Eagle Ford Shale Play http://eaglefordshale.com News, MarketPlace, Jobs Thu, 30 Jul 2015 14:44:43 +0000 en-US hourly 1 http://wordpress.org/?v=4.2.2 Anadarko Waiting on Better Margins http://eaglefordshale.com/news/anadarko-waiting-on-better-margins/ http://eaglefordshale.com/news/anadarko-waiting-on-better-margins/#respond Thu, 30 Jul 2015 14:44:43 +0000 http://eaglefordshale.com/?p=8273 Anadarko Q2 Report

Anadarko Q2 Report

Anadarko released its second quarter financials this week, announcing a 73% decrease in profits over last year and a reluctance to pinpoint when they will return to growth mode.

Related: Anadarko Reduces 2015 Spending by 30%

During a conference call on Wednesday, CEO Al Walker expressed the caution felt by many in the industry as crude prices continue to fluctuate. Margins remain low for the company as costs outstrip service providers’ ability to cut prices.

The uncertainty is particularly acute around operations in the shale plays, including the Eagle Ford. Walker was hesitant to commit to a timeline for moving back into a growth mode in the shale plays, saying that they do multi-year planning and can’t make predictions based on quarterly results.

Anadarko CEO Al Walker said that shale plays “deplete 50% to 80% in the first year, so there we have to be very confident of the margin environment that we’re moving into, because we’re not going to be able to capture that on the back side of the well, since so much of the production will have occurred. So that’s why I’m a little hesitant and cautious about exactly when we’ll see this company in particular and industry more broadly be encouraged to go back into a growth mode.”

Anadarko is one of the Eagle Ford’s largest producers, with roughly 388,000 gross acres in Dimmit, LaSalle, Maverick and Webb Counties.

Second Quarter Highlights

  • Drilling efficiencies improved in the Eagle Ford
  • Company will do new testing in the upper and middle Eagle Ford
  • Expects to achieve its objective of drilling more than 200 wells this year
  • Increased year-over-year oil sales volumes by 42,000 barrels per day
  • Achieved large-scale project milestones in the Gulf of Mexico and Mozambique
  • Announced deepwater exploration success in a frontier basin offshore Colombia
  • Announced more than $1.7 billion of monetizations year to date

Read more at anadarko.com

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Encana to Expand Eagle Ford Inventory http://eaglefordshale.com/news/encana-to-expand-eagle-ford-inventory/ http://eaglefordshale.com/news/encana-to-expand-eagle-ford-inventory/#respond Wed, 29 Jul 2015 14:33:58 +0000 http://eaglefordshale.com/?p=8270 Encana Q2 Report

Encana Q2 Report

Encana announced strong second quarter performance along with plans to expand Eagle Ford operations.

In a press release last week, Encana Corp reported that the second quarter of 2015 marked seven consecutive quarterly increases. Total company production averaged 389,000 (BOE/d) with Encana’s four strategic assets contributing approximately 223,000 BOE/d (57%).

“Following our successful portfolio transformation in 2014, we continue to lower costs, improve well performance and increase well inventory in our four most strategic assets,” said Doug Suttles, Encana President & CEO. “We exited the second quarter with significant operational momentum and we expect to accelerate liquids growth through the second half of the year.”

Encana is relatively new to the Eagle Ford and purchased 45,500 acres in a $3.1 billion deal in May of 2014. Suttles said that though adverse weather and flooding in Texas impacted the quarter, Eagle Ford inventory has almost doubled and the company plans to expand even more.  Eagle Ford highlights include:

  • Reducing D&C costs by almost 30%
  • Averaged $6.2 million well cost
  • Significant improvements to our artificial lift systems
  • Expect our total Eagle Ford production will be exceeding 50,000 Boe a day shortly. This represents a 15% increase from Q3 2014.
  • Undrilled well inventory stands at over 600 locations- a 70% increase since we acquired the asset
  • Ramping up production in the Permian and Eagle Ford where we expect to bring on approximately 40 wells in July and an additional 36 wells over the balance of the third quarter

Encana’s recent announcement that they will layoff over 200 employees will be would not affect the Eagle Ford operations.

Read more at encanacorp.com

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Cabot Plans to Reduce Eagle Ford Wells to One http://eaglefordshale.com/news/cabot-plans-to-reduce-eagle-ford-wells-to-one/ http://eaglefordshale.com/news/cabot-plans-to-reduce-eagle-ford-wells-to-one/#respond Tue, 28 Jul 2015 14:51:39 +0000 http://eaglefordshale.com/?p=8265 Cabot Q2 Report

Cabot Q2 Report

Cabot Oil & Gas reported second quarter earnings that highlight increased production, reduced costs and a focus on natural gas.

