Southwestern Energy Co. of Houston on Wednesday announced its capital investment for 2014 will be $2.3 billion, compared to a projected $2.25 billion in 2013.
In Arkansas, this includes a $900 million investment in central Arkansas' Fayetteville Shale Play — the same as 2013 — and $178 million in southern Arkansas and northern Louisiana's Lower Smackover Brown Dense formation, up from $90 million in 2013.
The company had 411 gross operating wells in the shale in 2013 and 326 net operating wells. Next year, those numbers are projected to be 460-470 and 320-330.
Wells in the Brown Dense are expected to increase from six to 14.
"2014 is going to be a good year for Southwestern Energy," CEO Steve Mueller said in the release. "In the Fayetteville Shale, our well performance continues to improve, evidenced by a well we recently placed on production at over 12 MMcf per day, and our effienciencies created by our vertical integration are also expected to continue to improve keeping our well costs low."
Mueller said the company's Brown Dense project will give it "meaningful upside" as it starts drilling new wells in that area.
In November, Southwestern reported drilling its "best well to date" in the Brown Dense, a formation covering southern Arkansas and northern Louisiana. The formation ranges in depths from 8,000 to 11,000 feet. Only now has new technology enabled companies to reach oil locked deep in the formation, and the energy industry thinks the Brown Dense could provide another oil boom in the region.
Experts have estimated that drilling a well in the Brown Dense Play costs about $20 million. To make drilling a success, Southwestern would need to produce several hundred barrels of oil a day on a sustained production basis. A barrel is the international standard for oil and equals 42 gallons of crude oil.
While no company has seen success on the Arkansas side of the Brown Dense, Southwestern has reported progress on wells in Louisiana.