?Lampasas County is famous for its mineral springs and its military base, Fort Hood. The central Texas county has a colorful history, abundant lakes and reservoirs and a diverse economy. And yet, although it lies within Railroad Commission District 7B, the same district that’s home to the western extension of the Barnett shale play, Lampasas has been a dry county with no oil or gas production.


That’s changed now, thanks to the efforts of Salado, Texas-based independent Scully Energy Corp. The private firm, headed by chairman Noel Scully, drilled an Ellenberger test in Lampasas County in mid-2006. The #1 Gotcher missed in Ellenberger (the carbonate was wet) but encountered gas in Pennsylvanian Strawn-group sands.


The discovery well made 193,000 cubic feet per day from Cisco between 894 and 904 feet. Scully embarked on a drilling program, both to chase the Ellenberger updip, and evaluate the extent of the shallow gas reservoir.


What it found has been a mighty surprise. To date, Scully has drilled 23 wells in Lampasas and neighboring Coryell County and developed two new Strawn fields, at depths from 900 to 1,500 feet. Toga Field is productive from Cisco, and Shane Field from the deeper Scully sand. Typically, wells have encountered between 30 and 65 feet of net pay. The fields are combination structural-stratigraphic traps, with shallow reservoirs onlapping onto the Lampasas Arch.


Scully’s wells cost $250,000 to $425,000 to drill and complete, depending on depth. The reservoirs have such good characteristics that some produce naturally, and others are lightly stimulated with small fracs. The two fields currently host 15 wells ready to produce, with initial per-well volumes expected to range between 300,000 and 500,000 cubic feet per day.


“Several of our wells have found close to 100 feet of pay,” says Scully. “These wells are very good producers.”


And, it appears the area has additional potential. Scully’s #1 Dillard is currently testing a promising section in Marble Falls Limestone, and its #1 Shackelford, a three-mile stepout, is testing an attractive Ellenberger interval, one of five potential pay zones intersected by the well. “Deep” tests to these objectives will run 2,500 to no more than 4,000 feet.


“We think the fields could encompass at least 100 wells,” says John Sobehrad, Temple, Texas-based consulting geologist. Sobehrad has worked on and off with Scully and Scully’s financial partner, Dallas-based Lampasas Energy Inc., for nearly 20 years.


“We manage a group of around 200 investors,” says Dan Mulligan, chief executive of Lampasas Energy. “It’s a tight group that’s been together a long time, and they all know Noel and John personally. We even have children of our original investors who continue to invest with us.”


Of course, drilling gas wells in a county with no production means services are scarce. “We had to buy a rig to drill our wells,” says Scully. “We couldn’t get one to move here.” The company acquired and upgraded a rig, which is engaged in a continuous drilling program. Scully has also purchased a pulling unit and water truck.


Furthermore, pipeline infrastructure was nonexistent. To take their gas to market, Scully and his partners called on Roger Chapin, president of Arlington, Texas-based Kimball Price Group, another long-time acquaintance. Chapin agreed to build a pipeline system to Toga and Shane fields. The 11.5-mile, $8-million line will be in service in first-quarter 2009 at expected rates of 5 million cubic feet per day.


Indeed, Chapin liked the play so much that he has partnered with Scully on additional leasing and drilling. “I quit my job to pursue this fully,” he says. “Some of the great attributes of this play, both from E&P and pipeline perspectives, are the low risks and costs associated with good reserves. We have possibilities of five to seven pays at depths less than 3,000 feet.”


Recoverable per-well reserves are in the range of 500 million to 1 billion cubic feet, based on initial work by a third-party engineer. Scully currently has 15,000 acres and continues to lease.


“We have the exploration capital for 50 more wells,” says Scully. “This is the biggest find of my life, and I’m pretty lucky.”

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