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

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 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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