In December 2014, Denver’s Forest Oil Corp. and Sabine Oil & Gas LLC of Houston announced they completed an all-stock merger.
The combined company will be called Sabine Oil & Gas Corp. It’s majority controlled by Sabine investors and will be run out of Houston by Sabine executives, including President and CEO David Sambrooks.
Forest Oil has over 100,000 acres in the Eagle Ford where the company targets the liquids-rich gas condensate window and the oil producing area of the play.
Gonzales County, TX is home to most of the company’s Eagle Ford acreage, but the company has development plans in DeWitt and Wilson counties. Forest Oil’s current operations are centered around the Granite Wash in North Texas and Oklahoma, but capital spending will continue to increase in the Eagle Ford if wells continue to perform well.
Forest Oil (NYSE: FST) is an exploration and production company with operations focused in North America. Forest Oil’s headquarters is located in Denver CO, and the company operates producing properties in Arkansas, Louisiana, New Mexico, Oklahoma, Texas, Utah, and Wyoming, and in Canada. Forest began operations in northwestern Pennsylvania in 1916, incorporated in 1924, and has been publicly held since 1969.
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Forest Oil Eagle Ford Shale Quarterly Commentary
May 6, 2014
Forest Oil’s net sales volumes from the Eagle Ford averaged approximately 3,025 boe/d in the first quarter, which was a 3% increase over the fourth quarter of 2013.
Six gross (three net) wells were completed across the southern extent of the Eagle Ford field and placed on production with an average 30-day gross production rate of 418 Boe/d (93% oil or 386 Bbls/d). The average lateral length of the wells drilled in the first quarter was 4,099 feet as four wells required shorter-than-average laterals due to lease configurations.
Forest also achieved significant cost reductions for the wells drilled during the first quarter through operational synergies and implementing a modified completion technique that, when combined with the shorter laterals, lowered drilling and completion costs to approximately $4.5 million per well. This compares to a 2013 average of $6.0 million per well.
July 31, 2012
Forest holds approximately 112,000 gross acres (103,000 net) in the oil-bearing section of the Eagle Ford Shale play.
Drilling in the Eagle Ford is focused in the central fairway of Forest’s acreage position, where the Company has experienced the most consistent results and has the largest, most contiguous block of acreage. As highlighted in the Forest Oil’s July 9th press release, Forest has initiated a development plan that should allow the Company to hold approximately 40,000 net acres over the next several years by employing a two-rig drilling program. Importantly, this acreage position has 500 total locations identified based on 80-acre spacing. The Company will look to monetize a portion of the remaining acreage through small divestitures or farm-outs.
Since the recent Eagle Ford operational update on July 9th, the Company has completed one additional horizontal well (100% working interest), which reached a 24-hour maximum production rate of 907 Boe/d (98% oil).
April 30, 2012
Forest holds approximately 112,000 gross (103,000 net) acres and is running one rig in the oil window.
Since Forest’s last earnings release, the Company completed three horizontal wells (100% working interest) targeting the upper-most member of the Eagle Ford Shale interval. The first well reached a 24-hour maximum production rate of 605 Boe/d (96% oil). This well, which utilized a new stimulation design, had a 30-day average production rate of greater than 500 Boe/d and, in less than 60 days, had cumulative production of approximately 25,000 barrels of oil.
Forest completed its second and third wells in April and they are currently testing at 24-hour rates of 449 Boe/d (92% oil) and 116 Boe/d (97% oil). The third well was drilled in the most structurally up-dip acreage position in order to delineate the areal extent of the play.
The Eagle Ford Shale development plan has evolved from targeting the lower section of the interval with larger fracture stages to targeting the uppermost section of the interval using smaller fracture stages. The results from this transition have led to a 133% increase in the wells’ 30-day average production rate to 468 Boe/d from the initial development program average production rate of 201 Boe/d.