Related: Cabot Grabs More Eagle Ford Acreage in Oil Window

Shares of Cabot stock fell 4.4% to $26.39 on Friday after the company reported earnings of 3 cents a share for the second quarter. Revenue fell 42.6% year over year to $306.3 million, below analysts’ estimates of $372.99 million. The company has no plans to change their $900 million capital campaign for 2015.

Cabot’s production increased over the second quarter of 2014 to 128.4 billion cubic feet (5% increase) of natural gas and 1.6 million barrels (68%) of crude oil.

In an earnings call, Dan O. Dinges, Chairman, CEO said the company will rely on discipline to weather the current pricing environment by focusing on improving efficiencies, reducing cost and focusing on natural gas.

Dinges commented that “I’m not as confident as what the oil price is going to do as I am what I see available to us on the natural gas side. So with that being said, we’re focused in natural gas, we’ll remain focused in natural gas. If we have the opportunity to improve our liquids position, it’s going to have to compete with what our view is long term in natural gas.”

Eagle Ford Operations

Cabot’s drilling activity is focused on 89,000 acres in the Eagle Ford Shale, which receives about 40% of the company’s capital allocation. Here are some highlights from the second quarter:

  • Net production was 17,889 barrels of oil equivalent (Boe) per day, an increase of 74 percent over the prior year’s comparable quarter.
  • Cash unit costs were approximately $15.00 per Bbl
  • Decreased our drilling days by about 20% relative to 2014
  • Increased the average number of completions per day by about 20%
  • Upwards of 30% cost reductions across all service lines
  • Currently operating three rigs in the Eagle Ford Shale, with plans to decrease to one rig by the end of 2015
  • Plans to drill approximate 45 net wells in the Eagle Ford Shale in 2015

Read the complete press release at cabotog.com

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New Eagle Ford Disposal Well http://eaglefordshale.com/news/new-eagle-ford-disposal-well/ http://eaglefordshale.com/news/new-eagle-ford-disposal-well/#respond Mon, 27 Jul 2015 14:51:59 +0000 http://eaglefordshale.com/?p=8263 New disposal Well for Eagle Ford

New disposal Well for Eagle Ford

A new new Saltwater Disposal well has opened in Waelder Texas that will serve oil & gas hydraulic fracturing operations in the Eagle Ford Shale Play.

Fortress Environmental Services announced last Wendesday that the $9.3 million facility is now open for business and can accept 25,000 barrels of produced saltwater which is pumped to a depth of approximately 8,000 feet.

The new state of the art facility provides an air-conditioned trucker’s lounge/break room, free high-speed Wi-Fi, food, drinks, outside BBQ grill and hot showers.

According to the company’s press release,  All roads to the huge Fortress Environmental Services 10-acre truck stop are paved. The SWD facility provides four pull-through lanes, rapid 8-minute saltwater pump-outs, quick 30-minute truck tank washouts and convenient 10-minute fill-ups from an onsite 50,000 BBL fresh water depot.

Disposal wells are used to inject saltwater waste through high pressure methods deep into storage facilities underground. These wells have been the focus of recent criticism since a new study presented scientific evidence that they lead to earthquakes. The peer reviewed study led by researchers at SMU concluded that earthquakes in the north Texas communities of Azle and Reno were likely triggered by the wastewater disposal methods used by fracking companies.

Related: Texas Earthquakes: The Verdict is Still Out | Eagle Ford Shale Play

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Eagle Ford Rigs at 112 http://eaglefordshale.com/news/eagle-ford-rigs-at-112/ http://eaglefordshale.com/news/eagle-ford-rigs-at-112/#respond Sat, 25 Jul 2015 15:14:05 +0000 http://eaglefordshale.com/?p=8259 Eagle Ford Rigs

Eagle Ford Rigs

The Eagle Ford Shale rig count fell slightly this week to 112 rigs running across our coverage area by midday Friday.

In recent Eagle Ford news, the historic agreement between the U.S. and Iran has analysts and energy executives worried about the impact on the global oil markets and the Eagle Ford Shale specifically.

Read more: Will Iranian Oil Be Bad for Eagle Ford?

The U.S. rig count increased by 19, ending with 876 rigs running by midday Friday.  A total of 216 rigs were targeting natural gas (two less than the previous week) and 659 were targeting oil in the U.S. (21 more than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.)   374 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 near the bottom of this article.

