Eagle Ford Drilling is Resisting $2 Gas - January 20th, 2012
The Eagle Ford Shale drilling rig count moved up 2 this past week. The rig count was relatively flat again week over week. Rigs targeting natural gas continue to be the only threat to the region. At current price levels, we're getting close to operational costs for wells and that means tough decisions will have to be made in regards to shutting in lower volume (high cost) wells. Natural gas prices are approaching ten-year lows at ~$2.30 / mmbtu. With that, we still added 5 gas rigs this week. Those units are likely targeting portions of the play with a rich condensate and NGL stream. We dropped 3 oil rigs, but prices held flat at $98/bbl through most of the week. Horizontal wells account for activity from 245 rigs drilling and we have 0 injection or service wells being drilled.
Karnes County expanded its lead in drilling this week with 43 rigs. Webb (40), La Salle (33), DeWitt (26), McMullen (24),Gonzales (21), and Dimmit (19) are the most active counties. Frio County did jump to 10 active rigs this week to round out the counties with double digit rig counts.
News in the Eagle Ford included:
- Eagle Ford NGLs are Adding to U.S. Supply Growth (Exclusive)
- Oil India Eagle Ford Position Coming Soon?
- Sanchez Energy Provided an Eagle Ford Operations Update
- Traffic Jams in Cotulla are More and More Common
Jeff Venghaus, from Jones Lang LaSalle, contributed an article addressing Eagle Ford Industrial Real Estate.
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Come back weekly for updates on the South Texas drilling rig count
Drilling 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.