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Monday, January 31, 2011
Sunday, January 30, 2011
Wednesday, January 26, 2011
Tuesday, January 25, 2011
The Truth About Gasland - America's Natural Gas Alliance
America's Natural Gas Alliance (anga) provides it's take on the controversial Oscar nominated documentary "Gasland".
Barnett Shale: Newsletter verbally pommels EPA
The Powell Barnett Shale Newsletter's Managing Editor Will Brackett took aim this week at the U.S. Environmental Protection Agency. Brackett's comments came after the EPA's no show last week at an Austin hearing regarding orders the EPA had issued against Range Resources. Star-Telegram writer Jack Z. Smith's article can be accessed at the following link.
Sunday, January 23, 2011
Company To Invest $50 Billion In W.Va. - News, Sports, Jobs - The Intelligencer / Wheeling News-Register
The following article by AP writer Casey Junkins states that Oklahoma based Chesapeake Energy has plans to invest as much as $40 to $50 billion in West Virginia's Marcellus Shale over the next few decades. The entire article can be accessed from the following link.
Hurst, Bedford, Southlake seek to balance needs of drillers, residents | Barnett Shale |...
In an article by Star-Telegram writer Aman Batheja, "gas drilling is becoming a tougher sell in parts of Northeast Tarrant County". The full story can be accessed at the following link.
Saturday, January 22, 2011
Range appealing EPA order on gas wells | Barnett Shale | Dallas Business, Texas Business...
Star-Telegram writer Jack Z. Smith explains in the following article why attorneys for Range Resources have filed an appeal with the 5th U.S. Circuit Court of Appeals in New Orleans regarding an order issued by the EPA which sites Range's alleged contamination of two Parker County water wells.
Friday, January 21, 2011
More Methane Found in Parker County Water
Range Resources states that the methane is coming from an area just below the aquifer, and not from the Barnett Shale formation where they are drilling, over a mile below the surface. The EPA disagrees. The debate is ongoing in an Austin District Court. (Video courtesy WFAA.com)
Thursday, January 20, 2011
EPA - MIA in Austin
EPA MIA in Austin. According to Energy in Depth, "the agency's credibility comes into question as basis for it's "emergency order" against Range Resources continues to fall apart". The entire article can be accessed through the following link.
Barnett Shale: Judge says water well case nationally significant
The EPA allegation that two Parker County water wells were contaminated via gas drilling by Range Resources could prove to be "of extreme significance". A federal judge in Austin has granted lawyers for Fort Worth-based Range Resources the right to take the deposition of an EPA official regarding the contamination investigation. The investigation could prove to have "national implications" according to the U.S. District judge. The full article by Star-Telegram writer Jack Z. Smith can be accessed by clicking on the following link.
Tuesday, January 18, 2011
Feds say Range Resources hasn't complied with EPA order | Barnett Shale | Dallas Busines...
The U.S. Justice Department has stepped in and filed a complaint in a Dallas Federal court against Range Resources. The DOJ cites Range's non-compliance of the E.P.A.'s emergency order regarding the contamination of two(2) water wells in Parker County. Range Resources has denied the allegation.
Rebuttal to Mike Norman's Star-Telegram Article
A rebuttal to the Star-Telegram article by Mike Norman, posted to this blog on Friday, January 14, 2011....entitled: "Barnett Shale Tricks of the Trade Aid Gas Companies Over Homeowners."
Eagle Ford Information
The following link from the Texas Railroad Commission gives numerous stats and information about this massive natural gas field in South Texas.
Monday, January 17, 2011
Is Tarrant tops in U.S. gas production?
JANUARY 17, 2011
Is Tarrant tops in U.S. gas production?
Tarrant County not only continues to lead Texas' 254 counties in natural gas production, but might lead all counties in the nation, according to the Powell Barnett Shale Newsletter. It said in its weekly edition today that it "believes Tarrant County is also the highest natural gas producing county in the U.S. and has asked the U.S. Energy Information Administration for confirmation."
Tarrant produced 55.3 billion cubic feet of gas in October, with Johnson County, its neighbor to the south, coming in No. 2 in the state with 43.3 billion cubic feet.
See full story in Tuesday's Star-Telegram.
--Jack Z. Smith
Read more:
Is Tarrant tops in U.S. gas production?
