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  • U.S. Energy (USEG) Is By Far The Most Levered Way To Play The Buda Oil Discovery In South Texas 40 comments
    Oct 9, 2013 3:49 PM

    Below this paragraph is the text of an article I wrote about new information uncovered on the Dan Hughes Buda discovery in south Texas. U.S. Energy (NASDAQ:USEG) is by far the most highly levered way for investors to play the Buda. U.S. energy has an enterprise value of $55 million and is the small oil company with a 30% working interest in the Booth-Tortuga lease mentioned below. Because Seeking Alpha uses a $100 million market cap to distinguish between small caps and micro caps U.S. Energy cannot be mentioned in one of their articles that is sent to their partners like Yahoo. After Contango's merger with Crimson Exploration it now has an enterprise value of approximately $950 million. The difference between the enterprise values and the working interests means a share of U.S. Energy gets around 10 times the amount of oil from the Buda as a share of Contango. And Contango is sitting on enough oil in the Buda to potentially have a PV-10 value of $800 million if they decide to run two full time rigs, go for the maximum number of infill wells, and assuming oil stays at an average price of $100. Noel Parks with Ladenburg Thalmann has a $2 price target on U.S. Energy. He stated he is waiting on results from the second well, and maybe the third well, to confirm the discovery before he upgrades the stock. He was unaware of the Dan Hughes wells before it was pointed out to him. The rest of the analysts are also waiting. Because of the Geology the second well is almost certain to be a success. And production from the first well has held up as the Beeler 2H reached full pay-out after three months in the middle of August. The third well which steps out to the west has a very good chance of being a success as well. U.S. Energy is sitting on 2 to 10 times their market cap in PV-10 oil just in the Buda. The 2 times is if the third well is a dud, because they have multiple wells to drill between their successful Beeler #2H well and the Dan Hughes wells. They will get a nice bump in PV-10 value from their petroleum reserve engineers based on the Buda wells they have participated in and the additional surrounding wells drilled by others by the end of the year. Their enterprise value is currently a few million below their existing PV-10 value without the Buda discovery. Those interested should read the links on Dan Hughes filing with the Texas Railroad Commission and the academic paper on the geology. Remember (this is my disclaimer), advice is worth what you paid for it and this advice comes to you for free.

    Excitement has been building in the oil patch in South Texas surrounding the recent Buda oil discovery by private oil company Dan A. Hughes. They discovered major natural fractures in the Buda oil formation along the Zavala and Dimmit County line in Texas. The Hughes Heitz 302 3H well has produced almost 300,000 barrels of light sweet crude oil in a little over a year and is still producing. Unlike Eagle Ford wells, Buda wells do not require fracture stimulation and the wells cost less than $4 million to drill and complete. In addition, the Heitz 3H well is producing fairly large quantities of very liquids rich natural gas.

    What makes this discovery so important for Contango Oil & Gas (NYSEMKT:MCF) is that they have a large lease bordering the western side of the Hughes lease called the Booth-Tortuga lease. This is because of Contango's recent acquisition of Crimson Exploration.

    Key information on this particular Buda sweet-spot is revealed by Dan A. Hughes Oil Company's filing with the Texas Railroad Commission at a hearing to observe field rules for the Buda formation in Zavala and Frio Counties in Texas. The hearing was observed by Black Brush O&G, LLC. In the filing, Dan A. Hughes reveals that "in support of its position it submitted a structural map for the Buda formation for the area surrounding its Heitz lease in Zavala County, Texas. The structural map indicates the Buda formation is contiguous throughout the region. It also shows that the Buda formation is thicker to the west of its lease."

    Contango Oil & Gas has a 50% working interest in 10,140 gross acres on the Booth-Tortuga lease, which neighbors the western side of the Hughes Oil Heitz lease. A small oil company has a 30% working interest in the Booth-Tortuga lease and the rest of the working interests are broken up amongst various entities.

    The real secret to unveiling Buda sweet-spots is unlocked in the hearing when Dan A. Hughes Company testifies that "faulting is present near the eastern boundary of the Zavala and Dimmit County line. Hughes seeks to drill wells near fault lines which create natural fractures due to faulting." Basically, the reason natural fractures occur in the Buda oil formation is because ancient earthquakes split the rocks and allow oil to flow naturally. The way to find natural fractures is to find fault lines. The bigger the better.

    It just so happens that the area Hughes and Contango are drilling in sits on top of ancient underground volcanoes with multiple fault lines. An academic paper by Truitt F. Mathews details the geology of the area. One aspect is a major fault line, known as the Zavala Syncline, runs very close to and potentially right under the Booth-Tortuga lease. The Zavala Syncline splits like a wishbone starting about 10 miles west of Frio County near the border of Zavala and Dimmit Counties. One leg runs due west just south of the Zavala County line and the other leg heads northwest up through Zavala County.

