XTO Energy Inc. has set a target to jump its natural gas-heavy production volumes by 17% in 2008 over this year’s levels, but instead of pouring the lion’s share of the capital budget into its prodigious Barnett Shale play, the producer plans to spend more money on emerging gas plays in East Texas and Louisiana.

The Fort Worth, TX-based producer last week said it has approved a 2008 capital budget of $2.6 billion for development and exploration. Another $400 million is budgeted to construct pipeline infrastructure and compression and processing facilities. The independent said it expects to drill about 1,160 wells (980 net) and perform 750 (600 net) workovers and recompletions.

About $850 million is allocated for XTO’s Eastern Region properties, which include East Texas and Louisiana. XTO’s top asset in the region is Texas’ Freestone Trend, where daily production is about 626 MMcfe. Output, said XTO, is on pace to grow 10-20% a year over the next few years. XTO said it has identified up to 2,100 drilling locations across the Eastern Region, which represent four to five years of development.

In its Eastern Region, XTO said the “primary producing horizons” include the Pettit, Rodessa, Travis Peak (Hosston in Louisiana.), Cotton Valley Sand, Bossier (Gray Sand in Louisiana), Cotton Valley Lime and the Haynesville, which all range in depth from 5,000 to 13,000 feet.

Earlier this month, EnCana Corp. bought out its partner in the Amoruso Field of the Deep Bossier in East Texas, a field that EnCana CEO Randy Eresman called the “best emerging unconventional gas play in North America” (see NGI, Nov. 12).

XTO has allocated about $700 million for its Barnett Shale Region, where it is one of the leading producers. XTO entered the Barnett in 2004, and it holds a position of about 240,000 net acres. Current production is 490 MMcf/d (gross).

In the Permian District, XTO set aside $425 million for exploration and development. The San Juan, Raton, Uinta and Piceance basins combined will be allocated $300 million. In addition, the Arkoma Basin and Midcontinent properties are budgeted $200 million. XTO also has budgeted $125 million for “exploration events.”

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