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Tuesday, June 14, 2011

SM Energy divests Eagle Ford acreage at ~$15,000/acre

SM Energy entered into an agreement with Statoil and Talisman to divest a portion of its Eagle Ford shale position. The position is a detached block of acreage that is comprised of the entirety of the company's operated acreage in LaSalle County, Texas, as well as an immaterial portion of adjacent operated acreage in Dimmit County, Texas. In total, approximately 15,400 net acres are being sold for cash proceeds of approximately $225 million.

Due to limited infrastructure, there is currently no production associated with three wells that have been drilled on the acreage. As of year-end 2010, there was an immaterial amount of proved reserves booked for this acreage. The buyers will be entitled to approximately 12% of the takeaway capacity associated with SM Energy's agreement with Eagle Ford Gathering LLC, a joint venture between Kinder Morgan Energy Partners LP and Copano Energy LLC.

For more presentations on "Eagle Ford", use our oil and gas document library:

A busy month for Eagle Ford Shale. A look at Eagle Ford metrics
SM Energy’s Eagle Ford divestiture is the third deal for the month June, 2011. The most notable transaction was Marathon’s acquisition of Eagle Ford acreage for ~$25,000/acre. The current SM divestiture leaves the acreage metrics at $14,600/acre.

In addition, Talisman is also looking to buy additional assets in Eagle Ford Shale, if prices are going to be reasonable. Recently, the metrics in Eagle Ford Shale is skyrocketing between $20,000-$25,000/acre as compared to the 2010 average metrics of $8,000/acre.

Here is an interactive tool with regards to Eagle Ford acreage metrics. Play around.




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