    Based on the well spacing information filed by Dan A. Hughes Oil Company, Contango could have approximately 40 to 80 horizontal drilling locations in the Buda formation due to the natural fractures created by the nearby fault lines. Hughes estimates there are 715,000 barrels of oil in place for every 152 net acres. Their current estimated recovery factor of 15% is for just one vertical well drilled on 152 net acres. But Hughes estimates three more in-fill wells can be drilled for a total of four vertical wells per 152 acres. This would significantly increase the recovery factor. Cotango could be sitting on top of 40 million to 50 million gross barrels of oil in the Buda formation on its Booth-Tortuga lease with a total recovery factor of potentially 30% to 50%.

    The opportunity for investors comes from the fact the information on the geology of Zavala county is obscure. And the documents on the Dan Hughes hearing in front of the Texas Railroad Commission are even more obscure. Contango has already drilled one Buda well that began producing in May and fully paid for itself during August. They have completed the second well and are currently drilling the third well. Right now the analysts following the companies near the Buda discovery are waiting for additional wells to confirm the discovery. They are unaware of the obscure geological information, or of the Dan Hughes filings with the Texas Railroad Commission. If they knew about this they wouldn't be waiting for more results because the first Contango well has been very successful. Results for the second Contango well could be out before the end of October. thirty day production results on the third well could be reported before the end of November.

    There are other publicly traded companies with acreage in the area. Matador Resources (NYSE:MTDR) is shooting 3D seismic and expects results in October. Chesapeake (NYSE:CHK) was the largest leaseholder in the area, but recently sold a lot of acreage to EXCO Resources (NYSE:XCO). Newfield Exploration (NYSE:NFX) owns a large portion of the leases on the western half of the Zavala and Dimmit County line right on top of one of the legs of the Zavala Syncline. Anadarko Petroleum (NYSE:APC) and Sanchez Energy (NYSE:SN) also lease acreage in the area.

    Most investors and oil people know a good Buda well requires finding an area with natural fractures. But they don't know where they occur, or why. They are waiting on someone else to drill near them to take the risk. This is how Contango stumbled into a fortune in the Buda thanks to Dan Hughes. What they should be doing is shooting 3D Seismic like Dan Hughes and Matador and looking for the fault lines. Finding the fault lines is the secret to a good Buda well. Because naturally fractured Buda wells recover their EUR's so quickly, Contango should put out a second full time rig and turn the Buda discovery into a windfall rather than an annuity.

    Disclosure: I am long USEG.

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Comments (40)
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  • intel_analyst
    , contributor
    Comments (38) | Send Message
     
    Thanks HVI for yet another well researched and insightful article.
    IA (aka Colorado_guy)
    10 Oct 2013, 05:01 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    Ditto from me HVI....great article...richtremblay (aka richardclovis)
    10 Oct 2013, 11:00 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI....fyi

     

    http://bit.ly/1ahIZa2

     

    Another Buda Well Permit Pending; WOOD UNIT B Well #1H (this Buda Well is farthest EAST)

     

    Form W-1: Review Status # 772264 API # OP # 190005 - CRIMSON EXPLORATION OPER., INC.
    Pending Approval ,Submitted: 10/22/2013 ,Filed: Online WOOD UNIT B - Well # 1H 01 - ZAVALA County New Drill
    Horizontal
    23 Oct 2013, 05:38 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    Latest Sage results for it's Oscar Wood # 1H buda well...
    Less than 2 months...40,000 plus whole barrels...

     

    http://bit.ly/IleXYS
    29 Nov 2013, 04:16 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    Wood Unit B Well #1H...
    Spud date 12/2/2013
    Surface Casing date 12/4/2013

     

    http://bit.ly/1bLbiA8

     

    Also..
    New permit pending...Beeler # 7H Pending approval 12/5/2013

     

    http://bit.ly/1bk6SO5
    5 Dec 2013, 08:37 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI..fyi
    USEG's 10Q reflects a relationship with US Enercorp regarding their Big Wells Buda prospect...

     

    Has this been public knowledge...

     

    From the 10Q...

     

    "We participate in the Leona River and Booth-Tortuga Eagle Ford/Buda prospects with Contango Oil & Gas Company ("Contango") and in the Big Wells Buda prospect with U.S. Enercorp".

