Well Starts — Eagle Ford Shale News

Baker Hughes reported a record number of Eagle Ford well starts in the fourth quarter of 2014. The company's quarterly report shows ~1,171 wells were started over the three month period.

Rigs also drilled 0.5 wells more in the quarter than they did in the third quarter of 2013. That's an improvement of 40% or 1.5 more wells per quarter per rig than the industry was capable of in early 2012.

We consider the Baker Hughes well start estimate conservative since the company only considers a 14 county area in its Eagle Ford statistics. The numbers reported ignore areas like Brazos County where Eagle Ford activity is increasing.

Also Read -Eagle Ford Record Set for Well Spuds in Q3 (now a broken record)

By adding in the non-core Eagle Ford counties, well spuds easily eclipsed 1,200 wells in the fourth quarter.

Even though we reported this in the third quarter, it's also the first quarter in which well spuds eclipsed 1,100 in the 14-county area. The Baker Hughes reported well spuds were revised down in the third quarter from 1,131 to 1,096.

Watch for this record to be broken throughout 2014 if oil prices hold in the $90/bbl or higher range.

Did you know that drilling rigs spud more than 1,000 Eagle Ford wells per quarter in South Texas? To top it off, that is a conservative estimate.

Baker Hughes is known for publishing weekly rig count estimates and the company is now publishing well count estimates in many of the major plays across the U.S.

The third quarter of 2012 was the first quarter that well starts in the Eagle Ford eclipsed 1,000. The number of wells spud fell below 1,000 in the fourth quarter and rose back above that level in both the first and second quarter of 2013.

Since the beginning of 2012, rigs have spud approximately:

Q1 2012 - 876 wells
Q2 2012 - 932 wells
Q3 2012 - 1,024 wells
Q4 2012 - 974 wells
Q1 2013 - 1,044 wells
Q2 2013 - 1,050 wells

We consider these conservative estimates because Baker Hughes only considers a 14 county area in its Eagle Ford statistics. That leaves out areas like Brazos County, where Halcon is ramping up development of the Eagle Ford. Considering all data points, it's likely well spuds surpassed 1,100 in the second quarter of 2013.

Eagle Ford Drilling Crews Are Getting More Efficient

It's no secret that drilling is speeding up as operators and crews gain experience in the Eagle Ford. When the Baker data begins in the first quarter of 2012, the average rig in the play was drilling 3.74 wells. The average rig drilled 4.56 wells in the second quarter of 2013. That's a 22% improvement or, more impressively, almost one more well per rig per quarter. I'd say that's pretty good improvement in just a little over a year.

With almost 250 of the 270+ rigs in the region targeting the Eagle Ford, it looks like we'll see 1,000 wells drilled per quarter for the foreseeable future.

The Permian Basin of West Texas is the only basin or region with more activity than the Eagle Ford. Operators target multiple plays across in the Permian and the area has almost twice as many rigs running.