Helping Landowners Understand The Eagle Ford Shale In South Texas


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Mineral rights owners and landowners in the Eagle Ford Shale are often left out of the loop when it comes to information on new drilling programs, frac technology, well lifespan and other issues regarding the oil discovery in South Texas. Our site offers to help fill in the gaps for South Texas landowners, so that they may make more informed decisions regarding oil and gas leasing and other issues.

Geology Of The Eagle Ford Shale And History Of Development

By now most farmers and ranchers in South Texas already know what the shale play is all about. To recap, here is some of the science that explains why our part of the state is now home to one of the largest oilfields on earth.

During the Cretaceous age, vast seas covered the area where Texas now lies on the globe. Roughly 90 million years ago, in a span of time that lasted about 10 million years in length, marine organisms lived, died and settled to the bottom of these ancient seas. Over time, the thick muck made up of trillions of marine life forms became covered up by more sediments and gradually formed into a sedimentary rock which geologists call shale. In South Texas the rock is now buried at depths ranging from 2,000' to more than 16,000'. Since it is rich in organic material, complex hydrocarbons such as oil and gas have formed inside the rock layer. For decades geologists have theorized that the Eagle Ford Shale is the "source rock" from which much of the oil and gas found in South Texas was created. As shale goes, this one is exceptionally brittle and high in carbonate content (closer to limestone than shale in some cases,) therefore responds to fracing very well. Fracing, sometimes spelled "fracking" or hydraulic fracturing, is a process of oil and gas well stimulation that involves thousands of gallons of water and sand, along with chemical conditioning agents and acids, being pumped into the deep rock to create fractures from which hydrocarbons can flow. Zipper fracs, where several wells are alternatively fraced in sequence, is frequently used in the Eagle Ford Shale. New well completion procedures are constantly being perfected, and some companies are even experimenting with propane as a frac fluid.

  Large pump jack near Three Rivers Texas.

Shale source rock was not widely viewed as a productive source of oil and gas up until around the late 1990's, when horizontal drilling was combined with hydraulic fracturing in North Texas, in a similar rock layer called the Barnett Shale. Petrohawk Energy, one of the major companies developing the Barnett, decided to begin leasing in South Texas after their geologists announced they had found and "analog formation" in that area. More than half a million acres of the brush country in LaSalle, McMullen, Dimmit, Zavala, and other counties was quietly leased up and drilling began on the first wells in 2008. Near Tilden, Texas, the discovery wells, the STS-241H and Dora Martin - 1H were drilled and completed with hydraulic stimulation provided by Schlumberger.

As production reports began to come in, Petrohawk's CEO, Richard Stoneburner, realized that the company had struck a "home run." A team of expert landmen was put together and the race was on to grab as much acreage as possible before the competition did. It wasn't long before EOG Resources and other "shale pros" also began to enter the play, leasing up acreage in areas where the shale appeared to hold more valuable liquid hydrocarbons such as condensate and crude oil. Following the successful completion of an array to "delineation wells," EOG Resources announced that they had found a billion barrel oil discovery in 2009. The company has since revised estimates of reserves upward, to more than 1.8 billion barrels (net after royalty to EOG.)  Some geologists have estimated that the entire Eagle Ford Shale play may contain reserves of more than 25 billion barrels of oil equivalent.

What Does The New Discovery Mean For Landowners In The Eagle Ford Shale?

South Texas stands at a crossroads as one of the largest oil and gas plays in the country is currently being developed. The changes being experienced by area residents are unparalleled anywhere in the nation. In the last five years an incredible economic transformation has occurred in the Eagle Ford Shale area. This monumental shale discovery is almost singlehandedly responsible for helping reverse the budget deficit in Texas and is even helping to turn the tide on foreign oil imports.

