Penn Virginia’s Eagle Ford position
On March 1, Penn Virginia Corporation (PVAC) completed the acquisition of Eagle Ford assets located primarily in Gonzales and Lavaca Counties, Texas, from Hunt Oil Company.
The company was one of the first to announce an Eagle Ford acquisition at the start of the year.
The transaction expands Penn Virginia’s core net leasehold position by 9,700 net acres. As a result of the transaction, the company’s operated net Eagle Ford acreage has increased from 93% to over 99%.
The acquired assets include production of ~1,870 barrels of oil equivalent per day, ~89% of which is oil.
After the Hunt Oil Company acquisition, Penn Virginia’s working interest in Area 1 in Eagle Ford increased from 58% to 77%. As a result of the higher interest and anticipated higher drilling, the company expects its production growth for 2018 to be ~127% higher than its production in 2017.
2018 production and capex forecast
Around 95% of Penn Virginia’s 2018 capital will be directed at drilling and completions in Eagle Ford. The company plans to drill a total of 55–60 gross wells, or 45–50 net wells. About 33–35 of these wells will be drilled in Area 1 in Eagle Ford, where the company holds 278 net drilling locations. Around 22–25 wells will be drilled in Area 2 in Eagle Ford, where the company holds 222 net drilling locations. Penn Virginia also expects to drill 22 extended reach lateral wells in 2018.
In the next and final part of this series, we’ll learn about the oil and gas producer that could be increasing its focus in the Eagle Ford Shale.