The wave of M&A activity in South Texas apparently hasn’t crested yet. Over the past couple months, Chesapeake Energy announced two deals totaling $2.825 billion that will almost complete its planned departure from the Eagle Ford — and signal UK-based INEOS’s arrival in the basin and a more than doubling of WildFire Energy’s production there. Just as important, Western Canada’s Baytex Energy a few days ago unveiled a $2.5 billion plan to acquire Ranger Oil, a pure-play Eagle Ford E&P, and thereby triple its South Texas production and gain its first operating capability in the U.S. And international interest in the basin doesn’t end there — Spanish energy giant Repsol, which had previously acquired the share of an Eagle Ford partnership held by Norway’s Equinor, recently bought basin assets held by Japan’s INPEX. (How’s that for multi-national M&A?) In today’s RBN blog, we discuss the latest round of E&P acquisitions and sales in South Texas, where production has been on the rebound.
Canadian crude output is rising, requiring new export routes. As traditional pathways face constraints, the U.S. Rockies—especially the Guernsey, WY hub—are emerging as key corridors for moving Canadian heavy crude to downstream markets, including the Gulf Coast.
Back in the first half of the 2010s, the Eagle Ford was in its glory, duking it out with the Permian and the offshore Gulf of Mexico for the #1 spot in crude oil production and with the then-preeminent Haynesville for top honors in natural gas output. But the mid-decade crash in oil and gas prices hit the Eagle Ford harder than any other U.S. production area and it didn’t rebound the way those other basins did, for a variety of reasons. Lately, however, M&A activity in the shale play has been surging, suggesting that the Eagle Ford may finally be on the verge of a serious, sustained comeback.
As we said last fall in Part 1, crude oil and natural gas production in the Eagle Ford peaked at about 1.7 MMb/d and 7.4 Bcf/d, respectively, in the mid-2010s, then sagged, bounced around a bit, and (like almost every basin) took a dive with COVID. Over the past few months, however, oil and gas production in South Texas have been showing new signs of life, averaging about 1.2 MMb/d and (a near-record) 7.3 Bcf/d, respectively, in February (blue and orange lines, respectively, in Figure 1 below). In that blog, we also discussed the slew of M&A activity occurring in South Texas, including Marathon Oil’s $3 billion purchase of Ensign Natural Resources’ Eagle Ford assets, Devon Energy’s $1.8 billion acquisition of Validus Energy, and a number of smaller deals by smaller players.
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About the song
“Come Back Song” was written by Darius Rucker, Casey Beathard and Chris Stapleton. It appears as the second song on Darius Rucker’s third studio album, Charleston, SC 1966. Released as the first single from the album in July 2010, it went to #1 on the Billboard Hot Country Songs chart and #37 on the Billboard Hot 100 Singles chart. It has been certified Platinum by the Recording Industry Association of America (RIAA). Personnel on the record were: Darius Rucker (lead vocals), Gordon Mote (Wurlitzer electric piano), Michael Rhodes (bass), Pat Buchanon and J. T. Corenflos (slide guitars), Dan Dugmore (steel guitar), Shannon Forrest (drums), Eric Darken (percussion), Ilya Toshinsky (mandolin), Bryan Sutton (acoustic guitar), and Wes Hightower (backing vocals).
Charleston, SC 1966 was the third solo album and the second country music album from Rucker. The album was recorded in early 2010 at Capitol Nashville and produced by Frank Rogers. It was released in October 2010 and went to #1 on the Billboard Top Country Albums chart and #2 on the Billboard 200 Albums chart and has been certified Gold by the RIAA. Three singles were released from the LP.
Darius Rucker is an American singer, guitarist, and songwriter. He first gained fame as the lead vocalist with the rock band Hootie & the Blowfish, which he founded with Mark Bryan, Jim Sonefeld, and Dean Felber in 1986 while all were students at the University of South Carolina. He released five studio albums and had six Top 40 hits while with the band. In 2002 he released his first solo R&B album. Starting in 2008, Rucker has focused on country music. With the release of his first country music single “Don’t Think I Don't Think About It” in 2008, he became the first black country music artist to have a #1 single since Charley Pride in 1983. As a solo artist, he has released seven studio albums, one compilation album and 20 singles. Rucker has won three Grammy Awards and two CMA Awards. He still records and tours. Hootie & the Blowfish still occasionally perform live with Rucker, and put on the annual Hootie Fest, with the next one to be held in Cancun, Mexico, in April 2023.
