El Paso Corporation, Company Intelligence Report

El Paso Corporation, Company Intelligence Report

Summary

El Paso Corporation (El Paso) is an energy company primarily operates in two segments comprising Exploration and Production (E&P) and Pipeline. El Paso's E&P operations are primarily located in the US, Brazil and Egypt, whereas it has been providing pipeline services primarily to the US market. It also has pipeline infrastructure in Canada and Mexico. The figure below shows El Paso's operations worldwide. During 2009, El Paso generated revenue of around $4.6 billion, representing 14% decline from 2008. The decline in revenue was primarily affected by the 34% decline in the E&P segment which was slightly offset by the 3% increase in pipeline segment revenue during 2009. The E&P segment revenue was accountable for around 39.5% of total El Paso's revenue whereas the pipeline segment accountable for 59.7% of the total revenue during 2009.

Scope

- Investment Thesis: This section highlights the companies new ventures, liquidity issues, assets analysis, hedging, new projects details, capex funding, geographical results of oil and gas operations, and other related analysis.
- Goals and Strategies: Provide highlights on their existing and upcoming challenges with the possible strategies.
- SWOT: This section highlights the companies internal strength, weakness, opportunities and threats to better understand their position in the market
- Production and Development profile: This section highlights the companies' forecasted crude oil and natural gas production from their existing and upcoming assets. It also covers the detailed information and analysis on the producing and development assets.
- Exploration and M&A trends: This section includes exploration assets information resulted due to new discoveries, new drilling and other activities. Additionally, M&A section highlights the companies' recent assets transactions, joint ventures, acquisition, and divestment activities during the specified period.
- Financial Forecast and Valuation: This section highlights the detailed financial forecast of the companies for coming five years. This section also provides intrinsic value of the companies' by using different valuation techniques.
- Peer Group: This section compares peer group performance with the main companies on the basis of share prices, financial ratios, operational and financial parameters and other related activities.

Reasons to buy

The report will enhance the decision-making capability in a more rapid and time sensitive manner. It will allow you to -
- Provide detailed analysis to those who are interested in knowing the companies' existing and future business strategies.
- Provide in-depth analysis on the companies E&P profiles along with the exploration and M&A updates.
- Provide valuable insights to those who are tracking oil and gas markets and wants to know the intrinsic value of the companies.
- Use the analysis for strategy and planning, M&A identifications, and competitor analysis.