     

    http://bit.ly/1beHnOE

     

    All the best...
    Rich
    10 Nov 2013, 10:21 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI...
    Came across this comment on your Contango blog of October 9th...
    Rich

     

    USEG relevant info

     

    Black Range Minerals, a tiny Australian uranium operation, purchased the Shootaring Canyon mine from Uranium One 2 weeks ago.

     

    http://bit.ly/1bRSGwG

     

    Recall that USEG sold that mine to Uranium One in 2007 with some possible contingent earn out for USEG ($40mm) and Uranium One never actually worked the mine. The deal specifically addresses the contingent payments in that Black Range will take over the liabilities.

     

    I have no idea the probability of USEG actually receiving any proceeds, but chalk it up to one more out of the money option in USEG's portfolio.
    20 Nov 2013, 07:19 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI...
    USEG seems excited about this sale...but although there are $ 40 million in contingencies over time they will not offer a Press Release until the sale closes in the "Spring"...
    Any comment on the ultimate value to USEG should the sale close as expected...

     

    http://bit.ly/1bRSGwG

     

    Thanks, and all the best..
    Rich
    22 Nov 2013, 01:50 PM Reply Like
  • HiddenValueInvestor
    , contributor
    Comments (354) | Send Message
     
    Author’s reply » I did not know about the pending sale. Thanks for sharing this.

     

    I'm pretty sure the value to USEG will ultimately be $40 million if they start the mill. According to the 10K much of that would come in the first few months.
    22 Nov 2013, 02:04 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    Thanks HVI....even with the strong move USEG has made up to the Feb 2012 resistance point of $3.81....before pulling back...I hope you still hold a few shares....
    Rich
    22 Nov 2013, 02:27 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI
    An additional link to the pending sale..

     

    http://bit.ly/1fvZ2Fm

     

    All the best..
    Rich
    23 Nov 2013, 10:23 AM Reply Like
  • HiddenValueInvestor
    , contributor
    Comments (354) | Send Message
     
    Author’s reply » USEG remains my largest core holding. Thanks again for the mining info.
    23 Nov 2013, 12:15 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    You are very welcome...with the well results as good or better than expected, the new JV with US Enercorp, and now the Mill sale pending...the present and future for USEG looks promising...
    Hope to see a number of your informative articles soon whether or not a follow up to your USEG instablogs...or another issue or issues you see promising...
    All the best...with respect
    Rich
    23 Nov 2013, 02:13 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    One more link...Black Range's Presentation..

     

    http://bit.ly/1i4KcaG
    23 Nov 2013, 05:49 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI
    Is Octopus drilling practical or even possible with the naturally frac'd Buda Formation ??

     

    http://bit.ly/18KI4kC

     

    Thanks
    Rich
    7 Dec 2013, 10:17 AM Reply Like
  • HiddenValueInvestor
    , contributor
    Comments (354) | Send Message
     
    Author’s reply » Sorry, but I am not familiar with that drilling technique.
    7 Dec 2013, 11:52 AM Reply Like
  • HiddenValueInvestor
    , contributor
    Comments (354) | Send Message
     
    Author’s reply » Potentially compelling new news on the Buda sweet spot with big impacts for XCO, MCF, and USEG.

     

    U.S. Enercorp is USEG and MCF's new Buda drilling partner on acreage south of the Booth-Tortuga lease. U.S. Enercorp also has acreage a little to the west of the Booth-Tortuga lease right next to XCO's leases. A couple of months ago U.S. Enercorp spudded a new wildcat Buda well. It must have been very successful because U.S. Enercorp permitted a second Buda well, the Elizabeth 2H, in the same area a couple of days ago. This could confirm that the fault line runs south of the Dimmit and Zavala border all the way to Maverick County.

     

    This would prove up all of the western acreage on the Booth-Tortuga lease and it would also prove up some of the acreage for XCO. While the upward movement in USEG and MCF has recently started because of the Buda, the coming upward movement on XCO based on the Buda is in front of it. Between January and May interest in the Buda sweet spot will grow on Wall Street because of MCF and USEG and at some point that interest will move to XCO.

     

    http://bit.ly/18RFhq7
    10 Dec 2013, 09:01 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI..

     

    FYI...Great Expectations..??

     

    http://bit.ly/Jc5GCF
    12 Dec 2013, 04:52 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI...FYI
    Excerpts from MTDR's Analysts Day Presentation..

     

    Good morning everybody. I'll really move along here to first of all talk about our [indiscernible] in South Texas. The first thing to note here is bulk of the -- successful Buda activity is within this green bubble here which is the Pearsall oil field on the Pearsall Arch. And Matador has the [indiscernible] here which is 9,000 acres of contiguous property all held by production where on the no immediate pressure to do anything with that right now but what we're doing is we're observing this activity in the south east corner of the Zavala County and you can see some of these rigs. Some of these rigs are very strong. Five months, 507 barrels a day that's a 30 day average, that's a cumulative production of 77,000 barrels and 78,000 million cubic feet of gas.

