UNION PACIFIC EXPANDING AUSTIN CHALK ROLE

Union Pacific Resources Co., Fort Worth, has expanded its leasehold in the Cretaceous Austin chalk trend of South Central Texas with an eye to increasing production and horizontal drilling there. The company plans 120 horizontal chalk Wells as operator and participation in another 20 for all of 1991. It has 15 rigs under contract to drill horizontal wells in the chalk.

June 3, 1991

2 min read

Union Pacific Resources Co., Fort Worth, has expanded its leasehold in the Cretaceous Austin chalk trend of South Central Texas with an eye to increasing production and horizontal drilling there.

The company plans 120 horizontal chalk Wells as operator and participation in another 20 for all of 1991.

It has 15 rigs under contract to drill horizontal wells in the chalk.

In its latest acquisition, UPRC bought working interests in more than 80 vertical wells and 6,257 net acres of leases, mainly near Giddings, Lee County, from Santa Fe Minerals Holdings Inc., Dallas. Terms have not been disclosed.

Last December UPRC purchased a 30% interest in the same leases from Dan A. Hughes Co., Beeville, Tex. (OGJ, Dec. 12, 1990, p. 22). With the Santa Fe Minerals purchase, UPRC will have an 85% net interest in the wells and acreage.

It will operate most of the wells.

As of May 14, UPRC operated 101 horizontal wells and was participating in 21 more in the Austin chalk trend. Its production from the wells is 19,000 b/d of oil, 48 MMcfd of gas, and 10,500 b/d of natural gas liquids.

In the first 2 weeks of May, UPRC tested 10 new horizontal chalk wells in five counties with combined flow rates of 11,900 b/d of oil and 12.1 MMcfd of gas. It operates eight of the wells and has an average working interest of 82%. With the latest purchase, UPRC's leasehold in the chalk play covers 340,000 acres.

Gross production from the Santa Fe properties, all from Austin chalk or Buda, is 1,210 b/d of oil and 7.4 MMcfd of gas.

UPRC Chairman Bill Adams said, "The wells have good potential for stimulation, which may significantly enhance production. The undeveloped acreage acquired may be utilized for new horizontal drilling."

Prior to the Santa Fe purchase, UPRC had seven wells in Giddings field producing from Lower Cretaceous chalks--two from Buda and five from Georgetown.