1
1.1 List of Tables
1.2 List of Figures
2 El Paso Corporation, Company Overview
2.1 Exploration and Production Segment
2.2 Pipeline Segment
3 El Paso Corporation, Key Events for 2011
4 El Paso Corporation, Key Highlights
4.1 Ruby Pipeline Project; A Win-Win Opportunity
4.2 El Paso's Unconventional Program to Build Long Term Drilling Inventory and Fuel its Production
4.2.1 Eagle Ford Shale
4.2.2 Haynesville Shale
4.2.3 Altamont-Bluebell-Cedar Rim Field
4.3 Highly Levered Capital Structure; Need to Unlever it For Better Liquidity
5 El Paso Corporation, SWOT Analysis
5.1 Strength
5.1.1 Extensive Pipeline Network to Capture Emerging Energy Infrastructure Opportunities
5.1.2 Strong natural gas and oil reserves
5.2 Weakness
5.2.1 Low Reserve-Production (RP) Ratio
5.2.2 Highly Leveraged Capital Structure Could Prevent the Company from Taking Advantage of any Market Opportunity
5.3 Opportunities
5.3.1 Moving Towards Unconventional Plays
5.3.2 The Ruby Pipeline Project
5.3.3 Significant Unconventional Inventory Prospects to Support Long Term E&P Growth
5.4 Threats
5.4.1 High Debt Could Increase El Paso's Marginal Cost of Capital
6 El Paso Corporation, Goals and Strategies
6.1 Divesting Non Core Assets to Restructure its Energy Portfolio; Proceeds will be Utilized to Boost E&P Business and to Improve Liquidity
6.2 El Paso Shifting its Focus Towards Unconventional Prospects; Increasing Oil Content
7 El Paso Corporation, Production Overview
7.1 Production Profile
7.2 The US
7.2.1 Central Division
7.2.2 Western Division
7.2.3 Gulf Coast Division
7.3 International Division
7.3.1 Brazil
7.4 Costs Incurred and Acreage
8 El Paso Corporation, Exploration and Development Overview
8.1 The US
8.1.1 Central Division
8.1.2 Western Division
8.1.3 Gulf Coast
8.2 International
8.2.1 Brazil
9 El Paso Corporation, Pipeline Overview
9.1 Upcoming Pipeline Projects
9.1.1 Elba Express III
9.1.2 CIG Raton 2010 Expansion
9.1.3 Ruby Pipeline
9.1.4 Gulf LNG Clean Energy
10 El Paso Corporation, M&A Activity
11 El Paso Corporation, Production and Financial Statements Forecast
11.1 Income Statement (2007–2015)
11.2 Balance Sheet (2007–2015)
11.3 Cash Flow Statement (2007–2014)
11.4 Financial Ratios
12 El Paso Corporation, Valuation
12.1 Net Asset Value
13 El Paso Corporation, Peer Comparision
13.1 Share Price Performance
13.2 Operational and Financial Performance
13.3 Key Financial and Operational Ratio
14 El Paso Corporation, Detailed Financial and Operational Metrics
14.1 El Paso Corporation, Quarterly E&P Costs Trends
14.1.1 Upstream Capital Expenditure, Q4, 2009-Q4, 2010
14.2 El Paso Corporation, Total Oil and Gas Production
14.2.1 Total Crude Oil and Natural Gas Production Trend, Q4, 2009-Q4, 2010
14.2.2 Total Crude Oil & Natural Gas Production, By Country/Region, Q4, 2009-Q4, 2010
14.3 El Paso Corporation, Crude Oil Production
14.3.1 Total Crude Oil Production Trend, Q4, 2009-Q4, 2010
14.3.2 Crude Oil Production, By Country/Region, Q4, 2009-Q4, 2010
14.4 El Paso Corporation, Natural Gas Production
14.4.1 Total Natural Gas Production Trend, Q4, 2009-Q4, 2010
