SM Energy plans to continue to the ramp up of activity in the Eagle Ford Shale and announced an increase to the company's capital budget for the remainder of the year. The company plans to spend over $1.5 billion developing oil & gas properties, with over $800 million allocated to the Eagle Ford Shale alone. The increase is funded by recent divestitures, which included a JV with Mitsui and the sale of acreage to a partnership between Talisman and Statoil. Read more about SM Energy's Eagle Ford Shale operations and acreage on the SM company page. SM's operations are primarily located in Webb County near the Texas and Mexico border.
The primary increase to the 2011 capital budget results from differences regarding the size and timing of the Company's previously announced Eagle Ford shale transactions, compared to assumptions made when they were originally budgeted. The reduction in SM Energy's total Eagle Ford shale position will not be as large as was assumed at the beginning of the year. The scheduled closing dates for these transactions are also later in the year than originally budgeted. As a result, higher amounts of production and capital expenditures will be recognized by the Company in 2011. The capital budget is also being increased to reflect the decision to continue drilling in the Company's operated Haynesville shale position in East Texas until its leasehold position is held by production in 2012. More detailed production and cost guidance for the remainder of 2011 is provided later in this release.
Read the full press release at SM-Energy.com