Sanchez
High IRR from oil window
November 7, 2016 |
Noble
Superior results change Noble's view of play
September 14, 2016 |
Carrizo
Boosts investment, adds acreage
September 20, 2016 |
EOG
Company to test enhanced oil recovery
November 3, 2016 |
Pure Eagle Ford producer Sanchez Energy increased output four-fold from mid-2013 to mid-2015, but growth leveled off as it slashed investment 73% from $871 million in 2014 to $235 million in 2016. But the company generated a 57% reduction in cash operating costs by limiting its focus to the Catarina and Cotulla areas within the oil window of the play, where its total capital costs were $3.0-3.5 million per well. Sanchez said it would raise total 2016 investment by 19% to run three rigs in Catarina and Cotulla, which would generate 5-8% production growth in 2017. |
Noble Energy entered the Eagle Ford and the Permian Basin through its 2015 acquisition of Rosetta Resources. It initially focused on investment in the Delaware Basin, which it moved to the top of its priority list after outstanding exploration well results. But the results from one rig in the Eagle Ford, especially EURs averaging 3.0 MMboe per well in its South Gates Ranch area targeting the Lower Eagle Ford, led the company to add a second rig in the fourth quarter. Noble said it now views Rosetta’s most famous legacy asset in the Eagle Ford as having about the same potential as the Delaware Basin. |
Carrizo Oil & Gas has a diverse portfolio that includes positions in the Delaware, Niobrara, Marcellus and Utica shale as well as the Eagle Ford. The company drastically cut 2016 investment and said it planned to suspend Eagle Ford drilling in Q4. However, Carrizo lowered its well cost to $4.3 million in its core area, reducing breakeven to just $32.50/bbl. It reversed its decision to suspend drilling, announcing it would run two rigs and one frac crew through Q4 and into 2017 while conducting no drilling in its other regions. And in late October, Carrizo announced it would increase its Eagle Ford holdings through a $181 million acquisition from Sanchez Energy. |
EOG Resources is the largest Eagle Ford producer, averaging 207,000 boe/d of liquids in 2015. It holds 561,000 net acres in the play. The company has sustained a higher level of activity than most of its peers, running five rigs to drill 190 wells in 2016. That investment could increase because EOG has been testing enhanced oil recovery. In fact, EOG has conducted four gas-injection pilot projects on 15 producing wells that have generated 30-70% increases in cumulative production per well. While the company says this technique isn’t widely repeatable in other tight-oil plays, it may be copied by other producers, which would significantly contribute to the Eagle Ford rebound. |
