The Eagle Ford Shale Blog, Maps and News
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The Eagle Ford shale (often spelled Eagleford) is not the next big thing in oil and gas plays, it is the “right now” big thing. You may have never heard of the Eagle Ford shale if you live outside of South Texas or are not in the oil and gas business but it will be big news in business circles around the rest of the country in the coming months. First recognized as a major natural gas play it is now being seen as possibly the sixth largest oilfield ever discovered in the United States and the largest discovery in over forty years.
What Is The Eagle Ford shale?
Shale is a sedimentary rock that is rich in organic material called kerogen. As this organic material decays hydrocarbons, such as oil and gas are released. The Eagle Ford shale is the source rock for other oil and gas bearing zones in South Texas, such as the Austin Chalk formation, which lies above it.
It was formed during the Cretaceous geologic period approximately 65 to 145 million years ago. It lies at a depth of between 2500 feet at the edge of the hill country to over 15,000 feet deep in southern LaSalle, McMullen, Live Oak, Bee, DeWitt and LaVaca counties. It is at the deeper or more mature end of the formation where pressures are higher and gas volumes greater. The Eagle Ford shale is over 330 feet thick in some areas.
The Eagle Ford shale was not recognized as an economically viable oil and gas reservoir until recently.
Now, because of a technology called horizontal drilling, which allows for a hole to be drilled across shales like the Eagle Ford for up to a mile or more, and because of advances in hydraulic fracturing, which uses high pressure liquid to bust apart the shale, oil and gas can now be extracted easily.
The Eagle Ford shale is high in carbonate content, making it very brittle and therefore able to be fractured easily with a frac job. Porosity and permeability are greater in the Eagle Ford shale than other shale plays. Core samples of the shale contain as much as 70% calcite with an average clay content of eleven percent.
An Oil and Natural Gas Producer
The Eagle Ford shale is producing impressive amounts of both oil and natural gas in wells all the way from Maverick county near the Mexican border to Dewitt county farther east. The current epicenter of activity in terms of horizontal drilling is along the Stuart City Reef and Sligo shelf trend from Maverick, McMullen, LaSalle, Live Oak and a handful of other counties farther east. Farther north, in those areas where the Austin Chalk has produced oil companies are finding oil in the Eagle Ford shale as well. The two formations are highly correlated, with the Eagle Ford shale being one of the major “source rocks” for oil that is found in the Austin Chalk formation. The map on this website shows the Eagle Ford shale oil and gas producing areas.
The northern part of the “Eagle Ford fairway” is the “oily” section, with lower pressure and high volumes of oil. There are reports of horizontal wells in the “oil window” producing well over 500 barrels per day. The middle section is the “condensate window” producing natural gas and condensate. The deeper section farther south, plunging as deep as 15,000 feet, is a producer of large volumes of drier gas.
Update: Two of the major players in the Eagle Ford shale, EOG Resources and Petrohawk Energy, have announced that they are focusing on the “oil window” of the play. This is partly due to the depressed price of natural gas and good results from test wells drilled across the upper oily section of the shale.
For years there has been oil and gas activity along the Stuart City trend, from the Mexico Border on through the prolific South Texas Syndicate field in LaSalle county, through the Dilworth field in McMullen county curving on back toward the coast and then trending northward, upwards towards East Texas . Numerous Edwards formation, Wilcox formation and Austin Chalk wells exist in this area among others. In past years drillers of deeper wells into the Edwards limestone, noticed a lot of gas coming back, though the mudloggers and wireline well logs showed the zone where it was coming from, the Eagle Ford shale, to be 100% shale rock. Shale in earlier years was not seen as a potential reservoir of oil and gas.
Once Thought To Be Worthless
Since the 1970’s geologists have known that the Eagle Ford shale contained high volumes of oil and gas throughout a wide geographic area stretching from East Texas to Mexico.
It was not thought of as any kind of resource that could be produced since a well that was drilled in the Eagle Ford shale would quickly deplete down to nothing. There was not enough porosity or natural permeability to allow for much oil or natural gas from the couple hundred feet of exposed shale to seep out. A few years ago companies like Halliburton, Weatherford, Baker Hughes and Schlumberger began to perfect horizontal drilling assemblies, along with accurate down-hole direction sensors called MWD or “measure while drilling” instruments, to guide these drilling assemblies. Starting in the 1990’s in the Barnett shale near Ft. Worth these two technologies were applied and it was proven that shale could be a productive source of oil and natural gas.
