GEOSCIENCE ASSESSMENT OF STARR
COUNTY, TEXAS LAND POSITION FOR
RIMFIRE LAND AND CATTLE CO.
Dr. William J Purves-Highlander Energy
December 16, 2012
Page 1 of 5
GEOSCIENCE ASSESSMENT OF STARR COUNTY
LAND POSITION FOR RIMFIRE LAND AND CATTLE CO.
Dr. William J Purves-Highlander Energy LLC
One long time adage in the petroleum business is that oil and gas is most easily found where
existing oil and gas have already been found. This adage is certainly true of this Starr County
acreage position. The 11,000 acre position lies within a productive, multipay trend that ranges
from shallow oil production to deeper gas with some NGL production. Because this is an
existing productive area, excellent infrastructure already exists that will minimize development
costs to link productive wells to market. Figure 1, a stratigraphic column representative of this
area, provides a highlight of the potential Cenozoic age reservoirs that are producing within this
area (see arrow on diagram).
This land position in south Texas is conventionally grouped within the Rio Grande
Embayment Geologic province and lies within a productive belt, the Vicksburg Fault system (see
figure 2). Figure 3 depicts the 3D survey-land position outlined in red, with the belt of NNE to
SSW productive trend traversing through the lease area. Most wells drilled within the leases are
shallow wells only. The Vicksburg Fault system trends NNE to SSW into this Starr County land
position butting into the Rio Grande River and US border. The Vicksburg Fault system, a down
to the Gulf of Mexico (in this case a down to the ESE) series of growth faults, creates the
environment of sedimentation, hydrocarbon sourcing and stratigraphic/structural trapping that
has made this a productive hydrocarbon play area. Figure 4 is a published graphic cross section
illustrating this tectonic-stratigraphic setting that extends into this land position. Figure 5 is an
West to East seismic line (XL 226) across the lease area illustrating the similar growth fault
tectonic style as observed within the seismic data. The Vicksburg Fault zone created an active
and almost continuous and repetitive shedding of clastic sediments from the WNW to ESE
during Tertiary time (Eocene and Oligocene). Thus, one would expect sand dispersal channels
to generally trend WNW to ESE with some sand redistribution along stratigraphic strike in a
NNE to SSW direction most likely from longshore drift and reworking of sediments. Overall,
this sediment dispersal through time has created the observable multi-stacked hydrocarbon
reservoir pays that extend along structural-stratigraphic strike into this land position. This land
position should not be considered an exploration holding, but more of an exploitation or
production offset play of conventional reservoir targets. Figure 6 is a tabular compilation of 14
productive or historically productive fields within and largely those fields immediately along
structural-stratigraphic strike, the respective two way time depths of their productive intervals
and an approximated measured depth. At the time of this land assessment analysis, a sonic log in
the immediate area was not available to convert time to depth so the discussion will always be in
time with approximate depth estimates. In general, one can expect to encounter at least 6
productive zones as denoted by the bracketed intervals shown on this figure. What is not
considered in this evaluation are possible unconventional shale gas plays within this acreage
position. Some geochemical work would be needed to confirm these additional possibilities.
Unconventional play potential reserves should be entertained as well as the conventional targets
already validated along this productive trend.
Page 2 of 5
Published data for this region provides more specificity of this structural-stratigraphic setting
through part of Tertiary time. Specifically, figure 7 is a paleogeographic map of the actively
developing Eocene age Queen City Formation which in the land position will range from 880010,000’ measured depth. The land position is predicted to lie within an interface of deltaicprodelta sediments which ideally mixes reservoir and source rock material. Stacked vertically at
about 3200 ft, the Oligocene age Frio Formation (see figure 8), shows a similar but albeit more
complex inter fingering of fluvial, floodplain, lacustrine, and deltaic facies as the filling of this
diminishing structural void shallows upwards with more complex sediment dispersal patterns.
Figure 9 depicts Late Eocene Yegua-Jackson group barrier strandplain sediments to exist within
the land position at a depth of about 7100’ and represents yet another example of a productive
pay interval lying between the deeper and shallower zones previously noted.
While the land position lies on structural-stratigraphic strike with these multi-stacked pays,
there is minimal development of some of these zones within the acreage position. This lack of
development within the land position is a bit anomalous to me, but this anomalous void of
drilling creates the production offset value to these leases. Importantly, the exploitation value to
this underdeveloped acreage position is greatly enhanced by having a 3D seismic data. The 3D
seismic data provides an X-ray view into the subsurface allowing identification of these multistacked sand intervals through time and greatly reduces exploitation risk to develop this land
position. Hence, one of the first tasks was to examine the 3D seismic and see if the expected
sand bodies could be observed over known existing fields within the bounds of the 3D survey.
Figure 10 is an arbitrary oriented seismic line traversing through a shallow productive area in the
Cortez Field in the southern 3D area. This seismic line links both productive wells and nonproductive wells. The productive wells producing interval has a channel-like geometry in this
seismic section. In contrast, the remainder of the seismic line that traverses over a series of dry
holes has a seismic signature of unvarying, railroad track looking reflectors. Thus, importantly,
using a known productive versus unproductive zone, one can verify that the 3D seismic data can
discriminate productive channelized zones from unproductive, non-channelized areas in the few
areas where shallow field development has occurred within the 3D seismic data (South 3D area).