Eagle Ford Oil & Gas Rigs

Natural gas rigs in the Eagle Ford fell clipped to 24 this week and natural gas prices traded at $2.78/mmbtu, an $.10 decrease from the previous week.

The oil rig count rose to 88 as WTI oil prices dropped again to $48.13, a decrease of $2.72. A total of 103 rigs are drilling horizontal wells, zero are drilling directional wells, and nine are vertical rigs. Karnes continues to lead development this week running 20 rigs, with LaSalle (15) and Webb (15) follow closely. See the full list below in the Eagle Ford Shale Drilling by County below.

Eagle Ford Shale Drilling by Count

County Previous Week Current Week County Previous Week Current Week
KARNES 19 20 BURLESON 1 1
LA SALLE 14 15 FAYETTE 1 1
WEBB 15 15 GRIMES 1 1
DE WITT 15 14 LAVACA 1 1
DIMMIT 11 11 MADISON 2 1
MCMULLEN 6 9 ROBERTSON 1 1
GONZALES 6 6 AUSTIN 0 0
ATASCOSA 4 3 COLORADO 0 0
BRAZOS 3 2 GOLIAD 0 0
DUVAL 2 2 LEON 0 0
FRIO 2 2 MAVERICK 0 0
LEE 1 2 MILAM 0 0
LIVE OAK 2 2 WASHINGTON 0 0
ZAVALA 2 2 WILSON 0 0
BEE 2 1 BASTROP 0 0

Eagle Ford Shale News

Fierce Competition in the Eagle Ford

Sanchez Energy Strong in the Eagle Ford

Does Eagle Ford Drilling Add to Ozone?

 

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.
Read more at bakerhughes.com

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Fierce Competition in the Eagle Ford http://eaglefordshale.com/news/fierce-competition-eagle-ford/ http://eaglefordshale.com/news/fierce-competition-eagle-ford/#respond Thu, 23 Jul 2015 16:59:07 +0000 http://eaglefordshale.com/?p=8248 Valley Energy Service

Valley Energy Service

The recent downturn in the oil and gas industry has hit all of the big players hard. But in the Eagle Ford, some small businesses may soon shut their doors due to the fierce competition that has added to the stress of the crisis.

Related:Weathering the Oil Crisis

Today I am featuring an interview with Robert Platts, owner of Valley Energy Service, a crude oil hauling company that has operated in the Eagle Ford since 2012.

Tell us about your experience in Eagle Ford

You guys ran an article about the trucking shortages in Eagle Ford when everything was going crazy in 2010. I was looking to make a move and I settled on the Eagle Ford area because of the industry boom that was happening. We started working with three out of our five trucks and then slowly went to 24/7, and that’s where we have been for two and a half years now.

It seems, though, everybody read your information and it was pretty competitive by the time we got up and running. We have been hauling for one major marketer since may of 2012. It has been good with them but I’ve had a heck of a time adding new work or clients. It seems there is a “good ol’ boy” network here. It’s all about who you know and that’s tough to break into.

The downturn of last year didn’t affect us until April, but it has gone from 40 loads a day down to six and then three and about 10 days ago, we have had no more loads. It’s a small company, just me, so it is scary because we’ve gone through all of our cash. We have been losing money since April and we have less than 30 days before we have to shut the doors.


There is work out there right now but it seems as though a lot of brokers and midstream companies are getting the work. The brokers are really small trucking companies who will land a contract and hire owner operators to run for them. I don’t know if the companies are ok with it, but all they are doing is subbing out the work and taking 20% off the top.

So it sounds like you were having trouble establishing yourself in the Eagle Ford even before the downturn. 

Well, trucking is new to me. I have not been in this industry my whole life, which has made it hard to break into because, as I said before, it’s all about who you know. But I have been a business owner for 16 years and I have a MBA from Pepperdine University.

We’ve had reputable records here as far as safety goes, that’s a big concern environmentally. We’ve had four spills in four years and two of those were equipment failure and the other two were driver errors; that is a pretty dang good safety record. How we can’t get work when we are hearing from our drivers that there are other companies who are not as safe and reputable as us -yet still have contracts- is a bit dumbfounding.

We have a great reputation, but we are not seeing the right contacts. We have scoured the markets but it is really competitive right now; the only work is for owner operator rates but it is hard to survive on those rates. But right now I am having to, to see if it will work and get us down the road a little farther and hopefully we can make the turnaround in the industry.

