Eagle Ford Shale - LaSalle Frio County Texas Oil Wells

By Tim - http://oilshalegas.com

November 6, 2011 - The Eagle Ford Shale continues to produce some nice oil wells as we head into 2012. Goodrich Petroleum (GDP) recently reported some of their oil well data which you will see below. These Eagle Ford Shale wells are located in LaSalle County, TX & Frio County, TX.

Eagle Ford Shale, LaSalle and Frio Counties, Texas

The Company completed the following five Eagle Ford Shale wells during the quarter, with an average 24-hour peak production rate of 907 BOE per day:

• Burns Ranch 20H (67% WI), a 5,960 foot lateral with 21 frac stages, at a 24-hour peak production rate of 1,080 barrels oil equivalent ("BOE") per day;
• Burns Ranch 2H (67% WI), an 8,320 foot lateral with 29 frac stages, at a 24-hour peak production rate of 1,004 BOE per day;
• Burns Ranch 3H (67% WI), a 5,160 foot lateral with 19 frac stages, at a 24-hour peak production rate of 953 BOE per day;
• Burns Ranch 18H (67% WI), a 5,060 foot lateral with 19 frac stages, at a 24-hour peak production rate of 883 BOE per day;
• Burns Ranch 19H (67% WI), a 5,940 foot lateral with 21 frac stages, at a 24-hour peak production rate of 613 BOE per day.

The Company completed two additional Buda Lime wells in the quarter:

• Carnes 7H (65% WI), an un-stimulated 4,215 foot lateral, at a 24-hour peak production rate of 1,167 BOE per day and a 30-day average of 871 BOE per day (762 BO and 655 Mcf per day);
• Burns Ranch 30H (67% WI), a 5,060 foot lateral with 19 frac stages, at a 24-hour peak production rate of 500 BOE per day.

The Company is in completion phase on the following wells:

• Burns Ranch 35H (67% WI), an 8,880 foot lateral with 32 planned frac stages;
• Burns Ranch 16H (67% WI), a 5,710 foot lateral with 20 planned frac stages;
• Burns Ranch 22H (67% WI), a 5,520 foot lateral with 20 planned frac stages;
• Shiner G-1 (67% WI), a 4,190 foot lateral in the Buda Lime;
• Shiner G-4 (67% WI), a 4,130 foot lateral in the Buda Lime;

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LaSalle County, TX: Eagle Ford Shale update

By Andrea: http://oilshalegas.com

SM Energy Company (SM) recently released an update on its position in the Eagle Ford Shale located in LaSalle County and Dimmit County, TX.

SM Energy Company has entered into an agreement with a subsidiary of Mitsui & Co., Ltd. concerning a 12.5% working interest in its non-operated Eagle Ford shale position. The Company will be carried on 90% of its drilling and completion costs (excluding costs associated with construction of mid-stream gathering assets) in this acreage until $680 million has been expended for the benefit of SM Energy. The purchaser will also reimburse SM Energy for the purchaser's share of capital expenditures and other costs, net of revenues, related to the period between the effective date of March 1, 2011, and the closing date. These reimbursed costs (net of revenues), estimated to range between $20 and $40 million, will be payable to SM Energy at closing and the Company will apply these funds to the remaining 10% of SM Energy's drilling and completion costs in this acreage. As a result, the Company will effectively be 100% carried until this reimbursement amount is exhausted. Once the reimbursement dollars have been expended, the Company will remain 90% carried until the remaining portion of the $680 million carry has been spent. The purchaser will also reimburse SM Energy for 50% of the Company's total capital investment expenditures in the related mid-stream assets in which the purchaser is acquiring an interest. This reimbursement is estimated to range between $20 and $30 million. The use of the reimbursement proceeds related to the mid-stream assets is not restricted and the proceeds will be treated as proceeds from divestitures in the Company's consolidated financial statements. Closing is anticipated to occur during the third quarter of 2011 and is subject to customary closing conditions and transaction fees.

After the closing of this transaction, SM Energy will have approximately 46,000 net acres in the non-operated portion of its Eagle Ford shale position, down from roughly 85,000 net acres. The Company's average working interest in this acreage will be reduced from approximately 27% to 14.5%. Reported average daily production from the Company's total non-operated Eagle Ford shale position at the end of the first quarter was 43.5 MMCFE/D (42% oil, 36% natural gas, and 22% NGLs). Proved reserves associated with the Company's total non-operated Eagle Ford shale position as of December 31, 2010 were 52 BCFE (52% proved undeveloped).

SM Energy will have roughly 196,000 net acres in the Eagle Ford shale, of which approximately 75% will be operated by the Company, after this transaction and the previously announced divestiture of Eagle Ford assets in LaSalle and Dimmit Counties, Texas are consummated. The size and timing of these transactions vary from the assumptions made in the Company's issued guidance, as these transactions are expected to close later in the year than originally anticipated and SM Energy is retaining a larger position in the Eagle Ford than was originally assumed. As a result, reported production and capital expenditures for the year will exceed the Company's currently published guidance. The Company will provide full capital, production, and cost guidance updates for the remainder of 2011, as well as preliminary capital and production guidance for 2012 in its second quarter earnings release.

SM Energy was advised on the transaction by Bank of America Merrill Lynch.

Tony Best, President and CEO, remarked, "I am pleased to announce the final phase of our planned Eagle Ford sell down effort. Combined with our previously announced LaSalle and Dimmit Counties Eagle Ford divestiture, we are generating nearly $1 billion in funds that will allow us to further develop our Eagle Ford assets while locking in some solid returns and maintaining a strong balance sheet. This specific transaction allows us to continue participating in the development of high value Eagle Ford assets, while providing us more control over our capital investment decisions."

