Gulf Coast / Shale Daily / Lower Smackover/Brown Dense

Information on the Lower Smackover/Brown Dense

LSBD map

 

Background Information

The Lower Smackover/Brown Dense is an oil and gas reservoir underlying northern Louisiana, parts of southern Arkansas and Mississippi -- although some geologists say the formation could extend as far east as Florida. The LS/BD has been an "emerging" play for years, as operators work near and around it. The Upper Jurassic age, kerogen-rich carbonate source rock ranges in vertical depths from 4,000 to 11,000 feet. The thick, muddy carbonate is believed to be the source rock for plays that include the Upper Smackover formation, which has been producing oil and gas since the 1920s.

In recent years, unconventional operators were testing various areas using horizontal drilling and hydraulic fracturing techniques, with a promise that the region could become another viable resource play using new drilling methods. It remains an emerging play. However, some of the best results as of 2015 remained old school -- verticals.

The formation gets deeper as it moves from the Northwest to the Southeast, with 21st century pioneers up to now mostly testing wells in Louisiana and Arkansas.

Southwestern Energy Corp., considered the biggest leaseholder today, had about 304,371 net acres at the end of 2014, which it obtained at an average cost of $831/acre. Southwestern's leases have an 81% average net revenue interest and an average primary lease term of three years, which could be extended for up to four more years. The company is currently analyzing 75 miles of 3-D seismic data it recently acquired in Union Parish, Louisiana.

At the end of 2014, however, Southwestern still had drilled only 14 operated wells, six of which were producing. Southwestern has acquired 75 miles of 3-D seismic data and was in the process of analyzing that data and the results in early 2015. However, Southwestern was putting more funding into other onshore plays, and in October 2015 was attempting to find a partner to help fund its LS/BD acreage.

A dearth of information exists about the full potential of the LS/BD as Southwestern has only drilled a handful of wells, and other operators have not publicly issued much information to date.

Another Houston-based independent, Linn Energy LLC, reported in July 2015 that it had found a Smackover interval that extended into its Bossier trend, which overlays the Haynesville Shale. Linn encountered the Smackover interval as it was proving up the prospectivity of its Bossier intervals in Louisiana. CEO Mark Ellis said the company was producing from the interval at initial production rates of 4 MMcfe/d.

Other operators holding leases in the play are said to include ExxonMobil Corp., which in 2013 had an estimated 215,000 net acres. Devon Energy Corp. confirmed in 2011 that it had 40,000 net acres across the formation, but little intelligence has been issued since. Breitburn Energy Partners LP in late 2014 also said it had "numerous workover and drilling projects" planned across the Louisiana region, including in the Smackover. Also said to have stakes are Bonanza Creek/Border Exploration, Epsilon Energy/JW Operating, Eagle Rock and Vision Exploration.

Takeaway exists for natural gas production, as the area is host to several pipelines, including Louisiana's Perryville hub in Richland and Ouachita parishes. However, early drilling indicated the formation may produce sour gas, which would need to be treated before becoming pipeline quality.

Counties/Parishes

Arkansas: Ashley, Bradley, Calhoun, Columbia, Hempstead, Lafayette, Miller, Nevada, Ouachita, Union

Louisiana: Clairborne, East Carroll, Morehouse, Ouachita, Richland, Union, West Carroll

LSBD

Local Major Pipelines

Natural Gas: ANR, CenterPoint Energy, Columbia Gulf, Gulf Crossing, Gulf South, Louisiana Intrastate Gas, Midcontinent Express, MidLa, Mississippi River Transmission, Perryville Hub, Southeast Supply Header, Southern Natural, Tennessee, Texas Eastern Transmission, Texas Gas Transmission, Tiger Pipeline, Trunkline

Crude Oil: Arklatex (Plains), Mid Valley Pipeline

 NGLs: ATEX, TEPPCO