Carrizo to Increase Eagle Ford Activity

May 17, 2016 Elizabeth Alford

Chesapeake Released 2015 Q1 — Carrizo Earnings Report

Carrizo credited the company's Eagle Ford Shale assets for their strong first quarter performance and announces plans to increase activity in the region.

Related: Carrizo Focuses on Eagle Ford

In a press release last week, Carrizo Oil & Gas executives reported 2016 first quarter results that included an adjusted net income of $9.2 million. The company also reported record production of 42,025 Boe/d, 21% above the first quarter of 2015.

“Sylvester P. Johnson, CEO, commented “We remain on track to achieve (our) goals. Our 2016 drilling and completion capital expenditure guidance of $270 million to $290 million is unchanged, but due to further efficiencies and cost savings, we’ve been able to increase our planned activity levels in the Eagle Ford and Delaware Basin during the year.”

Eagle Ford Operations

Carrizo spent approximately 85% of its budget in the Eagle Ford and acquired 4,000 net acres in the region. For the remainder of 2016, the company plans to increase crude oil production growth target to 9%.

“Our focus on cost reductions and efficiency gains continued to bear fruit during the quarter, as we were able to lower our expected well costs in the Eagle Ford to $4.1 million from $4.6 million per well, said Johnson”

Other first quarter Eagle Ford highlights:

Expects to drill approximately 57 gross (53 net) operated wells and complete 55 gross (52 net) operated wells in the play during 2016
Drilled 18 gross (17.0 net) operated wells
Completed 14 gross (12.5 net) wells
Crude oil production from the play rose to approximately 22,800 Bbls/d for the quarter, up 2% versus the prior quarter
33 gross (31.8 net) operated Eagle Ford wells waiting on completion
Operating two rigs
Reduction of well costs for a 6,100 ft. lateral well are currently expected to average approximately $4.1 million, down from $4.6 million previously.

Baytex Energy: Big Results in Eagle Ford

May 16, 2016 Elizabeth Alford

Baytex Energy reports strong first quarter thanks to their Eagle Ford operations.

During a first quarter earnings call last week, Baytex Energy announced they have done well in the middle of the current challenges brought on by this low oil price environment.

Baytex focused its Q1 operations on their Eagle Ford operations, spending 96% of its exploration and development budget in the South Texas region. Our operating results in the Eagle Ford were strong during the quarter with production up 2% over Q4/2015 and well costs continuing to decline.

“James Bowzer, President and CEO, commented: “To generate the highest netback and rate of return, we focused our capital expenditures on the Eagle Ford. (...) Importantly, we continue to direct the vast majority of our exploration and development dollars to the Eagle Ford which generates the highest rates return and the highest netbacks from our portfolio.”

Eagle Ford highlights include:

Production averaging 41,067 boe/d (77% liquids), a 2% increase from Q4/2015
Capital expenditures totaled $76.8 million, 96% of total E&D budget
Approximately six drilling rigs and one frac crew working
Drilling of 44 (12.5 net) wells and commenced production from 34 (10.2 net) wells. Of the 34 wells that commenced production during the first quarter, 19 wells have been producing for more than 30 days and have established an average 30-day initial production rate of approximately 1,300 boe/d.
Achieved an approximate 32% reduction in well costs with wells now being drilled, completed and equipped for approximately US$5.6 million, compared to US$8.2 million in 2014.
As of March 31, 2016, there were 36 (10.7 net) wells waiting on completion

Eagle Ford Rig Count Dips Again

May 14, 2016 Elizabeth Alford

The Eagle Ford Shale rig count fell again this week, ending with 34 rigs running across our coverage area by midday Friday.

In recent Eagle Ford news, Encana announced first quarter results that highlighted dramatic cost reductions, operational innovation and Eagle Ford flexibility.

A total of 405 oil and gas rigs were running across the United States this week, down nine from last week. 87 were targeting natural gas (one more than the previous week) and 318 were targeting oil in the U.S. (10 less than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.)181 of the rigs active in the U.S. were running in Texas.

Baker Hughes reports its own Eagle Ford Rig Count that covers the 14 core counties. 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 below.

Eagle Ford Oil & Gas Rigs

Natural gas rigs in the Eagle Ford remained at six this week as natural gas prices remaining flat at $2.10/mmbtu.

