Is EOG selling out of the Louisiana Austin Chalk
We are hearing rumors that EOG is or has made plans to sell out their position in the Louisiana Chalk play due to poor results on initial test well and initial seismic result data from shoot. Does anyone have any verifiable information on this subject?
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Replies to This Discussion
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Permalink Reply by littleasy on -
In a Forbes article from 1996 about CHK, someone was quoted as saying that he wouldn’t bet with him, but he wouldn’t bet against him. One difference between then and now, EOG acted steathfully from drilling the Eagle Ranch well to leasing their position in Central LA through another entity.
The biggest threat to the LA AC plays more golf than most PGA pros his age!!! They are now pushing coal through the dirty EPA.
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Permalink Reply by Skip Peel - Mineral Consultant on -
Yeah, all those guys with the star.
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Permalink Reply by Rock Man on
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"EOG Presentations state 9500 undrilled locations with proven value as of yesterday"
Just a comment on this EOG statement. Key word here is "proven value" - this is referring to SEC categories of Proven, Probable and Possible well locations. These locations are all in the Permian Basin and Eagle Ford / AC trend in Texas. To be "proven" by SEC standards, the undrilled locations need to be economic.
It is clear that the initial EOG well in Louisiana AC is not economic so they cannot state that they have "value" in this area without being in violation to SEC guidelines.
This is the burden that public companies have to bear when talking about potential and new trends.
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Permalink Reply by John Matherne on
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What if the well produces for many more years then it becomes economic.
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Permalink Reply by Rock Man on
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In response to comments about EOG's stealth approach to the AC in Louisiana, it should be noted that they did the same stealth approach in the Tx Eagle Ford back in 2009-2010 prior to "going public" as to this play and its potential.
They pursued a similar approach in the downdip AC trend in Colorado County (west of Houston) as well as the Goodland Lime plan in E Tx.
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Permalink Reply by littleasy on
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Yes, another pump and dump stock scheme might prove a bit too much, even in these ethically troubled times. I was looking at the history of the LA AC earlier and was surprised to learn that some consider it to be potentially the largest onshore deposit in the US. Equivalent to 4-6 Giddings fields in size???
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Permalink Reply by Rock Man on
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Permalink Reply by John Matherne 1 hour ago
What if the well produces for many more years then it becomes economic
My "reply" button not working / commenting on above note from John M.
"Economic" is not just producing enough O&G to payout D&C and production costs - for SEC "economic" consideration, the numbers are based on discounted rate of return and Present Value (PV). So even if there are is a long period of production, the PV / Discounted ROI analysis would not get one to an "economic well".
EUR projections for the EOG wells range from 300 to 400 MBO plus 300 to 400 MMCF of gas depending on B factor and decline variables. But it will take until 2050+ to achieve these numbers based on the production profile to date.
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Permalink Reply by John Matherne on
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Thanks Rock Man
You Rock
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Permalink Reply by Rock Man on
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Reply by littleasy 1 hour ago
Yes, another pump and dump stock scheme might prove a bit too much, even in these ethically troubled times. I was looking at the history of the LA AC earlier and was surprised to learn that some consider it to be potentially the largest onshore deposit in the US. Equivalent to 4-6 Giddings fields in size???
My Reply - Which report are you looking at? Sounds like a USGS report. These tend to be ultra optimistic and extol VERY high potential for huge areas. Personally I have never seen such a report be realistic in its expectations.
And was this report talking about the entire AC section in Louisiana including the historical fracture related production?
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Permalink Reply by littleasy on
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It was an ancient OGJ article from 1996.
Hot Louisiana chalk play spawning more drilling, added facilities
https://www.ogj.com/articles/print/volume-94/issue-52/in-this-issue...
“John Vering, UPR's vice-president of exploration and production services, said, "I'm guessing you could take maybe four, five, or six Giddings fields and fit them in along the trend from the Sabine River over to Baton Rouge, just in the area that has seen the activity thus far."”
Pie in the Sky, probably? But, it did take mankind over 2,500 years to fully appreciate Calculus. We don’t have that timeline, but as you say, “It’s all about the rock,” and LA apparently has a lot of it.
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