     

    Similarly with the Contango 310 barrels a day, the cumulative production here is 9,000 in the first month, some very promising results, very close to the Glasscock Ranch. Now, the reason, I think this is exciting for us is we have recently acquired a 3D seismic survey out here over the Glasscock Ranch and we're still working on the preliminary, what's called the fast track data pack. And what we've identified in that already is a series of seismic [indiscernible] which have a very strong parallel ventilation to fracture patterns that we know from the region. These are regional fracture patterns that are published but also when we drill our Glasscock #2H well we ran a start tool in that well to identify to count up an identify the number of fractures. And what we found is that the down hole fractures correspond very well with the seismic attributes.

     

    Now the other thing that we've observed out here is there seems to be a relationship between the high productivity in short wells and the high productivity Buda wells and there is a reason for that. It's because there is coincidence between the fracture networks in the upper [indiscernible] with the fracture networks in the Buda. That Buda rocks, they get bent over the Pearsall Arch, they both fracture in the same manner, so here is the high productivity area that people at Dan A. Hughes and Texas American are drilling and you can see in the lateral wells here, this is just literally a few miles away from the Southeast corner. We happen to have in our area, as well as down here some of the very best upper Austin Chalk wells.
    So what that does indicate to us is there's a very high likelihood particularly in view of some of the things we're seeing into the seismic of equally high production capability in the Southeast Vascog. And the other exciting thing about this is, these are pretty healthy rates but these wells are not wells that we drill and frac in the same way we do in the Eagle Ford, these are much cheaper wells, so the rates of return on wells in the Buda with this kind of rates are well up in the 100% type of range, so very healthy return. So we're excited, we're watching this and we're going to drill our first test well next year and it will probably be in this Western half of the lease.

     

    We are going to drill one exploratory well in the Buda on our Glasscock Ranch acreage. In 2013 we shot seismic and we had that process, we’re currently interpreting it, but we’re looking to try to extend some encouraging results that are just to the south and west of our acreage there at Glasscock Ranch and southeast of all the county. Dan Hughes, Sage, Crimson, Contango, others in that area have made some really pretty exciting wells there and high volume, lower cost, high rate of return type wells and so we’re looking to do a test of that Buda and if that’s successful it can set up a nice little program for us in the Buda on Glasscock Ranch.
    14 Dec 2013, 10:12 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    FYI....
    Buda Well Status...USEG interest..

     

    Chronological Drilling Order

     

    Beeler #2H...1st Buda well
    Spud...April 2013
    Depth...11,013 feet
    Lateral...3,700 feet
    24 hour initial rate...859 BOE/D...761 brls oil..56 brls Nat Gas Liquids...253 MCF NatGas...25/64th choke
    30 day average...797 BOE/D
    60 day average...750 BOE/D
    60 day gross production...45,000 BOE..approx
    83 day gross production...57,500 BOE..approx
    83 day average...693 BOE/D...158 net BOE/D to USEG
    July average production...597 BOE/D...136 BOE/D net to USEG
    Gross production thru October 2013...102,500 BOE....started May 2013

     

    Beeler #3H...2nd Buda well
    Spud...August 3 2013
    Depth...10,800 feet
    Lateral...3,215 feet
    24 hour initial rate...1,260 BOE/D...92% oil
    30 day average...859 BOE/D

     

    Beeler #4H...3rd Buda well
    Spud...September 2013
    Depth...11,350 feet
    Lateral...3,777
    24 hour initial rate...1,430 BOE/D...84% oil
    30 day average...1,190 BOE/D

     

    Willerson #1H
    Spud...August 26 2013
    Surface Casing...August 27 2013
    Depth...11,030 feet
    Lateral...3,300 feet
    24 hour initial rate...Very Positive!!
    Partial October Production...6,137 oil...10,757 gas

     

    Beeler #5H...4th Buda well
    Spud...October 2013
    Depth...7,696 feet...currently as of 11/12/2013
    Lateral...3,636 feet planned...

