Tendersinfo keep you informed about the latest events in the national and international Procurement Industry. Procurement News provides in-depth coverage of the procurement industry, including contract awards, contract additions, new contract wins, mergers and acquisitions. Tendersinfo through its tender news section provides an update on all domestic and global tendering opportunities, invitation to bid & trade leads.
UNITED STATES : Eureka Energy secures US$50 million as funds for Sugarloaf shale gas project
Publish Date : 22-Feb-2012
A debt facility of US $50 million has been secured by Eureka Energy to fund its share of an aggressive drilling program at its flagship Sugarloaf shale gas project on shore Texas, aimed at increasing reserves and production.
For the December 2011 quarter, Eureka’s share of production was equivalent of 2,631 barrels of oil, while operator Marathon Oil (NYSE:MRO) has an aggressive drilling program that targets a major increase in both proved reserves and production.
Capital allocation, value realisation for the field, which produces from the liquids rich Eagle Ford shale and optimum well spacing to optimise the overall development plan, will be evaluated by the program.
With around 200 rigs reported to be operating, The Eagle Ford Shale area is considered to be one of the premium shale plays in North America.
Marathon had signalled that it would spend half of its US$2.7 billion North American exploration and production budget on the Eagle Ford shale.
This includes two additional fracture stimulation crews, apart from ramping up to 17 rigs and drilling 200 to 210 wells.
As various operators accelerate development of the estimated resources of 3 billion barrels of oil and 20 trillion cubic feet of gas, Eagle Ford shale’s total production, currently estimated at over 200,000 barrels f oil equivalent per day is expected to increase to over 1.2 million within the next 5-6 years.
The first $15 million tranche of the 3-year facility provided by Macquarie Bank is immediately available to Eureka. Additional funds will be made available based on reaching reserves milestones.
Eureka is required to issue options by the LIBOR based facility as it draws down funds. At the end of December 2011 quarter, the company had US$6.08 m cash in hand.
Eureka has a 6.25% working interest in the Sugarloaf field.
