Eagle Ford Shale

Forest Oil - Eagle Ford Shale Update

Forest Oil (FST) reported the results on three recent horizontal wells drilled into the Eagle Ford Shale in Texas, where the company has 40,000 net acres under lease.

Forest Oil said that the wells averaged maximum production of 787 barrels of oil equivalent (BOE) per day during a 24 hour period, with 96% of the production composed of oil.

Forest Oil has moved a second rig to the field and reports that the average cost to drill and complete a well is now under $6 million per well. The company estimates that Eagle Ford Shale wells will have an estimated ultimate recovery of 300,000 BOE and earn a return of 25% at a West Texas Intermediate price of $80 per barrel.

Forest Oil has reduced its overall capital spending for 2012 and now estimates that the company will spend between $190 million and $210 million in the second half of the year.  The company spent $435 million in the first half of 2012.

Marathon Oil - Eagle Ford Shale Operational Update

Marathon Oil (MRO) released an update on the company’s operations in the Eagle Ford Shale in Texas, where the company has increased its position to 300,000 net acres.

Marathon Oil is operating 14 rigs in the Eagle Ford Shale and plans to add four more rigs here by the third quarter of 2012.  The company also has four hydraulic fracturing crews under contract and eight wells waiting on completion.

Marathon Oil is currently producing 15,000 barrels of oil equivalent (BOE) per day and expects to meet production guidance for 2012 of 30,000 BOE per day.

Murphy Oil Comments On Eagle Ford Shale

Murphy Oil (MUR) held a conference call on January 26, 2012, and discussed the company’s operations in the Eagle Ford Shale in 2011 and 2012.  The company plans to make substantial investments here in 2012.

“We currently have 16 rigs drilling in North America, including seven in the Eagle Ford Shale.  We exited the year near production of 9,000 barrels of oil per day net from the Eagle Ford Shale, as we ramped up our rig count from 3 to 6 over the year.”

“We now have seven rigs running, and we'll add two more by early March and average eight for the year. To date, we have drilled 56 wells, with nine awaiting hydraulic fracturing operations. Well results continue to be very encouraging and are trending better than our type curve for wells in the play. Costs are being worked down with improved service contract terms as well as improved efficiencies in drilling and completion operations. I expect to see further improvements in cost as gas rigs and equipment stand down across industry this year.”

“Our total capital budget for 2012 is $3.5 billion, with over $300 million earmarked for the exploration program. $3 billion will be spent largely on development projects, with $1 billion slated for the U.S., primarily in the Eagle Ford Shale.”

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