Aurora Oil & Gas Testing 350 ft Eagle Ford Well Spacing

How low will downspacing go in the Eagle Ford Shale?
Aurora Oil Gas Eagle Ford Acreage Map

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Aurora Oil & Gas provided an operations update announcing it will participate in 11 wells testing tighter spacing across the company’s acreage. Wells in the gas-condensate window of the play will be tested at 500 ft (~60-acre) spacing and wells in the volatile oil window will be tested at 350 ft (~40-acre) spacing. If successful, a 40-acre spacing test means there could be potential for as many as 16 wells drilled targeting the Eagle Ford on the best sections in the volatile oil window.

Ultimate recoveries normally fall when operators downspace in a field, but we’re still in the early stages of determining optimal well design across the Eagle Ford. The best case scenario is that test proves successful without lowering per well recoveries significantly. [Read more…]

Is a Eureka Energy Bidding War Close?

Eureka Energy’s board is rejected an offer from Aurora Oil & Gas, but could be near an agreement with Lonestar Resources. Details of a potential agreement will not be known until Eureka’s board meets over the weekend. Aurora’s offer is only good until June 15 and Australian regulations prevent the company from making a higher offer until after that date.

Lonestar Resources is a private Fort Worth based company with interests in the Bakken, Barnett, and Eagle Ford shales. [Read more…]

Aurora Oil & Gas Adds Sugarloaf Acreage for $95 Million

Second Sugarloaf Acquisition Proposed in Two Weeks

Aurora Oil & Gas is continuing its quest to add acreage in the Sugarloaf field in South Texas. Just two weeks ago, Aurora made a bid for Eureka Energy, but Eureka’s board wasn’t excited about the proposal. This week, Aurora announced a deal that adds 1,440 net acres to the company’s AMI in the Sugarloaf at a price tag of US$95 million.  [Read more…]

Eureka Energy’s Board is Rejecting Aurora Oil & Gas’ Offer

Eureka Values Sugarloaf at More Than $87,000 Per Acre

Sugarloaf Map | Click to Enlarge

Eureka Energy is advising shareholders not to accept the US$110 million offer that was made for the company by Aurora Oil & Gas on Monday.

Eureka asserts the offer is lower than their valuation of the company’s flagship asset in the Sugarloaf Field and does not attribute any value to its Pan De Azucar/Black Jack Springs, or Bioche assets.

Eureka owns a 6.25% working interest in 24,743 gross (1,521 net) acres operated by Marathon Oil in Karnes County. In U.S. dollars, the offer is for $0.46 per share and Eureka believes the Sugarloaf field alone is worth US$0.56 per share or US$132.7 million.

If I’m doing the math correctly, that’s $132,700,000/1,521 net acres = a valuation of $87,245.23/acre.

Read the entire recommendation at

Aurora Oil & Gas to Acquire Eureka Energy

Aurora Oil & Gas Eagle Ford Map

Aurora Oil & Gas Eagle Ford Map | Click to Enlarge

Aurora Oil & Gas is bidding to add to its Eagle Ford position through a $107 million acquisition of Eureka Energy. Both are Australian companies that control non-operated acreage in the South Texas shale.

Eureka’s assets include 24,743 gross (1,521 net) acres in the Sugarloaf Field in Karnes County.  Aurora has 24,033 gross (3,792 net) acres in the same area of the play. The acreage will add to Aurora’s 76,989 gross (16,365 net) acres and increase the company’s position to almost 18,000 net acres. The Sugarloaf field lies in the middle of the high rate condensate window of the Eagle Ford. [Read more…]