14.4.2 Natural Gas Production, By Country/Region, Q4, 2009-Q4, 2010
14.4.3 Share Price Performance, 2004-2009
14.4.4 Key Valuation Metrics, 2004-2009
14.5 El Paso Corporation, Total Oil and Gas, Reserves and Production
14.5.1 Total Crude Oil and Natural Gas Production and Reserves Trend, 2004-2009
14.5.2 Total Crude Oil & Natural Gas Production and Reserves By Country/Region, 2004-2009
14.5.3 Total Crude Oil and Natural Gas Reserve Changes, 2004-2009
14.6 El Paso Corporation, Crude Oil/Liquids Production and Reserve
14.6.1 Crude Oil/Liquids Production and Reserve Trend, 2004-2009
14.6.2 Crude Oil Production and Reserves By Country/Region, 2004-2009
14.6.3 Crude Oil/Liquids Reserve Changes, 2004-2009
14.7 El Paso Corporation, Natural Gas Production and Reserve
14.7.1 Natural Gas Production and Reserve Trend, 2004-2009
14.7.2 Natural Gas Production and Reserves, By Country/Region, 2004-2009
14.7.3 Natural Gas Reserve Changes, 2004-2009
14.8 El Paso Corporation, Total Crude Oil and Natural Gas Reserves Life Index
14.8.1 Total Crude Oil and Natural Gas Reserves Life Index, 2004-2009
14.8.2 Total Crude Oil and Natural Gas Reserves Life Index, By Country/Region, 2004-2009
14.9 El Paso Corporation, Allocation of the Upstream Capital Expenditure
14.9.1 Upstream Capital Expenditure, 2004-2009
14.9.2 Acquisition Costs By Country/Region, 2004-2009
14.9.3 Exploration and Development Costs, By Country/Region, 2004-2009
14.10 El Paso Corporation, Oil and Gas Cost Per boe, $/boe
14.10.1 Oil and Gas Cost Per boe, $/boe, 2004-2009
14.11 El Paso Corporation, Oil and Gas Revenue and Expenses
14.11.1 Oil and Gas Revenue and Expenses, 2004-2009
14.11.2 Oil and Gas Revenue and Expenses, By Country/Region, 2004-2009
14.12 El Paso Corporation, Oil and Gas Revenue and Expenses, Per boe
14.12.1 Oil and Gas Revenue and Expenses, By boe, 2004-2009
14.12.2 Oil and Gas Revenue and Expenses Per boe, By Country/Region, 2004-2009
14.13 El Paso Corporation, Oil and Gas Performance Metrics
14.14 El Paso Corporation, Developed and Undeveloped Acreage
14.14.1 Gross and Net Developed and Undeveloped Acreage, 2004-2009
14.14.2 Gross and Net Developed and Undeveloped Acreage, By Country/Region, 2004-2009
14.15 El Paso Corporation, Well Statistics
14.15.1 Producible Oil and Gas Well, 2004-2009
14.15.2 Producible Oil and Gas Well, By Country/Region, 2004-2009
14.15.3 Exploration and Development Wells Drilled, 2004-2009
14.15.4 Exploration and Development Wells Drilled, By Country/Region, 2004-2009
14.15.5 Developed Reserves per Well, Oil (Mbbls per Well), Gas (MMcf per Well), Oil & Gas (Mboe per Well), 2004-2009
14.15.6 Developed Reserves per Well, By Country/Region, 2004-2009
15 Appendix
15.1 Methodology
15.1.1 Coverage
15.1.2 Secondary Research
15.1.3 Primary Research
15.2 Data Sources
15.2.1 Company Source
15.2.2 SEC/Other Regulatory Filings
15.2.3 Agency Reports
15.2.4 Other Sources
15.3 Methodology for Company Valuation
15.4 Expert Panel Validation
15.5 Units of Measure
15.6 About Us
15.7 Disclosure
15.8 Disclaimer

