St. Mary Land & Exploration has announced the successful completion of its first operated horizontal Eagle Ford shale well, the Briscoe G 1-H (SM WI 100%) in Webb County, Texas.
The well produced at an average sales rate of 5.6 MMCFED (4.4 MMCF/d of natural gas and 192 Bbl/d of condensate) over a seven day initial flow period, during which the well was facility constrained. The well was drilled to a depth of approximately 7,500 feet TVD (11,350 feet MD) and completed with a 3,200 foot lateral using a ten stage hydraulic fracture treatment. Total well cost was $5.2 million, including the extra cost of drilling a pilot hole, coring, logging and micro-seismic monitoring during the fracture treatment. St. Mary anticipates that future completed well costs will be in the range of $3.5 to $4.5 million, depending on well depth.
St. Mary currently has a total of 225,000 net acres earned to date with potential for the Eagle Ford shale in Dimmitt, LaSalle, Maverick and Webb counties in Texas. Of this total, approximately 66,000 net acres relate to acreage earned through its joint venture with Anadarko Petroleum Corporation and TXCO Resources. The Company has the ability to earn roughly an additional 20,000 net acres through the joint venture. The remaining 159,000 net acres is outside of the joint venture, where St. Mary has 100% working interest.
The Company is currently operating two drilling rigs in this program in an effort to further delineate the potential of its acreage position. One rig is drilling in Webb County on St. Mary's 100% working interest acreage while the other rig is drilling on joint venture acreage in Dimmitt County. St. Mary has already drilled and cased another horizontal test on joint venture acreage, the Shape Ranch 1-H in Dimmitt County, which is awaiting completion. For the remainder of 2009, the Company plans to drill two additional horizontal wells on its 100% acreage and two additional horizontal wells on the joint venture acreage, as well as complete and interpret its ongoing 3D seismic efforts.
Tony Best, CEO of St. Mary, said, "We are pleased with this result from the Briscoe G 1-H and learned a great deal from the data we collected during the drilling and completion. While we were limited to some extent from testing the well at its full potential due to facility constraints, we believe that this is a very favorable result for our Eagle Ford program. Our Eagle Ford acreage is shallower compared to some other areas of Eagle Ford activity in the Maverick Basin, which will allow for shorter drill times and less expensive wells. A key goal of the Company is to add projects to our inventory that have attractive finding and development costs and margins. We think that this program has the potential to provide very competitive per unit reserve additions in the future. As always, St. Mary remains focused on growing value for our shareholders and I believe that the Eagle Ford could be a meaningful driver toward that goal."
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