Wednesday, October 11, 2017

EOG Eagles Ranch 14H-1 - Initial Potential

An official initial potential ("IP") has been released on SONRIS today for the well.

COMPLETED 9/11/17 AS A OIL WELL IN THE AUSC RB SUB RES;PM F; 1120 BOPD; 1157 MCFD; 1506 CP; 64/64 CK; 2947 BWPD; 1033 GOR; 43 GRVTY;PERFS 16275-20550' (ST: 10)

That means 1,120 barrels of oil, 1157 thousand cubic feet of gas, and 2947 barrels of water over a 24 hour period. The gas/oil ratio is 1033 with 43 API gravity oil.  The well is flowing naturally from 4275' of horizontal perforations.

My phone has been ringing all day. So here are the most frequent questions with my answers:

1) Do you believe these numbers?
The state allows a lot of leeway with regards to how an operator determines the initial potential. So these data are very likely accurate for some point during the flowback. That doesn't mean that it represents the best rate nor does it represent the well after it completed full flowback from the frac job.  Operators tend to release smaller rates when they are still leasing. I hear that EOG is wrapping up their lease acquisition.  Flippers tend to buy based on the rumors.

2) Doesn't 64/64 represent a full open choke?
Yes. This is not the typical choke that would be used during long term production. Many believe that sustained open choke can damage the reservoir.

3) Isn't that a lot of water production?
Yes, but the Austin Chalk always produces a lot of water and some of this could still be flowback water. Speculators start chasing SWD permits!

4) What do you think of the mix of oil versus gas?
This GOR is typical for the area. The GOR in six months will be much more telling

5) Are you happy with this result?
As stated prior, the IP isn't very significant. The production rate, GOR, pressure, and water production in 6-12 months is much more important.

6) Should I keep buying leases next to EOG?
That's your call. What does the geology tell you to do?

7) I heard that lease prices are skyrocketing?
Not exactly. Proximity to the well and the rumored initial rates are driving some interesting transactions.

8) How does this well compare to EOG's well in Texas?
See answer #5

9) 4275' of perforations seems short compared to what I hear in other plays?
EOG in other plays tends to not drill really long laterals. I assume that they'll be conservative on their first set of wells.

10) Where should I lease?
I wish I could tell you, but I would have to.....

Tuesday, October 3, 2017

EOG's Austin Chalk Core Focus Area

EOG's project strategy is starting to become apparent. With ~130,000 acres filed of record in the courthouse and an additional 70,000 possibly leased, the map is starting to tell a story.  They have acquired acreage on trend and east of here but it's not as contiguous.

The map below presents a general outline of EOG's largest contiguous block in yellow.  They have filed some tracts as 3D seismic permits (orange).  The dashed line outlining the 3D permits represents 238 square miles.  Based on the permits filed, I would assume that the 3D will be at least 150 square miles.  The Eagles Ranch 14H-1 falls within the estimated 3D outline.  3D seismic will be very useful due to the very complex geology.

Their geological theories are also becoming apparent. Their lease block consistently terminates on the west side bounded by a prominent salt ridge and three salt domes. Their northern boundary is clearly defined by the Edwards Shelf Edge.  The depth to reach the Austin Chalk increases more rapidly south of the shelf edge.  Formation pressure increases in a linear fashion also.  Their southern boundary is defined by depth of the formation.

Their theme appears to be high pressure, gas/oil mix, faulted, and porous.  My guess is that they will drill a few "pilot" wells in parallel with the 3D acquisition. This would give them some additional data on the formation and be prepared for a full scale development once the 3D is acquired, processed, and interpreted.  Stay tuned for an initial potential on the Eagles Ranch 14H-1.




Sunday, October 1, 2017

EOG Resources Takes Over the Eagles Ranch 14H-1

On SONRIS, EOG is now listed as the operator of the Eagles Ranch 14H-1. No surprises there.

http://sonlite.dnr.state.la.us/sundown/cart_prod/cart_con_wellinfo2?p_wsn=250209

Also note that the well is now a unit well (AUS C RB SUB).