Mud motors, which consist of a rotor and stator unit and a bit that are turned by the force of drilling fluid, are placed at the end of the drill string. The whole drill string, as hard as the steel drill pipe is, can actually turn ninety degrees to vertical and drill a horizontal oil and gas well. Without any rotary motion from above the drill pipe can remain stationary as the mud motor all the way down at the bottom of the well turns by the force of the drilling fluid and thereby turns the drill bit, eating away at the Eagle Ford shale until several thousand feet of horizontal lateral is drilled. This long lateral is later hydraulically fractured using very high pressure fluids, by a company such as Halliburton. Thousands of gallons of water are used in this process and in this notoriously dry part of the country that will be one of the challenges to development. Far above the Eagle Ford shale lies the freshwater Carrizo – Wilcox aquifer, which is currently being used for frac water, possibly depleting this valuable resource.
Deeper But Cheaper
The break even point for making a profit from Eagle Ford shale gas is about $3.88 per Million BTU’s, compared to $5.19 in the Barnett shale. Part of the reason is that there are less impediments to drilling in sparsely populated South Texas.
Major Oil Discovery
Due to lower natural gas prices companies are focusing more on the upper, oil laden section of the Eagle Ford. According to the CEO of EOG Resources the Eagle Ford shale may be one of the biggest oil discoveries in over forty years in the U.S. Since the price of oil is high due to international demand the upper side of the shale is where much of the new drilling activity in 2010 will take place.
Lease Area Growing Daily
Petrohawk alone has over 2,700 potential well locations on the more than 300,000 acres they have leased. Pioneer Resources has over 310,000 acres under lease and a host of other companies from EOG to Conoco have similar acreage leased. EOG, a major player in the Barnett shale, has leased up over a half million acres, mostly in the oil window. Australian companies are even getting in on the action with Antares Energy and Texon Petroleum, both Aussie firms, drilling in McMullen county. The number of wells eventually drilled in the shale could be in the tens of thousands.
The Eagle Ford shale is at least as large a shale gas play as the Barnett shale, perhaps larger. South Texas residents just may be about to see the kind of economic boom that many have always dreamed of. In addition to natural gas the Eagle Ford shale may be one of the biggest oil fields discovered in decades.
As the new year kicks off there are dozens of new drilling permits listed on the Texas Railroad Commission website. As of January, 2010 there were permits for 98 wells issued by the Texas Railroad Commission.
What Is In Store For South Texas
Already there are more than a couple dozen wells in the Eagle Ford shale producing over 6 million cubic feet per day of very high quality (in terms of contained hydrocarbons) natural gas and oil wells producing over 500 barrels a day. Companies such as Petrohawk, Pioneer Resources and EOG Resources who pioneered the discovery and development of major shale plays such as the Haynesville shale have leased up hundreds of thousands of acres of land in South Texas near the towns of Three Rivers, Pawnee, Tilden, Fowlerton and Cotulla and many more over an area over 150 miles long. These sleepy South Texas towns are headed for a major change.
What Will The Boom Look Like In South Texas?
In the Barnett shale play, near Dallas and Ft. Worth, the economy has seen massive growth, which the Fort Worth Chamber of Commerce once compared to having ten Boeing Aircraft plants plunked down on the prairie overnight. Jobs were created in record numbers and as royalty payments of billions of dollars poured into landowners hands, this money began to circulate through the economy. The two shale plays have a lot of similarities, both in structure and in size however the economy and population density of South Texas differ greatly from that of North Texas.
