Eagle Ford Drilling at 280 Rigs - La Salle County Leads - Oct 5, 2012

Penn Virginia Eagle Ford Acreage Map
Penn Virginia Eagle Ford Acreage Map

Eagle Ford Shale drilling jumped six rigs to 280 running in the region over the past week. If natural gas prices continue to rise throughout the winter, 2013 could prove to be another exciting year in the Eagle Ford. Over 80% of current activity is focused in oily portions of the play and most of the gas activity is in areas of high condensate and NGL yields. Higher natural gas prices will support activity in dry gas portions of the play that have been explored very little to date. While I'm not confident natural gas prices will get much better, I do believe we'll see more natural gas well records in the Eagle Ford fall if they do.

Penn Virginia had the biggest announcement of the week. The company acquired 4,100 net acres in what they call the "volatile oil" window in Gonzales and Lavaca counties for $10 million. You can read more in the article Penn Virginia Acquires Gonzales & Lavaca County Acreage for $10 million.

Eagle Ford Oil & Gas Rigs - New Oil Rig Count Record 217

Three natural gas rigs were added this week to reach a total of 46 running in the area.. That's a bounce off lows the past two weeks. The oil count blew through the previous record of 228 to reach 232 rigs targeting oil. Over 130 oil rigs have been added in the region since June of 2011.

One water well is being drilled in Bastrop County and one disposal well is being drilled in McMullen County.

Henry Hub futures were trading at ~$3.38 on Friday morning. A full week above $3 is welcomed by the industry. Spot prices began to catch up this week as well. Henry Hub spot prices were up a quarter, trading at $3.25.

WTI was trading at ~$90/bbl Friday. That's a level not seen since July. Eagle Ford crude priced at $100.68/bbl on the 4th of October. Light crude and condensate in the area traded at $88.25 and $87.25, respectively. Notice how Eagle Ford pricing is holding stronger than the rest of the country. Location near the Gulf Coast refinery complex and favorable oil characteristics provide a strategic advantage for the play.

There are 264 horizontal rigs running in the region. La Salle County took the lead in development with 41 rigs running. Karnes with 38 rigs, McMullen 29, Webb (26), Dimmit (24), Gonzales (23), DeWitt (20), Atascosa (15), and Frio (10) round out the top Eagle Ford counties.

News items this week included:

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Eagle Ford Rig Count by Operator

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 SmithBits 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 and/or Smith Service Co's (Schlumberger) Smith Rig Count.

Eagle Ford Shale Drilling by County