Eagle Ford Shale

SM Energy Reports On Eagle Ford Shale For Fourth Quarter Of 2010

SM Energy (SM) released an operational update on its activities in the Eagle Ford Shale in Texas during the fourth quarter of 2010.

SM Energy reported that its production from operated wells in the Eagle Ford Shale was 5.5 Bcfe in the fourth quarter of 2010, up 53% from 3.6 Bcfe in the previous quarter.  The company’s non operated production reached 2.4 Bcfe if the fourth quarter of 2010, up 85% from 1.3 Bcfe in the third quarter of 2010.

SM Energy also released the economic sensitivity of operated wells drilled into the Eagle Ford Shale, utilizing different commodity prices.

Oil Price	$  65	$  75	$  85	$  95
MMBtu	$ 3.5	$ 4.5	$ 5.5	$ 6.5
Pre Tax IRR	12%	27%	45%	68%

The analysis by SM Energy assumes that Eagle Ford Shale wells have an estimated ultimate recovery of 2.9 Bcfe per well, a gross well cost of $7 million and average initial production of 4.9 million of cubic feet of natural gas equivalents during the first thirty days of production.

SM Energy Reports Eagle Ford Shale 2011 Capital Budget

SM Energy (SM) announced that the company will spend $830 million in drilling capital in 2011 on its various properties in the United States.  The company will spend $500 million or 60% of these funds to develop properties in Texas that are prospective for the Eagle Ford Shale. 

SM Energy has 165,000 net acres in Webb and LaSalle Counties in Texas and plans to operate two rigs on this acreage starting in January 2011 and eventually increase to four operated rigs.  The company will target acreage that have wet gas and condensate and focus on the Briscoe and Galvan Ranch areas.

SM Energy is also involved in a joint venture with Anadarko Petroleum (APC) on a 84,500 net acre portion of the Eagle Ford Shale.  Anadarko Petroleum is operating seven rigs in this joint venture and will average ten operated rigs in 2011.

SM Energy Issues Update On Eagle Ford Shale Activities During Third Quarter Of 2010

SM Energy (SM) issued an operations update on its oil and gas development activities in various domestic areas, and provided information on its Eagle Ford Shale properties.  The company has operated acreage and is also involved in a joint venture with Anadarko Petroleum (APC).

SM Energy is currently operating two rigs in the play and spud nine wells and completed nine wells during the third quarter of 2010.  The company is currently producing 58.5 million cubic feet per day of natural gas and 2000 barrels per day of condensate.  SM Energy is facing limitation on infrastructure and only ran three Eagle Ford Shale wells at an unrestricted rate during the third quarter of 2010.

The Galvan Ranch 16H well was completed with a 5600 foot lateral and a seventeen stage hydraulic fracturing operation.  This Eagle Ford Shale well produced an average of 8.4 million cubic feet equivalent per day during the first seven days, and 7.8 million cubic feet equivalent per day during the first thirty days.

The Galvan Ranch 10H well was completed with a 5600 foot lateral and a seventeen stage hydraulic fracturing operation.  This Eagle Ford Shale well produced an average of 8.0 million cubic feet equivalent per day during the first seven days, and 7.3 million cubic feet equivalent per day during the first thirty days.

The Galvan Ranch 14H well was completed with a 5600 foot lateral and a seventeen stage hydraulic fracturing operation.  This Eagle Ford Shale well produced an average of 7.0 million cubic feet equivalent per day during the first seven days, and 5.9 million cubic feet equivalent per day during the first thirty days. 

SM Energy used to be known as St. Mary Land & Exploration Company.