Eagle Ford Shale News

Eagle Ford Shale Rig Count Stays Flat at 263

3.2 Magnitude Earthquakes Shakes Up Atascosa County
Eagle Ford Contour Map

Eagle Ford Depth Map | Click to Enlarge

The Eagle Ford Shale rig count stayed flat at 263 rigs running across our coverage area by the end of last week.

In recent news, the U.S. Geological Survey (USGS) confirmed a 3.2 magnitude earthquake last week, two miles southeast of Charlotte, TX in Atascosa County, which is almost entirely in the liquids-rich or oil window of the Eagle Ford Shale. Last week, 13 active rigs were running in the area.

According to the USGS, there is evidence that some central and eastern North American earthquakes have been triggered or caused by human activities that have altered the stress conditions in earth’s crust. The cause of this most recent quake is unknown; however, in the Eagle Ford Shale and other areas for oil & gas development in Texas, a link has been made between waste water disposal/injection wells and seismic activity.

Read more: Eagle Ford Earthquake – Video

The U.S. rig count increased by six to 1,931 rigs running by the end of last week. A total of 338 rigs were targeting natural gas (two more than the previous week) and 1,592 were targeting oil in the U.S. (8 more than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.).  905 or ~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 (203 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 decreased by two to 11 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 stayed relatively flat from the previous week at $3.94/mmbtu on Friday afternoon.

The oil rig count increased by 2 to 252 rigs running by the end of last week. WTI oil prices decreased slightly from the previous week, trading at $92.34/bbl on Friday afternoon. Eagle Ford light crude traded at $88.75/bbl on Sept. 12th.

A total of 246 rigs are drilling horizontal wells, seven rigs are drilling directional wells, and ten rigs are drilling vertical wells. Karnes, La Salle, De Witt, and Webb each have at minimum 25 rigs running. Karnes County has the highest rig count this week at 38. See the full list below in the Eagle Ford Shale Drilling by County below

South Texas Oil & Gas News:

Be sure to visit our South Texas Oilfield Job Listings to search openings and come back weekly for updates or sign up for alerts - Daily or Weekly Email Alerts

Eagle Ford Shale Drilling by Count


County Previous Week Current Week County Previous Week Current Week
KARNES 33 38 LEE 3 3
LA SALLE 30 28 LEON 3 3
DIMMIT 22 25 WILSON 3 3
MCMULLEN 20 24 ZAVALA 3 3
DE WITT 26 23 DUVAL 2 2
WEBB 26 21 GRIMES 2 2
ATASCOSA 13 13 ROBERTSON 3 2
BRAZOS 11 12 BEE 0 1
GONZALES 11 12 COLORADO 1 1
MADISON 12 12 GOLIAD 1 1
LAVACA 10 11 WASHINGTON 1 1
LIVE OAK 8 7 AUSTIN 0 0
BURLESON 7 6 MAVERICK 0 0
FRIO 7 5 MILAM 0 0
FAYETTE 5 4 BASTROP 0 0

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.

Eagle Ford Earthquake – Video

3.2 Magnitude Quake Recorded Two Miles Southeast of Charlotte, TX in Atascosa County

The U.S. Geological Survey (USGS) confirmed a 3.2 magnitude earthquake on Wednesday, two miles southeast of Charlotte, TX in Atascosa County, which is almost entirely in the liquids-rich or oil window of the Eagle Ford Shale. Last week, 13 active rigs were running in the area.

According to the USGS, there is evidence that some central and eastern North American earthquakes have been triggered or caused by human activities that have altered the stress conditions in earth’s crust. The cause of this most recent quake is unknown; however, in the Eagle Ford Shale and other areas for oil & gas development in Texas, a link has been made between waste water disposal/injection wells and seismic activity.

Injection wells are necessary to the fracking process, a method by which a well is completed using treated water under extreme pressure. When a well is fracked, it produces flowback or produced water that must be disposed of properly in waste water disposal/injection wells deep underground. Recently, EagleFordShale.com posted a story about new waste water disposal rules that could be put into practice soon in Texas, following a rash of low magnitude earthquakes across the state.

