Sprawling some 644 km (400 miles) across the southern and eastern portion of Texas, the Eagle Ford Shale play has kept operators, service companies of all flavors and more than a few restaurants hopping. While activity in the region has slowed due to the market downturn, it has certainly not stopped the explorers and innovators from finding ways to make the play’s economics and technologies work in their favor.

At Hart Energy’s sixth annual DUG Eagle Ford conference, the lessons learned and techniques that have delivered success were shared by presenters and attendees alike. What follows is a short roundup of those insights gleaned from the conference held in the heart of the Eagle Ford in San Antonio in October.

Runway extension
Surviving the downturn depends on how far operators can extend their runways. E&Ps are set on regaining altitude—if they have enough running room. Making operations and cash stretch means lowering drilling and completion costs as much as possible. Halcón Resources Corp. has done that in the El Halcón, its East Texas portion of the Eagle Ford in Burleson and Brazos counties, Texas.

Halcón President Steve Herod said that a year ago, the company’s Eagle Ford well costs were at $9.5 million. Everything has come down since then: “… pipe, tank batteries, consultants; rope, soap and dope,” he said. “So now we are spending about $6.75 million [that includes completed well costs] for a three-string well.”

Three-well pad drilling is expected to lower costs more, bringing wells costs in under $6 million on a consistent basis, Herod said.

“We’re going into full pad development,” he said. Halcón’s drilling group, with more than 100 wells under its belt, continues to work its magic in El Halcón.

“Every time I think our drilling group has hit the max on efficiency improvements, they are able to go a bit further and reduce the spud-to-rig release time another three or four hours,” Herod said.

A year ago, DUG Eagle Ford would have been filled with talk about completions: how to space frack clusters and how much sand to use. That’s changed.

“Now it’s about all these meetings with your bankers,” he said. “We’ve done a lot actually to help extend our runway.”

The company’s El Halcón Field east of the main Eagle Ford fairway consists of 100,000 net acres and proved reserves of 41.7 MMboe. About one-third of total company volumes come from the Eagle Ford, with the rest of production originating in the Bakken Shale.

Halcón has only one rig running in El Halcón, but the quality of the rock is significant.

“You could put a rig in [Texas A&M’s] Kyle Field’s end zone and probably make a 1,000-bbl/d well,” Herod joked.

Herod knows the area well—he was second in command at Petrohawk Energy Corp. when the Eagle Ford play discovery well was unveiled in La Salle County, Texas, in October 2008. What emerged, the Hawkville Field, set off a surge in drilling from Webb County, Texas, to the Louisiana state line. Petrohawk’s assets were subsequently acquired by BHP Billiton.

In 2014 the Eagle Ford was running 216 rigs, according to Baker Hughes Inc. That’s fallen about 64% to 77 rigs.

The Eagle Ford is producing about 1.8 MMbbl/d, and the economic impact on Texas has been huge. With the downturn in oil prices, Eagle Ford production is decreasing, with the latest data showing a reduction of about 62 Mbbl/d in September alone, Herod said.

“I have to think this 70 or so rig count is going to be here for a while, and production will come down,” Herod said.

Comments