The Eagle Ford shale play is a relatively new development compared to similar shale plays in the United States. Yet the promise this South Texas area holds is immense. The second quarter has shown some marked progress in terms of production and development of reserves. From major leaseholders to small-cap players, the progress is evident. Let's take a look at how this region fared in the past quarter.

The liquids seekers
Natural gas giant Chesapeake Energy's (NYSE: CHK) strategy to increase liquids production in the coming years is what interests me. The company's management aims for oil and natural gas liquids to account for 30% to 35% of total production by 2015. This is where the Eagle Ford shale play looks interesting. Though this region currently accounts for just 1% of the company's total production, the liquids-rich play is capable of scaling up substantially.

With 600,000 net acres in the Eagle Ford, and a joint venture with Chinese driller CNOOC (NYSE: CEO) to develop these reserves, expect this shale play to generate a substantial chunk of revenue for Chesapeake.

EOG Resources (NYSE: EOG) is another company that has made a transition to liquids production. The oil window in Eagle Ford near San Antonio has served the company well. The second quarter saw an increase in production by 30,000 barrels per day from Texas, primarily from this shale play. This translates into a solid $228 million growth in revenue. The company has ramped up the number of rigs to 22, from 10 at the beginning of the year.

The Gonzales County wells have each begun initial production at more than a thousand barrels per day. If a tighter spacing pattern (i.e., more wells per unit area) proves economically viable, reserves are bound to increase significantly. EOG Resources will be a major player in this region in the near future.

Pioneer Natural Resources (NYSE: PXD) increased production to 8,000 Boe/d in the second quarter, from 5,000 Boe/d in the first quarter. The company plans to further increase the rig count to 19 by 2014, and in the process increase production to 60,000 Boe/d.

Still strong on gas
The shale play continues to provide excellent results for Petrohawk (NYSE: HK). Second-quarter production at the Eagle Ford shale rose almost 30% over the previous quarter, to 202 million cubic feet equivalent per day (Mmcfe/d).

At the end of 2010, proved reserves for this region stood at a huge 736 billion cubic feet equivalent (Bcfe) of which 570 Bcfe was undeveloped. With $950 million allotted this year for the development of the Eagle Ford play, one can expect a substantial production hike in the days to come.

For SM Energy (NYSE: SM), production in the Eagle Ford increased by 115 Mmcfe/d in the just-ended quarter. This constitutes a whopping 72% of the total rise in production. In the process, revenues increased by $95.4 million. Expect further rises in production with management planning to increase the rig count to six by the end of 2011. Production levels are expected to increase to 460 Mmcf/d by the latter part 2014, from the current take-away of 150 Mmcf/d.

Canada-based Talisman Energy (NYSE: TLM) drilled four more wells in the second quarter to bring the total count this year to seven. With six rigs currently in operation, management plans to further ramp-up drilling by increasing the rig count to 10.

Foolish bottom line
The Eagle Ford shale play is not the predominant producer of oil and gas in the United States in terms of absolute numbers. However, it has been steadily increasing production. With the current pace of development, it's only a matter of time before this promising shale play will be compared to the likes of Haynesville and Barnett. Also, with some companies just starting out on production there, Foolish investors should definitely take note. Eagle Ford just may have the answers to ever-growing energy demand.

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