigs running by the end of last week. Average rig counts for natural gas production in 2012 were around 80 and then dropped to around 40 in 2013. Natural gas prices fell from the previous week to $3.95/mmbtu on Friday afternoon.

The oil rig count decreased by seven to 255 rigs running by the end of last week. WTI oil prices increased by ~$2 from the previous week, trading at $102.97/bbl on Friday afternoon. Eagle Ford light crude traded at $99.75/bbl on July 18th.

A total of 240 rigs are drilling horizontal wells, 11 rigs are drilling directional wells, and 14 rigs are drilling vertical wells. Karnes, La Salle, and De Witt each have at minimum 30 rigs running. La Salle County has the highest rig count this week at 33. See the full list below in the Eagle Ford Shale Drilling by County below

South Texas Oil & Gas News:

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Eagle Ford Shale Drilling by County

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.

Swift Energy - PT Saka Energi Close Eagle Ford JV Deal

July 18, 2014 Kirk Eggleston

Houston-based Swift Energy and PT Saka Energi Indonesia (Saka) have closed on their Eagle Ford joint venture to develop ~8,300 acres of the Fasken field in Webb County, TX.

The $175-million agreement was previously announced in May of 2014. At closing, Swift received approximately $147-million, which included an agreed upon $125-million in cash consideration. Approximately $38-million of Saka’s original $50 million drilling carry obligation remains; however, Swift officials indicate that commitment should be fulfilled during the 2016 calendar year.

Under the agreement, Saka gains a 36% interest in Swift's Fasken acreage. Swift will remain the operator for the area.

“Both parties have worked diligently towards the conclusion of this transaction, and we look forward to working alongside Saka to optimize this asset’s value through an advanced technology development program,”

— Swift Energy CEO ,Terry Swift

In related news, Swift Energy also announced in May of 2014, that it expanded a long term agreement for natural gas gathering services in Webb County with Howard Energy Partners and its affiliates. Under the terms of the agreement, Swift Energy will have up to 160-million cubic feet of gas per day of firm capacity for its Fasken field natural gas production.

Riches from the Eagle Ford Boom - Video

July 17, 2014 Kirk Eggleston

You may be curious to know exactly how some folks are getting rich from the Texas oil boom, and better yet, what you can do to ride the wave. The KPRC-TV report provides a concise look at how development of the oil-rich Eagle Ford formation has brought wealth to the small South Texas town of Three Rivers. The story also provides a hint at an industry segment some locals suggest would be a money-maker.

Boom Times in Three Rivers, TX

Prior to the beginning of the boom in 2008, Three Rivers, which is about 70 miles South of San Antonio, TX, was a sleepy little town, but that has all changed. For local residents "oil money" has changed their lives and the town in which they live. Recently, Three Rivers built an $11-million dollar junior-senior high school from tax revenues derived from oil & gas development. And some locals with mineral rights in the area have benefitted greatly from lease bonuses and "mailbox money" (i.e. royalty payments) from oil & gas production.

According to the University of Texas at San Antonio, the Eagle Ford Shale had a $61 billion economic impact across a 20-county area in 2012. That's a big chunk of change, and the money is mostly funneling into the pockets of oil & gas company executives, tertiary industry, the general workforce, mineral owners, investors and shrewd businessmen.

Getting Rich from the Eagle Ford Shale

So, the question is, what can you do to make money from the Eagle Ford boom? The best thing to do now for the majority of folks is go to work in the field, or open a business that serves the needs of the workforce. Certainly, everyone has different circumstances to consider, and not everyone has the necessary capital to open a business, but the money is there for the taking - you just have to be willing to work hard for it.

Oil patch jobs have provided individuals and families with lucrative salaries. Some rig workers can make upwards of 80k - 120k annually. Experience counts for certain positions, but entry-level opportunities can still be had as development continues to ramp up in the region. CDL Drivers are also in high demand in the Eagle Ford for hauling crude, supplies, frack water, etc. Their salaries can also top six figures.

Due to Eagle Ford development being concentrated in mainly remote areas, a growing workforce exists without access to a wide variety of amenities (i.e. washaterias, restaurants, grocery stores, etc.). Opportunities for investors to get on-board with projects in the service industry have the potential for paying off, at least up-front while there is less competition.

Cardinal Energy Group Acquires 2,800 Net Eagle Ford Acres

July 16, 2014 Kirk Eggleston

Dublin, OH-based Cardinal Energy Group is buying 2,800 net Eagle Ford acres from Hamburg Germany-based Nordic Oil USA 1 LLLP for an undisclosed amount of money.

The acreage is located in Gonzales and Wilson Counties in the oil and liquids-rich window of the play. The acquisition will include operating interests in ten producing wells and one salt water disposal well. The deal also secures production equipment, leases and drilling permits plus other assets needed to operate the wells.

“We have been diligently looking for an entry into the Eagle Ford Shale formation for the past year.”

— Cardinal CEO, Timothy Crawford

According to officials, the newly acquired oil and gas properties are currently producing from the Anacacho and Austin Chalk formations, and also include deep rights in approximately 1,500 net acres, for development of the Eagle Ford Shale and Buda formations. Officials also say other companies operating adjacent and in proximity to this acreage have horizontal wells coming in at 3,000 to 4,000 b/d oil. During the first quarter, EOG Resources, a major Eagle Ford producer, revealed strong initial production rates for two of its Gonzales County wells of 4,940 and 4,195 b/d oil.

According to its company website, Cardinal's focus is on reclaiming reserves from abandoned or minimally producing oilfields. The company indicates their primary focus is on Texas. Currently, there are 47,000 inactive and “orphan” wells in the state, according to the Texas Railroad Commission.

Penn Virginia Acquires Eagle Ford Acreage - $45 Million

July 15, 2014 Kirk Eggleston

Penn Virginia Corp. announced in July of 2014 that it will acquire ~13,125 (11,660 net) Eagle Ford acres in Lavaca County, TX for $45-million.

The transaction will bring the company's total Eagle Ford position to 142,500 (101,800 net) acres. The newly acquired assets are located next to the company's Shiner area. Officials estimate ~150 gross potential drilling locations from the acquired acreage, most of which will be prospective for the Upper Eagle Ford Shale.

Recently, Penn-Virginia stated it planned to further expand its Eagle Ford position to a minimum of 100,000 net acres. With this most recent acquisition, the company will reach its target goal.

“This acquisition is an optimal fit with our current acreage position in Lavaca County, and we believe is primarily prospective in the Upper Eagle Ford Shale, but could also have potential in the Lower Eagle Ford Shale and Austin Chalk.”

— Penn Virginia CEO, H. Baird Whitehead.

Penn-Virginia has been growing aggressively in the Eagle Ford. During the first quarter alone, the company added 6,400 net acres at a cost of $3,000 per acre.

Closing for the recently acquired Lavaca County acreage will be in August of 2014.