Eagle Ford Shale Play

How Long Will the Eagle Ford Shale Boom Last?
By RT Dukes

A Texas A&M economist met with business leaders to share his projections of how long the Eagle Ford shale boom will last. He expects the play will have a productive lifespan of 16 years. I’d like to see what is behind the 16 year number, but I believe the message was well delivered. This Eagle Ford development isn’t going to fizzle out any time in the near future. The opportunity is too big. Billions of barrels of oil & gas resources mean billions and possibly trillions of dollars in economic development.

The economist speaking at the 2013 Executive Economic Outlook breakfast was simply conveying there is significant opportunity in South Texas. Most real estate developers are being cautious and not making commitments unless they can project a one-year payout. If the play has a lifespan of decades, more permanent developments are needed. South Texas will need every thing from grocery stores to home developments, gas stations and Wal-Marts.

Eagle Ford Shale’s Lifespan

The Eagle Ford is still relatively young, so everyone is wondering if the play will go bust. The answer to that question lies in the future oil price. As long as oil prices hold steady at a level of more than $70, South Texans don’t have much to worry about. The Eagle Ford returns more to operators than almost all plays in the country. Even if oil prices drop, it will still have the same relative position as the investment of choice in North America.

An old industry addage is “The easiest place to find hydrocarbons is where you’ve already found them”. That will likely prove true in South Texas. We’re actually seeing it play out today. Operators have new development plans in several other oil & gas plays including the Austin Chalk, Buda, Escondido, Olmos, and Pearsall Shale formations.

I wouldn’t say never, but I’d place the probability of a bust in South Texas lower than anywhere else in the country.

http://www.eaglefordshale.com/
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http://www.eaglefordshale.com/

The Eagle Ford Shale is located in South Texas. The formation produces from various depths between 4,000 and 12,000 feet. The Eagle Ford Shale takes its name from the town of Eagle Ford Texas where the shale outcrops at the surface in clay form. (Often, the Eagle Ford is mistakenly spelled as Eagleford.)  The Eagle Ford is a booming shale play, results indicate there will be development activity for a long time to come. Unlike many other shale plays, thus far it does not exhibit natural fracturing within the formation. The Eagle Ford also benefits from high liquids yields across much of the play.  Higher oil prices have helped spur development as oil, condensate, and NGLs (ethane, propane, and butane) all command better prices than natural gas.

Eagle Ford Shale Geology

The Eagle Ford Shale is a geological formation directly beneath the Austin Chalk Shale. It is considered to be the “source rock”, or the original source of hydrocarbons that are contained in the Austin Chalk above it.  The formation was also penetrated many times as operators targeted the Edwards Limestone formation along the Edwards Reef Trend.

The Eagle Ford Shale is found at depths between 4,000 and 12,000 feet. The shale is up to 250 feet thick in some places, generally without natural fracturing present. To date, the most prolific area for production occurs at the convergence of the Stuart City Reef trend and the Sligo Reef Trend.




Karnes County, TX and the Eagle Ford Shale Play

Karnes County neighbors DeWitt County and produces gas from the Edwards Reef Trend in South Texas.  The region is not new to the oil & gas industry, but the Eagle Ford drilling boom brought development levels not seen before. The county is prospective for shale oil, shale gas, and the gas – condensate or liquids-rich window of the Eagle Ford Shale formation.

Karnes County forms part of a prolific area of the Eagle Ford where wells produce greater amounts of condensate, oil, and wet gas.  The dry gas window of the Eagle Ford also passes through the county along the Southeastern border and into Bee and Goliad counties.

Karnes County drilling is focused in the central portion of the county that is prospective for wet gas and condensate and the northwest third of the the county that is prospective for oil .  The best shale oil wells have come online producing more than 1,000 bbls/d.

The county is approximately 50 miles southeast of San Antonio, TX. Karnes City serves as the county seat. Notable communities include Cestohowa, Ecleto, Falls City, Gillett, Helena, Hobson, Kenedy, Panna Maria, Runge, and Wintergreen.

Major Operators in Karnes

Burlington (ConocoPhillips), EOG Resources, Murphy Oil, and Plains Exploration all have significant acreage positions in Karnes County.

  • EOG Resources targets the shale oil window of the play and has drilled shale wells in the northern portion of the county.  Notable initial production rates include the Wiatrek Unit with two wells averaging 857 bopd and 682 mcfd, the Vickers #2H 743 bopd and 444 mcfd, Wagener Unit with four wells averaging 563 bopd and 478 mcfd, the Dullnig #5H with 1,353 bopd and 1,224 mcfd, the Braune Unit #3H with 601 bopd and 458 mcfd, and the Greenlow Unit with two wells producing an average of 607 bopd and 386 mcfd.
  • Murphy Oil also targets the oil window or more liquids prone area of Karnes County.  The company expects wells will ultimately recover as much as 400,000 boe.
  • Plains Exploration targets the Eagle Ford Shale gas formation at depths of 9,500 ft to 11,500 ft on its almost 60,000 acres in the central portion of the county.  Wells produce condensate and liquids-rich gas on Plain’s acreage.
Karnes County Economic & Community Development Corporation
P.O. Box 295, Kenedy, TX 78119
(830) 583-3957 office (830) 583-3967 fax
Email: KarnesEDC@sbcglobal.net
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