An initial potential has not been posted. Many trucks are reported to be entering and exiting the well site. Oil and water are the cargo. Many speculators are using advanced math to determine an oil flow rate. Stay tuned for an official release. 


Tuesday, September 26, 2017

Eagles Ranch Update

The rumor mill is in "high gear" now that the frac job has completed. The ironic point is that the rumored post-frac oil rate is the same as the rumored rate before the frac job. I need that crystal ball. As most that have followed this blog know, I don't post rumors. Soon the initial potential will be published on SONRIS. This is the first real data point, but as stated before, the first six month's rate, decline curve, pressures, and water production will be key information.

EOG's lease "buy area" map is making the rounds in Lafayette. I wonder if La Fonda's is giving away copies with a two margarita purchase!!
http://www.lafonda1957.com/menu.html

Speculators beware. All acres aren't created equal. The Austin Chalk has historically bankrupted many honest explorers.  Definitely don't trip over the ancestral Mississippi River.



Tuesday, August 29, 2017

EOG Eagles Ranch 14H-1 - FRAC CREW ON LOCATION

Frac crews have arrived this morning on the EOG Eagles Ranch 14H-1. It's very likely that it will be many weeks before an initial potential is posted on SONRIS. Be sure to "filter" through what you hear. Remember, rumors of 2200 bopd started BEFORE the frac job even started. Also, it will take six months to get comfort on the initial decline curve.  The presence of natural fractures in the Austin Chalk can create some chaos and unpredictability.

Monday, August 21, 2017

EOG - Austin Chalk - Colorado County, TX

EOG has taken a similar "stealth" approach in Colorado County, Texas as they have recently in Louisiana. On March 27, the company spud an Austin Chalk well, the Pallas Energy Services LLC Tonkawa Unit #1. It has a permitted total depth of 16500'.  In Avoyelles Parish, their well was permitted under Sentry Energy Services LLC.

The Tonkawa well is located in the southern deep part of the very prolific Giddings Field. The maps below illustrate that EOG's well is on trend with some of the most prolific gas producers in the play. In contrast to the Karnes Trough, they appear to be targeting a much higher GOR in Colorado County.  Their well is in the "bullseye" of the most active leasing over the past 90 days.  Everyone likes to chase EOG.

Most importantly, the log signature is very similar in all three of their project areas: Karnes, Colorado, and Avoyelles/St.Landry/Pt. Coupee Parishes, Louisiana.  The cross section below illustrates two wells from Colorado County and Avoyelles Parish.  While 293 miles apart, the Passey log display presents very similar log signature with very comparable Passey values.  The high TOC thicknesses (DLogR > 1.0) of 174' and 180' represent a very attractive target for a high proppant frac job. The mean DlogR values are also very similar. Results from these two "Energy Services" wells will be very important for both areas.



















Friday, August 18, 2017

Sentry (EOG) Eagles Ranch 14H-1 - Drilling Update


Sentry Energy Services (EOG) has completed the drilling process on the Eagles Ranch 14H-1. Note that a pilot hole was drilled before kicking out horizontally.  The drill times compare with the Louisiana Austin Chalk drilling phase that occurred in 2011.  A permit has been filed for the frac job. It sounds like 4288' will be the perf range.

Finally the rumors have started and the mineral buying speculators have shown up.  As always, they range from gusher to dry hole.  Always entertaining.

The first significant data point will appear 30-60 days after the frac job completes. Until then, we'll all have to be patient.  Note that this new Austin Chalk approach is different from the historical "naturally fractured" play. Review the prior posts regarding the Karnes Trough.

Drill times: Eagles Ranch 14H-1 compared to 2011 Louisiana Austin Chalk wells

Add caption


Monday, June 5, 2017

Austin Chalk - South Texas, Karnes Trough Area


The map below depicts recent Austin Chalk activity in the Karnes Trough area (Karnes, Gonzalez Counties, TX).  The yellow boxes highlight active rig locations while the green provide the details on EOG's Austin Chalk completions.  EOG's Matterhorn well had a "prac IP" of 7088 bopd and 11858 mcfgd equating to 9064 boepd (Source DrillingInfo).  Their nine Austin Chalk completions in Sugarkane Field have prac IP's ranging from 157-9064.  It will be interesting to see if they can repeat these rates in other areas of the play.  Their results to the northeast in Gonzales County have prac IPs ranging from 64-795 boepd. Keep an eye on this one.