Read more: Could New Waste Water Disposal Rules be Coming in Texas?

EagleFordShale.com Founder Kenny DuBose, said, “there are two primary ways in which the oil and gas industry commonly “ads” energy (pressure) into the ground. That is through hydraulic fracturing and water injection. The industry “subtracts” energy from the ground by producing hydrocarbons and the associated water that generally comes with it. These two forces are constantly opposing and offsetting each other. On a localized basis, at any given point in time, it is possible that the net result of these two forces is great enough (in either direction) to cause small and local trimmers. No doubt many of these are of such short duration and so small that they are never even noticed. Then there are some that make it to the observable and measurable threshold. Local and hyperlocal geology will generally determine the susceptibility of a particular area to these trimmers.”

KABB, the Fox affiliate in San Antonio, ran a story yesterday about the quake that occurred this week. Click on the video below to see their report:

How the Eagle Ford Impacts the Price at the Pump

EIA: Eagle Ford Expected to Produce 1.5 Million b/d in Sept. 2014
Eagle Ford Contour Map

Eagle Ford Depth Map | Click to Enlarge

The Eagle Ford Shale is a powerhouse play for Texas, and it is even bigger than the last great Texas oil boom that began with Spindletop at the turn of the last century. Texans and all Americans are reaping the benefits of this modern day boom, and where this may be most evident is at the gas pump.

It wasn’t long ago that the price of a gallon of gas in Texas was well above $4 a gallon, and although Texans may still feel some pain at the pump, the prices could be much higher if it wasn’t for the Eagle Ford Shale and the oil and gas renaissance taking place in the U.S. Some industry professionals speculate the price of a gallon of gas could be as much $7 – $8 dollars a gallon if it wasn’t for the shale oil boom, made possible by advances in horizontal drilling and fracking.

Read more: North Dakota & Texas Make Up Half of U.S. Oil Production

What Determines the Price of a Gallon of Gas

According to the Energy Information Administration (EIA), there are four main components that go into the retail price of a gallon of gas:

  • Crude Oil (67%)
  • Refining Costs and Profits (14%)
  • Distribution, Marketing, and Retail Costs and Profits (8%)
  • Federal and State Taxes (12%)

The majority of the price, as shown by the breakdown, comes from crude oil, which is determined by commodities traders. World-wide supply and demand are key factors in influencing pricing.

With the U.S. poised to become the top oil producing country in the world by 2015, more supply has entered the world market, and that has ultimately impacted the price of crude oil. There are a number of other factors (i.e. global political upheaval) that are beyond the scope of this post, and they are all taken into account when determining the price of oil futures.

How the Eagle Ford Impacts Crude Oil Supply

The Eagle Ford alone produces nearly 1.5-million b/d. That’s more than half of total production for the entire state of Texas. The U.S. currently produces around 11-million b/d.

Read More: EIA: Eagle Ford Oil Production Will Hit 1.5-Million b/d – Sept. 2014

By comparison, Iraq, which is currently rated as the second largest OPEC producer, produced 3.2-million b/d in April of 2014. By June of this year, Texas’ total monthly production surpassed that of Iraq, as its production dropped below 3-million b/d.

Production growth is expected to continue in the Eagle Ford, and for the immediate future, it will remain a top supplier of U.S. crude oil. That equates to the Eagle Ford continuing to play a role in influencing the price of oil.

Sundance Seeks More Eagle Ford Acreage – Sept. 2014

Bloomberg: Company Plans to Add 10,000 - 20,000 Net Acres Within 12-Months
Sundance Energy's Eagle Ford Acreage

Sundance Energy’s Eagle Ford Acreage

Australian-based Sundance Energy’s Managing Director Eric McCrady was cited in a Bloomberg report this week saying the company plans to add 10,000 to 20,000 net acres in the Eagle Ford within 12-months.