1.1 List of Tables
Table 1: El Paso Corporation, The US and International Operations, 2009
Table 2: El Paso Corporation, Existing Pipeline Operations, 2009
Table 3: El Paso Corporation, Expected Pipeline Operations, 2009
Table 4: El Paso Corporation, Key Events, January 2010–January 2011
Table 5: El Paso Corporation, The Ruby Pipeline Project's Contracted Volume and Term, 2010
Table 6: El Paso Corporation, The Eagle Ford Shale Per Well Cost By Peers, 2010
Table 7: El Paso Corporation, The Haynesville Shale Per Well Cost By Peers, 2010
Table 8: El Paso Corporation, Master Limited Partnership Reduction Transactions, 2008–2010
Table 9: El Paso Corporation, Divestiture details, By Segment, $m, 2007 – Q3 2010
Table 10: El Paso Corporation, Upstream Growth Profile, MMboe, 2010–2015
Table 11: El Paso Corporation, Existing Pipeline Operations, 2009
Table 12: El Paso Corporation, Expected Pipeline Operations, 2009
Table 13: El Paso Corporation, Recent Transactions as a Buyer, June 2009–December 2010
Table 14: El Paso Corporation, Recent Transactions as a Seller, June 2009–December 2010
Table 15: El Paso Corporation, Forecast Production, 2007–2015
Table 16: , Price Forecasts, 2010–2014
Table 17: El Paso Corporation, Income Statement ($m), 2007–2015
Table 18: El Paso Corporation, Balance Sheet ($m), 2007–2015
Table 19: El Paso Corporation, Cash Flow Statement ($m), 2007–2015
Table 20: El Paso Corporation, Profitability Ratios, 2010–2015
Table 21: El Paso Corporation, Other Financial Ratios, 2010–2015
Table 22: El Paso Corporation, Capital Market Ratios, 2009–2011
Table 23: , Price Forecast, 2011–2015
Table 24: El Paso Corporation, Net Asset Value, 2011
Table 25: El Paso Corporation, Prospective Acreage & Non Proven Reserves, 2011
Table 26: El Paso Corporation, NPV of Natural Gas Reserves, $/Mcf, 2011
Table 27: El Paso Corporation, NPV of Oil/NGL Reserves, $/bbl, 2011
Table 28: El Paso Corporation, NPV of Total Oil and Natural Gas Reserves, $/boe, 2011
Table 29: El Paso Corporation, Sensitivity Analysis on Fair Value ($/share), 2011
Table 30: El Paso Corporation Vs. Peer Group, Operational and Financial Performance, 2009
Table 31: El Paso Corporation and its Peer Group Comparison, Financial Ratios, 2009
Table 32: El Paso Corporation, Upstream Capital Expenditure, Q4, 2009-Q4, 2010
Table 33: El Paso Corporation, Total Crude Oil and Natural Gas, Production, Q4, 2009-Q4, 2010
Table 34: El Paso Corporation, Total Oil & Gas Production, By Country/Region, MMboe, Q4, 2009-Q4, 2010
Table 35: El Paso Corporation, Total Crude Oil Production, MMbbl, Q4, 2009-Q4, 2010
Table 36: El Paso Corporation, Crude Oil Production, By Country/Region, MMbbl, Q4, 2009-Q4, 2010
Table 37: El Paso Corporation, Total Natural Gas Production, Bcf, Q4, 2009-Q4, 2010
Table 38: El Paso Corporation, Natural Gas Production, By Country/Region, Bcf, Q4, 2009-Q4, 2010
Table 39: El Paso Corporation, Share Price Performance, 2004-2009
Table 40: El Paso Corporation, Key Valuation Metrics, 2004-2009
Table 41: El Paso Corporation, Total Crude Oil and Natural Gas, Production and Reserves, MMboe, 2004-2009
Table 42: El Paso Corporation, Total Crude Oil & Natural Gas Production and Reserves, By Country/Region, MMboe, 2004-2009
Table 43: El Paso Corporation, Total Crude Oil and Natural Gas Reserve Changes, MMboe, 2004-2009
Table 44: El Paso Corporation, Crude Oil Production and Reserves Metrics, MMbbl, 2004-2009
Table 45: El Paso Corporation, Crude Oil Production and Reserves, By Country/Region, MMbbl, 2004-2009
Table 46: El Paso Corporation, Crude Oil Reserve Changes, MMbbl, 2004-2009
Table 47: El Paso Corporation, Natural Gas Production and Reserves Metrics, Bcf, 2004-2009
Table 48: El Paso Corporation, Natural Gas Production and Reserves, By Country/Region, Bcf, 2004-2009
Table 49: El Paso Corporation, Natural Gas Reserve Changes, Bcf, 2004-2009
Table 50: El Paso Corporation, Oil and Gas Reserves Life Index, Years, 2004-2009
Table 51: El Paso Corporation, Oil and Gas Reserves Life Index, By Country/Region, Years, 2004-2009
Table 52: El Paso Corporation, Upstream Capital Expenditure, $m, 2004-2009
Table 53: El Paso Corporation, Proved and Unproved Acquisition Costs, By Country/Region, $m, 2004-2009
Table 54: El Paso Corporation, Exploration and Development Costs, By Country/Region, $m, 2004-2009
Table 55: El Paso Corporation, Reserves Replacement, Finding and Development Costs, Finding Cost and Proved Acquisition Costs Per boe, $/boe, 2004-2009
Table 56: El Paso Corporation, Revenue and Expenses, $m, 2004-2009
Table 57: El Paso Corporation, Revenue and Expenses, By Country/Region, $m, 2004-2009
Table 58: El Paso Corporation, Oil and Gas Revenue and Expenses, $/boe, 2004-2009
Table 59: El Paso Corporation, Oil and Gas Revenue and Expenses, $/boe, By Country/Region, 2004-2009
Table 60: El Paso Corporation, Oil and Gas Performance Metrics, 2004-2009
Table 61: El Paso Corporation, Land Holdings (Developed and Undeveloped Acreage), Acres, 2004-2009
Table 62: El Paso Corporation, Land Holdings (Developed and Undeveloped Acreage), By Country/Region, Acres, 2004-2009
Table 63: El Paso Corporation, Producible Oil and Gas Wells, 2004-2009
Table 64: El Paso Corporation, Producible Oil and Gas Wells, By Country/Region, 2004-2009
Table 65: El Paso Corporation, Exploratory and Developed Wells, 2004-2009
Table 66: El Paso Corporation, Exploratory and Developed Wells, By Country/Region, 2004-2009
Table 67: El Paso Corporation, Developed Reserves per Well, Oil (Mbbls per Well), Gas (MMcf per Well), Oil & Gas (Mboe per Well), 2004-2009
Table 68: El Paso Corporation, Developed Reserves per Well, By Country/Region, Mboe per Well, 2004-2009

