EOG Resources Adds Reserves & Reports Record Well

EOG Resources South Texas Eagle Ford Map
EOG Resources South Texas Eagle Ford Map

EOG Resources added 305 net Eagle Ford wells in 2012, while running an average of 23 wells throughout the year. With improving well results and successful downspacing test, EOG has increased its estimate for recoverable reserves from 1.6 billion boe to 2.2 billion boe (38% increase). At current activity levels, that provides a twelve year drilling inventory.

EOG expects its acreage in the east will be developed on 40-acre spacing, while acreage in the west will be developed on 65-acre spacing. Current reserve estimates indicate the company will recover 8% of the 26.4 billion boe net in place across its acreage.

The company's major oil assets are showing promise. A slide in the latest investor presentation shows the Bakken and Eagle Ford account for 82% of the oil produced from horizontal wells in the US.

"The Eagle Ford's potential reserves of 2.2 billion barrels of oil equivalent represent the largest domestic crude oil find net to one company in 40 years. Not only is 600 million net barrels a meaningful increase, this onshore U.S. oil field is readily accessible to premium markets," Papa said. "With both the technical acumen and high-quality assets, EOG is at the forefront in developing this world-class shale oil resource."

Record Eagle Ford Well Details

[ic-r]EOG's best Eagle Ford wells to date have been located in Gonzales County.  The Burrow Unit #2H, which had an initial production rate of 6,330 b/d of oil with 713 b/d of NGLs and 4.1 mmcfd of natural gas, is the biggest well drilled to date. That's over 7,700 boe/d! The offsetting Burrow Unit #1H was completed to sales at a maximum rate of 5,424 b/d of oil with 600 b/d of NGLs and 3.5 mmcfd of natural gas. Two other prolific wells, the Boothe Unit #1H and #2H, began initial production at 5,380 and 3,810 b/d of oil with 625 and 525 b/d of NGLs and 3.6 and 3.0 mmcfd of natural gas.

In McMullen County, the Naylor Jones Unit 59 East #1H and West #4H had initial peak production rates of 1,670 and 1,150 b/d of oil with 225 and 138 b/d NGLs and 1.3 and 0.8 mmcfd of natural gas, respectively. The two wells were completed in January 2013.

EOG Plans in 2013

EOG plans to drill 400 net wells in 2013. That's almost 100 MORE wells than the company drilled in 2012.

"EOG's demonstrated ability to organically grow crude oil volumes should lead to strong 2013 returns," Papa said. "Until other commodity prices strengthen, we are directing EOG's capex dollars almost exclusively toward crude oil exploration and development.....With the most attractive drilling program in our history, EOG has the critical assets in place to make 2013 another outstanding year."