Murphy Oil (MUR) reported earnings for the fourth quarter of 2010 and held a conference call with the investment community to discuss the results. The company disclosed additional data on its operations in the Eagle Ford Shale in Texas, where it estimates that production will reach 8,000 barrels of oil equivalent (BOE) per day by the end of 2011.
“New development projects continue to be brought forward, and we sanctioned the first part our Eagle Ford program before yearend. This first one in Karnes County saw excellent oil results throughout the year and currently has two rigs working.”
“Our Board sanctioned the development of part of our Karnes acreage. We've built 10 wells to-date and completed four. A couple of wells have been on for quite a bit of time. One of them has achieved 170,000 barrels. One has achieved 83,000 barrels. We think both wells are above the tight curve that we use, and so they are likely to recover probably 700,000 barrels versus 500,000 which is kind of the tight curve when used there.”
“This year we are looking to build 16 wells. We may bring in another rig and be able to get more wells in that drill. We need to let this first quarter run for us and then see how we are going to move. We sanctioned that on a 160-acre spacing and we figure we'll get something like 40 million barrels out of that development.”
“We have also got drilling in Dimmit County. We have three wells drilled and two completed. And these wells look like they are about based on the nearby results from others and ours, 35,000 EUR-type wells. Our best IP rate was just over 200 barrels, but we (choked) it back to be able to let the well unload and then extend its plateau around one that didn't have a high rate.”
“And then we are in the third oil area in our acreage in Northern McMullen County. We've just filled the well and log results are very encouraging, and we are going to move forward and frac that here and hope to have some results in the first quarter.”