1.2 List of Figures
Figure 1: El Paso Corporation, Operational Map, 2011
Figure 2: El Paso Corporation, Performance Charts, 2006–2009
Figure 3: El Paso Corporation, Share Price Performance, January 2010– February 2011
Figure 4: El Paso Corporation, The Ruby Pipeline Project, 2011
Figure 5: El Paso Corporation, Reserve-Production Ratio Comparison With its Peers, Years, 2005–2009
Figure 6: El Paso Corporation, Debt-Equity and Debt-Capital Ratios Comparison With its Peers Average, 2005–2009
Figure 7: El Paso Corporation, Total Production From Upstream Assets, MMboe, 2007–2015
Figure 8: El Paso Corporation, Production Mix, MMboe, 2007–2015
Figure 9: El Paso Corporation, The US Operations, 2011
Figure 10: El Paso Corporation, The US, Central Division Production, MMboe, 2007–2015
Figure 11: El Paso Corporation, Western Division Production, The US, MMboe, 2007–2015
Figure 12: El Paso Corporation, Gulf Coast Division Production, The US, MMboe, 2007–2015
Figure 13: El Paso Corporation, Brazil Division Production, International, MMboe, 2007–2015
Figure 14: El Paso Corporation, Cost Incurred, $m, 2005–2009
Figure 15: El Paso Corporation, Reserve Replacement and Finding and Development Cost, 2005–2009
Figure 16: El Paso Corporation and its Peers, Total Net Developed and Undeveloped Acreage, Million Acres, 2009
Figure 17: El Paso Corporation, Development and Exploration Cost, $m, 2005–2009
Figure 18: El Paso Corporation and its Peers, Relative Share Price Performance Index, February 2010–2011
Figure 19: El Paso Corporation, Operational and Financial Parameters, $/boe, 2009
Figure 20: El Paso Corporation, Total Reserves and Production, MMboe, 2009
Figure 21: El Paso Corporation and Peer Group Comparison, Valuation Ratio, 2009
Figure 22: El Paso Corporation, Upstream Capital Expenditure, $m, Q4, 2009-Q4, 2010
Figure 23: El Paso Corporation, Total Crude Oil and Natural Gas, Production, MMboe, Q4, 2009-Q4, 2010
Figure 24: El Paso Corporation, Total Oil & Gas Production, By Country/Region, MMboe, Q4, 2009-Q4, 2010
Figure 25: El Paso Corporation, Total Crude Oil Production, MMbbl, Q4, 2009-Q4, 2010
Figure 26: El Paso Corporation, Crude Oil Production, By Country/Region, MMbbl, Q4, 2009-Q4, 2010
Figure 27: El Paso Corporation, Total Natural Gas Production, Bcf, Q4, 2009-Q4, 2010
Figure 28: El Paso Corporation, Natural Gas Production, By Country/Region, Bcf, Q4, 2009-Q4, 2010
Figure 29: El Paso Corporation, Key Valuation Metrics, EV/Production ($/boed), EV/Proved Reserve ($/boe), 2004-2009
Figure 30: El Paso Corporation, Total Crude Oil and Natural Gas, Production and Reserves, MMboe, 2004-2009
Figure 31: El Paso Corporation, Total Proved Oil & Gas Reserves, By Country/Region, MMboe, 2004-2009
Figure 32: El Paso Corporation, Total Oil & Gas Production, By Country/Region, MMboe, 2004-2009
Figure 33: El Paso Corporation, Total Crude Oil and Natural Gas Reserve Changes, MMboe, 2009
Figure 34: El Paso Corporation, Crude Oil Production and Reserves Metrics, MMbbl, 2004-2009
Figure 35: El Paso Corporation, Total Proved Oil Reserves, By Country/Region, MMbbl, 2004-2009
Figure 36: El Paso Corporation, Oil Production, By Country/Region, MMbbl, 2004-2009
Figure 37: El Paso Corporation, Crude Oil Reserve Changes, MMbbl, 2009
Figure 38: El Paso Corporation, Natural Gas Production and Reserves Metrics, Bcf, 2004-2009
Figure 39: El Paso Corporation, Total Proved Gas Reserves, By Country/Region, Bcf, 2004-2009
Figure 40: El Paso Corporation, Gas Production, By Country/Region, Bcf, 2004-2009
Figure 41: El Paso Corporation, Natural Gas Reserve Changes, Bcf, 2009
Figure 42: El Paso Corporation, Oil and Gas Reserves Life Index, Years, 2004-2009
Figure 43: El Paso Corporation, Gas Reserve Life Index, By Country/Region, Years, 2004-2009