How the flow of money that will occur over the next decade will affect the area remains to be seen. In much of the region large ranches, whose owners often live elsewhere, will be the the recipients of the oil and gas royalties. Undoubtedly they will spend some of the money on ranch improvements such as fences, ponds, barns, etc, as we are already seeing in LaSalle and McMullen counties, and this will create a few local jobs but much of it will end up being spent elsewhere. Oil and gas service companies in hubs like Alice and Freer will hire more workers and a few companies will open satellite offices in smaller towns near the production. For county governments tax coffers will swell and this will lead to new schools and road construction. However, due to the low population density and high number of non resident landowners the billions in Eagle Ford shale royalties may not leave quite as visible an effect on South Texas as Barnett shale money did near Fort Worth. That being said however, the effects on the economy of South Texas will nonetheless be dramatic.
Boom Times Coming. Why This Time It Is Different
If you live in this area of Texas you are about to see a boom like you may have never imagined in your wildest dreams. Population of small towns in the area will begin to grow again, your neighbors who own land with mineral rights will become rich overnight, and there will be good jobs for your children without them having to leave for the big city. This is not some kind of pipe dream, it is real and it is happening right now. All the evidence from well logs, test wells, seismic surveys and new well production figures point to one of the largest oil and gas finds in the past half century. The economic effects are already being seen. All you have to do to notice is look at all the cars of landmen parked at the courthouses and the flow of oilfield traffic up and down the roads. Anywhere from $200 to $2500 an acre is flowing into the hands of landowners and they are starting to spend it.
What makes this oil and gas boom dramatically different from others that the region has seen is the widespread nature of the Eagle Ford shale. While not every well drilled will be productive, with shale plays like this one, the odds are much better. Unlike the relatively small fields and pockets of oil and gas that exploration companies have chased over the years, this field is all over, underneath a very wide swath of country, all the way from Southeast Texas to Mexico. The full implications of this massive oil and gas field have not yet been reported by the mainstream media in Texas but it will be major news very soon.
How productive will the play be? Petrohawk Vice President Richard Stoneburner had this to say in a July, 2009 meeting about the Eagle Ford in their McMullen and LaSalle county leasehold area: “The gas-in-place numbers are “so exceptional,” because the shale is some 250 feet thick over a 50-by-25-mile swath and is 100% net pay. The pressure gradient, while not as high as the Haynesville, is still “above normal” at 0.65.”
It should be noted that Stoneburner is talking only about their focus area, not the entire Eagle Ford shale play.
How Long Will Eagle Ford Shale Oil Wells Last?
EOG Resources has just released reports estimating as much as 900,000 barrels of recoverable oil in the areas the have leased. How long will the boom last? Past oil and gas booms , such as the Austin Chalk play, which promised to make the region the next Saudi Arabia, were an eventual letdown as initially high production rates fell to only a few barrels per day. One oil company CEO stated recently that they estimate Eagle Ford shale wells to produce in the eight to ten year plus range. EOG investor reports show Eagle Ford shale wells with production curves over 20 years. With the vast amount of infill drilling that will occur as the play is exploited we may see more than a couple of decades worth of production.
Winds Of Change Blowing In South Texas.
It is the purpose of this blog about the Eagle Ford shale to get the word out. Change is coming to South Texas and that change will be much more widespread than was brought on by past oil and gas booms. Millions upon millions of dollars are already changing hands. There will be scores of newly rich landowners and this wealth will have both dramatic positive and negative consequences for the recipients.
You read it here first. This is the most exciting thing to ever happen to the economy of South Texas and the next few years will be a wild and crazy ride as the Eagle Ford shale is developed.
The boundaries of the Eagle Ford are still being drawn. As test holes are drilled from near Jourdanton Texas and north of Laredo, East of Del Rio to West of Dewitt county and further east, we will be able to get an idea of how large the productive area is. Already oil and gas companies have leased up much of McMullen, Dimmitt, Zavala, Live Oak, DeWitt, Karnes and LaSalle counties, with leaseholds over a million acres in the play. The Eagle Ford shale no doubt extends over into Mexico as well and we may see Pemex exploiting it there as well. Going rates for lease payments, which allow oil land gas companies to hold the exclusive rights to drill for a period of time, are from $200 to $2500 an acre with a quarter of royalties going to the landowner.
For more maps of the Eagle Ford shale See: More Maps
Thanks for stopping by the Eagle Ford Shale Blog. Bookmark this site for news updates on this exciting resource play.
Posted by Nolan – February 12, 2010 at 2:38 pm
See the pages in this site for maps and news about drilling activity.
