Assessment of the Mexican Eagle Ford Shale Oil and Gas Resources

According to the 2011 Energy Information Agency (EIA) global assessment, Mexico ranks 4th in shale gas resources. The Eagle Ford shale is the formation with the greatest expectation in Mexico given the success it has had in the US and its liquids-rich zone. Accurate estimation of the resource size and future production, as well as the uncertainties associated with them, is critical for the decision-making process of developing shale oil and gas resources.

The complexity of the shale reservoirs and high variability in its properties generate large uncertainties in the long-term production and recovery factors of these plays. Another source of uncertainty is the limited production history. Given all these uncertainties, a probabilistic decline-curve analysis approach was chosen for this study, given that it is relatively simple, it enables performing a play-wide assessment with available production data and, more importantly, it quantifies the uncertainty in the resource size.

Analog areas in the US Eagle Ford shale were defined based on available geologic information in both the US and Mexico. The Duong model coupled with a Markov Chain Monte Carlo (MCMC) methodology was used to analyze and forecast production of wells located in the previously defined analog sectors in the US Eagle Ford shale. By combining the results of individual-well analyses, a type curve and estimated ultimate recovery (EUR) distribution for each of the defined analog sectors was obtained. These distributions were combined with well-spacing assumptions and sector areas to generate the prospective-resources estimates. Similar probabilistic decline-curve-analysis methodology was used to estimate the reserves and contingent resources of existing wells.

As of March 2013, the total prospective resources (P90-P50-P10) for the Eagle Ford shale in Mexico (MX-EFS) are estimated to be 527-1,139-7,268 MMSTB of oil and 17- 37-217 TSCF of gas. To my knowledge, this is the first oil estimate published for this formation in Mexico. The most attractive sectors based on total estimated resources as well as individual-well type curves are located in the southeast of the Burgos Basin and east-west of the Sabinas basin. Because there has been very little development to date, estimates for reserves and contingent resources are much lower than those for prospective resources. Estimated reserves associated with existing wells and corresponding offset well locations are 18,375-34,722-59,667 MMSCF for gas and zero for oil. Estimated contingent resources are 14-64-228 MSTB of oil and 8,526-13,327- 25,983MMSCF of gas. The results of this work should provide a more reliable assessment of the size and uncertainties of the resources in the Mexican Eagle Ford shale than previous estimates obtained with less objective methodologies.