East Texas | Southwestern Energy

Southwestern Energy Company was a newcomer to East Texas in 2000 when it purchased nearly 11,000 acres in the Overton field. At that time, 16 wells were producing a modest 1.8 MMcf per day. By applying the principles of the company’s Formula for Success, employees used new drilling and completion techniques to yield outstanding results. Over the next eight years, the company drilled and completed over 400 wells producing more than 100 billion cubic feet of gas and developed more than 400 billion cubic feet of gas reserves. Southwestern’s opportunities in East Texas continue to expand in the Angelina River Trend area’s James Lime, Pettet, Travis Peak, Cotton Valley, and Haynesville/Bossier Shale formations.
In 2009, the company invested approximately $167 million in East Texas and participated in 46 wells, of which 33 were successful and 13 were in progress at year-end, resulting in a 100% success rate and adding new reserves of 94 Bcfe. This area recorded negative revisions of approximately 55.3 Bcfe primarily due to a comparative decrease in the average 2009 gas price from the year-end 2008 gas price and 25.5 Bcfe due to negative performance revisions. Net production from East Texas was 34.9 Bcfe in 2009, compared to 31.6 Bcfe in 2008.
The company’s 2009 drilling program was primarily focused on developing the James Lime formation in its Jebel prospect area located in Shelby County, Texas, and it initiated drilling in the Haynesville Shale in Shelby and San Augustine Counties with good success. At December 31, 2009, Southwestern had participated in 77 James Lime horizontal wells, 51 of which were operated. Of those, 43 wells that were operated were placed on production at an average gross initial production rate of 9.8 MMcfe per day, resulting in net production from the James Lime of approximately 48 MMcf per day at December 31, 2009.
In the second quarter of 2008, Southwestern signed a 50/50 joint venture agreement with a private company targeting the Haynesville/Bossier Shale intervals in Shelby and San Augustine Counties, Texas. The first horizontal well, the Red River 877 #1 located in Shelby County, was production tested at 7.2 MMcf per day in the first quarter of 2009. The company drilled four additional wells in the Haynesville Shale formation which production tested at 13.4 MMcf per day, 16.7 MMcf per day, 21.0 MMcf per day and 18.1 MMcf per day. Additionally, Southwestern completed its first well in the Middle Bossier formation which production tested at 11.3 MMcf per day. In total, the company has approximately 42,300 net acres it believes are prospective for the Haynesville and Middle Bossier Shales and its average gross working interest is approximately 61%.
Southwestern engages in gas gathering activities in East Texas in connection with its Angelina properties. At year-end 2009, the company had approximately 21 miles of pipeline in Texas.
For 2010 in East Texas, the company expects to participate in approximately 50 to 60 gross wells, 22 to 27 of which will be operated. Of the wells planned in 2010, 21 to 26 wells will be targeting the Haynesville or Middle Bossier Shales and 29 to 34 wells will be targeting the James Lime, Pettet or Cotton Valley formations.

Last Updated on 03/01/2010