Milam on the cusp of Eagle Ford oil play

‘Nobody wants to drill first’
Reporter Editor

It’s oh-so-close to Milam County, the oil and gas drilling in the Eagle Ford Shale, a name which is quickly joining the list of legendary oil formations.

But Eagle Ford activity is not quite here yet, although oil patch veterans are pretty sure the formation extends under Milam.

“We’d be looking at the southeast corner of the county for Eagle Ford activity,” Bill Whitmire, Milam driller, said. As of yet, I just don’t think anybody wants to be the first (to drill).”

The most recent information (Dec. 30) from lists four Eagle Ford rigs in Burleson County and two in Lee County.

“I know there are some between Lexington and Giddings,” Whitmire said. lists 30 counties within the formation. Milam is one of six without any present rig count activity.

The five others are Austin, Goliad, Robertson, Washington and Bastrop.

AUSTIN CHALK—That’s not to say there isn’t oil activity in Milam County.

According to mid-2013 figures, 14 operating companies produced 53,623 barrels in one month, along with 3,488 thousand cubic feet (MCF) of natural gas, in Milam.

In fact, there’s been so much oilfield traffic the county has recently qualified for a Texas Department of Transportation ( TxDOT) grant of at least $2 million to help deal with damages to county roads caused by oilfield traffic.

A five-member advisory board, which includes Whitmire, has been appointed to help commissioners oversee the project.

The Minerva area, near Rockdale, has seen a rebirth of oil activity in recent years. It was the scene of major oil activities in the 1920s.

TIGHT FORMATION—But, so far, Milam’s oil play is in formations other than the Eagle Ford, mostly in the Austin Chalk, which triggered a Central Texas oil boom in the 1970s and ‘80s.

“ The Eagle Ford is different than the Austin Chalk,” Whitmire said. “You’ve really got to hit it exactly. Some of the other formations will ‘drift out’ and you can still get production. But not the Eagle Ford. It’s a real tight formation.”

Whitmire said about five years ago attempts to drill into the Eagle Ford in nearby counties south of Milam “failed miserably.” But a lot has changed.

“ The technology is so much better now,” he said.

What does he think will happen?

“Someone will drill for the Eagle Ford and hit it,” he said. “Then everyone will get into it. That’s just the way things happen with the drilling business.”

MIND- BOGGLING— It ’s almost impossible to exaggerate the impact of the Eagle Ford Boom, which is centered around counties far to the south and west of Milam.

As of Dec. 30, 2013, about 12 percent of the oil rigs operating in the United States were in the Eagle Ford.

The first well to produce oil and gas from the Eagle Ford in 2008, was in LaSalle County.

Oil companies quickly moved into the productive area, which stretches from the Texas-Mexico border and extends 400 miles toward East Texas.

The play is 50 miles wide and an average of 250 feet thick at a depth between 4,000 and 12,000 feet.

Its oil reserves are estimated at 3 billion barrels along with 50.2 trillion cubic feet of unproved, technically recoverable gas.

By the end of 2013, production had skyrocketed to over a million barrels of oil equivalent (BOE) per day.

IMPACT—Economists have said the Eagle Ford Shale is quite possibly the largest single economic development in the history of Texas.

It also ranks as the largest oil and gas development in the world based on capital invested.

It’s estimated almost $30 billion was spent developing the play in 2013.

According to the U. S. Energy Information Administration, the twin booms in the Eagle Ford and North Dakota’s Bakken Formation have pushed the United States past Saudi Arabia and Russia to become the world’s largest petroleum and natural gas producer.

The Eagle Ford boom had more than a $60-billion impact on the South Texas economy in 2012 and over 116,000 Eagle Ford jobs were supported in a 20-county area impacted by the activity.

That, of course, doesn’t include Milam.

Just yet.

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