Tarrant County not only continues to lead Texas' 254 counties in natural gas production, but might lead all counties in the nation, according to the Powell Barnett Shale Newsletter. It said in its weekly edition today that it "believes Tarrant County is also the highest natural gas producing county in the U.S. and has asked the U.S. Energy Information Administration for confirmation."
Tarrant produced 55.3 billion cubic feet of gas in October, with Johnson County, its neighbor to the south, coming in No. 2 in the state with 43.3 billion cubic feet.
See full story in Tuesday's Star-Telegram.
--Jack Z. Smith
Friday, January 14, 2011
Has Natural Gas Finally Bottomed?
Another Brick in the Wall:
Has Natural Gas Finally Bottomed?
Costas Bocelli
THE COMMODITIES SECTOR WAS ONE OF THE TOP PERFORMING ASSET CLASSES IN 2010, WITH PRICES SOARING ACROSS THE BOARD.
Precious metals were up big ...
Base metals, like copper, made record highs ...
Tight supplies and bad weather sent corn, soybeans, and wheat to the moon ...
Even soft commodities like sugar, coffee, and cotton made stellar gains.
The Thomson-Reuters/ Jefferies CRB Commodity Index was up 18% for 2010. Since the market rally in September, the index has gained 29% in 4 short months.
Yes, the Commodity sector was in a bullish feeding frenzy, except for ... Natural Gas.
Natural Gas prices have been in a dismal decline since the commodity bubble burst in mid 2008, just before the credit crisis sent the world into the great recession.
2010 was another difficult year for Natural Gas, and it was unable to ride the commodity rally with the rest of the sector. Natural Gas prices fell 35% last year, making it -- by far -- the worst performer in the space.
Although energy is in high demand in the United States and abroad, Natural Gas supply has been abundant and plentiful, putting pressure on prices. New technologies and large discoveries of proven reserves have been the main driver of lower prices.
Have a look at the Natural Gas February Futures Contract (weekly) ...
(Click on image to enlarge)
You can see that it maintained a bearish trend throughout the year, making a series of lower highs and lower lows in a downward channel.
But now, the early price action this month appears to exhibit a technical breakout from the pattern. Is this the start of a turn in Natural Gas prices, and an indicator that a floor has been put in?
Is it Finally Time to Get Bullish?
Some very smart investors think so. Hedge funds almost doubled their bullish bets that Natural Gas prices go higher -- in fact, their net long positions have increased by more than 90% since the end of 2010. According to the Commodity Futures Trading Commission (CFTC), which tracks these large positions and open interest, the surge was the largest increase in over a year.
It's hard to say what their time frame is on the bullish play. But with Natural Gas prices at historic lows, inventory levels not breaching 2009 record levels, and harsh winter snow storms hitting major cities in the United States, the bet makes perfect sense.
Longer term, Natural Gas may play a more significant role in how we deal with energy consumption. As oil prices rise, alternative resources attract greater attention. Green energy innovations such as solar and wind are still in their early stages and a small piece of the pie to a real solution. However, Natural Gas continues to grab share from Coal when it comes to electricity generation.
Chesapeake Energy (ticker: CHK) is the second largest producer of natural gas and one of the most active drillers of new wells in the U.S. They have a vast amount of proven reserves.
Their biggest shareholder, Billionaire Carl Icahn, recently doubled his equity exposure in CHK. According to an SEC filing that was released in mid December, he now controls almost 6% of the company, or 39 million shares. Obviously, Mr. Icahn thinks that the current valuation of Natural Gas is quite compelling.
The stock is up 17% since the Icahn news became public. CHK is a pure play on where Natural Gas prices are headed. Aside from their production, the company has a very large proprietary trading desk that makes them the ultimate player in Natural Gas prices.
Here's a daily Chart on CHK ...
Another way to play Natural Gas is through a very liquid and heavily traded ETF. The United States Natural Gas Fund (ticker: UNG) seeks to replicate the performance of Natural Gas Futures prices on the NYMEX.
Because of the contango effect on Natural Gas Futures, there has been some price slippage as the fund rolls over their expiring contracts. Recently, with the price of Natural Gas bottoming, some of the contango effect has lessened, which reduces the slippage. The shift in skew (contango) across contract months also indicates a bullish bias in prices, as there is more interest in near term delivery.
Here's a daily chart on UNG ...
