SilverBow expects 70% y-o-y oil production increase as Eagle Ford deal closes

Nov. 30, 2023
SilverBow Resources anticipates a 2024 capital expenditures budget of $550-580 million to support a three-rig drilling program and a preliminary production outlook of 551-611 MMcfed in 2024.

SilverBow Resources Inc., Houston, expects an anticipated 2024 capital expenditures budget of $550-580 million to support a three-rig drilling program and a preliminary 2024 production outlook of 551-611 MMcfed in the South Texas Eagle Ford.

The pure play company provided a preliminary 2024 outlook and updated its 2023 guidance upon closing of its acquisition of Chesapeake Energy Corp.'s oil and gas assets in South Texas for $700 million on Nov. 30 (OGJ Online, Aug. 14, 2023). SilverBow now holds over 220,000 net acres with 1,000 drilling locations identified, it said.

For 2024, SilverBow plans to operate three drilling rigs with one rig dedicated to the recently acquired assets. Oil production is expected to increase about 70% year-over-year and average 25,000 b/d. The full year production mix is expected to be more than 40% oil/NGLs.

2023 drilling, production

For the remainder of 2023, there is no material change to SilverBow’s development plans as noted in early November. The company expects to continue operating two drilling rigs across its acreage and does not anticipate any incremental capex on the acquired assets. In its third-quarter update Nov. 1, SilverBow noted fourth-quarter 2023 production of 353-375 MMcfed was expected, with oil volumes comprising 16,400-17,000 b/d, or 28% of total production at the midpoint.

Full year 2023 estimated production of 336-342 MMcfed is expected with oil volumes of 13,900-14,100 b/d, a 26% increase year-over-year. Full year 2023 capital budget range of $400-425 million remains unchanged.