What do you think the future holds?

We are right now finalizing a deal with another mid stream  company who has trucks. We are basically having to run for owner operator rates just to keep our trucks busy. With this new work I may be able to limp through and get to that point where things turn around, but I think it will be a lot different. I think there are a lot of companies who are falling by the wayside. These smaller companies, they are moving out of the area and going to West Texas, or wherever they can. We are looking for work in those places as well, it’s just a matter of cash flow for us.

 

de82dfe617c833733b0d8712008cf5b2  For more information about Valley Energy Service, visit their website.

 

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Sanchez Energy Strong in the Eagle Ford http://eaglefordshale.com/news/sanchez-energy-strong-in-the-eagle-ford/ http://eaglefordshale.com/news/sanchez-energy-strong-in-the-eagle-ford/#respond Wed, 22 Jul 2015 14:22:25 +0000 http://eaglefordshale.com/?p=8241 Sanchez Q2 Report

Sanchez Q2 Report

Sanchez Energy, focusing its development in the Eagle Ford, stands out in the midst of a sea of suffering oil & gas producers.

The crude price slump has taken its toll on a number of producers who have not been able to adjust enough to stay afloat. Six producers have filed bankruptcy since the first the year; American Eagle Energy, Quicksilver Resources, BPZ Resources, Sabine Oil & Gas, WBH Energy and Walter Energy. Analysts are warning that this is just the tip of the iceberg and many are forecasting bankruptcies will increase later in the year.

Related: Sabine Files Chapter 11

In the midst of the uncertainty, Sanchez is having a really good year. A few weeks after releasing a strong Q1 report, the company’s second quarter earnings show that current volumes are the highest in the company’s history.

Tony Sanchez, III, President and Chief Executive Officer of Sanchez Energy, commented: “During the second quarter 2015, we had success on a number of fronts.Estimated production for the second quarter 2015 averaged approximately 53,920 BOE/D. As a result of operational efficiencies, we are now able to drill and complete wells at a faster pace and at lower costs. Our innovative procurement strategy and continued focus on cost reduction has enabled us to drive capital costs down and deliver average well costs under $4.5 million per well in Catarina during the second quarter.”

Q2 Highlights:

  • Record production of 4,907 thousand barrels of oil equivalent (“MBOE”) during the second quarter 2015 for average production of 53,920 barrels of oil equivalent per day (“BOE/D”)
  • Shorter drilling times and strong production from recent wells put on production at Catarina.
  • Current production is approximately 53,000 BOE/D.
  • The two most recent two-well pads at South-Central Catarina have averaged 24-hour initial production rates between 1,400 and 1,800 BOE/D
  • Increasing its full year 2015 production range to 44,000-48,000 BOE/D.
  • 32 wells required to be drilled before June 30, 2016
  • Decreased well costs from $6.5 million per well to below $4.5 million

In May, Sanchez announced that Gleeson Van Riet has been named Senior Vice President and Chief Financial Officer of the company. Van Riet is replacing Mike Long, who retired on April 30, 2015.

Read more at sanchezenergycorp.com

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Does Eagle Ford Drilling Add to Ozone? http://eaglefordshale.com/news/does-eagle-ford-drilling-add-to-ozone/ http://eaglefordshale.com/news/does-eagle-ford-drilling-add-to-ozone/#respond Tue, 21 Jul 2015 16:41:26 +0000 http://eaglefordshale.com/?p=8238 Does Eagle Ford Drilling Add to Ozone?

Does Eagle Ford Drilling Add to Ozone?

The Alamo Area Council of Governments will hold an executive meeting on Wednesday to discuss ozone levels in South Texas, including what whether drilling in the Eagle Ford Shale plays a role.

Related: EPA Finds Little Risk to Drinking Water from Fracking

The AACOG is responsible for  planning, information, and coordination activities for the region’s air quality that includes some of the top producing counties in the Eagle Ford.

The Council is concerned that the region historically has trouble staying within the federal standards for ozone this time of year and is proposing that private citizens get involved.

Brenda Williams, AACOG’s interim director of natural resources told epressnews.com that “There are a number of things we all can do to help our air quality. We’re basically asking people to limit outside activities that involve use of fuel.”

