Encana Corporation (USA) (ECA), Sunoco Logistics Partners L.P. (SXL): Chasing Growth in the Up-and-Coming Eaglebine

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Halcon Resources Corp (NYSE:HK) is another small operator, but its run by the former leaders of PetroHawk, and experience matters a great deal in this game. The company drilled and completed two wells in the Eaglebine earlier this year, and they are producing 90% oil. Even more encouraging is that this is a heavier crude than what is typically produced in the Eagle Ford. Gulf Coast refining capacity for that standard, lighter crude is all but maxed out. There is plenty of room, however, for heavier crudes, which naturally bodes well for Halcon Resources Corp (NYSE:HK).

What about pipelines?
Now, so far we’ve got four companies drilling in this play, and not a mention of a single midstream player in the mix to make sure all of this production can actually get to market. Enter Sunoco Logistics Partners L.P. (NYSE:SXL).

Sunoco Logistics Partners L.P. (NYSE:SXL) launched a binding open season on its Eaglebine Express pipeline this past May. The line’s initial capacity is slated to be about 60,000 barrels per day, which should be sufficient given the developmental nature of the play right now. The Eaglebine Express will carry crude out of the play to a Sunoco Logistics Partners L.P. (NYSE:SXL) terminal at Nederland, Texas, which sits between Beaumont and Port Arthur. If everything goes according to plan, the line will be up and running by the middle of next year.

Bottom line
While many are busy bemoaning dwindling decline rates in the Bakken, the oil and gas industry is plowing full steam ahead into less talked about plays like the Eaglebine, which may drive significant growth down the road. It may not ever be as big as the Bakken, but it is certainly worth following.

The article Chasing Growth in the Up-and-Coming Eaglebine originally appeared on Fool.com is written by Aimee Duffy.

Fool contributor Aimee Duffy has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

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