Tuesday, April 29, 2014

Last Week's Louisiana Completions

  • Hall-Williams 4-34 H #1, Anadarko: 3.759 MMcf/day IP on 24/64 in. choke at 2,438 psi (56 barrels condensate, 63.7 gravity); Perfs: 10,718-17,660, length: 6,942 ft.; Caddo Pine Island Field, Caddo Parish, S4/T19/R15; res. A, serial #247044 
  • State of LA 34 H #1-ALT, Petrohawk Operating: 8.826 MMcf/day IP on 16/64 in. choke at 7,577 psi; Perfs: 12,049-16,615, length: 4,566 ft.; Caspiana Field, Caddo Parish, S34/T15/R12; res. B, serial #246918 

EXCO Q1 2014 Results

This afternoon, EXCO Resources released its quarterly earnings report with an update on the company's progress in the Haynesville.  Below, I've noted a couple of key points with the text of the update below.
  • In Q1, EXCO drilled 13 gross wells but completed only two, ten of these are multi-well pad wells in DeSoto Parish that will be completed in Q2.
  • For the rest of 2014 in DeSoto, EXCO plans to develop seven of its 36 undeveloped units by drilling 34 gross wells. 
  • The company will start drilling its first cross-unit wells in Louisiana, including 5,000 to 8,000 foot laterals, in DeSoto later in the year.
  • In the Shelby trough area of TX, where EXCO is still focused on testing its leasehold, the company plans eight gross wells with longer laterals and a restricted flowback procedure to try to find the "secret sauce" for that area.
  • EXCO is experimenting with lowering the line pressure in its Holly Field gathering pipeline from 1,250 psi to 980 psi, which is leading to an 8-10% production uplift.

Haynesville Shale Rig Count: -3 to 24

Last week's Haynesville Shale rig count was down by three rigs to 24.  Louisiana was down by three rigs to 16 (Chesapeake, Petrohawk and EXCO down one each), while Texas was unchanged at eight.


U.S. Rig Count: +30 to 1,861

Last week, Baker Hughes reported that the U.S. rig count was up 30 rigs to 1,861.  Oil rigs were up 24 to 1,534, gas rigs were up seven to 323 and miscellaneous rigs were unchanged at four.  By type, horizontal rigs were up 21 to 1,245, vertical rigs were up seven to 398 and directional rigs were up two to 218.  Among gas rigs, horizontal rigs were up five to 238, directional rigs were up one to 55 and vertical rigs were up one to 30.

Thursday, April 24, 2014

EIA: Storage +49 Bcf to 899 Bcf [Updated]

EIA reported that working gas in storage was up 49 Bcf to 899 Bcf. The weekly injection was 63% greater than last year (+30 Bcf) but in line with the five year average (+47 Bcf).  The current storage level is 48.0% below last year (1.73 Tcf, a difference of 831 Bcf) and 52.9% below the five year average (1.907 Tcf, a difference of 1.008 Tcf).


Monday, April 21, 2014

Two Weeks of Louisiana Completions

  • Hewitt Land LLC 33 #2-ALT, EXCO Operating: 13.618 MMcf/day IP on 20/64 in. choke at 7,272 psi; Perfs: 12,607-17,190, length: 4,583 ft.; Caspiana Field, DeSoto Parish, S33/T14/R12; res. A, serial #246843 
  • CHK Min 24-14-12 H #1-ALT, Chesapeake Operating: 13.896 MMcf/day IP on 20/64 in. choke at 7,150 psi; Perfs: 12,374-16,559, length: 4,185 ft.; Red River-Bull Bayou Field, DeSoto Parish, S24/T14/R12; res. D, serial #246519 

Haynesville Rig Count: +2 to 27

Over the past two weeks since I've last reported, the Haynesville rig count has gone up by two rigs to 27.  Texas was pretty much unchanged over the period, holding at eight, while Louisiana saw three new rigs from Chesapeake, while SWEPI (Shell) dropped its last rig to end at 19.  Suddenly it feels like old times again with Chesapeake operating three times more rigs than anyone else in the play.


Thursday, April 17, 2014

U.S. Rig Count Unchanged at 1,831; Gas Rigs +6

The Baker Hughes U.S. rig count was unchanged this week at 1,831.  Oil rigs were down seven to 1,510, gas rigs were up six to 316 and miscellaneous rigs were up one to five.  By type, there were no changes (?!?) with horizontal rigs holding at 1,224, vertical rigs at 391 and directional rigs at 216.  Among gas rigs, horizontal rigs were up two to 233, directional rigs were up two to 54 and vertical rigs were up two to 29.


And yes, I am behind on my Haynesville rig counts.  The kids are out this week for spring break so I haven't had time to deal with it.  I'll do two weeks together by the start of next week.

EIA: Storage +24 Bcf to 850 Bcf

EIA working gas in storage was up 24 Bcf last week to 850 Bcf.  The weekly injection was inline with last year (+25 Bcf) and 35% below the five year average (+37 Bcf).  The current storage level is 50.0% below last year (1.7 Tcf) and 54.3% below the five year average (1.823 Tcf).  The current storage level is now exactly 1/2 of last year's level and 1.01 Tcf below the five year average.  You probably won't see that again in coming years!


Friday, April 11, 2014

"Cautious Optimism" - Haynesville Shale Word of the Year?

With the natural gas storage withdrawal season now behind us, it is time to reflect on where we are headed in the Haynesville Shale.  Bottom line:  I am cautiously optimistic for 2014.