February 21, 2012
Completed Two Horizontal Eagle Ford Shale Wells in the Uppermost Member with an Average 24-Hour Production Rate of 604 Boe/d (98% Oil)
Our effort of raising the lateral landing zones higher in Eagle Ford continues to yield improved results over our first-generation wells. We completed 3 additional wells with an average IP of 530 barrels of oil equivalent per day. We did have one well that suffered ineffective completion due to a poor cement job, which is the first occurrence of this in our horizontal program. Not only are the IPs meeting our type curves, in which we have raised the lateral landing target, but the longer-term performance is holding up as well.
The two completions we discussed on the last call that had average IPs of 750 barrels of oil per day averaged 260 barrels of oil per day during their first 4 months of production. The performance of these wells is within our type curve expectations.
We continue to optimize the fracture stimulation designed for the Eagle Ford wells using the microseismic data gathered after we raise the lateral landing target. We have been changing not only the rates of which to fracture pump, but also the sizes of the jobs as well to optimize our initial rates and ultimate recovery.
November 1, 2011
Gonzales, Lee, and DeWitt counties –
Forest holds approximately 128,000 gross acres (118,000 net) in the Eagle Ford Shale play. The area provides Forest access to the oil-bearing section of the Eagle Ford and has the potential to become a significant oil development opportunity…
Forest completed five horizontal Eagle Ford Shale oil wells that had average 24-hour production rates of 481 Boe/d. Forest’s most recent completion tested the uppermost member of the Eagle Ford Shale and encountered positive results with a 24-hour production rate of 951 Boe/d, and has averaged 552 Boe/d over the first 21 days of production. This most recent well had the lateral placed in the uppermost member of the section and utilized new completion techniques that included pumping smaller and less expensive fracture stages. Further, this well was monitored using micro-seismic to further evaluate the effectiveness of the fracture stimulation. Forest has four wells drilled in the uppermost member of the Eagle Ford that are currently waiting on completion.
Forest is currently utilizing two rigs to drill vertical micro-seismic monitoring wells as it continues to delineate its acreage position in Gonzales County, Texas. These micro-seismic wells are intended to optimize completions to increase initial production rates and estimated ultimate recoveries while decreasing completion costs. In most cases, these vertical wells can further be used as water supply wells for future completions.
Read the full press release at forestoil.com
August 2, 2011
“Forest Remainco invested $52 million and $106 million in leasehold acquisitions for the three and six months ended June 30, 2011, respectively, compared to $19 million and $57 million in the corresponding 2010 periods, respectively. The increase in leasehold acquisition spending is a result of Forest Remainco’s strategic decision to focus development efforts in prospective liquids areas. The addition of 137,500 gross acres (125,000 net) in the Eagle Ford Shale, the Wolfcamp Shale, the Texas Panhandle, and other prospective liquids areas during the six months ended June 30, 2011, bolsters Forest Remainco’s inventory of potential liquids drilling locations.”
May 2, 2011
“Gonzales, Wilson, Lee, DeWitt Counties, Texas – Eagle Ford Shale Play
Forest holds approximately 118,000 gross and 109,000 net acres in the Eagle Ford Shaleplay as of March 31, 2011. Forest added approximately 4,000 gross and net acres in the first quarter of 2011. The acreage is concentrated in the oil-bearing section of the Eagle Ford and has yielded excellent results through the application of horizontal drilling and completion technologies.
Forest completed four Eagle Ford Shale oil wells in the first quarter that had average 24-hour initial production rates of 733 Bbls/d. The first operated well, in Wilson County, had a 24-hour initial production rate of 730 Bbls/d before the installation of artificial lift and 916 Bbls/d after the installation of a pumping unit. Two subsequent wells, drilled approximately 30 miles apart in Gonzales County, had 24-hour initial production rates of 709 Bbls/d and 661 Bbls/d, respectively, while flowing up casing. These wells are scheduled to be placed on artificial lift as needed. In addition, Forest has drilled two wells that are planned to be completed during May and has two wells currently drilling.
Forest’s initial non-operated well in the Eagle Ford Shale play, which had a 24-hour initial production rate as high as 830 Bbls/d (as previously reported), is currently producing 410 Bbls/d, after being on-line for 133 days, with total cumulative production of 50 MBbls.
With the success achieved in the field to date, Forest intends to move a third rig into the play and expects to commence drilling in July of 2011. Forest also is considering adding additional rigs to the play.”