What would your portfolio look like if you bought one of today's big Eagle Ford producers back in 2010? Or how about a Bakken producer back in 2008? For example, Continental Resources (NYSE:CLR) is up almost six times since the end of 2008. 

Last month, Halcon Resources (NYSE:HK) CEO Floyd Wilson said that his company was entering the Tuscaloosa Marine Shale, or the TMS for short. Wilson also said he believed that the Tuscaloosa Marine Shale would be one of the last big shale oil discoveries that America will see.

So what? Well, Floyd Wilson knows a thing or two about shale exploration. Wilson is the person most credited with discovering the Eagle Ford Shale last decade. The company he founded, Petrohawk, was the first player in the Eagle Ford. Petrohawk would later be bought by BHP Billiton for a cool $12 billion. 

Wilson looks to repeat this success in the TMS. While he is not the first player in the TMS, Halcon's entrance into this nascent shale play gives it added legitimacy. The addition of Halcon's name to the list of TMS producers will provide a catalyst for oil service companies to enter this play. This should, in turn, help drive down completion costs and make the TMS economically viable. 

The two big players
Halcon's move into the TMS is a big one. Halcon now has a 300,000 acre position in the TMS and will move two rigs into this play. Buying shares of Halcon would be one solid way to participate in the TMS: Floyd Wilson and company certainly are capable managers, and I believe management will make its Tuscaloosa acreage very profitable.

The more Tuscaloosa-focused play here, however, is Goodrich Petroleum (NYSE:GDP). Goodrich has 400,000+ acres in the Tuscaloosa, and most of that acreage is in the "core" of this play, where well returns should be the highest. Goodrich is to the TMS what Continental Resources is to the Bakken: The first and biggest player with a large core position. 

The most important aspect of developing the Tuscaloosa right now is reducing well costs. The TMS, so far, is entirely an oil play. This is favorable to today's situation because oil fetches a much higher margin than does natural gas. 

Unfortunately, the Tuscaloosa's oil is way down in the ground. Most oil in the TMS is between 10,000 ft. and 14,000 ft. deep, compared with 8000 ft. to 11,000 ft. in the Eagle Ford. This, along with little servicing competition, drives up well costs. For example, wells in the TMS, on average, cost about $13 million versus a functionally comparable well cost of $7.5 million in the Eagle Ford. On the upside, TMS wells have been more prolific than Eagle Ford ones, and so well economics in the Tuscaloosa will rival that of the Eagle Ford if costs can come down by just $3 million or $4 million.

Bottom line
According to Floyd Wilson, the Tuscaloosa will be one of America's last shale discoveries, at least with this generation of technology. I believe that the TMS is an important 'frontier' of America's "shale revolution," and that the two best ways to participate are now Goodrich and Halcon. 

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Casey Hoerth has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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