Cabot Getting Good Returns in the Eagle Ford

Cabot Reports Q1 2017

Cabot Oil and Gas reports strong results from their Eagle Ford assets during the first quarter of the year, boasting good returns and reduced costs.

Related: Eagle Ford Rig Count on the Move!

Cabot released first quarter results this week showing a positive reversal since last year. The company reported a net income of $106 million for the first quarter of 2017 compared to a loss of $51 million during 2016 Q1.

2017 First Quarter Highlights

  • $106 million net income
  • 7% increase in daily production
  • 11% decrease in operating expense per unit

Eagle Ford Operations

Cabot's net production in the Eagle Ford Shale during the first quarter of 2017 was 12,059 barrels of oil equivalent (Boe) per day, an increase of 15 percent form the last quarter. The company raised its 2017 E&P capital budget to $845 million and plans to spend $200 mm for development activities in the Eagle Ford Shale.

Other highlights include:

  • 7 net wells drilled and completed
  • 10 net wells placed on production
  • Drilling costs were 13 percent lower, compared to the full-year 2016 average
  • Currently operating one rig
  • Utilizing one completion crew
“Our Eagle Ford has improved (...), our efficiency, our cost of business, cost of operations, the return that we are able to deliver and the strip pricing that we have out there right now. We’re getting good returns in our Eagle Ford operation. ”
— Dan O. Dinges, President and CEO

Eagle Ford Rig Count on the Move!

The Eagle Ford Shale rig count increased by six this week, with our data showing 99 rigs running across our coverage area by midday Friday. 

In recent Eagle Ford News, NuStar Energy experienced low volumes from their Eagle Ford assets during the first quarter but say the recent increase in drilling activity are cause for optimistic.

Read more: NuStar Sees Positive Turn in Eagle Ford

A total of 870 oil and gas rigs were running across the United States this week, an increase of 13 over than last week. 171 rigs targeted natural gas (four more than the previous week) and 697 were targeting oil in the U.S. (nine more than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.) 437 of the rigs active in the U.S. were running in Texas.

Baker Hughes reports its own Eagle Ford Rig Count that covers the 14 core counties. The rig count published on EagleFordShale.com includes a 30 county area impacted by Eagle Ford development. A full list of the counties included can be found in the table below.

Eagle Ford Oil & Gas Rigs

Nine rigs in the Eagle Ford region targeted natural gas this week with the commodity trading at $3.28/mmbtu.

90 Eagle Ford rigs were targeting oil with WTI oil prices moving to $49.33

A total of 94 rigs are drilling horizontal wells, two are drilling directional wells and three are vertical.

Karnes County leads this week with 22 rigs in production. See the full list below in the Eagle Ford Shale Drilling by County below.

Eagle Ford Shale Drilling by County

Eagle Ford Rig Count by County-April 28, 2017

Eagle Ford Rig Count by County-April 28, 2017

 

Eagle Ford Shale News

NuStar Sees Positive Turn in Eagle Ford

Sitton: Every Day is Earth Day

Venado Building Strong Eagle Ford Business

More Texas Pipelines Needed

 

 

What is the Rig Count?

The Eagle Ford Shale Rig Count is an index of the total number of oil & gas drilling rigs running across a 30 county area in South Texas. The South Texas rigs referred to in this article are for ALL drilling reported by Baker Hughes and not solely wells targeting the Eagle Ford formation. All land rigs and onshore rig data shown here are based upon industry estimates provided by the Baker Hughes Rig Count.

The Eagle Ford Shale drilling rig count has had its ups and downs, marking the rise of the region's shale development and the decline brought on by low crude prices. The following infographic shows the rig count trends since 2011.

NuStar Sees Positive Turn in Eagle Ford

Q1 Results for NuStar

NuStar Energy announces strong first quarter results despite low crude volumes from the Eagle Ford.

Related: Eagle Ford Rig Count Breaks 90

For the first quarter of 2017, NuStar experienced improved results and a decrease in overall operating expenses. Quarterly income was $38.5 million, with EBITDA at $154.1 million.

The company experienced low volumes form their Eagle Ford assets during the quarter but say the recent increase in drilling activity are cause for optimistic.

San Antonio-based, NuStar recently announced a $1.475 billion acquisition of the Navigator system, a fully integrated crude platform with over 500 miles of pipeline and 412,000 barrels per day of capacity in the Midland basin. In a quarterly earnings call, company executives affirmed they are looking for opportunities to connect the Navigator system with its Eagle Ford assets.

