Haynesville Shale

Petrohawk Energy Issues Haynesville Shale Update For 2010

Petrohawk Energy (HK) issued an operational update on its development activities on properties prospective for the Haynesville Shale in Texas and Louisiana.  The company has 225,000 net acres, with 170,000 operated by the company, and 55,000 non-operated.

Petrohawk Energy drilled 351 total wells into the Haynesville Shale in 2010, with 101 wells operated, and 250 wells non-operated.  The company is operating 16 rigs in the play and will drill 57 wells by the middle of 2011.  After that, the company will reduce its operated rig count to 7 rigs and drill 31 additional wells.

Petrohawk Energy has been engaged in a drilling frenzy in the Haynesville Shale the last few years in order to convert its term acreage to held by production, and the company estimates that 280 operated sections and 590 non-operated sections will held by production by the end of 2011.  Petrohawk Energy reported that it will have to drill another 145 wells in 2012 (25 operated and 120 non-operated) to complete the lease capturing process in the Haynesville Shale.

SM Energy Sets 2011 Haynesville Shale Capital Budget

SM Energy (SM) has established a drilling capital budget of $830 million to develop oil and gas properties in 2011, with $35 million, or 4% devoted to the company’s properties in the Haynesville Shale.  The company has 22,000 net acres in the Shelby Trough area of Texas.

SM Energy will use this capital for five gross operated horizontal wells in 2011, and another 20 gross horizontal wells operated by its partner in the Haynesville Shale. This will not be enough to hold its acreage in the play as twelve additional gross wells would have to be drilled in 2011 and eight gross wells in 2012 to convert the company’s Haynesville Shale acreage from term to held by production.

Petrohawk Energy Issues Third Quarter Of 2010 Haynesville Shale Update

Petrohawk Energy (HK) issued an operations update on its oil and gas activities during the third quarter of 2010.  The company reported average daily production of 434 million cubic feet of natural gas equivalents from its Haynesville Shale properties, and drilled 102 total wells (29 operated, 73 non operated) during the quarter.

Petrohawk Energy said that well costs in the Haynesville Shale in 2010 would average $10.5 million, and are expected to decrease to $9.8 million in 2011.  The company has cut its rig count over the last three months, from 16 at the beginning of the third quarter of 2010, to 12 currently.

Petrohawk Energy drilled and completed the Mendenhall 10H #1 well into the Haynesville Shale in the third quarter of 2010.  The Mendenhall 10H #1 well utilized a new design that cut hydraulic fracturing costs by $1 million per well.  The well had an initial production rate of 8.4 million cubic feet of natural gas equivalents per day.

Petrohawk Energy also established a $1.9 billion budget for drilling and completion activities in 2011.  The company has allocated $900 million of this total for development of the Haynesville Shale.