Some of the suggestions for people to reduce ground-level ozone are:

  • Ride a bus, bicycle or carpool instead of driving
  • Avoid drive-through lanes
  • Take a sack lunch to work or walk to lunch
  • Drive at moderate speeds to limit car exhausts

Meeting Details

July 22nd at 8:30am
AACOG Al J. Notzon III Board Roo
8700 Tesoro Drive Suite 100
San Antonio, TX 78217

Read more at: aacog.com

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Will Iranian Oil Be Bad for Eagle Ford? http://eaglefordshale.com/news/will-iranian-oil-be-bad-for-eagle-ford/ http://eaglefordshale.com/news/will-iranian-oil-be-bad-for-eagle-ford/#respond Mon, 20 Jul 2015 15:49:15 +0000 http://eaglefordshale.com/?p=8234 Oil Prices Predicted to Fall

Oil Prices Predicted to Fall

Last week, the U.S. reached an historic agreement with Iran that will include lifting economic sanctions and allow the oil-rich nation to sell its oil once again. This news has analysts and energy executives worried about the impact on the global oil markets and the Eagle Ford Shale specifically.

Related:EIA: U.S. Oil Production Has Peaked

Clearly this is bad timing. Since crude prices bottomed out in November, many producers have struggled to stay afloat while waiting for things to stabilize. If Iran floods the market with its crude as expected, prices will continue to fluctuate and will likely decline. Some analysts predict a drop in the price of WTI to as low as $40 a barrel.

This price point will be difficult for most procedures to withstand for the long term, but many have been able to stay the course and gain strength by slashing costs associated with drilling through greater efficiencies and supplier reductions. Eagle Ford Economist Tom Tunstall of UTSA believes prices will definitely fall, but the efficiencies of the unconventional drilling will allow for smart Eagle Ford producers to remain profitable.

Related: Birthday of 2014 Oil Crash

Bloomberg’s Mark Barton doesn’t think that there will be an immediate impact and believes that it will take 6-12 months for Iran to even begin moving towards production. He goes on to say that Bloomberg is predicts $62 a barrel in the fourth quarter. See Barton’s full comments in the video below:

 

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Eagle Ford Rig Count Falls to 111 http://eaglefordshale.com/news/eagle-ford-rig-count-falls-to-115/ http://eaglefordshale.com/news/eagle-ford-rig-count-falls-to-115/#respond Fri, 17 Jul 2015 20:59:04 +0000 http://eaglefordshale.com/?p=8232 Eagle Ford Rigs Decrease

Eagle Ford Rigs Decrease

The Eagle Ford Shale rig count fell this week to 111 rigs running across our coverage area by midday Thursday.

In recent Eagle Ford news, researchers from the University of Austin released a new report that shows water usage in the Eagle Ford has expanded exponentially over the last five years thanks to fracking.

Read more: Fracking Uses 16% of Eagle Ford Water

The U.S. rig count decreased by six, ending with 857 rigs running by midday Friday.  A total of 218 rigs were targeting natural gas (one more than the previous week) and 638 were targeting oil in the U.S. (seven less than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.)   366 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 near the bottom of this article.

Eagle Ford Oil & Gas Rigs

Natural gas rigs in the Eagle Ford remained at 25 this week and natural gas prices traded at $2.88/mmbtu, an $.11 increase from the previous week.

The oil rig count fell by four to 86 as WTI oil prices dropped to $50.85, a decrease of $1.89. A total of 101 rigs are drilling horizontal wells, zero are drilling directional wells, and 10 are vertical rigs. Karnes continues to lead development this week running 19 rigs, with DeWitt (15) and Webb (15) following closely. See the full list below in the Eagle Ford Shale Drilling by County below.

Eagle Ford Shale Drilling by County

County Previous Week Current Week County Previous Week Current Week
KARNES 20 19 BURLESON 2 1
DE WITT 15 15 FAYETTE 1 1
WEBB 15 15 GRIMES 1 1
LA SALLE 17 14 LAVACA 1 1
DIMMIT 14 11 LEE 0 1
GONZALES 8 6 ROBERTSON 1 1
MCMULLEN 3 6 AUSTIN 0 0
ATASCOSA 5 4 COLORADO 0 0
BRAZOS 3 3 GOLIAD 0 0
BEE 1 2 LEON 0 0
DUVAL 2 2 MAVERICK 0 0
FRIO 1 2 MILAM 0 0
LIVE OAK 1 2 WASHINGTON 0 0
MADISON 2 2 WILSON 0 0
ZAVALA 2 2 BASTROP 0 0

Eagle Ford Shale News

Sabine Files Chapter 11

Frac Sand Shipment Largest on Record

Eagle Ford Company Beats Giant

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.
Read more at bakerhughes.com

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