Encana moving back into Haynesville

After pulling its drilling rigs out of Louisiana's Haynesville Shale because of high service costs for half of 2012, Canadian independent Encana is coming back to the play, the company revealed in an earnings announcement Thursday.

Encana has two rigs operating in the Haynesville, the company said, with plans to increase that to five rigs by the end of this year.

Encana said its costs have come down far enough for the company to make a profit at its forecast Henry Hub price of $3.75/Mcf.

http://www.platts.com/RSSFeedDetailedNews/RSSFeed/NaturalGas/6158011

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Good news they're moving back in to drill

Bad news, if anyone was still dreaming of $5.00 or higher NG (or maybe even $4.00)  that dream looks like the pipe variety.

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Permalink Reply by JAMES SMITH on February 21, 2013 at 8:35

KCM,

Have you heard of any certain section Encana possible returning to?

Permalink Reply by Renee Rains on February 21, 2013 at 8:08

If Encana comes back into Louisiana does that mean they will be leasing again?  In the Marthaville, LA. area there are a lot of people that are not in a lease.

Permalink Reply by JAMES SMITH on February 21, 2013 at 8:30

Dont know, I was hearing coming in Northwest Louisiana in areas where they already hold leases. I dont know if someone have heard of any certains sections.

Permalink Reply by Skip Peel - Mineral Consultant on February 21, 2013 at 8:35

I think it likely that EnCana will drill alternate unit wells in existing units where their production costs will be lowest.  The infrastructure is in place and paid for.  I don't think any Haynesville Shale operators will consider step out drilling and thus new leasing until prices surpass $4+/mcf.

Permalink Reply by Renee Rains on February 21, 2013 at 9:16

Thanks for the info!

Permalink Reply by kittycatmama on February 22, 2013 at 2:49

We have acreage in the Holly Field with Encana. We only live in LA part of the time, but our friends who live there called in Dec. and said something was up. Encana was taking in loads of rock to their drilling sites at several locations in the Holly. Initially I thought that they were just maintaining roads. Then another friend heard that Encana was bringing in barges of rock at the port. Now it is all starting to make sense. Encana has lots of leased, producing areas in the Holly--especially up and down Red Bluff and Long Roads in Desoto. Those areas already have pads with some pads drilled out to 7 -8 wells and some pads with 2 wells. Their infrastructure is in place there, so costs to come back in would not be that high. Guess I was hoping they were coming back in to drill the CV, but looks like once again they are after the Haynesville

 

Permalink Reply by JAMES SMITH on February 22, 2013 at 4:03

KCM,

Are you hearing anything about sec 19 14-14 in the kickapoo area

Permalink Reply by kittycatmama on February 22, 2013 at 21:22

James, I haven't heard of any particular area that Encana is returning to, but it would make sense for then to come back into all of 14/14. Encana drilled a lot of super pads in 14/14. Pads are in place so their costs to drill would be reduced. I was hoping they were coming in to drill the Cotton Valley for liquids, but after reading their presentation, it seems they are coming back for the Haynesville

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