Wednesday, January 6, 2010

Endeavour Buys Into the Haynesville Shale

Through a transaction with Cohort Energy Company, a subsidiary of J-W Operating, Endeavour International Corporation has purchased a 50% interest in Cohort's properties in the Haynesville Shale, as well as in the Marcellus Shale.  Endeavour also purchased interests in other U.S. producing areas from other private companies. 

In the Haynesville Play, Endeavour purchased a 50% interest in 17,700 gross acres (7,250 net) that should be able to host 200 drilling sites. The leases are in the Woodardville (Red River Parish), Metcalf (Caddo Parish), Bull Bayou (Red River) and Grand Cane (DeSoto Parish) fields, as the map below shows.  The land is also prospective for the Hosston and Cotton Valley formations and some of it is prospective for the Mid-Bossier Shale.  Interestingly, in its press release, Endeavour cites estimated ultimate recoveries for these prospects in the 7-8 Bcf range.  That is a higher EUR than most competitors are publishing.

Endeavour is based in the U.K. and has offshore interests in the North Sea.  Because these are big high risk/high return investments with long-term time horizons, the company adjusted its business strategy a couple of years ago to pursue shorter term production opportunities in the U.S. to offset its long cycle North Sea investments. 

Welcome to the party, Endeavour.

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