Barclays: BHP Billiton upbeat on Eagle Ford shale

BHP Billiton reported strong rates of return in the Eagle Ford shale in South Texas where the Australian firm is aggressively pursuing development, Chief Executive Officer J. Michael Yeager told the Barclays Capital CEO Energy & Power Conference in New York on Sept. 4.

Many individual Eagle Ford wells are exceeding 100% rate of return, and the average single well payback is under 1 year, Yeager said. He sees potential for higher recovery factors over time through reduced well spacing and improved technologies.

BHP has holdings in the Eagle Ford, Fayetteville, and Haynesville shale plays and the Permian basin. The company envisions continued long-term growth in shale liquids.

For fiscal 2012, BHP’s petroleum division plans a $6.5 billion capital program with shale liquids representing the largest share. Yeager expects 40 rigs operating onshore US during 2013 with over 85% directed toward the Eagle Ford and Permian.

Yeager said BHP will ramp up its shale dry gas operations when US natural gas prices recover.

“Shale dry gas resources remain strong and are valuable to the long term,” Yeager said. He believes BHP can grow its overall production 10%/year for the next 10 years.

Earlier this year, BHP announced a $2.84 billion writedown of its US shale assets, saying a short-term over supply of gas resulted in a before-tax impairment charge against the value of the Fayetteville shale assets acquired from Chesapeake Energy Corp. in February 2011 (OGJ Online, Aug. 3, 2012).

No writedown was needed on shale assets obtained through BHP’s acquisition of Petrohawk Energy Corp., Houston, for $12.1 billion (OGJ Online, July 25, 2011).

Related Articles

Apache fracs Wolfcamp wells without fresh water in dry Barnhart project area

02/11/2014 At a site in drought-stricken West Texas, Apache Corp. has devised a system to hydraulically fracture wells in the prolific Wolfcamp shale without ...

Monumental innovations

02/10/2014 Oil production from the Permian basin in West Texas is once again on the rise. According to the January Drilling Productivity Report published by t...



Permian production competes on a world scale


The Permian basin in West Texas has reentered the race to become the world's largest oil-producing region.

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!


Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected