Save for later Print Download Share LinkedIn Twitter The Eagle Ford Shale may be maturing, but operators believe there is still plenty of life in the South Texas play.That became apparent earlier this week, when Devon Energy announced it would acquire privately held Validus Energy for $1.8 billion, the biggest Eagle Ford deal since 2018. The transaction nearly doubles Devon’s current output of 38,000 barrels of oil equivalent per day.While Validus’ already producing assets were the main attraction, as it allows Devon to seamlessly grow output to capitalize on high oil prices, the properties also hold 350 “repeatable drilling locations” in the core of the Karnes Trough oil window, along with 150 “high-quality” older wells that could be recompleted in the future, the buyer said.“This highly economic inventory positions the company’s Eagle Ford assets to sustain its high-margin production and free cash flow generation for several years,” Devon said.Cash CowOther operators view the Eagle Ford as an engine for cash rather than growth, not unlike the Bakken Shale of North Dakota, which is also reaching maturity. The wells in the Eagle Ford tend to be cheaper and transportation costs lower than in more remote or less advanced plays.Management at EOG Resources, one of the top operators in the play, recently said that the play continues to show “outstanding” results despite a decline in output in the second quarter.“We're on pace to deliver, for the second year in a row, basically record rates of return and record finding costs in our drilling program there,” COO Lloyd Helms told analysts last week. “And the big thing that it comes to is … the right investment rate for plays at different life cycles. So clearly, our Eagle Ford position has reached a point where it's not a main focus area for growth anymore. But what we see is a very, very long runway of exceptional returns on those wells as you reinvest in them, assuming that we're moving at the right pace where our team has the ability to execute on lowering costs, increasing incrementally the well productivity.” Eagle Ford Shale Last week, Chesapeake Energy laid out its plans to exit the Eagle Ford to focus on its core natural gas plays in the Haynesville and Marcellus shales. But CEO Nick Dell’Osso noted that the South Texas play was still in a position to generate “a tremendous amount” of free cash flow.“While our Eagle Ford asset has attractive capital efficiency, [on] our gas asset, capital efficiency is just off-the-charts good,” he said during Chesapeake’s second-quarter earnings call.Meanwhile, ConocoPhillips, another top operator in the Eagle Ford, sees potential for growth. The company reported a jump in production in the second quarter after several months of declines. Executive Vice President Jack Harper said the increase was due to a disproportionate number of pads coming on line at the same time as well as a successful refracturing program.“In general, the Eagle Ford is growing toward its plateaued production, but it's not there yet,” he said. “So it will be a continued source of lower 48 production growth.”Activity RampsLike most oil-bearing provinces in the US, drilling has increased in recent months in the Eagle Ford as commodity prices have risen. Last week, there were 72 active drilling rigs in the play, according to oil-field services firm Baker Hughes, compared to 44 at the start of the year. Only the Permian Basin of West Texas and Southeastern New Mexico had more rigs working last week, according to the data. The core counties of Webb, Karnes, Dimmit and La Salle held the bulk of the rigs, while earlier this year Bee County saw rigs return for the first time since 2019.Oil production in the play dropped below the 1 million barrels per day mark in May 2020 as demand withered amid the opening wave of the Covid-19 pandemic, and fell below that level again in February 2021, according to data from Energy Intelligence and the US Energy Information Administration. However, it has more or less risen steadily since to an estimated 1.21 million b/d in August 2022.As of Aug. 1, Chesapeake and ConocoPhillips were the top operators in the Eagle Ford by rig count, with six active units each, according to data from Enverus. EOG had five, while privately held Verdun Oil had four. Earlier this year, Verdun expanded its position in La Salle County with the acquisition of more than 100,000 net acres through the purchase of fellow private EP Energy.