ZaZa Energy and EOG Resources have reached terms on a joint venture (jv) targeting the Eaglebine in Grimes, Madison, Montgomery, Trinity, and Walker counties.

ZaZa is also selling Eagle Ford acreage in separate transactions. Two deals for more than 10,000 acres in the Moulton area were sold to undisclosed buyers for $52.5 million.

EOG gains 55,000 net acres or a 75% interest in 73,000 acres across ZaZa's Eaglebine position if the company elects to move forward with all three phases of the agreement. ZaZa retains 100% interest in 19,000 of it's 93,000 net acres where previous discoveries were made.

Todd A. Brooks, ZaZa’s CEO, stated “Partnering with one of the largest unconventional oil focused operators in the country validates the Eaglebine work program that has been executed by ZaZa to date. Our new joint venture will benefit from economies of scale and focus on optimizing field development and accelerating production at a reduced cost.”

EOG will operate the joint venture and will proceed in phases. Details of the transaction were not disclosed, but EOG will make cash payments and commit to drill three wells in each of the three phases. Phases two and three will go forward at EOG's election.

I bet we see the first three wells drilled by year-end and we'll know if EOG is going forward with phase two and three in early 2014. Of note, Range Resources also has an interest in portions of the acreage.

Read more about the deal at zazaenergy.com

You can also read more about the Eaglebine at our Eagle Ford Geology page