It’s not a household name yet—and it’s a bit of a mouthful—but the 2.7 million-acre Tuscaloosa Marine Shale (TMS) in Southeast Louisiana and Southwest Mississippi is shaping up to be another prime play to add to the US unconventional roster, even though it’s still early days.
We still don’t know what the potential is here, so uncertainty is high, but E&P companies are betting on some big finds, estimating that we’re looking at a “Texas-size” pay-out.
They might be right. After all, the TMS is close to the Gulf of Mexico and has geological similarities to Eagle Ford in south Texas. Geologists think there could be a continuous oil and gas shale that runs all the way from Eagle Ford to the TMS, and that’s what all the drilling is banking on.
The TMS is a sedimentary rock formation that consist of organic-rich fine-grained sediments deposited in a marine environment that existed across the Gulf Coast region approximately 90 million years ago. The TMS includes the Eagle Ford Shale, being similar in geological age.
For now all we’ve got to go on is some dated, pre-fracking surveys that estimate the TMS could contain 7 billion bbl of recoverable oil from shale that is from 500-800 feet thick and at a depth range of 11,000-15,000 feet, extending for 3.8 million acres across both states. It was only about 3 years ago that the first horizontal wells were drilled, so we still don’t know what’s out there--really.
Industry estimates vary, but let’s wait for more drilling before we speculate on how big this could actually be (we’ll be following Tuscaloosa closely this summer and fall to that end).
Drilling has been slower than we would like, but this is largely because of the uncertainty and the long lease lives that allow explorers to take it slowly and absorb the risk a bit. And the risk is high because drilling is comparatively expensive: On average, companies are paying between $11 and $20 million to drill a single well, while the cost is about $10 million in Bakken.
Let’s break it down by state, because there are some legislative differences that will shape competition here.
The Mississippi TMS
The sweet spots here are in three counties: Amite, Wilkinson and Pike, and the state is hoping to out-compete neighboring Louisiana in exploration by offering more incentives.