Chesapeake's Eagle Ford Production Set to Top 100,000 boe/d by Year-end

Chesapeake Eagle Ford Acreage - Drilling Map

Chesapeake is on pace to surpass 100,000 boe/d of net Eagle Ford production in the fourth quarter. Average production in the third quarter was 211,000 gross (95,000 net) boe/d from the play.

Add back Eagle Ford assets sold to EXCO that produced over 6,000 boe/d during the quarter and Chesapeake would have already surpassed the 100,000 barrel mark.

Production is up 82% from the third quarter of 2012 and 11% over the second quarter.

“Our oil assets in the Eagle Ford Shale continue to deliver strong results, prompting us to raise our full-year 2013 oil production guidance by 2 million barrels (mmbbls) to 40 – 42 mmbbls.”

— Mr. Lawler

Chesapeake operated 13 rigs and brought 100 gross wells to sales during the quarter. The company is expected to run more like 20 rigs in 2014.

The average Eagle Ford well brought to sales in the third quarter came online at ~930 boe/d.

The company had 788 producing wells and 117 wells awaiting completion or infrastructure at the end of the quarter.

Read the full press release at chk.com

EXCO's Eagle Ford Results Are Meeting Expectations - Manufacturing Mode Coming

EXCO Eagle Ford Map

EXCO Resources completed the acquisition of Eagle Ford assets in the third quarter and ended September producing approximately 7,600 boe/d from the play.

Immediately following the Chesapeake deal, the company sold a 50% interest in the undeveloped portion of acquired assets to KKR for $131 million, so the two are partners with CNOOC in the Eagle Ford.

EXCO, as the operator, plans to run 4-5 rigs in full development mode and expects to drive down costs by leveraging what the company has learned through its "manufacturing" approach in other shale plays.

“Our acquisitions in the Haynesville and Eagle Ford shales support our strategy to grow in our core areas, add to our oil production, and use our outstanding operating expertise. We have begun our development program in the Eagle Ford through the drilling partnership with KKR. Our early drilling and completion results are meeting our expectations, and we plan to quickly implement a manufacturing program on both the Eagle Ford and Haynesville assets.”

— Douglas H. Miller, CEO

EXCO acquired 55,000 net acres from Chesapeake in July and entered a farm out agreement on another 147,00 acres.

EXCO then sold a 50% interest in the undeveloped acreage to KKR for $131 million. KKR owns half of the acquired interest in undeveloped properties and EXCO will assign half of its remaining interest to the company as each well is drilled. KKR will fund and own up to 75% of each well and EXCO will fund and own 25%. EXCO then has the right to purchase wells in batches from KKR starting in the first quarter of 2015.

Read the full press release at excoresources.com

Chesapeake & EXCO Reach Eagle Ford Deal - $680 Million

Chesapeake Eagle Ford Acreage Map

Chesapeake has agreed to sell approximately 55,000 net acres in Dimmit, Frio, La Salle, and Zavala counties to EXCO Resources for $680 million. The deal adds a new operating area for EXCO. The company currently operates rigs in West Texas, East Texas & North Louisiana, and the Marcellus Shale region.

The sale is part of Chesapeake's plans to raise $4-7 billion through assets sales in 2013.

The Eagle Ford acreage includes:

• 120 producing wells (94 Eagle Ford wells)
• 6,100 boe/d of production in May
• 300 potential drilling locations

Douglas H. Miller, EXCO’s CEO, stated “The Eagle Ford acquisition establishes our position in the high value oil core area of the Eagle Ford shale, and delivers immediate production and reserve additions, significant resource potential, and solid economic returns.

Undeveloped locations in the Eagle Ford will be developed through a partnership between EXCO and KKR. KKR will fund approximately $133 million or 50% of the development costs and EXCO will operate the wells.