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Drillers look to Eagle Ford east

Jennifer Hiller | San Antonio Express-News

SAN ANTONIO — Everyone knows the Eagle Ford Shale is big. But on the eastern — and newer — edge of the shale drilling region, things remain more of a mystery.

About 50 miles northeast of the established area for Eagle Ford production sits about 1 million oily acres. They’re profitable and on par with some of the best fields in the country, said Welles Fitzpatrick, senior analyst with Johnson Rice & Co. LLC.

But Fitzpatrick said last week at Hart Energy’s DUG Eagle Ford Conference in San Antonio that the eastern area is often misunderstood.

It’s part of the “Eagle Ford proper,” although it’s not as consistent as the western side of the shale.

“It’s not an extension in the sense that it’s not economic all throughout that line,” Fitzpatrick said. “It’s more of a satellite or an outpost of the traditional Eagle Ford. This separation geographically creates a lot of confusion.”

Northeast of the well-established drilling areas in Gonzales and DeWitt counties, there are 11 counties classified by the Texas Railroad Commission as part of the Eagle Ford: Lavaca, Fayette, Lee, Burleson, Brazos, Milam, Robertson, Leon, Madison, Grimes and Walker.

Related: Industry seeking ways to recover more oil

Geology varies, but the eastern end of the Eagle Ford is nestled between the Austin Chalk and the Woodbine Sandstone, resulting in the common nickname “Eaglebine” and the less common “Chalkleford.”

Fitzpatrick said the best areas for eastern Eagle Ford drilling are in Brazos, Burleson and Lee counties. “No companies are ending this year with fewer rigs than they started with,” he said.

“It’s a real play and it’s a tremendous play.”

Many companies operating in the area have been there for years. It saw a boom of Austin Chalk drilling in the late ’70s with vertical wells, as well as a boom of horizontal chalk wells in the early ’90s, said Mark Houser, CEO and president of EV Energy Partners LP and COO and executive vice president of EnerVest Ltd.

Houser said EnerVest bought into the area because it was chasing the chalk and doesn’t consider itself a shale driller. But it has been tracking nearby Eagle Ford wells, and since it looks like operators are finding success, the company is selling some of its Eagle Ford rights while retaining the rights to drill in formations such as the Georgetown and Buda limestones.

“We’re gaining meaningful data from operators in the area,” Houser said. “This portion of the Eagle Ford is early, but you’re getting stable, predictable performance that seems to be improving already.”

Operators in the field include Apache Corp., Anadarko Petroleum Corp., Clayton Williams Energy and Halc�n Resources Corp.

In the eastern part of the field, ownership is dominated by smaller landowners. Leasing in the South Texas brush country was easier — companies started by targeting large ranches.

Glenn Hart of Laredo Energy IV LP has been a longtime operator in South Texas, where his company holds around 93,000 acres in gas-rich Webb County. The company recently added around 33,000 acres in the east around Brazos and Burleson counties to diversify into an oil-producing region.

“Trying to lease in here felt like World War I to me,” Hart said. “We were getting an inch of ground at a time compared to what we were used to. It’s not exactly being in the city, but it’s a lot of 100-acre ranchettes and things like that where people are more particular about what you’re doing out there on the surface.”

But as in other areas of the Eagle Ford, drillers on the eastern edge are looking at the rocks above and below the famous shale. Laredo Energy sees potential in formations that include the Pecan Gap Chalk, the Navarro Group and the Buda Limestone.

“We’re as interested in the other horizons as we are in the Eagle Ford,” Hart said.

jhiller@express-news.net

Twitter: @Jennifer_Hiller

 

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