Acquisitions & Divestitures

E&Ps Discover Premium In South Louisiana Vertical Play

Old-time conventional E&P is yielding big profits in South Louisiana for these operators familiar with bypassed potential.

Gregory DL

Morris

Contributor

Gregory DL Morris, Hart Energy

Wed, 01/23/2019 - 08:30 AM

Baywater Atchafalaya drilling rig, operating for Upstream Exploration, drilled the Palmetto D prospect in the East Cox Bay Field in Plaquemines Parish, La. The company has drilled four wells so far. (Source: Upstream Exploration LLC)

[Editor's note: A version of this story appears in the January 2019 edition of Oil and Gas Investor. Subscribe to the magazine here.]

The fracked, horizontal, unconventional-resource bonanza seems ubiquitous across the Lower 48. It is not.

Vertical development of conventional resources is not only alive and well on Louisiana’s Gulf Coast, proponents make a powerful case for its profitability over horizontal drilling and fracking—albeit while the sweet spots aren’t thousands of square miles in size.

Wells can cost 10% of those in shale. Leases can cost as little as 1%. And prices for crude are higher on the Gulf Coast. Louisiana Light Sweet (LLS) usually fetches a price near that of Brent and usually at a substantial premium over West Texas Intermediate (WTI).

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Texas/La Gulf Coast

Gregory DL Morris

Gregory DL Morris has covered conventional energy from exploration and production to refining and petrochemicals. He regularly contributes to Oil and Gas Investor and Midstream Business.

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