Discovered in 2008 , the Eagle Ford Shale play is one of the largest discoveries of new oil reserves in the United States since Prudhoe Bay , Alaska in 1968 , and extends over 23 South Texas counties . Its southern edge begins at Laredo and trends northeast toward Austin producing natural gas . The northern edge , a formation 50 miles wide , produces oil and the central zone is rich in natural gas liquids .
New Trends are Pushing South Texas Forward
The Eagle Ford ’ s scale and speed of development based on new technologies that allow for extraction of natural gas and oil from shale has created the ‘ Eagle Ford Shale Boom ’. This has attracted exploration and production companies from the Super-majors to the Independents , based on several favorable factors including :
• High Reservoir Quality
• Favorable Business Climate
• Diversity of Play : Contains both natural gas and oil deposits
• Accesses to Talent - Jobs brought to the area as a result of the shale play have wages considerably higher than the average for the region .
• Lower breakeven point - Although the Eagle Ford is not a blanket reservoir , and production capabilities differ from point-topoint , there are ‘ sweet spots ’ where wells are extremely economic .
• Existing infrastructure to support oil and gas operations
• Ready access to Gulf Coast refineries
The high quality and diversity of the shale play has been an important factor in this growth : while natural gas was inexpensive , oil and gas producers shifted focus to more profitable oil . Technology was transferred from shale gas to liquids made from shale , and by 2011 , the number of drilling permits in the area more than doubled .
Since 2007 , Eagle Ford counties have increased production of natural gas by 24 %, oil by 80 % and condensate by 541 %. Effects on the South Texas Economy
The Eagle Ford Shale Play has created revenue for local economies through lease payments ( made to reserve mineral rights for a specific location ), drilling , pipeline and other infrastructure construction , royalties , and the purchase of local goods and services . There has been an estimated $ 7.5 billion in lease payments since 2007 . Even if only 5 % of this compensation is spent in the Eagle Ford counties , it brings $ 375 million into the local economy . In 2011 , the shale play generated an expenditure of approximately $ 14.6 billion by oil and gas producers . Additionally , the jobs brought to the area as a result of the shale play have considerably higher wages than the average for the region , with wages increasing 14.6 % in the 23 Eagle Ford counties , as compared to 6.8 % for all of Texas .
The Shale Boom is Expected to Continue
The discovery of the Eagle Ford Shale Play has sparked enormous oil and gas growth in South Texas . The Shale Boom has also been good for Texas as a whole , as companies drilling in the region often spend money on services in other cities . Although it ’ s difficult to say how long the Shale Boom will continue , large companies are committing billions of dollars to build up the infrastructure of the region , so it is expected that economic growth will continue for years to come .
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