Back in 2012, we kept hearing analysts say, "wait until 2014" for prices to go back to $4.00 - $4.50/MMcf for natural gas.  Guess what, here we are in 2014 and prices are in the $4.50 range, which many people cite as the magic number to get producers interested in the Haynesville again.  Of course, these prices are driven by a very cold winter throughout most of the country and a record storage withdrawal of 3 Tcf of gas in four and a half months, so it is a worthy question if this is a fundamental change in prices or a reaction to a temporary situation.  But the fact is that now it's mid-April and we have about seven months to replenish approximately 2.6 Tcf to get storage back to a minimum level of 3.4 Tcf.  Doable, but you never know if there will be a hot summer or an unexpected natural event.  In any case, there will need to be strong gas production.

A Tale of Two Hydrocarbons: Gas Rigs Down to 310; Oil Rigs at Record High

The Baker Hughes U.S. rig count was up 13 to 1,831.  Oil rigs were up 19 to 1,517, gas rigs were down six to 310 and miscellaneous rigs held at four.  This is first time oil rigs have broken the 1,500 barrier, and it is the highest level ever recorded on the BHI records (beginning 1987).  By contrast, the gas rig count hasn't been this low since May 21, 1993.

By type, horizontal rigs are unchanged at 1,224, vertical rigs are down two to 391 and directional rigs are up 15 to 216.  Among gas rigs, horizontal rigs were down five to 231, directional rigs were up three to 52 and vertical rigs were down four to 27.

Thursday, April 10, 2014

EIA: Gas in Storage +4 Bcf to 826 Bcf

The EIA reported that working gas in storage was up 4 Bcf last week to 826 Bcf.  This is the first net injection since mid-November and, if it holds, marks the end of the winter withdrawal season.  This week last year saw a 25 Bcf withdrawal, but the current injection was largely in line with the five year average, which was up 9 Bcf.  The current storage level is 50.7% below last year (1.675 Tcf) and 54.7% below the five year average (1.823 Tcf).


Tuesday, April 8, 2014

A Bunch of New Texas Completions

3/24/14 - 4/8/14:
Three Observations:
  1. Some moldy oldies at the top of the list from Sabine O&G.  These two Dinkle wells were originally permitted in late 2010 and drilled in early 2011.   They seem to be going through some old inventory in Harrison Co.  Sabine completed two older Harrison wells in October and August 2013.  The last non-Sabine well to be completed in Harrison was completed in March 2013.
  2. There were several wells with lots of liquids (>100 Bbl/day)
  3. EOG is getting in on the liquids action.  Both of their completions reported liquids, including one >100 Bbl/day.
Completions:
  • Dinkle Deep GU #1H, Sabine Oil & Gas: 9.447 MMcf/day IP, 0 Bbl/day liquids, 20/64" choke, 6,255 psi; Perfs: 11,512-15,867, length: 4,355 ft.; Carthage Field (Haynesville Shale), Harrison Co., Survey: BRITAIN, JW, A-78 

Haynesville Shale Rig Count: -2 to 25

The Haynesville Shale rig count was down two rigs last week to 25.  Louisiana was down two (both Chesapeake) to 17, while Texas held at eight.


Recent Texas Permits

3/24/14 - 4/7/14:
  • New Horizons #6H, XTO Energy; Carthage Field (Haynesville Shale), Panola Co. Co., Survey: ENGLISH, W, A-189 
  • CGU 21-22-26 #71HH, Anadarko E&P; Carthage Field (Haynesville Shale), Panola Co. Co., Survey: LIDDY, W, A-398 
  • BSI/USFS Unit F11 #1H, XTO Energy; Carthage Field (Haynesville Shale), San Augustine Co. Co., Survey: WILLIAM COLWELL, A-8

Friday, April 4, 2014

Gas Rig Count: -2 to 316; How Low Can it Go?

The Baker Hughes overall U.S. rig count was up nine rigs this week to 1,818.  Oil rigs were up 11 to 1,498, gas rigs were down two to 316 and miscellaneous rigs were unchanged at four.  By type, horizontal rigs were up 13 to 1,224 (the highest level ever), vertical rigs were up nine to 393 and directional rigs were down 13 to 201.  Among gas rigs, horizontal rigs were unchanged at 236, directional rigs were down two to 49 and vertical rigs were unchanged at 31.

Thursday, April 3, 2014

EIA: Gas in Storage -74 Bcf to 822 Bcf

The EIA reported this morning that working gas in storage was down 74 Bcf last week to 822 Bcf.  The weekly withdrawal was actually 22% lower than last year (-95 Bcf) but nine times greater than the five year average (-8 Bcf).  The current storage level is 51.6% below last year (1.7 Tcf) and 54.7% below the five year average (1.814 Tcf).


Wednesday, April 2, 2014

Last Week's Louisiana Completions

  • Red Oak Timber 6 #4-ALT, EXCO Operating: 11.595 MMcf/day IP on 18/64 in. choke at 7,633 psi; Perfs: 12,046-16,072, length: 4,026 ft.; Bethany Longstreet Field, Caddo Parish, S6/T14/R15; res. A, serial #247148 
  • Red Oak Timber 7 #3-ALT, EXCO Operating: 9.614 MMcf/day IP on 16/64 in. choke at 6,823 psi; Perfs: 12,410-16,905, length: 4,495 ft.; Bethany Longstreet Field, Caddo Parish, S6/T14/R15; res. A, serial #247149