Sundance’s most recent reported acquisition came in late May of 2014, when the company announced it would purchase 11,000 net acres in Dimmit and Maverick counties for $33-million. The deal added 115 gross (69 net) locations to the company’s Eagle Ford drilling inventory and approximately 200 boe/d in production. Sundance currently has ~19,500 net Eagle Ford acres covering 295 gross (196 net) drilling locations.

Read more: Sundance Energy Acquires 11,000 Net Eagle Ford Acres for $33-Million

The company’s Eagle Ford expansion comes at a time when some Eagle Ford operators will likely need to divest their assets to pay down debt. In June, Freeport McMoran completed at $3.1-billion deal with Encana to sell 45,500 net acres in the play. Freeport McMoran officials said a portion of the proceeds would be used to pay down debt.

Read more: Encana Purchases Eagle Ford Assets from Freeport-McMoran – $3.1 Billion

Sundance Eagle Ford Operations in Second Half of 2014

In July, Sundance officials said 26 gross (20.6 net) Eagle Ford wells were expected to begin production in the second half of the year, pushing the company’s production up to 8,000 – 9,000 boe/ d by year’s end. According to Bloomberg, McCrady confirmed the company expects to hit that target goal in September and increase output next year.

Read more at Bloomberg.com

Eagle Ford Shale Rig Count Increases by 1 to 263

New Waste Water Disposal Rules Could be Coming to Texas Soon
Eagle Ford Disposal Well Map

Eagle Ford Disposal Well Map | Click to Enlarge

The Eagle Ford Shale rig count increased by one to 263 rigs running across our coverage area by the end of last week.

In recent news, new waste water disposal rules could soon impact oil and gas development in Texas.

After a rash of low-magnitude earthquakes linked to injection/waste water disposal wells across the state, new rules could soon be on the table soon for industry to dispose of its drilling waste water.

Read moreCould New Waste Water Disposal Rules Be Coming to Texas?

The U.S. rig count increased by 11 to 1,925 rigs running by the end of last week. A total of 340 rigs were targeting natural gas (two more than the previous week) and 1,584 were targeting oil in the U.S. (9 more than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.).  907 or ~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 (202 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 13 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 decreased by ~$.10 from the previous week to $4.08/mmbtu on Friday afternoon.

The oil rig count stayed flat at 250 rigs running by the end of last week. WTI oil prices increased by more than $2 from the previous week, trading at $93.25/bbl on Friday afternoon. Eagle Ford light crude traded at $89.75/bbl on Sept. 5th.

A total of 249 rigs are drilling horizontal wells, six rigs are drilling directional wells, and eight rigs are drilling vertical wells. Karnes, La Salle, De Witt, and Webb each have at minimum 25 rigs running. Karnes 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:

Be sure to visit our South Texas Oilfield Job Listings to search openings and come back weekly for updates or sign up for alerts - Daily or Weekly Email Alerts

Eagle Ford Shale Drilling by Count


County Previous Week Current Week County Previous Week Current Week
KARNES 34 33 LEE 3 3
LA SALLE 30 30 LEON 3 3
DE WITT 26 26 ROBERTSON 3 3
WEBB 27 26 WILSON 2 3
DIMMIT 23 22 ZAVALA 3 3
MCMULLEN 21 20 DUVAL 2 2
ATASCOSA 12 13 GRIMES 2 2
MADISON 12 12 COLORADO 1 1
BRAZOS 11 11 GOLIAD 0 1
GONZALES 11 11 WASHINGTON 1 1
LAVACA 10 10 AUSTIN 0 0
LIVE OAK 8 8 BEE 0 0
BURLESON 7 7 MAVERICK 0 0
FRIO 6 7 MILAM 0 0
FAYETTE 4 5 BASTROP 0 0

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.

Could New Waste Water Disposal Rules be Coming in Texas?

Railroad Commission Could Have More Power to Modify Permits
Eagle Ford Disposal Well Map

Eagle Ford Disposal Well Map | Click to Enlarge

New waste water disposal rules could soon impact oil and gas development in Texas.

