The recent Eagle Ford analyst trend is to break the play down into five areas; East and West oil, dry gas, and East and West condensate. In our estimation, the Sugarkane corridor (which corresponds to the East condensate area) is producing the best wells in the trend and has been for about a year, ever since the Geosouthern wells of Dewitt County came online. Of course this could all change when the EOG oil window data finally arrives which should be by 3Q2011. With that being said lets take a quick look at the data in this area using Drillinginfo.
I have a map posted below showing producing Eagle Ford wells in the area. They are colored by company and bubbled by maximum monthly liquids produced. I like to bubble by the maximum liquids produced to give an idea of how liquids’y wells are relative to the others. GOR contours work much better, but that map is much more detailed and available to our Unconventional Research Platform subscribers only…
The three ovals correspond to three distinct areas of production: Oil, wet gas with high volumes of liquids, and wet gas with mid-range volumes of liquids This is also where many of the big deals have occured lately, namely the Pioneer/Reliance, the Enduring/Talisman-Statoil, and the Dan A. Hughes/PXP acquisitions.
If I had to pick one operator here that is seemingly standing above the rest, it would be Burlington (Conoco). I will allow three of their latest wells to make a case for me.
– HILMER KOOPMANN A274 with a peak month production of 1,082 Bbls/D + 3,203 Mcf/D
– MARALDO A403 with a peak month production of 926 Bbls/D + 3,593 Mcf/D
– F. MALEK with a peak month production of 1,071 Bbls/D + 3,046 Mcf/D
These wells seem to be the norm for Burlington as of late and fall in the Sugarkane corridor.
I also want to show how an example of how to use the extensive Drillinginfo leasing tool. Drillinginfo has landtrac polygons for many, and soon to be all, of the unconventional plays. Below is Live Oak County, layered with 4Q permits and Drillinginfo Landtracs.
These are extremely valuable in the evaluation of a potential target position and the evaluation of neighboring leasholds. The area shown in this map is firmly in the condensate window as the dry gas data point, Robert Crawley 1H, is further south.
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For the past six months all the operators have been publicly downright giddy when announcing the IP of their Eagle Ford wells. On virtually every conference call we have heard operators say like a mantra how economic their Eagle Ford wells are. At times, it seems like they struggle to find the proper superlative to describe the Eagle Ford. From what has been flowing off the operators tongue, it’s safe to say there is nothing but gushers all along the trend. It also seems fair to say that when they are speaking about their Eagle Ford acreage, it’s all either good, better, or best. EOG has repeatedly made Sherman statements that they will not sell or JV any of their Eagle Ford oil window acreage. The way EOG has gone out it’s way to declare their oil window acreage sacrosanct and off limits to any JV deals gives me the impression they know something they aren’t telling. Papa and Leiker have body language that tell me there may be some really good news announced that they haven’t released yet. Papa and Leiker both bemoan the fact that EOG oil window Eagle Ford acreage has not received the proper media credit it deserves, and had their discovery acreage been made in the Gulf of Mexico, that it would be receiving banner headlines. Time will tell whether this Sugarkane corridor will remain king of the Eagle Ford or not. I personally believe the overpressure oil window Goldilocks zone along the DeWitt-Gonzales County line will dethrone Sugarkane and will be crowned the legitimate king of the Eagle Ford, economically speaking. The ROI from these wells is making production from conventional plays look like poor relations. The Eagle Ford is destined to be an Elephant Field for the history books.
Aurora Oil & Gas Limited has acquired an additional 3/16ths of existing joint venture partner Hilcorp’s working interest in three Sugarkane field AMI’s Aurora already participates in, adding an additional 5,100 net acres, for $120 million.
The transaction appears to come in at $23,529 per acre.
https://afr.com/rw/2009-2014/AFR/2010/12/23/Photos/b8d3b182-0eea-11e0-931d-5fbddc6f44fa_Settlement%20of%20Eagle%20Ford%20Shale%20acquisition.pdf
This is alot of money per acre. I wonder what else this $120 MM entails, if anything. These AMIs are located in eastern Karnes County, one of the sweetest spots in the trend with excellent liquids production. I am not sure how these Australian companies ended up here in the Eagle Ford, but it has been profitable. Not just Aurora, but Antares and others.