The Eagle Ford shale of South Texas has presented many challenges over the years. Its geographic expanse presents drilling conditions requiring different approaches. Many wells have been drilled over the years, but not all successfully. The abundance of past activity gives today’s operators more detailed knowledge of the play, its varied formations, and the necessary steps needed to engineer and drill a well for the highest return.
With a strong rebound in numbers for active rigs and drilling permits, past experience coupled with modern technology creates abundant opportunity in the Eagle Ford basin. From boom to bust and back to recovery, operators now aim for a sustainable business model for consistent production and financial returns. The careful consideration of producers and investors means long-term success on the horizon for the Eagle Ford play.
A Closer Look at Eagle Ford History
As Eagle Ford begins its comeback, operators of this new resurgence must take a look at past mistakes to ensure sustainable success in the future, including a combination of statistical and analytical aspects regarding source rock and design of wells. By analyzing 17,000 wells drilled over the past decade, assessments of the geological and completion design data reveal strategies for maximum returns in the future.
The complexity of Eagle Ford requires a deeper understanding of varied strategies for success. Optimum indicators of production are five main completion variables: perforated interval, proppant quality, fluid loading, proppant type, and treatment type. For maximum output, operators must determine the ideal operating ranges for these variables in each zone. Finally, identifying the right balance between production and cost because consistent returns will result in consistent activity in the Eagle Ford basin.
Careful mapping of formation type with the best operating completion design and strategic technology is a requirement of operating in Eagle Ford. Using the data available will prevent the losses of this play’s past. Operators willing to learn from the past will reap the benefits in the future.
Read more about Eagle Ford shale’s past and recommendations for its sustainable future in Deliotte Insights analysis.
A New Model for Success
In order to generate more excitement among investors, one Eagle Ford operator made strategic acquisitions resulting in 50% higher production and 60% greater land position. Despite the global demand and stronger commodity pricing, these independent producers are focusing on free cash flow and rewarding investors with higher returns. They will continue with strategic bolt-on acquisitions while developing a stable drilling program.
Looking toward a different sort of oil boom, producers aim to create consistent and steady production of oil. Instead of the phenomenal rise in production of the past boom, the benefits of the current uptick in activity in Eagle Ford will translate into stronger balance sheets, efficiencies and technological advances, per-well results, and ESG-related advances. The booms of the past are not sustainable, so current shale producers focus on stable drilling programs that generate profits and meet the demands of their investors in hopes of stable business environments.
Read more about new business models for operating in Eagle Ford in Forbes magazine.
New-Age Technology at Work
Not only has the business plan of the original Eagle Ford boom changed so has the technology. With significant advancements in performance drilling centers, detailed data collection and analytics, and increased use of AI, Eagle Ford producers are utilizing the latest technology to enhance drilling and completion operations.
Operators in Eagle Ford are employing new technologies and learning new techniques from drilling activities of the past. Ranger Oil Corporation, Crimson Energy Partners, Devon Energy, and BPX are all utilizing new drilling strategies for higher returns. Strategies include: adding smaller adjacent tracks to existing leases, extending lateral lengths, adding 6” casing instead of 5.5-inch pipe for quicker execution, increasing proponent loading, reducing stage spacings, and adding a variety of high-tech diagnostics to monitor every step of the drilling progress. All additions create better performance and production results.
Refracs maximize asset value, and many producers look to exploit the stranded hydrocarbon left from first-generation fracs. Refracs have minimal geological risk, place less pressure on the supply chain, and are much more sustainable for ESG and capital allocation.
The acceleration of the Austin Chalk development region of Eagle Ford is exciting as operators focus on new technology and years of shale data and experience to optimize drilling and completion plans.
Read more in The American Gas & Oil Reporter about the new strategies and technology operators are using to reactive the Eagle Ford play.
The Rise of Refracs
Producers are returning to existing wells to increase output for a fraction of the cost amid opposing demands from the government to increase production and investors needing an increase in profits. Re-fracing gives a quick increase in production with a smaller investment than drilling a new well. With the help of new technology available, a successful re-fracing strategy revitalizes aging oilfields and increases production with minimal cost.
New techniques for re-fracking are up to 40% cheaper and produce double to triple the output from first-generation fracs. Oil futures are up 40%, but so are production costs on material and delays due to labor shortages. Re-fracs produce oil much faster than a new well, as no new permits are needed and no new disruption to the environment with well sites already established. Utilizing wells under-fracked or under-completed in the beginning helps producers utilize the infrastructure already established and access hydrocarbons still available at a greatly reduced cost. Given the current climate of rising costs, supply chain issues, and labor issues, re-fracking is a favorable option for operators in the Eagle Ford play.
More information about re-fracking possibilities and techniques is available on Reuters.
Eagle Ford’s outlook is strong
Producers in Eagle Ford are making smart choices for a sustainable future in the basin. Advancements in drilling technology continue to improve efficiency and accuracy in the basin. Analyzing past activity, planning drilling projects carefully, and taking advantage of new tools and technology provide Eagle Ford operators with opportunities for a sustainable future of production in the shale play of Eagle Ford.