KKR Sells Texas Shale Assets

KKR & Co. has sold a swath of Texas shale to an unidentified oil company for about $140 million, and the private-equity firm made back twice its money on the property in a year, according to a person familiar with the matter.

The deal marks the third time in as many years that the firm has been able to flip energy-bearing shale fields and at least double its money. It underscores KKR’s continued drive to become a major player in U.S. oil and gas exploration.

In the last decade North American energy companies have combined horizontal drilling techniques with a rock-cracking process called hydraulic fracturing to unleash oil and natural gas from deeply buried rock formations called shale.

The resulting bounty has altered the U.S. energy picture, leading to a price-depressing flood of natural gas and pushing domestic oil production higher for the first time in decades.  It’s also created opportunity for investors, as global energy giants pay to gain access to the vast reserves.

Source: Wall Street Journal

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Drilling, Hydraulic Fracturing used in Ealge Ford Shale

McMULLEN COUNTY — Chesapeake Energy Corp.'s rig jutted 165 feet into the sky and sat off a rocky road that was a long and jolting ride from the nearest paved stretch in a remote part of the county.

The rig punched a hole 9,278 feet down — more than a 13/4 miles — before turning a corner to bore 6,408 feet horizontally through the Eagle Ford shale in South Texas, a vast formation under 24 counties that stretches 400 miles from East Texas to Webb County and the border.

In just the past few years, technological advances, including horizontal drilling and a technique called hydraulic fracturing, have made it possible to tap the oil and natural gas trapped in the Eagle Ford's tight rock.

It costs about $7 million to drill and complete a well using hydraulic fracturing in the Eagle Ford shale, Chesapeake spokesman Silver Vasquez said.

Source: My San Antonio 


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Indigo Announces New Eagle Ford Horizontal Well Permit in Louisiana

HOUSTON, May 16, 2011 /PRNewswire/ -- Indigo II Louisiana Operating LLC ("Indigo") today announced a new horizontal well permit targeting the Louisiana Eagle Ford Shale ("LA Eagle Ford") formation.  Indigo's proposed Bentley Lumber 23H #1, Section 23, T5N-R5W, Rapides Parish, Louisiana, is permitted to a proposed total measured depth of 15,500' and is projected to include a 4,000' horizontal lateral section targeting the LA Eagle Ford zone at approximately 10,600' true vertical depth.  It is anticipated that the well will be completed through the horizontal segment with 15 fracture stimulation stages.  This new horizontal well will be located eight miles north of Indigo's recent vertical LA Eagle Ford "test" well, the Bentley Lumber 32 #1, T4N-R5W, Vernon Parish, Louisiana, drilled and completed earlier this year.  Full conventional cores were taken through the LA Eagle Ford section in the Bentley Lumber 32 #1, a suite of modern logs was run and the objective section was subsequently tested by two fracture stimulation stages in this wellbore.  The vertical well, which reached a total depth of 12,020', established LA Eagle Ford oil production (42.2 API gravity) in the center of Indigo's acreage position. 

Bill Pritchard, Indigo's Chairman and CEO stated:  "Indigo began its pursuit of this new oil shale play back in mid-2008 and has accumulated over 240,000 net acres of leasehold and mineral fee in central Louisiana that is prospective from the Louisiana Eagle Ford Shale formation. This horizontal oil shale play will involve considerable time and capital to fully develop, and it is Indigo's intent to eventually secure a joint venture partner in order to establish oil production over the entirety of its leasehold."

Source: PR Newswire

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