Figure 44: El Paso Corporation, Oil & Gas Reserve Life Index, By Country/Region, Years, 2004-2009
Figure 45: El Paso Corporation, Oil Reserve Life Index, By Country/Region, Years, 2004-2009
Figure 46: El Paso Corporation, Upstream Capital Expenditure, $m, 2004-2009
Figure 47: El Paso Corporation, Proved Acquisition Costs, By Country/Region, $m, 2004-2009
Figure 48: El Paso Corporation, Unproved Acquisition Costs, By Country/Region, $m, 2004-2009
Figure 49: El Paso Corporation, Development Costs, By Country/Region, $m, 2004-2009
Figure 50: El Paso Corporation, Exploration Costs, By Country/Region, $m, 2004-2009
Figure 51: El Paso Corporation, 3-Year Wt.Avg., Reserves Replacement, Finding and Development Costs, Finding Cost and Proved Acquisition Costs Per boe, $/boe, 2004-2009
Figure 52: El Paso Corporation, Revenue and Expenses, $m, 2004-2009
Figure 53: El Paso Corporation, Depreciation, Depletion & Amortization , By Country/Region, $m, 2004-2009
Figure 54: El Paso Corporation, Income Tax/(Benefit), By Country/Region, $m, 2004-2009
Figure 55: El Paso Corporation, Net Income/ Loss, By Country/Region, $m, 2004-2009
Figure 56: El Paso Corporation, Oil & Gas Revenue, By Country/Region, $m, 2004-2009
Figure 57: El Paso Corporation, Pre-tax Profit, By Country/Region, $m, 2004-2009
Figure 58: El Paso Corporation, Production Expenses, By Country/Region, $m, 2004-2009
Figure 59: El Paso Corporation, Total Expenses, By Country/Region, $m, 2004-2009
Figure 60: El Paso Corporation, Oil and Gas Revenue and Expenses, $/boe, 2004-2009
Figure 61: El Paso Corporation, Income Tax/(Benefit) per boe, By Country/Region, $/boe, 2004-2009
Figure 62: El Paso Corporation, Lifting Cost per boe, By Country/Region, $/boe, 2004-2009
Figure 63: El Paso Corporation, Annual Net Income per boe, By Country/Region, $/boe, 2004-2009
Figure 64: El Paso Corporation, Oil & Gas Revenue per boe, By Country/Region, $/boe, 2004-2009
Figure 65: El Paso Corporation, Total DD&A per boe, By Country/Region, $/boe, 2004-2009
Figure 66: El Paso Corporation, Total Revenue per boe, By Country/Region, $/boe, 2004-2009
Figure 67: El Paso Corporation, Oil and Gas Performance Metrics, 2004-2009
Figure 68: El Paso Corporation, Land Holdings (Developed and Undeveloped Acreage), Acres, 2004-2009
Figure 69: El Paso Corporation, Total Gross Undeveloped Acreage, By Country/Region, Acres, 2004-2009
Figure 70: El Paso Corporation, Total Net Undeveloped Acreage, By Country/Region, Acres, 2004-2009
Figure 71: El Paso Corporation, Total Gross Developed Acreage, By Country/Region, Acres, 2004-2009
Figure 72: El Paso Corporation, Total Net Developed Acreage, By Country/Region, Acres, 2004-2009
Figure 73: El Paso Corporation, Producible Oil and Gas Wells, 2004-2009
Figure 74: El Paso Corporation, Gross Producible Gas Wells, By Country/Region, Number, 2004-2009
Figure 75: El Paso Corporation, Gross Producible Oil & Gas Wells, By Country/Region, Number, 2004-2009
Figure 76: El Paso Corporation, Gross Producible Oil Wells, By Country/Region, Number, 2004-2009
Figure 77: El Paso Corporation, Net Oil & Gas Wells as % of Gross Oil & Gas Wells, By Country/Region, %, 2004-2009
Figure 78: El Paso Corporation, Net Producible Gas Wells, By Country/Region, Number, 2004-2009
Figure 79: El Paso Corporation, Net Producible Oil & Gas Wells, By Country/Region, Number, 2004-2009
Figure 80: El Paso Corporation, Net Producible Oil Wells, By Country/Region, Number, 2004-2009
Figure 81: El Paso Corporation, Exploratory and Developed Wells, 2004-2009
Figure 82: El Paso Corporation, Developed Gas Reserves per Well (MMcf per Well), By Country/Region, 2004-2009
Figure 83: El Paso Corporation, Developed Oil & Gas Reserves per Well (Mboe per Well), By Country/Region, 2004-2009
Figure 84: El Paso Corporation, Developed Oil Reserves per Well (Mbbls per Well), By Country/Region, 2004-2009

