Shell Sells Eagle Ford Interest | Russell T. Rudy Energy LLC
Royal Dutch Shell announced the sale of its Eagle Ford shale acreage, reserves, facilities and infrastructure to Sanchez Energy Corp. according to a recent article in “Rigzone”. This includes 100% working interest in approximately 106,000 net acres in Dimmit, LaSalle and Webb counties in South Texas. The sale, which is effective the first of this year, is projected to close by June 30.
Proven reserves are estimated at 60 million barrels of oil equivalent. During the first quarter of 2014, 176 wells produced 24,000 barrels of oil equivalent per day (boepd), about 60% of which were liquids.
Shell had been the fifth largest player in the Eagle Ford, but Sanchez has also been an aggressive second tier operator according to Hart Energy’s “Eagle Ford Techbook”, with a significant position a few miles to the East of the Shell acreage. Sanchez’s commitment to the play is evidenced by a 2014 capital budget of $635 million.
After the sale, Sanchez will be producing about 42,800 boepd and will manage about 226,000 acres with nearly 3,000 potential drill sites. The operator maintains that due to economies to scale, it will be the leading low cost producer in the Eagle Ford well into the future.
Meanwhile, Shell indicated that because of disappointing financial results from its products and North American resource plays, it plans to divest $15 billion in assets. To date it has sold $4.5 billion.
To read the article in its entirety, please go to www.rigzone.com/news/oil_gas/a/133200/Sanchez .
