Portions of BHP’s Eagle Ford Gathering System Closed Due to Corrosion

$1.8 Billion in Eagle Ford Spending Planned from January to June

BHP Billiton LogoBHP Billiton reported in February 2014 that portions of its Eagle Ford gathering system have been temporarily closed due to corrosion. The cause of the corrosion issue is at present being evaluated by the company.

The gathering system closure was revealed in BHP’s December 2013 financial report of Petrohawk. BHP is required to report operations updates and financial results to Petrohawk’s debt holders, after acquiring the company in 2011.

Read more at bhpbilliton.com 

BHP Eagle Ford Gathering Line Closure Operations Impact

According to BHP, production is continuing in the Eagle Ford, despite the interruption from the line closure. The company has increased the use of trucking to deliver product to market, and claims that there should be no significant impact on production.

BHP Eagle Ford Expenditures To Go Down in 2014

Onshore U.S. drilling and development cost BHP $2.4 billion in the second half of 2013. About 75% of this expense or $1.8 billion was spent in the Eagle Ford, mostly in the company’s liquids-rich Black Hawk acreage. The company achieved a 72% increase in production for onshore US liquids in the second half of 2013, which was primarily attributable to the Black Hawk acreage.

In 2014, expenditures are expected to decrease in the second half of the financial year, following a 35% decrease in the company’s active rig count to 26.

BHP Eagle Ford Highlights in Second Half of 2013

  • Eagle Ford gathering line system closed due to corrosion
  • BHP using trucks to deliver product to market
  • $1.8 billion Eagle Ford spending in second half of 2013
  • 72% increase in production for onshore US liquids
  • Active rig count down to 26 – 35% decrease

Copano Energy Expanding the Eagle Ford’s DK Pipeline To McMullen County

The 65-Mile Pipeline Expansion is Supported by Petrohawk Energy (BHP)
Copano South Texas Map

Copano South Texas | Click for Larger Image

Copano Energy announced an additional Eagle Ford pipeline and midstream expansion related to its DK Pipeline. The company is expanding the pipeline 65-miles southwest into McMullen County. The project will begin service in the first half of 2013 and will follow the same route as the Copano and Magellan Eagle Ford Condensate Pipeline.

Total costs are estimated at $120 million and the project is supported by a long-term fee based agreement with Petrohawk Energy, a subsidiary of BHP Billiton. Copano will provide midstream gathering and handling services in exchange for committed volumes of production from BHP in McMullen County.  [Read more…]

Eagle Ford Oil & Gas Completion Technology – HAL – SLB – GFS.TO

GasFrac Photo

GasFrac LPG Completion

Eagle Ford completion technology is evolving as it needs to if operators want to remain competitive. Operators have lots of theories, but the proof is in the pudding. Drilling and completing wells is the only real way to test new technologies.  That technology is needed as we experience rising service costs, along with natural gas prices of $4 per mcf and oil prices that look to be below $90 for the foreseeable future. $90 a barrel isn’t bad, but it isn’t $100.

Petrohawk was the first to announce a major change in completion technology by using Schlumberger’s Hi-way Frac system. SLB refers to it as “HiWay Flow Channel Fracturing”. Fancy name and all, nobody really cares unless it delivers. For Petrohawk, it looks to have done just that. Petrohawk had utilized hiway fracs in 12 wells that had a production history of 90 days or more as of June. Those 12 wells had produced 32% more at a pressure 42% higher than other wells with a choke (18/64ths). More production at a higher pressure is about as good as it gets. The higher pressure indicates better overall communication, which is great in tight shale rocks. We’ll hear more about hiway fracs as operators test it in other parts of the Eagle Ford and in other plays. Read more on Schlumberger’s HiWay Flow Channel Fracturing at www.slb.com  [Read more…]

Loreto Resources – Eagleford Energy Reach Joint Venture Agreement

Loreto Resources and Eagleford Energy have come to an agreement on a potential joint venture. Loreto will have the opportunity to earn a 50% working interest on two leases in Zavala County, TX.

In Petrohawk’s Q2 conference call, the company announced it was suspending drilling operations at Red Hawk in favor of other producing areas. Read more in our post titled: Petrohawk Abandons the Red Hawk Field. Watch to see if Loreto Resources and Eagleford Energy are able to make a commercial play in Zavala County. Secondary formations such as the Austin Chalk and Buda may become the primary drilling targets. [Read more…]

BHP – Petrohawk’s Red Hawk Zavala County Acreage Abandoned

Petrohawk has terminated any further investment in Zavala County’s Red Hawk field. We’ve heard this was a possibility. Eagle Ford Shale Oil wells in the county have not outperformed expectations like many other areas of the play and Petrohawk has now stepped away from the asset. BHP is not expected to continue drilling, but I’m sure the company will consider whether or not the Zavala County Eagle Ford assets fit the company’s overall portfolio. [Read more…]

Kinder Morgan Expects Eagle Ford Shale Growth

Kinder Morgan expects future growth in its Eagle Ford Shale pipeline gathering and transport assets. The company expects the acquisition of Petrohawk by BHP to only enhance value across the Haynesville Shale and Eagle Ford Shale. [Read more…]

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