The economic impact of the Eagle Ford Shale on South Texas has been incredible. According to the Institute of Economic Development at UTSA in San Antonio, in 2010 along the new oil and gas discovery generated more than $2.9 billion in revenue. Forecasts are for more as much as in $30 billion in economic benefits to a 24 county area of Texas over the next ten years. This oil boom is creating thousands of new jobs and putting royalty income into the hands of many area residents, who in turn invest that money into the local economy. For some lucky landowners, lease bonus checks and royalty payments amount to some serious "mailbox money." In one recent case, an elderly landowner reportedly went to cash a royalty check at a bank in Shiner Texas and the cashier replied "I apologize but we don't keep that kind of cash on hand." The landowner asked why the bank didn't have $15,000 in cash on hand and the teller replied, "sorry Ma'am, that check is for $1.5 million." Stories such as this one are circulating all across South Texas as oil royalty checks come in.   It's not all roses and sunshine however, there are negative aspects of shale drilling in South Texas as well as the positive ones.

Landowners in the Eagle Ford Shale are still coming to grips with the magnitude of the new unconventional oil discovery under their feet. Oil drilling affects issues such as a landowners privacy, property rights, land value, hunting and much more. Hunting for example, used to help South Texas ranchers make ends meet, now many ranchers, flush with oil royalty money, are reserving hunting rights for family only. For landowners lucky enough to own all or part of the mineral rights under their land, the new unconventional oil discovery is seen as a bonanza. For non - mineral rights owners, it may be seen as a curse, although some owners of large properties without mineral rights have done pretty well getting paid for pipeline easements, etc. The whole game in South Texas is constantly changing. One month a company may be paying $1000 per acre for Pearsall Shale rights alone, the next month, after results of test wells come in, the price might be $0 or $5,000 an acre. Part of the key to protecting your interests is staying in touch with what is happening in the industry. Our aim on this site is to help you do that.

Shale Drilling's Negative Impact On South Texas

Unfortunately, along with all of the benefits of oil and gas drilling in the Eagle Ford shale come a host of negative aspects. The number of reported traffic fatalities has drastically increased over the entire shale area and law enforcement agencies are struggling to cope with all of the traffic on area roads. Some residents are starting to complain of the odor of H2S or hydrogen sulfide gas in the Eagle Ford shale, especially as wells are now starting to be drilled nearer to populated areas. A shortage of housing for oilfield workers has been an ongoing problem, with "man camps" or hastily constructed collections of temporary housing springing up in many counties. Schools are overcrowded, grocery prices are high, and rental homes are scarce. These are however, problems that can be solved with time, planning and money.  Some anti shale drilling crusaders have an agenda when it comes to Eagle Ford Shale, namely to stop drilling altogether. We recognize that this energy resource is vital to our nation's security and for the economy of South Texas, and believe that concerns about shale drilling need to be addressed with reason and intelligence, not purely with emotions and rhetoric.

Understanding Terms Used In Eagle Ford Shale Drilling

So that our readers can better understand articles about the Eagle Ford Shale, we offer a "shale drilling dictionary" on this site. (See left margin.) It may be useful to landowners and investors who are trying to make sense of oil and gas company reports and presentations, which tend to be full of industry jargon. The correct spelling of the Eagle Ford Shale is as it appears here, as two separate words. Many oilfield workers and oil and gas executives pronounce it as "Eagleferd" or "Eagleford" however. The shale got its name from the Dallas county community of Eagle Ford, which is located along the Trinity River. The same rock formation that is being drilled for oil and gas in South Texas appears there on the banks of the Trinity river as clay. The shale was given its name by early day geologists who performed studies of exposed rock layers in North Texas in the 1940's.

Recent Map Of Eagle Ford Shale Wells

The following map shows recent drilling activity in South Texas. It also shows the core area of the shale play, as it reaches from near East Texas to the Mexican border. Most oil and gas exploration companies divide the play into the "east" and "west" regions. It is in the eastern part of the shale, in counties such as Gonzales, DeWitt and Karnes that several 4,000 IP (initial production) wells have been completed in recent months.

Purpose Of This Site aims to offer unique insights for  Eagle Ford Shale landowners and mineral rights owners as the play evolves. Our agenda is not to sell any product or service, but rather to inform mineral rights owners about potential developments in the Eagle Ford Shale which could affect their interests. Rather than sell classified ads or job postings, we will try to address issues that matter to landowners. Mineral rights scams, water rights issues, new zones of interest such as the Pearsall Shale and other topics will be our primary focus. We welcome your feedback. Please feel free to contact us with your concerns or questions.


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