Eagle-Ford oil patch a vast jobs field
Image via WikipediaThe Eagle Ford shale, a vast oil and natural gas play in South Texas, will become one of the state's fastest-growing areas for new business and job creation over the next decade, experts said Wednesday.It sounds like there are opportunities for new pipelines and the work associated with installing them. The oil is the more attractive product right now because there is a glut of natural gas on the market because of the success of shale fields.
That's if they can get the oil out. Pipelines already are full, and companies are having to truck it out or ship it by rail.
Jumps in leased acreage and in drilling permits signal the rapid advance of the Eagle Ford as an energy-producing area, experts said at a meeting of the Texas Alliance of Energy Producers in San Antonio.
The activity in the Eagle Ford started with drilling in gas regions and has moved into oil-producing regions, generally in the northern part of the play, as oil prices have jumped, said Ramona Hovey, senior vice president at DrillingInfo, an information company specializing in oil and gas.
Drilling permits issued jumped to 944 for 2010 from 94 permits issued two years earlier, according to Railroad Commission data.
In 2008, about 1.5 million acres were leased in the Eagle Ford shale. About another 1.5 million acres were leased just in the first half of 2010, the last period for which numbers are available.
The top counties for leasing were Atascosa, LaSalle, Dimmitt and Webb, commission data show. The Eagle Ford underlies 15 counties mostly south and west of San Antonio.
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As oil nears $100 a barrel, conditions are favorable for stronger profit margins, as the break-even point for producing a barrel of oil in the Eagle Ford is $47.25, said Champion Technologies, a chemical firm that sells products to drilling companies.
Yet all isn't rosy. "The biggest challenge of this play is the infrastructure and access to the market," Hovey said. "There are bottlenecks."
Pipelines are full, and the cost of trucking oil out has soared to $15 a barrel, a historically high level, she said.
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One reason the price is so high is that this administration has been strangling production in the Gulf of Mexico and on federal owned land. Because they do not control much of the land in Texas it is harder for them to prevent production other than through the EPA which has a more indirect hold on things.
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