Updated Texas Railroad Commission Map of the Eagle Ford Shale

Eagle Ford Shale Well Map

The Railroad Commission released an updated well map in May. Since the March 15, 2012 version, the number of gas wells on schedule has only grown by 25, but the number of oil wells on schedule has surged by 422 to 1,376.

We're close to having 2,000 producing wells on record. Take into account the delays in reporting and we're likely well past 2,000.

The number of permits issued in the play jumped 381 to more than 4,000 over the past two months as well.

We're running at a blistering pace. 400+ oil wells in two short months is a substantial feat and with ~250 rigs running, we'll likely replicate the growth of the past two months many times over.

The increased pace of drilling and permitting is exactly why we're seeing higher future production estimates almost weekly.

Eagle Ford Shale Well Map - 3,700 Permits - 1,500 Producing - March 2012

Eagle Ford Shale Well Map

As of March 15, 2012, the Texas Railroad Commission reported almost 3,700 permits had been submitted, with 954 oil wells and 578 gas wells on schedule. That's up from ~1,900 permits, with 194 oil wells and 249 gas wells on schedule in June of 2011. That means the industry brought on almost 1,100 wells in 9 months. Add in the many gathering delays in 2011 and that number could have been even higher. In 2012, don't be surprised if as many as 2,500 wells are brought to production.

Also, note the difference in the proportion of oil vs. gas wells. In June of 2011, 56% of producing wells were considered "gas" wells, but in March of 2012 that number had fallen to just 38%. That's a direct reflection of the commodity markets. Natural gas is at multi-decade lows, while oil has held strong above $100 per barrel.

Do you think 2,500 Eagle Ford wells will be drilled this year? Use the comments below to share your thoughts.

Goodrich Petroleum Buda Lime Well Results Impress

In Goodrich Petroleum's operations update from the second quarter, the company announced impressive well results from a horizontal Buda Lime well. The well came on at almost 1,400 barrels of oil per day and 1.5 mmcfd. The well averaged 1,000 barrels of oil equivalent per day over the first 30 days. At $75 oil that $2.25 million in first month. Subtract royalties and operating costs and your looking at a pretty quick payout. Possibly, 3-4 months. That's a good well!  

The Company has completed its third Buda Lime well, the Carnes 6H (67% WI) well, an unstimulated 3,100 foot lateral, at a 24-hour initial production rate of 1,635 BOE per day, comprised of 1,380 barrels of oil and 1,535 Mcf per day. The well averaged 1,000 BOE per day over the first thirty days, and had an estimated completed well cost of less than $3.0 million.

The Company has two rigs running full time drilling Eagle Ford Shale and Buda Limewells. For the remainder of 2011, the Company currently anticipates drilling 5 gross (3.5 net) Eagle Ford Shale wells on the southern half and 8 gross (5.5 net) Buda Limewells on the northern half of the Company's approximate 40,000 net acre block.

Read the press release at GoodrichPetroleum.com

Lufkin Industries Gets Eagle Ford Revenue Boost

Eagle Ford Shale oil and liquids production is adding to the bottom line for Lufkin Industries. The company's oilfield division provides pumping units that help with the artificial lift of fluids to the surface. Oil wells have pumping units installed within months and sometimes days of being completed. As drilling ramps up in South Texas, you can expect Lufkin has a lot of work ahead.

Customers continue to spend aggressively in North America, especially in the Permian Basin, the Niobrara and in the Eagle Ford Shale play.

Automation revenues were up 23% sequentially from our new U.S. Automation factory, setting a new high for shipments, as customers continue upgrading to higher-value variable-speed drives to optimize production and minimize well operating costs. Oilfield's new order bookings increased 51% to $195.4 million from a year ago. Sequentially, international bookings more than doubled to $60 million, led by strong increases originating from South America. Automation bookings were stronger than anticipated as several international orders from projects in Oman and Romania helped bookings during the quarter.

Read the full news release at lufkin.com