The state of Texas is proud of its sedimentary rock formation known as the Eagle Ford Shale. It has become the target of oil and gas companies because of the production of hydrocarbon. Today, the shale has been referred to as the most profitable oil field in the world. The promising profits have pushed companies to expand the drilling operations and even attracted more businesses on the site.
Japan Petroleum Exploration Co is one of the companies that has shown interest in Eagle Ford. The Japan-based business is engaged in the oil and natural gas exploration and production. The company is said to have cooperated with Marathon oil who already have operations in the shale. According to the report, Japex hopes to use the technology and know-how for the experiment in tapping tight oil in the northern part of Japan.
The San Antonio Business Journal reported that Japan Petroleum Exploration Co. (Japex) has purchased two additional stakes in the Eagle Ford Shale play in South Texas. Japex officials said the stakes total 840 acres. That acreage is adjacent to an existing lease of 27,000 acres. Read the full article here
The 400 mile-long and 50 mile-wide formation reaches across 25 counties in Texas. However, the majority of the play is operating in five counties that includes La Salle, Karnes, McMullen, Gonzalez, and DeWitt. According to FuelFix, La Salle and McMullen are even referred to as “more oily”. Rigs are clustering in the 3 other counties – Gonzalez, Karnes, and DeWitt.
In the article written by Jennifer Hiller of FuelFix entitled “Finding the Sweet Spots of the Eagle Ford“, she highlighted the 5 counties that have been considered as the best spots in Eagle Ford.
Highlights of the 5 counties:
1. La Salle County has the most active drilling rigs of any in the Eagle Ford — 36 as of November 16 — and they are concentrated on the northwest swath of the county.
2. McMullen County 31 drilling rigs, all in its northern half.
3. Becca Followill of U.S. Capital Advisors LLC said companies operating in Gonzales, DeWitt and Karnes counties have seen initial rates of return, higher than 50 percent, with some wells as high as a 70 percent.
4. Part of the Eagle Ford’s profitability has been practical in nature, including relatively quick access to coastal refineries. Moving oil by rail from the Bakken field in North Dakota can add $10 to $12 to the production cost per barrel
5. The formation generally produces more oil on its northern arc, more natural gas, or “dry gas” on its southern arc, and more natural gas liquids such as propane and butane in-between. Wells generally bring up a bit of everything.
6. Karnes County has good oil production in the northwest corner and good natural gas liquids in the southwest corner, and neither in the southeastern corner.
The best spots at Eagle Ford Shale will continually attract many businesses and more investors especially when the top players in the industry have already reported the profits for 2012.