Global alternative asset manager The Carlyle Group L.P. (NASDAQ: CG) and EOG Resources, Inc. (NYSE: EOG) have entered into a definitive agreement to fund the development of EOG’s oil and gas assets in Ellis County, Oklahoma. As part of the joint venture, Carlyle Energy Mezzanine Opportunities Fund II L.P. will fund up to $400 million for the development program over four years. After certain performance hurdles are achieved in the program, Carlyle’s working interests will largely revert to EOG.
The Carlyle Energy Mezzanine Opportunities Group has 20 investment professionals based in New York and Houston and is dedicated to providing growth and refinancing capital to projects and companies in the energy sector through its two funds Carlyle Energy Mezzanine Opportunities Fund, L.P. and Carlyle Energy Mezzanine Opportunities Fund II, L.P., which have combined assets of approximately $4 billion.
EOG recently reported its first-quarter results and they were spectacular. While the shale king’s earnings were merely in line with expectations, its operational prowess delivered stunning results. Not only did it produce some of the best wells ever drilled in the Permian, but it continues to boost its expectations for future oil recovery.
Fueling that result was the company’s strong well results, driven by recent technical advances. That was most evident in the Permian Basin where its four-well Whirling Wind pad “shattered industry records” after each well produced at an average initial 30-day rate of 5,060 barrels per oil equivalent per day (BOE/d). The company chalked up that result to its “advanced technology and proprietary techniques,” which are leading to “break-through well performance” across the Permian and its other resources plays.
Takeaway:
EOG Resources once again proved that it’s the best shale driller in the country. Thanks to a combination of technology and techniques, the company is drilling some of the best wells in the country while at the same time continuing to expand its low-cost oil position. That’s quite a feat considering that its return hurdles for these wells are so far below those of its competitors.
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Compiled and Published by GIB KNIGHT
Gib Knight is a private oil and gas investor and consultant, providing clients advanced analytics and building innovative visual business intelligence solutions to visualize the results, across a broad spectrum of regulatory filings and production data in Oklahoma and Texas. He is the founder of OklahomaMinerals.com, an online resource designed for mineral owners in Oklahoma.
