Repsol Moves into the Eagle Ford

Repsol Acquires Talisman
Repsol Acquires Talisman

Repsol completed its acquisition of Talisman Energy last month and became one of the largest companies in the energy sector worldwide.

Related: Talisman Energy Cuts Jobs

The deal brings Repsol into the Eagle Ford and allows them to gain 59,000 net acres of south Texas land. It is still unclear how this merger will affect those Eagle Ford shale operations. In a conference call on May 10th, Repsol said that Talisman’s assets had been consolidated into its upstream division, but they were not ready to reveal further details about their plans.

The announcement comes days after Talisman released strong first quarter results.

Talisman delivered solid operational and financial results in the first quarter of 2015 against a backdrop of significantly lower commodity prices and our strategic decision to cut capital investment,’ said Hal Kvisle, President and CEO. ‘Production from ongoing operations averaged 360,000 boe/d in the quarter, up slightly from the first quarter of 2014, and cash flow(1) was $605 million for the quarter, supported in large part by hedging settlements.

First Quarter Highlights:

  • Production averaged 360,000 boe/d in the first quarter of 2015, up 2% from the first quarter of 2014.
  • Cash flow was $605 million, up 19% from the previous quarter
  • Capital spending was $436 million, down 48% from last quarter and 43% from the first quarter of 2014
  • Operating cost was $439 million, down 17% from the previous quarter and 15% from the first quarter of 2014.

Read more at repsol.com

Statoil - Talisman Sale of Eagle Ford JV Tabled

Statoil and Talisman Eagle Ford Acreage Map
Statoil and Talisman Eagle Ford Acreage Map

Talisman Energy Inc. and Statoil ASA have tabled plans to to sell their joint venture in the Eagle Ford Shale after offers came in lower than expected, Bloomberg reported in early July of 2014.

The companies were seeking around $4-billion for a 50-50 partnership, according to Bloomberg, which cited unidentified sources knowledgeable on the matter. Bids fell short in part because the venture produces especially light condensate, rather than crude oil, which commands more money, the article noted.

In June of 2013, our site reported (via Reuters) that Talisman Energy had retained the Royal Bank of Canada to determine if buyers were interested in the company’s Eagle Ford acreage. Talisman has approximately 70,000 net acres in the play according to a company spokesman.

Read more: Talisman Energy Shopping for Eagle Ford Buyers

Talisman said in March it plans to sell $2-billion of assets in 18 months to re-direct its focus on a smaller number of areas. In July of 2014, the company announced plans to unload its Australian operations.

Talisman and Statoil entered their joint venture in 2010. Last year, Statoil took over operations of the eastern portion of the JV. Statoil has approximately 73,000 net acres in the play.

Read more: Statoil - Talisman JV buys Enduring Resources Eagle Ford Acreage

Recent Eagle Ford Deal Closings

Recently, several other notable deals have closed as early Eagle Ford players cashed out on their investments in South Texas. Encana closed its acquisition of ~45,000 net Eagle Ford acres from Freeport McMoran on June 20, 2014 for $3.1 billion. Sanchez Energy also closed its $639 million deal with Shell for 106,000 net Eagle Ford acres on June 30th. Earlier this year, Devon Energy closed on its $6 billion Eagle Ford acreage acquisition with Geo Southern.

Read more: Eagle Ford Deal Closings

Read more: Devon Banking on High Returns from Eagle Ford Investment

Regency - Talisman - Statoil Plan $150 Million Expansion of Eagle Ford Gathering Assets

Regency Eagle Ford System Map
Regency Eagle Ford System Map

Regency Energy Partners announced a $150 million expansion of the company's Edwards Lime Gathering Joint Venture. The Eagle Ford pipeline and midstream expansion will bring capacity of the company's system up to 160 mmcfd of natural gas and 17,000 b/d of crude. Regency owns 60% of the joint venture and operates the assets. Talisman and Statoil own the remaining 40%.

Talisman and Statoil are supporting the expansion by dedicating production from their area of mutual interest. The expansion is supported through fee-based contracts and is scheduled for completion in the fourth quarter of 2012.

Read the full press release at regencyenergy.com

Talisman Energy Exits 2011 With 54 mmcfed of Eagle Ford Production

Talisman Energy exited 2011 producing more than 54 mmcfed. That's up from just 8 mmcfed in the fourth quarter of 2010 and means total operated production is over 100 mmcfed.  Talisman operates a 50/50 JV with Statoil in the Eagle Ford. Talisman operates 10 rigs in the play currently and has plans to ramp up to 14 rigs by the end of the year. The company has $500 million in spending planned for the Eagle Ford in 2012, which means the partnership will spend more than $1 billion developing acreage during the year. With $1 billion budgeted for the partnership, I expect the four additional rigs will be added in the later half of the year. 

Production is expected to at least double from approximately 30 mmcfe/d as we build out our drilling programs and secure access to additional egress.

With 54 mmcfed of production at the end of 2011, I don't believe Talisman will have any trouble averaging more than 60 mmcfed in 2012. It should be another big growth year for production in the Eagle Ford.

Read more at talismannergy.com

Boardwalk Adding 150 mmcfd Eagle Ford Processing Plant - Expands Gathering

Boardwalk Pipeline Partners has started a $180 million expansion. The Eagle Ford pipeline and midstream company plans to add 55 miles of 20" and 24" pipeline to its existing 340 mile gathering system, while adding a 150 mmcfd Flag City processing plant near Edna, TX. The expansion is supported by long-term fee-based agreements.  Anchor shippers include Statoil and Talisman, who operate a partnership that cuts through the core gas-condensate window in DeWitt County, Karnes County, LaSalle County, Live Oak County, and McMullen County.

Read more at bwpmlp.com