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SM Energy Company (SM): Eagle Ford Shale News

By Andrea: http://oilshalegas.com


SM Energy Company (SM) recently released an operational update on the Eagle Ford Shale located in Webb and LaSalle County,TX:

SM Energy Company (SM) plans to begin 2011 operating two (2) drilling rigs on its high working interest 165,000 net acre position in Webb and La Salle counties in South Texas. Over the course of the year, the Company plans to ramp its operated rig count to four (4) drilling rigs, the vast majority of which will target portions of the acreage containing rich gas and condensate. Most of the wells planned for the year will be in the Briscoe and Galvan Ranch program areas where SM Energy has been active during 2010. A higher level of activity is also planned for La Salle County, Texas in order to de-risk and delineate that portion of the Company's acreage. In addition, a number of projects such as retained energy fracture stimulations and reduced spacing pilots are planned for next year across the play. Projects in the Eagle Ford shale program make up the largest portion of the Company's facilities budget of $65 million.

In the partner-operated portion of SM Energy's 84,500 net acre position prospective for the Eagle Ford shale, seven (7) rigs are currently being operated by the Company's partner, Anadarko Petroleum Company (APC). For 2011, SM Energy anticipates that Anadarko will operate an average of ten (10) rigs for the year.

SM Energy has allocated approximately $500 million for drilling investment in its total Eagle Ford shale position for 2011. Based on the activity levels contemplated above, capital expenditures net to the Company would be in excess of this amount next year. The Company is initiating a marketing process to sell down or joint venture a portion of its total position in the play, which will lead to a smaller amount of net investment in 2011. Bank of America Merrill Lynch has been engaged to market the Eagle Ford shale package on behalf of the Company. Although details of the composition of the sale package are still being determined, SM Energy currently estimates that it will sell roughly 20% to 30% of its total acreage position and that as a result the net spending for 2011 will be approximately $500 million after adjusting for capital expenditures associated with divested properties and possible drilling carries.

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La Salle County, Texas - Eagle Ford Shale Update

By Andrea: http://oilshalegas.com

Carrizo Oil and Gas Inc. (CRZO) recently released an operational update on the Eagle Ford Shale, located in La Salle County, Texas:

During the third quarter, the company drilled and cased three Eagle Ford Shale horizontal wells and is currently drilling the horizontal leg in a fourth. Following the completion of drilling and casing activities on this well, the drilling rig will be moved to a location in close proximity to the El Paso Hixon #1 to spud a fifth well. The first three wells are being prepared for hydraulic fracture stimulation, which is expected to begin in the third week of October. The fourth and fifth wells are expected to be stimulated and completed in succession following the completion of the first three. These Eagle Ford wells are all located in the condensate window in central La Salle County, Texas.

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LaSalle County, TX: Eagle Ford Shale update

By Andrea: http://oilshalegas.com

Carrizo Oil & Gas Inc. (CRZO) released an update on the Eagle Ford Shale recently in their 2010 2Q Earnings Call.

"Our production for the quarter came in ahead of forecast due to the faster clean-up and better initial response of new Barnett wells completed during the quarter and the optimal management of the producing wells at our facility on the University of Texas at Arlington campus during completion activities. We are now in the final stages of completing the last 8 wells on this 22 well pad. We moved one of our Helmerich & Payne rigs out of the Barnett Shale to drill our initial three horizontal Eagle Ford Shale wells in LaSalle County. We have reached total depth on our first well and are finishing up the second, both with lateral legs of over 5,000'. The information generated during the course of drilling these wells is encouraging and we expect to move the rig to the third well following completion of drilling the second well. We plan to frac and complete these wells later this year. We have had some success in adding acreage in both the Eagle Ford and Niobrara plays recently. We currently own around 17,000 acres in the Eagle Ford and 58,000 acres in the northern D. J. Basin prospective for Niobraraoil. We expect that our first Niobrara well should spud in September and we hope to drill three horizontal wells in this play by the end of the year. We have contracted an additional rig to initiate our development drilling in Pennsylvania with our new partner Reliance Industries, and are on track for a September start date."

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LaSalle & Frio County, Texas: Eagle Ford Shale

By Andrea: http://oilshalegas.com

There is a positive update in the Eagle Ford Shale for Goodrich Petrolium Corp. (GDP):

Goodrich Petrolium Corp. (GDP) has entered into agreements to acquire approximately 50,000 gross (35,000 net) acres in the oil window of the Eagle Ford Shale play in LaSalle and Frio Counties, Texas. Currently, the Company estimates its acreage position in the play at approximately 37,500 net acres. The Company has drilled or participated in the drilling of the Goodrich Petroleum Company – Pan Am B 1H, formerly known as the Francis Shiner B-1 (80% WI), and the Blackbrush Oil & Gas – Pals Ranch 9H (50% WI) targeting the Buda Lime formation, which sits directly below the Eagle Ford Shale. The Pan Am B-1H, which is a horizontal Eagle Ford Shale well with a lateral length of approximately 4,700 feet, is currently in completion phase. The Pals Ranch 9H was completed without stimulation as an open-hole completion with an initial 24-hour production rate of 530 BOE (77% oil) and a 30-day average rate of 435 BOE/day. By year-end, the Company expects to have conducted drilling operations on approximately four gross wells targeting the Eagle Ford Shale and three gross wells targeting the Buda Lime formation.

The Eagle Ford Shale is a rock formation located in Southern Texas. Other companies involved in Eagle Ford Shale include Apache (APA), EOG Resources (EOG) and Petrohawk Energy (HK).

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