     

    Wood Unit B Well #1H
    Permit approved 10/30/2013
    Spud...December 2 2013
    Surface Casing..December 4 2013

     

    Beeler #6H...5th Buda well
    Permit approved 10/26/2013

     

    Beeler #7H...6th Buda well
    Permit pending / Filed 12/5/2013

     

    Location of Wells:

     

    Beeler #2 (1st Buda) 6.2 Miles NW of Big Wells
    Beeler #3 (2nd Buda) 6.2 miles NW of Big Wells
    Beeler #4 (3rd Buda) 6.2 miles NW of Big Wells
    Beeler #5 (4th Buda) 5.9 miles NW of Big Wells
    Beeler #6 (5th Buda) 6.5 miles NW of Big Wells
    Beeler #7 (6th Buda) 7.3 miles NW of Big Wells
    Willerson #1H..Buda 5.0 miles NW of Big Wells
    Wood Unit B Well #1H 5.2 miles NW of Big Wells
    15 Dec 2013, 11:26 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    Buda Wells / Status
    Added...RRC Monthly Production Numbers...Whole Barrels / Oil....MCF / Gas

     

    Chronological Drilling Order

     

    Beeler #2H...1st Buda well
    Spud...April 2013
    Depth...11,013 feet
    Lateral...3,700 feet
    24 hour initial rate...859 BOE/D...761 brls oil..56 brls Nat Gas Liquids...253 MCF NatGas...25/64th choke
    30 day average...797 BOE/D
    60 day average...750 BOE/D
    60 day gross production...45,000 BOE..approx
    83 day gross production...57,500 BOE..approx
    83 day average...693 BOE/D...158 net BOE/D to USEG
    July average production...597 BOE/D...136 BOE/D net to USEG
    Gross production thru October 2013...102,500 BOE....started May 2013
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    May Production..14,142 Oil...No Gas
    June Production..20,498 Oil...No Gas
    July Production..12,605 Oil...33,901 Gas
    Aug Production..10,815 Oil...34,245 Gas
    Sept Production..8,392 Oil...36,167 Gas
    Oct Production..7,437 Oil...30,307 Gas

     

    Beeler #3H...2nd Buda well
    Spud...August 3 2013
    Depth...10,800 feet
    Lateral...3,215 feet
    24 hour initial rate...1,260 BOE/D...92% oil
    30 day average...859 BOE/D
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Sept Production..9,312 Oil...5,924 Gas
    Oct Production..18,145 Oil...20,695 Gas

     

    Beeler #4H...3rd Buda well
    Spud...September 2013
    Depth...11,350 feet
    Lateral...3,777
    24 hour initial rate...1,430 BOE/D...84% oil
    30 day average...1,190 BOE/D
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Oct Production..19,696 Oil...19,471 Gas

     

    Willerson #1H
    Spud...August 26 2013
    Surface Casing...August 27 2013
    Depth...11,030 feet
    Lateral...3,300 feet
    24 hour initial rate...Very Positive!!
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Partial October Production...6,137 OIl...10,757 Gas

     

    Beeler #5H...4th Buda well
    Spud...October 2013
    Depth...7,696 feet...currently as of 11/12/2013
    Lateral...3,636 feet planned...

     

    Wood Unit B Well #1H
    Permit approved 10/30/2013
    Spud...December 2 2013
    Surface Casing..December 4 2013

     

    Beeler #6H...5th Buda well
    Permit approved 10/26/2013

     

    Beeler #7H...6th Buda well
    Permit pending / Filed 12/5/2013

     

    Location of Wells:

     

    Beeler #2 (1st Buda) 6.2 Miles NW of Big Wells
    Beeler #3 (2nd Buda) 6.2 miles NW of Big Wells
    Beeler #4 (3rd Buda) 6.2 miles NW of Big Wells
    Beeler #5 (4th Buda) 5.9 miles NW of Big Wells
    Beeler #6 (5th Buda) 6.5 miles NW of Big Wells
    Beeler #7 (6th Buda) 7.3 miles NW of Big Wells
    Willerson #1H..Buda 5.0 miles NW of Big Wells
    Wood Unit B Well #1H 5.2 miles NW of Big Wells

     

    16 Dec 2013, 11:03 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI..FYI
    New request for permit...12/20/2013
    Beeler #8H...7th Crimson Buda well !!

     

    http://bit.ly/19ijCrb
    20 Dec 2013, 09:21 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI...FYI...in case you are un-aware...

     

    After completing the Willerson #1H...with USEG interest....US Enercorp spud the Elizabeth #1H on October 17th....with NO USEG interest..

     

    Operator: 875468 - U.S. ENERCORP, LTD.
    Issued: 10/08/2013, Filed: Online
    Lease Name: ELIZABETH
    Well #: 1H, District: 01, County: DIMMIT
    Filing Purpose: New Drill
    Wellbore Profiles: Horizontal
    Status: Approved View Current W-1 View Current W-1H View Current Permit
    Completion Information
    Well Status Code Spud Date Drilling Completed Surface Casing Date
    - 10/17/2013 10/19/2013

     

    On December 19th....US Enercorp got their permit approved for the Elizabeth #2H....8 miles NW of Big Wells..also NO USEG interest other than de-risking the area...

