With the sale of its oil-producing Tunisian assets to OMV, Pioneer Natural Resources (NYSE:PXD) is reinvesting the $866 million in generated capital in its onshore US exploration and production ventures, namely the Spraberry and Eagle Ford Shale.
The company plans to substantially increase the number of rigs drilling the Spraberry formation in West Texas over the course of 2011.
“Our most recent drilling program called for 30 rigs to be operating in the Spraberry during 2011, but we now plan to increase the rig count to 35 rigs by mid-year,” revealed Pioneer Chairman and CEO Scott D. Sheffield.
According to Pioneer, the Spraberry field is the fifth largest oil field and the 15th largest gas field in the US, and the company currently has interest in 5,600 active wells across nine counties, making Pioneer the largest acreage holder, driller and producer in the Spraberry.
The company will also bump up its rigs drilling the Eagle Ford Shale in South Texas.
“In the Eagle Ford Shale, an acceleration plan has now been approved by the joint-venture partners, which will result in an average of 12 rigs operating during 2011 as compared to the initial development plan that ramped up to 10 rigs by the end of 2011," Sheffield reported.
Pioneer holds 310,000 gross acres in the Eagle Ford Shale, which is growing in popularity among producers because it holds natural gas and oil.
"This accelerated drilling program, which is planned to ramp up further in 2012 and 2013, is expected to increase the company’s current compound annual production growth target of more than 15 percent for the 2011 through 2013 period while maintaining our strong financial position," he concluded.