Sanchez Energy Corp. is in full development mode in each of its project areas in the Eagle Ford Shale and is preparing to begin an operated drilling program next year on recently acquired Tuscaloosa Marine Shale (TMS) acreage. Third quarter production was up by 710% from the year-ago quarter.

Third quarter production was 1.08 million boe (11,774 boe/d), an increase of 54% over the second quarter, and consisted of 76% oil, 10% natural gas liquids (NGL), and 14% natural gas. Current production is about 15,500 boe/d, excluding about 1,500 boe/d that is shut-in for offset fracture stimulation operations.

“Our third quarter 2013 average daily production of approximately 11,800 boe/d was above the midpoint of our guidance range of 11,000-12,000 boe/d,” said CEO Tony Sanchez. “With six rigs drilling (five net), 19 wells in various stages of completion, and the addition of our recently closed Wycross acquisition [see Shale Daily, Sept. 10], we expect our production to continue growing at a rapid pace, and we reiterate our fourth quarter 2013 average daily production guidance range of 15,000-17,000 boe/d.”

During the third quarter Sanchez entered the TMS by acquiring 40,000 undeveloped net acres in the core of the play (see Shale Daily, Aug. 9).

“With a significant portion of the acquired acreage held by production and plenty of term on the remaining acreage, we plan to participate in several non-operated wells in the area before commencing our operated TMS drilling program in 2014,” the CEO said. “As well costs are trending down and well performance continues to improve, we see significant upside potential from this strategic diversification while maintaining our focus on our Eagle Ford operations.”

Sanchez has 25 gross wells in various stages of drilling and completion.

Next year Sanchez plans to spud 75-80 net wells using an annual average rig count of approximately five rigs net. Spending for this is estimated to be about $700 million. About 95% of the capital program is directed to drilling and completing new wells. The company expects to end 2014 producing 22,000-26,000 boe/d and expects next year’s production to be more than 100% greater than this year’s.

In addition to the TMS acreage, Sanchez has 144,000 net acres in the Eagle Ford Shale, 82,000 net acres in the Bakken/Three Forks/Heath, and 1,000 non-operated net acres in the Haynesworth Shale.