     

    http://bit.ly/1cuGSRq

     

    All the best...Happy New Year..
    Rich
    27 Dec 2013, 04:20 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    Added: November RRC Production Numbers

     

    Chronological Drilling Order

     

    Beeler #2H...1st Buda well
    Spud...April 2013
    Depth...11,013 feet
    Lateral...3,700 feet
    24 hour initial rate...859 BOE/D...761 brls oil..56 brls Nat Gas Liquids...253 MCF NatGas...25/64th choke
    30 day average...797 BOE/D
    60 day average...750 BOE/D
    60 day gross production...45,000 BOE..approx
    83 day gross production...57,500 BOE..approx
    83 day average...693 BOE/D...158 net BOE/D to USEG
    July average production...597 BOE/D...136 BOE/D net to USEG
    Gross production thru October 2013...102,500 BOE....started May 2013
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    May Production...14,142 Oil...No Gas
    June Production.20,498 Oil...No Gas
    July Production...12,605 Oil...33,901 Gas
    Aug Production...10,815 Oil...34,245 Gas
    Sept Production....8,392 Oil...36,167 Gas
    Oct Production......7,437 Oil...30,307 Gas
    Nov Production.....6,680 Oil...29,847 Gas

     

    Beeler #3H...2nd Buda well
    Spud...August 3 2013
    Depth...10,800 feet
    Lateral...3,215 feet
    24 hour initial rate...1,260 BOE/D...92% oil
    30 day average...859 BOE/D
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Sept Production..9,312 Oil......5,924 Gas
    Oct Production..18,145 Oil....20,695 Gas
    Nov Production...8,993 Oil....15,412 Gas

     

    Beeler #4H...3rd Buda well
    Spud...September 2013
    Depth...11,350 feet
    Lateral...3,777
    24 hour initial rate...1,430 BOE/D...84% oil
    30 day average...1,190 BOE/D
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Oct Production...19,696 Oil....19,471 Gas
    Nov Production..24,855 Oil... .25,987 Gas

     

    Willerson #1H
    Spud...August 26 2013
    Surface Casing...August 27 2013
    Depth...11,030 feet
    Lateral...3,300 feet
    24 hour initial rate...Very Positive!!
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Oct Production (partial)...6,137 OIl...10,757 Gas
    Nov Production...7,131 Oil....24,290 Gas

     

    Beeler #5H...4th Buda well
    Spud...October 2013
    Depth...7,696 feet...currently as of 11/12/2013
    Lateral...3,636 feet planned...

     

    Wood Unit B Well #1H
    Permit approved 10/30/2013
    Spud...December 2 2013
    Surface Casing..December 4 2013

     

    Beeler #6H...5th Buda well
    Permit approved 10/26/2013

     

    Beeler #7H...6th Buda well
    Permit pending / Filed 12/5/2013
    Permit approved 12/19/2013

     

    Beeler #8H...7th Buda well
    Permit pending / Filed 12/20/2013
    9 Jan 2014, 09:10 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    New Willerson #2H well permit pending....US Enercorp / USEG..

     

    http://bit.ly/19yd73i

     

    Also... additionl Zavala County Buda interest...Texas American Resources...

     

    http://bit.ly/1f0dqSH
    18 Jan 2014, 11:07 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    More on Gulf Coast Western LLC entry in Wilson County...

     

    http://bit.ly/1aHs5Cp
    21 Jan 2014, 04:32 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    Beeler #8H...7th Buda well
    Permit pending / Filed 12/20/2013

     

    Spud date....January 19 2014
    Surface Casing date....January 22 2014...

     

    http://bit.ly/1dRZ9dR
    23 Jan 2014, 10:44 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    New Crimson / Contango Buda Well Permit Pending....

     

    Dunlap #1H...7.1 miles SW of Big Wells in Dimmit County..

     

    http://bit.ly/1fkDD0h
    28 Jan 2014, 03:27 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    The Dunlap #1H well with permiot pending...

     

    Apparently this well is south of the Booth Tortuga Lease Area....with no USEG interest ...
    30 Jan 2014, 05:12 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    Partial December Buda Production

     

    Beeler #2H... Dec... 5,940 boe and 30,268 mcf gas
    Beeler #3H... Dec... 6,447 boe and 20,678 mcf gas
    Beeler #4H... Dec. 17,602 boe and 23,658 mcf gas

     

    Links and more to come...
    5 Feb 2014, 03:12 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    http://bit.ly/Lzsayd

     

    http://bit.ly/Lzsayf

     

    Awesome Beeler #4H...

