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  1. Sanchez, Blackstone team to buy Anadarko Eagle Ford acreage for $2.3 billion

    Sanchez Energy Corp. , Houston, and funds managed by private equity firm Blackstone Energy Partners LP have entered a 50-50 partnership and agreed to acquire working interest in 318,000 gross operated acres in the western Eagle Ford shale of South Texas from Anadarko Petroleum Corp. , The Woodlands, Tex., for $2.3 billion. Encompassing the Comanche area, the 155,000 acres net to Sanchez Energy and Blackstone is contiguous to Sanchez Energy’s Catarina area, where the firm has 106,000 net acres in Dimmit, LaSalle, and Webb counties with 100% working interest. Eagle Ford shale development covers 80% of the acreage to be acquired, with resource potential from the Austin Chalk and Pearsall shale. Current production from the assets averages 67,000 boe/d, of which 70% is liquids. Proved reserves total 300 million boe, of which 70% is liquids and 75% is proved developed. Sanchez Energy says the deal includes 132 gross drilled but uncompleted (DUC) wells with individual rates of return expected to exceed 100%, and more than 4,000 Eagle Ford drilling locations that provide more than 20 years of economic drilling inventory at current strip prices. Tony Sanchez, III, chief executive officer of Sanchez Energy, commented, “Upon completion of the acquisition, we will triple our exposure to the Upper and Middle Eagle Ford trends that have been successfully developed by the company at Catarina. The Upper and Middle Eagle Ford sections thicken in southern Dimmit County, where the majority of the acquired leasehold is concentrated. Upon closing the transaction, we believe we will have locked up the core of the trend within the volatile oil window.” Sanchez Energy now projects it will produce more than 100,000 boe/d while operating within cash flow in the next 12-18 months. The deal is expected to close in the first quarter. Sanchez Energy will fully fund its half through a combination of cash on hand and commercial bank and preferred equity commitments at a newly formed nonrecourse subsidiary, and Blackstone will fund its half through a separate entity via equity and commercial bank commitments. Sanchez Energy in October 2016 boosted its liquidity by agreeing to sell noncore Eagle Ford assets to Carrizo Oil & Gas Inc. for $181 million in cash, and its 50% interest in Carnero Processing LLC and noncore assets in South Texas as part of a $107-million deal with Sanchez Production Partners LP ( OGJ Online, Oct. 25, 2016 ). Blackstone’s involvement in oil and gas operations in recent months includes the formation alongside Jetta Operating Co. Inc. of Jetta Permian LP, a Fort Worth-based firm focused on the Delaware basin; and formation alongside Jay Still of Dallas-based, Midland basin-focused Guidon Energy ( OGJ Online, Aug. 26, 2016 ). Anadarko’s strategic shift Anadarko's sponsored master limited partnership, Western Gas Partners LP, will continue to own and operate its midstream assets in South Texas and is expected to benefit from drilling commitments made by the buyers in conjunction with the deal. Prior to its agreement with Sanchez Energy and Blackstone, Anadarko had 388,000 gross acres in Dimmit, LaSalle, Maverick, and Webb counties. “The ongoing success of our portfolio-management activities provides us with the flexibility to further accelerate capital investments in our higher-return oil opportunities in the Delaware basin, the DJ basin, and the deepwater Gulf of Mexico, which drive our ability to deliver a 12-14% 5-year compounded annual oil growth rate,” explained Al Walker, Anadarko chairman, president, and chief executive officer. Anadarko’s first move of the year follows a busy December in which it agreed to sell operated and nonoperated upstream assets and operated midstream assets in the Marcellus shale to Alta Marcellus Development LLC for $1.24 billion ( OGJ Online, Dec. 21, 2016 ); and closed its $2-billion purchase of Freeport McMoRan Oil & Gas’s deepwater Gulf of Mexico assets ( OGJ Online, Sept. 12, 2016 ). The firm in November sold its Carthage upstream and midstream assets in East Texas to Castleton Commodities International LLC (CCI) for $1 billion ( OGJ Online, Nov. 12, 2016 ). Anadarko plans to further increase drilling activity in the Delaware and DJ basins in 2017. By the end of the first quarter, it expects to have 14 operated rigs in the Delaware and 6 in the DJ, compared with 7 and 1 in the basins, respectively, at the end of last year’s third quarter. Contact Matt Zborowski at matthewz@ogjonline.com .

    Online Articles

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    Fri, 13 Jan 2017

  2. BLM amends oil shale rule to let royalty rates be set lease-by-lease

    The US Bureau of Land Management announced final amendments to federal oil share regulations that give the Secretary of the Interior flexibility in setting rates lease-by-lease and require oil shale operations to include environmental protection plans.

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    Wed, 11 Jan 2017

  3. Center for Sustainable Shale Development receives two-year grant

    The Richard King Mellon Foundation has awarded the Center for Sustainable Shale Development a two-year grant in support of the Center’s certification program and public engagement initiatives. 

    Online Articles

    Online Articles

    Wed, 14 May 2014

  4. Credit Suisse: U.S. shale development just beginning

    The U.S. has significantly boosted its oil and gas output in the last decade, but a new report from investment bank Credit Suisse said much more shale development is coming.

    Online Articles

    Online Articles

    Wed, 2 Oct 2013

  1. Shale development boosts oil field chemicals market, low oil prices slow trend

    Online Articles

    Online Articles

    Tue, 14 Jul 2015

  2. EIA: Argentina, China lead shale development outside N. America

    Argentina and China have respectively drilled more than 275 and 200 wells targeting shale plays over the past 2 years, providing each country with the potential to significantly increase production of shale gas and tight oil, the US Energy Information Administration highlighted on June 26 in an ...

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    Article

    Fri, 26 Jun 2015

  3. EIA: Outside North America, Argentina and China lead shale development

    As recently as last year, only four countries in the world were producing commercial volumes of either natural gas from shale formations (shale gas) or crude oil from tight formations (tight oil): the US and Canada, and, more recently, Argentina and China, according to the US Energy Information ...

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    Online Articles

    Wed, 1 Jul 2015

  4. PwC: Engineering, construction firms help maximize shale development returns for oil and gas sector

    As oil and gas companies continue developing new shale wells across the US, engineering and construction (E&C) firms have a vital opportunity to optimize these plays using their existing core competencies, according to a new report by PwC US.

    Online Articles

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    Fri, 17 Jan 2014

  5. Deloitte: International shale development will take longer than in US

    Vast shale plays worldwide are going to be explored and developed although it’s going to take more than a decade before another country outside the US or Canada can duplicate the current US shale boom, speakers told the Deloitte Oil & Gas Conference on Nov. 13 in Houston.

    Online Articles

    Online Articles

    Wed, 14 Nov 2012

  6. University initiative to provide shale -development best practices training

    A new multi-university initiative announced March 8, will provide best-practices training for people working in the shale natural gas and oil development sector.

    Online Articles

    Online Articles

    Fri, 9 Mar 2012

  7. Clariant brings new shale development catalyst on-stream

    Clariant has successfully expanded production capacity for Houdry dehydrogenation catalysts at its Louisville, Kentucky plant.

    Online Articles

    Online Articles

    Wed, 9 Oct 2013

  8. New program begins from Center for Sustainable Shale Development

    CSSD announces its independent third-party certification and verification program is now accepting applicants.

    Online Articles

    Online Articles

    Wed, 22 Jan 2014

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