Home » Upstream

Upstream

Eagle Rock's Upstream Segment has long-lived, high working interest properties located primarily in the Mid-Continent, Southern Alabama, East Texas, South Texas and West Texas.

As of December 31, 2010 pro forma for the Crow Creek acquisition which closed May 3, 2011, and based on the SEC pricing as of December 31, 2010, our working interest properties included the following:

• 603 operated productive wells and 1,200 non-operated wells 
• Proved reserves of 385 Bcfe with approximately 63% natural gas, 20% crude oil, and 17% natural gas liquids
  • 65% proved developed producing ⁽¹⁾
  • 9% proved developed non-producing 
  • 26% proved undeveloped
• Reserve life index is approximately 17 years ⁽²⁾
• Average production of approximately 83 Mmcfe/d during the second quarter 2011 ⁽³⁾

Our Mid-Continent assets primarily consist of the properties acquired from Crow Creek Energy on May 3, 2011.  Core operating areas include 330 operated wells and 1,063 non-operated wells on approximately 115,500 net acres across the Golden Trend Field, Verden Field and the Cana Shale Play, all located in the Anadarko Basin, the Mansfield Field and other various fields in the Arkoma Basin, and the Barnett Shale in north Texas.  In addition to the current cash flow and low-risk development opportunities provided by the proved reserves acquired, the Crow Creek assets include approximately 13,100 net acres with 434 identified drilling locations in the emerging Cana Shale play in Oklahoma.  Average production from these properties beginning May 3, 2011, the date the Crow Creek acquisition closed, and ending June 30, 2011 was 36.0 MMcf/d, 846 Bopd and 959 Blpd.  

Our Alabama assets, located predominately in Escambia County, Alabama, produce from the Smackover and Norphlet formations from 29 wells. Net production from these properties averaged 4.5 MMcfd, 1,703 Bopd, 834 Blpd and 197 LT/d of sulfur during the second quarter 2011. The production from these formations contains significant percentages of hydrogen sulfide and carbon dioxide which must be extracted prior to sales. As a result, Eagle Rock’s Upstream operating arm, Escambia Operating Company, LLC owns and operates, two treating plants to facilitate the extraction of these contaminants and elemental sulfur, and one cryogenic processing plant to process and sell the natural gas liquids.

Eagle Rock’s East Texas, South Texas and West Texas properties are operated by Eagle Operating Company, LLC. The East Texas assets include 34 producing wells from multiple fields located mostly in Rains, Van Zandt, and Henderson Counties. Our East Texas fields produce from the Smackover formation and during the second quarter 2011 averaged 3.9 MMcfd, 266 Bopd, 594 Blpd and 80 LT/d of sulfur. The production from these assets are gathered, compressed, treated, and processed by a third party processor. Our South Texas properties consist of 11 producing wells in the Jourdanton field located in Atascosa County. These wells produce from the Edwards formation and averaged 1.5 MMcfd and 7 Bopd during the second quarter 2011.

Our Permian assets, acquired in May 2008, are located predominately in Ward, Crane and Pecos Counties, Texas and are characterized by long life oil and gas reserves. Production from 186 wells is derived from multiple pay horizons extending from the shallow Yates formation to the deeper Pennsylvanian formations. The net production from these assets averaged 1.5 MMcfd, 474 Bopd and 217 Blpd in second quarter 2011. Since acquiring these assets, we have drilled and completed 12 wells on these assets in addition to numerous recompletions and workovers that have enhanced our base production. Additional drilling locations exist on these assets providing an ongoing source of organic growth opportunities for Eagle Rock.

(1) EROC PDP reflects recategorization of reserves following the resumption of East Texas production associated with the Eustace facility.

(2) Adjusted to reflect estimate of a full year of East Texas production removing the impact of the Eustace processing facility shut-down.

(3) Includes average production from the acquired Crow Creek assets beginning May 3, 2011 through June 30, 2011.