     

    http://bit.ly/Lzs8GR

     

    Still waiting on the US Enercorp / USEG....Willerson #1H December results..
    5 Feb 2014, 03:33 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    USEG and MCF Updates...

     

    http://bit.ly/1aRqQmn

     

    http://bit.ly/1jt5nTW

     

    Excerpts from MCF's Update....

     

    "As of January 31, 2014, the seven day average in the Buda formation was 2,069 boed (57% oil), and expect that to increase during 2014."

     

    "Similar to our drilling performance experienced in the Woodbine, we have optimized our Buda drilling and completion practices to reduce well costs from an average of $3.9 million per well on our first three wells, to an average of $2.6 million per well on the last three wells while lateral lengths increased an average of 33%. Days from spud to initial production have also decreased from 34 days to 25 days, when comparing the same group of wells. We expect to have one to two rigs active in the area for the remainder of 2014 to drill 14 operated wells, as we continue to delineate and evaluate the Buda potential over our 6,000 net acre position."
    11 Feb 2014, 11:36 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    USEG Investor's Presentation...

     

    http://bit.ly/1aSuufS
    11 Feb 2014, 06:26 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI..
    It will be interesting to hear any comments from you subsequent to the release of the operation's update from both MCF and USEG and today's webcast.
    What are we missing here....except un-informed investors / analysts ??
    All the best..
    Rich
    12 Feb 2014, 10:38 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    Added: January Production

     

    Condensed List / Producing Wells

     

    Chronological Drilling Order

     

    Beeler #2H...1st Buda well..Crimson
    24 hour initial rate...859 BOE/D...761 brls oil..56 brls Nat Gas Liquids...253 MCF NatGas...25/64th choke
    30 day average...797 BOE/D
    60 day average...750 BOE/D
    60 day gross production...45,000 BOE..approx
    83 day gross production...57,500 BOE..approx
    83 day average...693 BOE/D...158 net BOE/D to USEG
    July average production...597 BOE/D...136 BOE/D net to USEG
    Gross production thru October 2013...102,500 BOE....started May 2013
    Gross production thru January 3014...136,716 BOE
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    May Production..14,142 Oil...No Gas
    June Production..20,498 Oil...No Gas
    July Production..12,605 Oil...33,901 Gas
    Aug Production..10,815 Oil...34,245 Gas
    Sept Production..8,392 Oil...36,167 Gas
    Oct Production..7,437 Oil...30,307 Gas
    Nov Production..6,680 Oil...29,847 Gas
    Dec Production..5,940 Oil...30,268 Gas
    Jan Production..5,935 Oil...30,747 Gas

     

    Beeler #3H...2nd Buda well..Crimson
    24 hour initial rate...1,260 BOE/D...92% oil
    30 day average...859 BOE/D
    Gross production thru January 3014...57,681 BOE
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Sept Production..9,312 Oil...5,924 Gas
    Oct Production..18,145 Oil...20,695 Gas
    Nov Production..8,993 Oil....15,412 Gas
    Dec Production..6,447 Oil....20,678 Gas
    Jan Production..4,723 Oil....17,041 Gas

     

    Beeler #4H...3rd Buda well..Crimson
    24 hour initial rate...1,430 BOE/D...84% oil
    30 day average...1,190 BOE/D
    Gross Production thru January 2014...96,997 BOE
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Oct Production..19,696 Oil...19,471 Gas
    Nov Production..24,855 Oil...25,987 Gas
    Dec Production..17,602 Oil...23,658 Gas
    Jan Production..13,641 Oil...34,672 Gas

     

    Willerson #1H..U S Enercorp
    Initial flow rate..1,039 BOE/D on a 22/64th choke
    30 day average...605 BOE/D (~67% oil).
    Gross Production thru January 2014...32,581 BOE
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Oct Production (partial)...6,137 Oil...10,757 Gas
    Nov Production...7,131 Oil....24,290 Gas
    Dec Production...2,571 Oil....23,139 Gas

     

    Wood Unit B Well #1H..Crimson
    Permit approved 10/30/2013
    Spud...December 2 2013
    Surface Casing..December 4 2013
    30 day average...338 BOE/D 27% Oil
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Jan Production...2,879 Oil....38,592 Gas (Partial Month)

     

    Beeler #7H...6th Buda well..Crimson
    Spud December 26 2013
    Initial flow rates positive
    RRC Numbers...Oil / Whole Barrels...Gas / MCF
    Jan Production...2,063 Oil....2,004 Gas (Partial Month)
    4 Mar 2014, 05:08 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    1 new permit pending 3/5/2014

     

    Status # 781377
    API # OP # 190005 - CRIMSON EXPLORATION OPER., INC.
    Pending Approval ,Submitted: 03/05/2014 ,Filed: Online BEELER - Well # 12H
    01 - ZAVALA County New Drill
    Horizontal

     

    2 new permits pending 3/11/2014....Beeler Unit B #10H and Beeler #5H Sidetrack...