The Eagle Ford rigs targeting oil fell this week to 29 with WTI oil prices settling in at $46.21, a $1.59 increase this week. A total of 31 rigs are drilling horizontal wells, zero are drilling directional wells, and three are vertical rigs.

Karnes County leads development in the region with 10 rigs running this week. See the full list below in the Eagle Ford Shale Drilling by County below.

Eagle Ford Shale News

Encana’s Reports Strong First Quarter

Noble Energy Reports Solid First Quarter

Sanchez Reports First Quarter Production Increase

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.

Sanchez Reports First Quarter Production Increase

May 12, 2016 Elizabeth Alford

Sanchez Energy announces a strong first quarter for their Eagle Ford operations.

Related: Sanchez Ends 2015 Strong

During a first quarter earnings call, executives credited process improvements and efficiency gains with lower costs and strong production in the first quarter of 2016. The company finished the quarter with about $362 million in cash and $300 million that is available for future borrowing.

While many producers in the oil and gas industry are struggling to stay afloat, Sanchez Energy Corporation has been able to position itself for strength during this difficult time. Their minimal debt gives them considerable financial flexibilities for moving forward.

Sanchez continues to focus on the development and competitive practices in the Eagle Ford to drive operations.

“CEO Tony Sanchez commented, “We currently have two rigs running in Eagle Ford and expect to reduce to one rig towards the end of the second quarter. Due to efficiency gains in drilling and completions, we expect there is a chance production may come online a bit earlier than originally expected. Assuming this trend continues, it will likely result in a portion of third quarter and fourth quarter production being realized in the second quarter.”

First quarter highlights include:

Total production of 5.1 million barrels of oil equivalent ("MMBoe") during the first quarter 2016, up approximately 26% over the first quarter 2015
Average production of approximately 56,500 barrels of oil equivalent per day ("Boe/d"), which exceeded the high end of the Company's guidance of 48,000 to 52,000 Boe/d for the first quarter 2016 by over 8.5%
Revenues of $79.8 million (approximately $133 million inclusive of hedge settlements) and Adjusted EBITDA (a non-GAAP financial measure) of $64.6 million
Average drilling and completion costs during the first quarter 2016 of $3.3 million per well atCatarina and $3.4 million per well at Cotulla, with the Company's best wells coming in at approximately $3.0 million per well in both areas
South-Central Catarina wells continue to exceed expectations, with average 30-day rates of greater than 1,300 Boe/d from all South-Central wells the Company has brought on-line to date
The Company has met its 50 well annual drilling commitment at Catarina for the period July 2015 through June 2016 and has banked 13 wells toward the 50 well annual drilling commitment for the period July 2016 through June 2017
The Carnero Pipeline, constructed by Sanchez Energy's joint venture with a subsidiary of Targa Resources Corp. (NYSE: TRGP) ("Targa"), went in-service in March 2016 and now transports the majority of Catarina gas volumes

Noble Energy Reports Solid First Quarter

May 10, 2016 Elizabeth Alford

Noble Energy announces solid first quarter with Eagle Ford assets bumping up the company's production.

During a first quarter earnings call last week, Noble executives reported that they had a tremendous operating quarter and a 'very solid start' to 2016. The company's first quarter results show they were able to deliver on their key goals to protect their balance sheet, align cash outflows and inflows, leverage the benefits of our diversified portfolio, and optimize returns with enhanced completion.

Noble's total volumes for the first quarter of 2016 increased to 416 thousand barrels of oil equivalent per day (MBoe/d), up 31 percent from the first quarter of 2015. A portion of this increase is due to the production from the 50,000 acres they acquired in the Eagle Ford last year.

Eagle Ford Operations

Noble continues to develop their newly-acquired assets in the Eagle Ford and are seeing promising results and 'unlocking additional resource potential'.

“In March, we brought online six Gates Ranch wells which tested various spacing and completion concepts...and these wells will drive significant volume growth in Texas during the second quarter.”

— Gary W. Willingham - Executive Vice President-Operations

Willingham goes on to say that throughout the quarter, they have continued to refine completion techniques leading to improved results. Other first quarter Eagle Ford highlights include:

Production volumes averaged more than 60 MBoe/d
Drilled two operated wells to total depth
Drilling times down 20%
Commenced production on eight Lower Eagle Ford wells
33 wells drilled but uncompleted