A check on shallow production and seismic data was analyzed for the north area similar to the
southern 3D area. Figure 11 is an arbitrary seismic line in the North 3D area trending South to
North within the Boyle Field (Boyle,E,W,SW) that produces variable around 3350-3500’ (about
0.6 sec). Sand channel buildups are delineated by the dotted oval on this line at about the .6 sec
level.
Using the knowledge from paleogeologic studies and the immediately adjacent drilled multipay zones on structural-stratigraphic strike to this land position provides confidence that within
this land position there will be vertically repetitive depositional sequences of sand enriched
channelized areas. These prospective sand enriched channel areas can then be isolated both
vertically and laterally from tight, non productive inter-channel zones. Review of the 3D seismic
data confirms expectations that there are numerous potentially productive channel areas at
varying depths enveloped in sealing or trapping shale (strat traps). Other areas also show
complexities to this picture where growth faults cut and offset some of these features. Some
faults may be sealing, others may leak. However, there are definite areas where strat traps occur.
Page 3 of 5
One major reservoir target to focus on in this land position is to expand the recent
development drilling of the Garcias Ridge Queen City horizon. Companies such as TransTexas
Gas, Metano Energy, now superseded by Legend Natural Gas LP have had a continuous drilling
program for over a decade for this target. The project land position lies immediately adjacent to
and along structural and stratigraphic strike of the Queen City drilling play. Some wells are less
than 1 mile from the acreage position. Not all wells have good production but an example of a
good well could be typified by the Legend Sherrin Gas unit well 2, see figure 13 (API #
4242734334 drilled in 2008.)
October 2011 production was 34,437 Mcf gas and 1160 Bbl
condensate. Many if not all of these wells are classified as “tight gas sands” which may or may
not have given them a tax break.
Similar to seeing sand channels on the shallow Cortez Field example, Queen City Sands
sealed and encompassed in shale facies are visible on the 3D seismic over the western 1/3 of the
3D survey (see figures 13,14,15,16) which suggests that a major Queen City development
program would be possible in this land position. As you go east, complexing of this interval
occurs related to NNE to SSW trending growth faults. Selective development farther to the east
into this more complex setting appears probable as well as seen in seismic inline 195 (see figure
17).
Another sand interval stacked below this Queen City interval is exemplified by the La Grulla
Field, which has an 11,300 ft pay sand zone. This zone or a comparable zone was observed in
the 3D seismic data as the deeper sand channel zone seen in figures 13, 14, 15, and 16 (deeper
zone). This zone lying below the Queen City sands, similar to the Queen City appears to be
sealed, most likely locally sourced and trapped by shales. In some cases as you cross from
unfaulted to growth faulted down dropped sequence, the downdropped Queen City play may be
intermixed with this 11,300 La Grulla field zone. Figure 18 is a time map of the top of the
11,300’ sand zone. Note the easterly dispersal channels seen in this map (green).
Along the eastern margin of the land position, discontinuous channel sands are observable in
a north to south seismic line, see figure 19, (XL299) at .7 to .85 sec or approximately 3800-4500’
depth, a similar productive depth as horizons within the Garcia, Reilly, Vela Fields. These
channels appear dispersive in a westerly to easterly direction as depicted when a timeslice was
made of this interval figures 20 and a dispersal interpretive map made from the timeslice map,
figure 21.
Figure 22 is (XL 178) is a north to south oriented seismic line that illustrates the vertical
stacking nature of channels through time. These laterally discontinuous channels in a north
south cross section occur at time intervals/depths of .75-.85, .94-1.0, 1.05-1.09 which
corresponds approximately to pays previously noted above in Garcia Reilly, Vela Fields at 38004500’, the very productive Rincon Field at 5480, and Yegua sands respectively.
Deeper seismic reflectors and partial structural closures are seen in the seismic data that may
have exploration value, however, there is no local or nearby productive examples or deeper log
data to calibrate at this time. Thus, this evaluation process has focused on the multiple, lower
risk, exploitation targets that are 11,000’ or shallower. Starr County lies within an elevated
geothermal belt that regionally extends across the Gulf Coast margin of Texas and Louisiana.
Page 4 of 5
Bottom hole temperatures noted in wells at the 11,000’ level or shallower do not exceed but do
approach potential hostile borehole conditions where borehole temperatures may reach or exceed
325 degrees F. Thus, exploration for deeper targets will have hostile borehole conditions within
this land position. If deeper targets than 12,000 feet are sought, dealing with the higher
temperatures are manageable, however, operational costs and completion complexities due to the
higher borehole temperatures should be expected.
In conclusion, this Starr County, South Texas land position lies along what appears to be
an incompletely developed segment of the Vicksburg Growth productive fairway of vertically
stacked, multipay Tertiary age clastic reservoirs. Use of the existing 3D seismic data
significantly reduces risk for exploitation infill drilling of this incompletely developed
producing area.
Page 5 of 5