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Over $4.6 billion in Eagle Ford deals…all in the last week!


Plains E&P announced their acquisition of 60,000 net acres in the Eagle Ford for $578 million, Chesapeake agrees to sell a third of their 600,000 net Eagle Ford acres to CNOOC Limited for $1.08 billion cash along with financing $1.08 billion in drilling costs, and Talisman purchases an additional 97,000 net Eagle Ford acres with Statoil for $1.325 billion from Enduring Resources… all in the last week.

Plains announced last Tuesday that it has agreed to purchase interest in approximately 60,000 net acres in the Eagle Ford from an undisclosed party (Bloomberg mentioned Dan A. Hughes Co. and Houston American Energy Corp. as included sellers in the deal) .  The Company paid $578 million in cash for the acreage that is in the oil and gas condensate window located primarily in Karnes County.  Approximately 20,400 of the 60,000 net acres are in a joint venture area with EOG Resources.  Plains estimates a net resource potential of roughly 140 to 175 Mboe for the acreage with projected net production capability of approximately 2,000 Boe/d and a 2011 target exit rate of around 5,000 Boe/d net to Plains.

This past Sunday Chesapeake announced the sale of one third undivided interest in their 600,000 net Eagle Ford acres.  The acreage was sold to a wholly-owned subsidiary of China National Offshore Oil Corp. (CNOOC) for $1.08 billion in cash and CNOOC agreed to fund 75% of Chesapeake’s drilling and completion costs until another $1.08 billion has been paid.  Chesapeake is currently running a 10 rig program in the Eagle Ford but plans to up their rig count to 31 by year-end 2011 and 40 rigs by year-end 2012, expecting to drill 900 wells by the end of 2012.

Finally, also on Sunday, Talisman announced the acquisition of 97,000 Eagle Ford acres in a 50/50 joint venture with Statoil from Enduring Resources for $1.325 billion.  The details of the purchase are that Talisman will pay $485 million after Statoil buys a 50% working interest in Talisman’s existing 37,000 net acres and associated production for $180 million.  The purchased acreage is predominantly in the liquids rich widow of the Eagle Ford and approximately 55,000 net acres are already held by production.

These three huge deals are just further validation of how important this play is to the industry and we should be looking for more deals like this as there is still more acreage waiting to be picked up to anyone that wants to pay top dollar.

To learn more, visit the Acquisition and Divestitures Folder in the Eagle Ford Unconventional Updates in DI’s DNA.

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