That’s exactly what Fort Worth, Texas–based Encore Acquisition Company called it last month in a seven-page press release on the prospective oil zone known as the Tuscaloosa Marine Shale.   Encore describes its program as a "large oil resource play" covering 5,900 square miles, of which Encore has already leased some 208,000 net acres.

 
Encore’s press release goes on to state that it has drilled two wells to date.  First is the Joe Jackson Appraisal Well in Amite County, with initial production on a lateral length of 1,650’ that was fractured in three stages and placed on pump with an initial production of 175 barrels of oil per day. The second well, the Richland Plantation Appraisal Well located in East Feliciana Parish, is currently awaiting testing.

 
Encore has also announced two more appraisal wells to prove up additional acreage, with the third well having just recently spudded (commenced drilling) in St. Helena Parish.

Dan S. Collins, CPL, a Baton Rouge-based mineral consultant with an office in Clinton, represents a large group of landowners who have organized in an effort to lease their lands in the TMS at a fair price.  Collins confirmed the recent frenzy of activity.
 
Collins indicated that  “the leasing covers a wide expanse in excess of 75 miles across portions of the Louisiana parishes of East Baton Rouge, West Feliciana, East Feliciana, St. Helena, Tangipahoa, Washington and into the counties of Wilkinson, Amite, Pike and Wathall.  The leasing activity covers an area in excess of 3,600,000 acres."
 
Collins, who opened his Clinton office late last year, says that “the activity could be bigger than the Tuscaloosa Trend in terms of actual production, if the completion process is successfully worked out with various operators." He stressed that the prospective play straddles the state line of Louisiana  and Mississippi with an estimated “48  to 60 billion barrels of oil in place.

"This play is unique in that the Tuscaloosa Marine Shale is a formation hundreds of feet thick that underlies essentially the entire area.  Hydrocarbon-saturated portions appear to be 100 to 200 feet thick in some areas, but extend widely, so this is different from many of the past oil booms that targeted smaller oil and gas traps."  Collins stressed that all landowners in the prospect area are likely to have some thickness of saturated shale beneath their property.

A report prepared and published in 1996 by the Basin Research Institute and Louisiana State University confirms that BRI/LSU believed production could exceed over seven billion barrels. As Collins stated, “producing only ten to 20 percent could result in 4.8 to 12 billion barrels,” which obviously would be a lot of oil.
 
Collins lauded Encore and other operators who have advanced the new horizontal drilling and hydraulic fracturing techniques, but points out that the process is still being perfected.

He points to other activity throughout the state and in particularly to what is going on in the northwest region of Louisiana in the parishes of Caddo, Bossier, Desoto, Red River, Sabine and others.  “Leasing has hit all- time highs, with lease prices exceeding $4,000 to $6,000 an acre for large landholdings, while small tracts are known to have been leased upwards of $10,000 an acre” where a new shale play identified as the Haynesville Shale has recently been discovered.
 
Collins, however,  is quick to point out that the formation in northwest Louisiana is primarily gas,  as opposed to the prospective oil zone in the Tuscaloosa Marine Shale, where prices are not expected to reach those levels.

"The mineral  landowners in our association," Collins says, "all have a common interest and goal of a fair lease, favorable terms and a protective lease form."
 
Currently discussions are ongoing between Collins and numerous companies interested in being part of the development process by taking leases in what he believes to be a “win/win” trade for the landowners and the oil companies.
 
Collins warns that the initial leasing in the TMS began at $50 an acre for a three-to-five-year paid up lease, then elevated to $75 an acre, $100 an acre, in some cases reaching $150 an acre for paid up leases.

  "At today’s high prices for oil,” Collins says, "those lease terms are literally 30 years behind, even at the $150 an acre range."  Collins warns mineral landowners to be wary of the first offer they receive.
 
“Many landowners have told me they have hunting leases that exceed the amounts offered by some oil companies," Collins says.
 
Collins points to landowner groups throughout the country that have banded together for bargaining for “strength in numbers to achieve better negotiating power."
 
A review of the internet blog (startelegram.typepad.com/barnett_shale/) regarding the prolific Barnett Shale in the Dallas–Fort Worth, Texas–area identified several neighborhoods joining together and receiving $27,000 an acre and 26 percent royalty in one trade in Arlington, Texas.  “The process works when landowners lease together” Collins stated, as he points to a map identifying shale plays throughout the United States and Canada.
 
“While our group of landowners is not trying to replicate the incredible lease prices of gas shales in the TMS oil play, the lease terms offered to date are disproportionately low in light of record oil prices."  With oil estimated by some to reach $150 a barrel by July, leasing at the current rates of $10 to $50 an acre do appear quite low.
 
"If you're not careful, you could trade away three-fourths of an acre's oil for the price of a single barrel, and plenty of companies are out there right now offering that to landowners."

Collins indicated that numerous companies are popping up, attempting to take oil and gas leases at wholesale rates throughout the TMS area.  “Companies which aren’t even listed with the Secretary of State are attempting to purchase leases at rates that are so low that landowners should be wary when considering the signing of any oil and gas lease," Collins said.  Many landowners believe that because the lease term states three to five years, the lease will be up at that point.  Collins warns, however, that “the lease will actually exceed the term and extend to the life of the production if in paying quantities. That," Collins states, “could go on for many, many years under the terms of your lease contract." 

Encore reported potential drilling locations of 280 to 340 (640 acre spacing) and 560 to 640 (320 acre spacing).  In simple terms Collins indicated that would amount to “a well every 1 to 1.5 miles, if the formation yields the production as Encore has reported.
 
“It’s good to see the activity and to think of what prosperity it could bring to the area,” Collins states. He warns, however, those land/mineral owners who have not signed oil and gas leases to be cautious and informed about what they sign.
 
“We saw it once before, and we're hopeful we’ll see it again like the Tuscaloosa days,” Collins stated, indicating “most folks would love to have a well or two in their backyard”.
 
Persons may review further information about the Tuscaloosa Marine Shale  at tmslandowners.org