El Paso's Unconventional Program to Build Long Term Drilling Inventory and Fuel its Production

El Paso's E&P operations are primarily focused on the exploration, acquisition, development and production of natural gas, crude oil and Natural Gas Liquids (NGL) in US conventional and unconventional assets. However, with the increasing demand for natural gas in the market and depleting reserves of conventional natural gas resources, many companies have shifted their focus towards unconventional sources in order to meet future demand. Recently, the production from the unconventional sources such as shale, tight sands and coal bed methane has rapidly increased. Similarly, in order to exploit the underlying prospects in unconventional gas, El Paso has been building a strong unconventional assets portfolio. Currently, El Paso's unconventional program is primarily focused on Haynesville Shale in northwest Louisiana and east Texas, Eagle Ford Shale in south Texas, and Altamont-Bluebell-Cedar Rim Field fractured tight sands in Utah. In addition, the company has entered into Wolfcamp shale, an emerging oil play, by winning a bid for leases covering around 123,100 acres during September 2010. The company holds net acreages of around 170,000, 40,000 and 193,000 in the Eagle Ford Shale, Haynesville Shale and Altamont field respectively. El Paso's shift in focus from conventional to unconventional sources would provide the benefits of a longer reserve life and lower supply costs, stabilizing the company's top line and improving the bottom line.

Eagle Ford Shale

The Eagle Ford Shale is shale rock formation located in the multiple counties in South Texas. The Eagle Ford Shale has been considered to hold a significant volume of hydrocarbons and has the capacity to produce both gas and oil. The shale holds high condensate content, attracting companies as a result and emerging as one of the major shale plays in the US. With the increasing crude oil prices in the market, many companies have been investing in the Eagle Ford Shale to acquire acreages with the intention of increasing their oil production. El Paso holds net acreage of 170,000 acres, of which around 62% lies in the liquids rich area. Thereby, the development of the Eagle Ford Shale will provide a significant upside in the oil production and cash flow to the company. Until now, El Paso has drilled 14 wells, of which nine are producing. The company estimates that its acreage in the Eagle Ford Shale could hold net unrisked resource potential of more than 250 MMbbl of liquid and 1.8 tcf of natural gas and also provide a drilling inventory of more than 1,000 locations. El Paso considers the Eagle Ford Shale a key source of reserve and production growth long term and intends to increase its development and production activities in 2011.

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