After a rash of low-magnitude earthquakes linked to injection/waste water disposal wells across the state, new rules could soon be on the table soon for industry to dispose of its drilling waste water. According to The Houston Chronicle, the proposed rules would require companies to submit more information about the seismic history of the drill site and the underground pressure the water will cause. The rules also give the Railroad Commission (RRC) more power to modify permits and requests.

Since the drilling boom began in the Eagle Ford Shale, scientists have recorded a steady up-tick in earthquakes in South Texas. Most scientific findings link injection wells, and not fracking to the earthquakes; however, injection wells are necessary to the fracking process. Fracking of just one Eagle Ford well uses approximately 4.2 million gallons of water, and the flowback or produced water needs to be disposed of in an injection well. In addition to Eagle Ford quakes, the more highly publicized North Texas’ quakes, stemming from development of the Barnett Shale, have also been linked to injection wells.

Read more: Eagle Ford Quakes Linked to Disposal and Injection Wells

Law makers in Austin on a seismic activity subcommittee heard testimony on new waste water disposal rules at the end of August. According to the Chronicle, the subcommittee will report their findings to the House Committee on Energy Resources. The committee will take comment on the proposed rules through Sept. 29th.

Read more at chron.com

Pioneer CEO Confirms Condensate Exports to Europe

Condensate Exports Fuel Conversation for Lifting Oil Export Ban
Pioneer Central Gathering Plant

Pioneer Central Gathering Plant | Click to Enlarge

Pioneer Resources CEO Scott Sheffield confirmed this week the company has exported its second round of condensate exports – this time to Europe – during an investor webcast presentation. The first exports were to the Asian market in South Korea in July.

In June, Pioneer and Enterprise Products Partners, a midstream service provider, received permission from the U.S. Commerce Department (U.S. DoC) to export minimally processed condensate to foreign buyers. Other major operators in the Eagle Ford like BHP Billiton have also applied for permits, but have not gotten the nod from the U.S. DoC.

Read more: Eagle Ford’s BHP Billiton Seeks to Export Condensate

Sheffield said, “I expect the commerce department to approve several more permits, primarily for condensate, in the Eagle Ford, as long as it goes through the distillation process. I am optimistic this administration or the next one will remove the export ban.”

The pressure to lift the oil export ban is mounting from other industry executives. This week, Shell’s CEO Ben van Beurden urged Barack Obama to lift the ban during a speech he gave at Columbia University.

Van Beurden said, lifting the ban “would reinforce the long term future of North American energy production, and help make the global energy system more stable.”

Under the oil export ban, refined products can be exported. Pioneer’s minimally processed condensate exports are considered a refined product by the U.S. DoC.

Listen to the Pioneer Webcast

Buckeye Buys Eagle Ford Facilities – $860 Million

$240 - $270 Million Slate for Improvements Through 2016
Trafigura Eagle Ford Assets

Trafigura Eagle Ford Assets

Buckeye Partners, L.P. announced this week it will acquire an 80% interest in Trafigura AG’s South Texas Eagle Ford midstream assets for $860-million. The deal creates a new joint venture, whereby Trafigura will retain a 20% interest in its assets and jointly own the new company, Buckeye Texas Partners, that will own and operate the assets divested by Trafigura.

In the deal, Buckeye gains a deep-water, high volume marine terminal located on the Corpus Christi Ship Channel, a condensate splitter and LPG storage complex in Corpus Christi, and three crude oil and condensate gathering facilities in the Eagle Ford shale. All of the assets are supported by 7- to 10-year minimum volume throughput, storage and tolling agreements with Trafigura.

Buckeye CEO Clark Smith, said, “we are excited about the opportunity to partner with Trafigura and to position ourselves with them in the rapidly growing Corpus Christi and Eagle Ford markets,” stated Mr. Smith. “We believe this strategic partnership will provide significant opportunities for additional infrastructure expansion to support further expected growth in these markets.”

