DUG Eagle Ford Day Two: CEO Perspectives, EOR, Minerals, Austin Chalk

SAN ANTONIO—After an information-packed first day at Hart Energy’s DUG Eagle Ford conference and exhibition, day two began with a unique perspective on the basin from two veteran private operators and ended with an in-depth look at production growth and potential of the Austin Chalk.

Hart Energy editors covered the event via Twitter dispatches below. You can find these updates at @HartEnergyConf.

Detailed articles, video and analysis will be available to subscribers of HartEnergy.com in the coming days.

Glenn Hart, president and CEO of Rio Grande Exploration & Production, kicked off day two during the opening panel. He said the company acquired its first assets in May 2018 and just spudded its first Eagle Ford well. It is backed, in part, by Gold Sky Energy and Intrepid Financial Partners.

Hart said 564 wells have been drilled in the dry gas window in the Eagle Ford. Since 2014, new completions have grown production dramatically. Now private-backed companies are becoming involved in the play.

Critical factors include identifying and staying in the landing zone, creation of large SRV and frac hit management. Areas that were previously thought to be marginal are now highly productive. Dry gas wells in the Eagle Ford now can have 14 billion cubic feet EURs, according to Rio Grande.

"If you are going to be in the gas business in North America, the Eagle Ford dry gas window is best place to be," Hart said. He cited its close proximity to Mexican, LNG and Gulf Coast petrochemical demand and indicated the play offers the top netbacks in the business.

Editor’s note: Look for an upcoming one-on-one video interview with Glenn Hart, CEO, Rio Grande Exploration &
Production and Martin Thalken, CEO, Protégé Energy III LLC in October, exclusively on HartEnergy.com.

Protege Energy III entered the Eagle Ford in 2016, said CEO Martin Thalken. It has a $635 million equity commitment from EnCap. Protege’s development inventory in its West Asherton and Fashing assets includes 425 gross locations in the Upper and Lower Eagle Ford and Austin Chalk.

Thalken said the company has been shutting in parent wells prior to frac operations on child wells. It has found that it is beneficial to pump into parent wells at the same time the child wells are being fracked.

There are 25 EOR projects involving 395 wells in the Eagle Ford. These are huff-and-puff projects in the oil window. To date, the EOR pilots are demonstrating productivity uplift and attractive economics, according to Protege.

Speaking of EOR, George Grinestaff, CEO of Shale IOR, said there are 30 pads/units conducting huff-and-puff (cyclic gas injection) in the Eagle Ford. Hydrocarbon gas is injected over a period of 30 or so days, then the wells are produced.

Based on what is known publicly to date, 100% additional recovery is realistic for Eagle Ford EOR projects, Grinestaff said. This assumes cyclic gas injection rates and pressures are maintained.

The Minerals roundtable features Randy Bayless of Credit Suisse and Mike Downs of Falcon Minerals. Falcon continues to grow its mineral position in the Eagle Ford, mainly in the core area of Karnes, Gonzales and DeWitt counties.

Access to capital is better for mineral companies than for oil and gas operators at present, Bayless said. Mineral companies also are more attractive to debt investors.

Public mineral companies are looking primarily at near-term cash flow, whereas private companies can buy less developed minerals and take more time to monetize them, the panelists said.

The black oil window of the Austin Chalk is highly economic, said Phil Martin, CEO of New Century Exploration, during the final session of the conference. There’s a new matrix porosity play in quiet areas surrounding the main Giddings Field, he added.

The final speaker, Treadstone Energy Partners' Frank McCorkle, said the company acquired the 42,000-gross-acre Hearne Field from Anadarko in third-quarter 2016. Currently, nine rigs are running in the area, making nearly 80,000 bbl/d.