Eagle Ford shale McMullen joint venture forms

By OGJ editors
-- Petrohawk Energy Corp. and Swift Energy Co. will jointly explore and develop 26,000 acres of Swift Energy’s acreage in McMullen County, Tex., prospective in the Cretaceous Eagle Ford shale.

Petrohawk will initially serve as operator of the 50-50 venture that covers leasehold interests in Swift Energy’s AWP field 70 miles south of San Antonio beneath the gas-prone Olmos tight formation at 9,000-11,500 ft to the base of the Pearsall formation.

Swift Energy received $26 million when the agreement closed, and Petrohawk will fund $13 million of capital spending on Swift Energy’s behalf in the first 12 months of the joint venture, afterward paying Swift Energy any unspent sum in cash.

Petrohawk will operate the drilling and completion phase of the joint development, and Swift Energy will take over once a well enters the production phase, subject to terms of the agreement. The appraisal drilling program covered by the agreement will begin before yearend and is expected to accelerate in 2010.

Petrohawk said it believes Swift Energy’s acreage is in a geologically ideal depositional location and contiguous to Petrohawk’s rapidly developing program in Hawkville field. Petrohawk said it will bring its own Eagle Ford drilling experience and access to processing and transportation to the joint venture.

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