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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landownerPermalink Reply by littleasy on August 21, 2018 at 5:51

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.


landownerPermalink Reply by Matt Hall on August 21, 2018 at 8:44

This thread sure has a bunch of negative Nancy's! LOL


Oil & Gas ProPermalink Reply by Skip Peel - Mineral Consultant on August 21, 2018 at 8:49

Yeah, all those guys with the star.


Oil & Gas ProPermalink Reply by Rock Man on August 21, 2018 at 15:12
"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.

landownerPermalink Reply by John Matherne on August 21, 2018 at 15:35

What if the well produces for many more years then it becomes economic. 


Oil & Gas ProPermalink Reply by Rock Man on August 21, 2018 at 15:20
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.

landownerPermalink Reply by littleasy on August 21, 2018 at 15:42

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???


Oil & Gas ProPermalink Reply by Rock Man on August 21, 2018 at 16:52
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.

landownerPermalink Reply by John Matherne on August 22, 2018 at 1:42

Thanks Rock Man

You Rock


Oil & Gas ProPermalink Reply by Rock Man on August 21, 2018 at 16:55
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?

landownerPermalink Reply by littleasy on August 21, 2018 at 22:56

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.


landownerPermalink Reply by littleasy on August 22, 2018 at 4:36

Wasn’t meant for you!!!  Might also be true for LA AC?

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