Thursday, June 1, 2017

EOG/Sentry Spuds Austin Chalk Well

Sentry/EOG spud the Eagles Ranch 14H-1 on May 23. With a planned measured depth of 21900', it will be interesting to see how long it takes to drill this well. In the Eagle Ford and Permian, EOG has set records for drilling time.

Drilling Report
DROVE 20" TO 177' W/ 143' PENETRATION; SPUD 5/23/17; DRLD; RAN SURFACE HOLE QUAD COMBO LOGS; RAN 13 3/8" CSG TO 2704' W/ 2465 SXS; TSTD BOP'S TO 250 LOW / 5000 HIGH ON 5/28/17; TSTD CSG; (BOP INFO: ANNULAR, GK, 13 5/8", HYDRIL, 5M; RAMS: TYPE U, 5", CAMERON, 10M);
SOURCE: SONRIS




Wednesday, May 24, 2017

Austin Chalk Trend - Field Production


The Austin Chalk Formation has been producing for many years from the Mexican border into Louisiana.  The trend covers millions of acres.  To date, 15,370 wells have produced 1.28 billion barrels of oil, 6.27 trillion cubic feet of gas, and 14 billion barrels of water.  In barrels of oil equivalent, it has produced 2.36 billion barrels. The map below presents the trend with the major fields summarized.



Tuesday, May 16, 2017

Austin Chalk - Log Analyis Comparison


With EOG's recent leap over to Louisiana to test their new Austin Chalk frac design, it might be beneficial to compare the log analysis from each area.  All three areas compared below have a plethora of historical vertical wells to use for analysis.

EOG's recent "monster" Austin Chalk wells are located in the Karnes Trough of Karnes County, Texas. 

EOG Resources - Austin Chalk competions - Karnes County, Texas
The figures below present a log analysis comparison using Exxon's Passey Log Method which presents a log-calculated total organic carbon (TOC) value. This method has been proven to work across most of the unconventional plays in the U.S.

For an overview of the method, here's an excellent paper from Thomas Bowman:
http://www.searchanddiscovery.com/pdfz/documents/2010/110128bowman/ndx_bowman.pdf.html

EOG has also been leasing on the county line between Fayette and Lavaca Counties. The figures below compare three wells from Karnes, Fayette/Lavaca, and Avoyelles Parish. 

For comparison, a Passey thickness (DLogR > 1.0) and DLogR "mean" were calculated.  Higher DLogR indicates higher TOC.  The mean DLogR values range from 1.09-1.26 with Avoyelles being the highest at 1.26. Thicknesses range from 174'-187' with Karnes County being the highest.

As more wells are drilled, a tighter calibration can be made.





Wednesday, May 3, 2017

EOG Returns to Louisiana Expanding Their Austin Chalk Exploration Plan

EOG Resources has been making some extraordinary Austin Chalk completions in the Karnes Trough of South Texas. Under their service provider's entity, Sentry Energy Services, LLC, they have filed a Louisiana Austin Chalk permit in North Bayou Jack Field.  On the ground intel indicates that a total of 10 permits have been filed in Avoyelles and St. Landry Parishes.  This first permit will be drilled as a lease well.

In EOG's February 27, 2017 quarterly presentation, they noted their game plan to include "capture new premium plays through organic exploration". This appears to be part of that plan.

The Sentry Energy Services LLC Eagles Ranch 14H-1 has a measured depth planned of 21,900' with a TVD of 16,720'.  In South Texas, the TVD of the completions have ranged from 10,500-12,150'.  The Eagle Ranch well plan represents a signficant increase in depth to drill and complete in. If anyone can succeed at this, it will be EOG Resources.  I consider them to be the best unconventional operator in the U.S.

More details to follow.