Buckeye Texas Partners will invest appoximately $240-million – $270-million on improvements to the system, increasing its liquid petroleum products storage capacity to 5.6-million barrels. A 50,000 barrel per day condensate splitter is currently under construction and is anticipated to be completed by mid-2015.

Read more at buckeye.com

Eagle Ford Shale Rig Count Increases by 2 to 262

Texas Oil Production Hits 2.16 Million b/d - June 2014
Pump Jack Image

Oil Well Pump Jack

The Eagle Ford Shale rig count increased by two to 262 rigs running across our coverage area by the end of last week.

In recent news, the Texas Railroad Commission (RRC) reported state-wide crude oil production of 2.16-million b/d for June, 2014, at the end of August. That’s less than a 1% increase from the previous month, but 29% from the same time in 2013. Most of the state’s oil production in June came from the Eagle Ford Shale and West Texas’ Permian Basin.

Read more: Texas Oil Production Hits 2.16 Million b/d – June 2014

The U.S. rig count increased by 18 to 1,914 rigs running by the end of last week. A total of 338 rigs were targeting natural gas (eight more than the previous week) and 1,575 were targeting oil in the U.S. (11 more than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.).  900 or ~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 (203 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 decreased by one to 12 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 increased by more than $.20 from the previous week to $4.08/mmbtu on Friday afternoon.

The oil rig count increased by three to 250 rigs running by the end of last week. WTI oil prices increased by ~$2 from the previous week, trading at $95.85/bbl on Friday afternoon. Eagle Ford light crude traded at $92.50/bbl on August 29th.

A total of 247 rigs are drilling horizontal wells, six rigs are drilling directional wells, and nine rigs are drilling vertical wells. Karnes, La Salle, De Witt, and Webb each have at minimum 25 rigs running. Karnes County has the highest rig count this week at 34. See the full list below in the Eagle Ford Shale Drilling by County below

South Texas Oil & Gas News:

Be sure to visit our South Texas Oilfield Job Listings to search openings and come back weekly for updates or sign up for alerts - Daily or Weekly Email Alerts

Eagle Ford Shale Drilling by Count


County Previous Week Current Week County Previous Week Current Week
KARNES 33 34 LEE 3 3
LA SALLE 31 30 LEON 3 3
WEBB 27 27 ROBERTSON 2 3
DE WITT 25 26 ZAVALA 5 3
DIMMIT 22 23 DUVAL 2 2
MCMULLEN 20 21 GRIMES 2 2
ATASCOSA 13 12 WILSON 1 2
MADISON 12 12 COLORADO 1 1
BRAZOS 13 11 WASHINGTON 1 1
GONZALES 12 11 AUSTIN 0 0
LAVACA 10 10 BEE 0 0
LIVE OAK 8 8 GOLIAD 0 0
BURLESON 7 7 MAVERICK 0 0
FRIO 3 6 MILAM 0 0
FAYETTE 4 4 BASTROP 0 0

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.

SM Energy 2014 Eagle Ford Capex Budget Increased

SM Energy Production Guidance Increased Portfolio-Wide
SM Energy Eagle Ford Acreage Map

SM Energy Eagle Ford Acreage Map|Click to Enlarge

SM Energy revealed in mid-August that it will add $30-million to its $900-million Eagle Ford capex budget for 2014.

Company officials indicate the increase is due to higher than expected activity in SM’s non-operated acreage. The company currently holds approximately ~46,000 net non-operated Eagle Ford acres.

Read moreSM Energy-Mitsui Eagle Ford Carry Ends

SM Energy Revises Production Guidance Portfolio-Wide

SM Energy increased its portfolio guidance for 2014 by approximately 3% in August, 2014. In addition to its Eagle Ford assets, the company is active in the Bakken, Powder River, and Permian.

The revised production estimates take into account the company’s anticipated downtime in its operated Eagle Ford assets. During the third-quarter, SM will temporarily shut-in certain wells to conduct offset completion work. SM’s operated assets in the Eagle Ford (~144,000 net acres) are located primarily in Webb County, TX, with a portion in Dimmit County, TX.

Read more sm-energy.com

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