     

    Status # 781824
    API # OP # 190005 - CRIMSON EXPLORATION OPER., INC.
    Pending Approval ,Submitted: 03/11/2014 ,Filed: Online BEELER UNIT B - Well # 10H
    01 - DIMMIT County New Drill
    Horizontal

     

    Status # 781822
    API # OP # 190005 - CRIMSON EXPLORATION OPER., INC.
    Pending Approval ,Submitted: 03/11/2014 ,Filed: Online BEELER - Well # 5HST
    01 - ZAVALA County New Drill
    Horizontal Sidetrack
    SIDETRACK FOR PERMITTED WELL #770599 ( 03/10/2014 03:11:05 PM )
    11 Mar 2014, 07:46 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI
    Here's hoping you remain a USEG shareholder, and should tomorrow's Investor Presentation illustrate continued success with the recently producing wells. as well as the increasing number of permits approved and pending....that you will offer an updated article on USEG's prospects going forward...even as the stock has recently appreciated nicely....
    Thanks for your past articles bringing invaluable exposure to the opportunities available to producers holding Buda formation acreage...and always looking forward to your future insightful articles.
    All the best..
    Rich
    6 Apr 2014, 01:41 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI...fyi

     

    http://bit.ly/1eQOfXC
    18 Apr 2014, 12:22 PM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI...FYI
    EXCO CC..

     

    "Our 2014 drilling program consists of manufacturing and testing in the core area, and appraisal drilling in the adjacent farm-out areas. We have budgeted drilling 90 gross wells, including 6 farm-in wells in the Eagle Ford.

     

    In addition, our evaluation of the 37,000 net acres that are potentially prospective for the Buda formation is underway."

     

    http://seekingalpha.co...
    1 May 2014, 11:29 AM Reply Like
  • richtremblay
    , contributor
    Comments (254) | Send Message
     
    HVI...FYI

     

    http://bit.ly/1gbrDfr

     

    Also...

     

    May 8, 2014
    U.S. Energy Corp. Enters Into Participation Agreement in South Texas
    Initial Drilling to Target the Buda Limestone Formation

     

    RIVERTON, Wyo., May 8, 2014 (GLOBE NEWSWIRE) -- U.S. Energy Corp. (Nasdaq:USEG) (the "Company"), announced today that it has entered into a Participation Agreement covering lands in Dimmit County, Texas with a private South Texas based oil and gas company (the "Seller").

     

    Under the agreement, the Company acquired 33% of the Seller's interest in approximately 12,100 gross (3,384 net) acres. The acreage consists of 3,870 gross (1,080 net) acres of primary leasehold acreage and 8,080 gross (2,203 net) acres of farm-in acreage, to be earned through a continuous drilling program. The farm-in acreage has an initial two well commitment and a 12.5% working interest carry for the leaseholder (the "Farmor") in the first 10 wells. After 100% payout of all costs for the first 10 wells that are drilled under the farm-in program, the Farmor will back in for their 12.5% retained working interest in the prospect. The Seller also retained a 25% working interest back-in after 115% of project payout has been received by the Company. The Company paid $3.9 million to enter into the transaction, which includes leasehold and farm-in acquisition costs as well as our proportionate share of drilling costs for the initial test well in the prospect. A minimum of three Buda formation wells are scheduled to be drilled during the balance of 2014. The first well in the program spud the week of May 5th and is currently drilling in the vertical portion of the wellbore.

     

    In addition to the Buda limestone formation, there are multiple stacked hydrocarbon-bearing formations present in this region of South Texas. The Austin Chalk and Eagle Ford Shale formations will be analyzed during the drilling of the first three Buda formation wells.

     

    "We continue to refine our focus on South Texas due to the multiple hydrocarbon-bearing formation potential in the region. Our initial tests will target the Buda formation, which we believe is highly prospective in the leasehold. In keeping with our 2014 budget and plan, this acquisition can increase our net leasehold in the region by 58% to 8,975 net acres. We have sought acquisitions that are drill ready and we are now participating in three Buda drilling programs. If successful, we believe that our combined drilling programs could add meaningfully to our production and revenues throughout the year and beyond," said Keith Larsen, CEO of the Company.
    8 May 2014, 09:20 AM Reply Like
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