American Oil and Gas Reporter - December 2022 - 56

SpecialReport: Eagle Ford Playmakers
cases using existing facilities and pads to
help lower costs.
Completions Strategy
Henke joined the company two years
ago, he says, at which time the company
took a " deep dive " into its completions
strategy to lower costs and increase production.
" We
focused on the number of frac
stages and cluster architecture, " he notes.
Ranger reduced both the number of holes
per cluster and cluster spacing. He says the
company really did not make much change
in the amount of fluid and sand that it was
pumping, although it is now employing
100% 100-mesh sand in its frac designs.
Ranger Oil's Lower Eagle Ford play
has produced a number of benefits, according
to Henke. First, it has allowed
the company to pay down debt and reduce
leverage by 45%. It also means the company
can pay dividends and repurchase
shares, returning approximately $80 million
to its shareholders since May.
" We are growing organically, " he
adds. " Our production should grow 48%
year-over-year including the Lonestar
Resources acquisition. And organically
we should increase production 15%
through the drill bit. This double-digit
growth also means we have enough cash
flow to make other deals. "
Ranger Oil has operated two rigs since
late 2020 and has added an occasional
third rig this year. Henke says the company
has not yet decided whether it will operate
two or three rigs in 2023.
" Either way, we believe we will break
50,000 bbl/d of oil next year, " he boasts.
" We expect to grow our production by
double digits next year. If we run two
rigs, we expect our growth will be in
the low teens. If we run a third rig, it
should be in the high teens. We have an
estimated 20-year inventory with two
rigs. We have a strong balance sheet, so
we will continue to evaluate strategic
acquisitions in 2023. We should be able
to attract some partners. "
Dry Gas Focus
Like Ranger Oil, Ageron Energy LLC
rebranded itself when it entered the Eagle
Ford Shale play. Unlike Ranger, however,
Ageron now is focused on the dry gas
play in the Austin Chalk.
It wasn't always that way.
" We are just trying to get on the right
side of the cycle, " says Ageron Chief Executive
Officer Bruce Gates, acknowledging
the ebb and flow in the fluctuation of
commodity prices has impacted the stopand-go
drilling activity in the Eagle Ford.
Gates founded US Enercorp Ltd., in
the late 1990s and embarked on a deep
conventional South Texas natural gas
drilling program in 2001.
As gas prices plummeted in 2010,
however, US Enercorp began divesting
its natural gas assets and started acquiring
oil-weighted assets.
" There was a paradigm shift in the industry, "
Gates surmises. " We knew if we
were going to survive, we had to make a
change. "
In 2015, US Enercorp started a new
Backed by private equity investment,
Ageron Energy
LLC is returning to its roots
as a South Texas natural
gas player, pivoting away
from the Eagle Ford's oil
window in favor of the dry
gas window. Ageron is also
kicking off a drilling program
in the Austin Chalk above
the Eagle Ford, initiating
production in 2022 on its
first two Austin Chalk wells,
both of which had peak initial
production rates in excess
of 20 million cubic feet
a day.
56 THE AMERICAN OIL & GAS REPORTER
joint venture with a private equity company,
changed its name to Ageron Energy,
and started a successful drilling program
in the Eagle Ford oil window. By 2018,
however, as gas prices improved, Ageron
Energy diversified back into the dry gas
window of the Eagle Ford, attracting two
new private equity partners.
Gates says Ageron still has oil production,
which reached 6,000 bbl/d in 2020.
" Our oil production is on auto-pilot, " he
points out. " It is a declining resource. "
This year, Ageron's leasing program
has reached more than 17,000 net acres,
and the company began production on
its first two Austin Chalk wells, each
producing more than 20 million cubic
feet a day.
" They hung in at 20 MMcf/d for
three months before starting to decline, "
Gates lauds.
Although Ageron has production and
acreage in seven different counties, he
says " all of our action right now is in
Webb County " in the heart of the dry
gas window.
" Austin Chalk is the gift that keeps on
American Oil and Gas Reporter - December 2022

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