Richard Zeits (Zeits Energy Analytics) Oct 17 2013, 05:27

2013: A Breakthrough Year For The East Texas Eagle Ford

Among emerging horizontal oil plays, the Eagle Ford Shale/Eaglebine in the East Texas Basin has been one of the most confusing and perhaps misunderstood. The play has been frequently mentioned in the industry press. Several highly regarded operators, including Encana (ECA) and Halcon Resources (HK), have spoken repeatedly of the massive potential that the oil-bearing Eagle Ford Group of shales has to offer. Still, until this year, the play had failed to gain true momentum. Testing activity had been disappointingly slow and, for some time, no convincing evidence had been established to confirm the shales' commercial productivity. Drilling focused predominantly on horizontal redevelopment of conventional Woodbine Sands/Silts within large legacy oil fields.

All that has changed this year. Over the past twelve months, the East Texas Eagle Ford play has picked up steam and indications are building up that it may soon emerge as a major new horizontal oil play.

A New Old Play

The Eagle Ford in East Texas is part of the same stratigraphic group as the world famous Eagle Ford in South Texas. The two plays are separated by the San Marcos Arch (picture below). From a geologic perspective, the two Eagle Fords are cousins rather than identical twins: the formations are characterized by different depositional environments and, strictly speaking, are two stand-alone plays. Notwithstanding the differences, the Eagle Ford is viewed to be a highly potent source rock on both sides of the Arch. As a result, there are legitimate reasons to hope that the shale can be a producible reservoir to the east of the San Marcos Arch just as it is in South Texas, possibly offering highly economic sweet spots.

The most recent drilling results and tangible capital commitment from several important E&P operators indicate that such hopes may in fact prove true.

(click to enlarge)

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