Thursday, 5 June 2014

Eagle Ford Shale

Intro and history

  • Play in South Texas stretching into Louisiana; contributes c.10% towards US production
  • Three “windows” to the play – oil, gas-condensate, dry gas; focus has been on development of the liquids section
  • Eagle Ford formation not singled out until 2008 although routinely tested before then
  • Initial production was gas/condensates by Petrohawk with Apache testing oil around the same time
  • Big change in 2010: EOG acquired acreage in oil window, changing Eagle Ford into a liquids focused play


Well economics

  • Production and reservoir quality varies greatly in Eagle Ford; EURs can range from 200mboe to > 1mmboe per well
  • Drilling and completion costs: USD5.5-9.5m / well
  • Early Eagle Ford wells were completed with 10-stage hydraulic fracs; now common for 15-20 stages

Infrastructure


  • Ideally located to supply refineries in Corpus Christi and Houston
    • Short distance to Gulf Coast refineries reduces costs and allows for more transport options (barges, pipelines, rail and trucks)
  • Volume of crude, condensate and NGLs that require processing has led to the construction of several projects; trucks will continue as intermediate solution whilst projects are being completed
    • Eagle Ford Crude Oil Pipeline (Enterprise Products): 350mboepd capacity with interconnections to Seaway Pipeline and the new 5mmbbl Echo Terminal in houston
    • Kinder Morgan condensate pipeline: Eagle Ford to Pasadena, 300mbopepd capacity
    • Koch/NuStar/Arrowhead: 200mboepd capacity
    • Plains All American: Eagle Ford to Corpus Christi, 300mboepd capacity
Outlook
  • Operators looking to increase resource potential through down spacing and testing additional formations

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