“We’ve had some favorable acquisitions in the Eagle Ford specifically with Sanchez buying into some acreage down there. So they’re more active than Anadarko was. So we’re starting to see things like that make a positive turn in the Eagle Ford.”
— Bradley Barron, CEO

Navigator owns and operates crude oil transportation, pipeline gathering and storage assets located in the Midland Basin, including:

  • 500 miles of crude oil transportation pipelines with approximately 74,000 barrels per day, ship-or-pay volume commitments and deliverability of approximately 412,000 barrels per day through multiple outbound interconnects;
  • A pipeline gathering system with more than 200 connected producer tank batteries capable of more than 400,000 barrels per day of pumping capacity covering over 500,000 dedicated acres;
  • Approximately 1 million barrels of crude oil storage capacity with 440,000 barrels leased to third parties

The Eagle Ford Shale rig count is continuing its climb, with our data showing 93 rigs running across our coverage area last week. 

Eagle Ford Rig Count Breaks 90

Eagle Ford Shale Rig Count

The Eagle Ford Shale rig count is continuing its climb, with our data showing 93 rigs running across our coverage area by midday Friday. 

In recent Eagle Ford News, Texas Railroad Commissioner Ryan Sitton says his agency is working as if 'every day is Earth Day!'

Read more: In Texas, Every Day is Earth Day

A total of 857 oil and gas rigs were running across the United States this week, an increase of 10 over than last week. 167 rigs targeted natural gas (five more than the previous week) and 688 were targeting oil in the U.S. (5 more than the previous week). The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.) 462 of the rigs active in the U.S. were running in Texas.

Baker Hughes reports its own Eagle Ford Rig Count that covers the 14 core counties. The rig count published on EagleFordShale.com includes a 30 county area impacted by Eagle Ford development. A full list of the counties included can be found in the table below.

Eagle Ford Oil & Gas Rigs

Nine rigs in the Eagle Ford region targeted natural gas this week with the commodity trading at $3.10/mmbtu.

84 Eagle Ford rigs were targeting oil with WTI oil prices slipping to $49.62

A total of 89 rigs are drilling horizontal wells, one are drilling directional wells and three are vertical.

Karnes County leads this week with 19 rigs in production. See the full list below in the Eagle Ford Shale Drilling by County below.

Eagle Ford Shale Drilling by County

Eagle Ford Rig Count by County-April 21, 2017

Eagle Ford Rig Count by County-April 21, 2017

What is the Rig Count?

The Eagle Ford Shale Rig Count is an index of the total number of oil & gas drilling rigs running across a 30 county area in South Texas. The South Texas rigs referred to in this article are for ALL drilling reported by Baker Hughes and not solely wells targeting the Eagle Ford formation. All land rigs and onshore rig data shown here are based upon industry estimates provided by the Baker Hughes Rig Count.

The Eagle Ford Shale drilling rig count has had its ups and downs, marking the rise of the region's shale development and the decline brought on by low crude prices. The following infographic shows the rig count trends since 2011.

Sitton: Every Day is Earth Day

Earth Day

Tomorrow is Earth Day, and while some might think that Texas oil and industry would be at odds with the celebration, the Texas Railroad Commission (RRC) works as if 'every day is Earth Day!'

Related: RRC Blasts EPA for Unnecessary Regulations

Texas Railroad Commissioner, Ryan Sitton, released a message yesterday to affirm that the agency is working hard to protect the public and the environment.

“As a father, husband, private property owner and elected official, I know the health of our environment tomorrow is only as strong as our actions today. It’s important to me that at Texas’ energy regulatory agency, the Railroad Commission of Texas (RRC), we work as if every day is Earth Day.”
— Ryan Sitton, Texas Railroad Commissioner

Regardless of the public perception, Sitton went on to say that most Republicans care deeply about our air, water and environmental quality. This is, in fact, at the core of their mission as the state's oil and gas regulatory agency. Sitton believes that energy regulation doesn't have to be in conflict with environmental protection.

RRC Protects the Environment

Following are some examples where Sitton says the RRC is protecting our environment:

  • A strict permitting process is in place that requires operators to provide detailed plans that include how they will prevent pollution
  • RRC inspectors work daily to inspect wells and pipelines to ensure they are in compliance with rules set by the RRC
  • The RRC enforces the rules and applies fines and other punishments when an operator is not in compliance. 
  • The RRC also assists communities across Texas with land restoration

Earlier this year, the RRC issued a statement criticizing a recent court decision concerning oil and gas waste disposal. The statement defending the record of the RRC and said that the ruling added unnecessary and burdensome regulations to the industry.

To learn more about the Texas Railroad Commission, visit their website here.