It turns out Marble Falls refers to more than a bucolic Texas Hill Country destination in wildflower-spackled Central Texas.

It is also the name for a burgeoning tight oil unconventional reservoir 150 miles north, in the same zip code as the western Barnett Shale. The Marble Falls features a sweet spot in Jack County, Texas, where operators such as Newark E&P Operating LLC are using slickwater fracture stimulation in a traditional multistage vertical well model to pursue 35% to 50% returns, even in the current low price environment. Operators are spending an average $750,000 per well in drilling and completion costs to target reserves of more than 200,000 barrels of oil equivalent (boe) at less than 6,000 feet of depth.

So yes, it works at $50 oil.

In addition to Jack County, the modern Marble Falls play underlies several North Central Texas counties, including Stephens, Young, Palo Pinto, Eastland and Parker. Operators have drilled more than 800 wells targeting the formation since 2010, though the main activity increase followed the introduction of slickwater fracture stimulation in 2013. It is yet another example of how operators are adapting unconventional completion techniques to traditional reservoirs and capturing previously inaccessible hydrocarbons.

While several operators, some with prominent NYSE ticker symbols, have played the liquids-rich western Barnett since 2010, Newark is the lead operator in the overlying Marble Falls. The Fort Worth-based company, which is backed financially by CCMP Capital Advisors and Quantum Energy Partners, has 95,000 contiguous net acres prospective for the Marble Falls, including 80,000 in the core. At year-end 2014, Newark had 165 Marble Falls producers online, generating more than 7,500 boe/d in aggregate, about 60% liquids (split 35% natural gas liquids and 25% black crude).

The Marble Falls lies on the Pennsylvanian side of the academically elusive Mississippian/Pennsylvanian boundary and is temporally coterminous with Oklahoma’s Springer Shale, just as the lower-lying Meramec in Oklahoma is temporally coterminous with the Mississippian-aged Texas Barnett Shale.

The Barnett is the primary source for hydrocarbon charging in the overlying Marble Falls, although there may be self-sourcing hydrocarbon generation from a facies featuring high total organic content. Geologists previously assumed the Marble Falls was a carbonate, providing a nice top seal as a barrier for fracture stimulating the Barnett. However, further study showed the North Central Texas Marble Falls as a siliceous, highly brittle, naturally fractured formation, with alternating layers of carbonate, mudstones, and siltstones full of sponge spicules. Newark actually describes the western Marble Falls sweet spot as a spiculating siltstone.

Newark spent 2014 defining the western Marble Falls core through more than 100 vertical delineation wells. The company initially planned to drop its two-rig program at the end of 2014 and concentrate on the completion cycle with a backlog of nearly two dozen wells. Now Newark is looking at adding a rig later in 2015 and drilling 30 to 40 wells in its most economic locations. Newark has built substantial infrastructure in the play, including a network of saltwater disposal wells.

Craig Adams is president of Newark E&P, though his resume dates back more than a couple of decades to include a stint with Amoco in the Niobrara. Later, Adams and his management team were early movers in the Barnett Shale, though the company also targeted shallow zones such as the Caddo and the Strawn. While doing so, Newark’s technical team noticed operators turning to the liquids-rich Marble Falls after natural gas prices fell. Examining cores, the Newark team found that the Marble Falls was highly fractured throughout the play. Modern fracture stimulation techniques connect existing fractures and allow the liquids to flow.

Other advantages to working the Marble Falls include the availability of 3-D seismic, a legacy pipeline infrastructure and rural, oil-friendly landowners in an area where drilling dates back 100 years.

Newark’s success in the Marble Falls speaks to a transition underway in oil and gas. Previously, technically astute, smaller privately held firms generated ideas, blocked up acreage and flipped it to prospect-hungry public independents. These days, privately held independents have lost the technological edge to the larger public independents in tight formation plays. To compete, nimble operators like Newark seek economically viable plays under the radar, build these into mature projects and seek an exit to larger firms looking for turnkey upside.

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