(Click on image to enlarge)
Very similar to the Natural Gas Futures contract, UNG appears to have bottomed, and is making a bullish uptrend, putting in higher lows (green line). The longer dated downtrend line (red line) was also breached. If UNG trades higher, the 200-day moving average could be the next resistance level, or 10% higher from Wednesday's close of 6.14.
Could 2011 be the year for Natural Gas? We shale see ...
Has Natural Gas Finally Bottomed?
Costas Bocelli
THE COMMODITIES SECTOR WAS ONE OF THE TOP PERFORMING ASSET CLASSES IN 2010, WITH PRICES SOARING ACROSS THE BOARD.
Precious metals were up big ...
Base metals, like copper, made record highs ...
Tight supplies and bad weather sent corn, soybeans, and wheat to the moon ...
Even soft commodities like sugar, coffee, and cotton made stellar gains.
The Thomson-Reuters/ Jefferies CRB Commodity Index was up 18% for 2010. Since the market rally in September, the index has gained 29% in 4 short months.
Yes, the Commodity sector was in a bullish feeding frenzy, except for ... Natural Gas.
Natural Gas prices have been in a dismal decline since the commodity bubble burst in mid 2008, just before the credit crisis sent the world into the great recession.
2010 was another difficult year for Natural Gas, and it was unable to ride the commodity rally with the rest of the sector. Natural Gas prices fell 35% last year, making it -- by far -- the worst performer in the space.
Although energy is in high demand in the United States and abroad, Natural Gas supply has been abundant and plentiful, putting pressure on prices. New technologies and large discoveries of proven reserves have been the main driver of lower prices.
Have a look at the Natural Gas February Futures Contract (weekly) ...
(Click on image to enlarge)
You can see that it maintained a bearish trend throughout the year, making a series of lower highs and lower lows in a downward channel.
But now, the early price action this month appears to exhibit a technical breakout from the pattern. Is this the start of a turn in Natural Gas prices, and an indicator that a floor has been put in?
Is it Finally Time to Get Bullish?
Some very smart investors think so. Hedge funds almost doubled their bullish bets that Natural Gas prices go higher -- in fact, their net long positions have increased by more than 90% since the end of 2010. According to the Commodity Futures Trading Commission (CFTC), which tracks these large positions and open interest, the surge was the largest increase in over a year.
It's hard to say what their time frame is on the bullish play. But with Natural Gas prices at historic lows, inventory levels not breaching 2009 record levels, and harsh winter snow storms hitting major cities in the United States, the bet makes perfect sense.
Longer term, Natural Gas may play a more significant role in how we deal with energy consumption. As oil prices rise, alternative resources attract greater attention. Green energy innovations such as solar and wind are still in their early stages and a small piece of the pie to a real solution. However, Natural Gas continues to grab share from Coal when it comes to electricity generation.
Chesapeake Energy (ticker: CHK) is the second largest producer of natural gas and one of the most active drillers of new wells in the U.S. They have a vast amount of proven reserves.
Their biggest shareholder, Billionaire Carl Icahn, recently doubled his equity exposure in CHK. According to an SEC filing that was released in mid December, he now controls almost 6% of the company, or 39 million shares. Obviously, Mr. Icahn thinks that the current valuation of Natural Gas is quite compelling.
The stock is up 17% since the Icahn news became public. CHK is a pure play on where Natural Gas prices are headed. Aside from their production, the company has a very large proprietary trading desk that makes them the ultimate player in Natural Gas prices.
Here's a daily Chart on CHK ...
(Click on image to enlarge)
Another way to play Natural Gas is through a very liquid and heavily traded ETF. The United States Natural Gas Fund (ticker: UNG) seeks to replicate the performance of Natural Gas Futures prices on the NYMEX.
Because of the contango effect on Natural Gas Futures, there has been some price slippage as the fund rolls over their expiring contracts. Recently, with the price of Natural Gas bottoming, some of the contango effect has lessened, which reduces the slippage. The shift in skew (contango) across contract months also indicates a bullish bias in prices, as there is more interest in near term delivery.
Here's a daily chart on UNG ...
(Click on image to enlarge)
Very similar to the Natural Gas Futures contract, UNG appears to have bottomed, and is making a bullish uptrend, putting in higher lows (green line). The longer dated downtrend line (red line) was also breached. If UNG trades higher, the 200-day moving average could be the next resistance level, or 10% higher from Wednesday's close of 6.14.
Could 2011 be the year for Natural Gas? We shale see ...
Chesapeake's LA #1-H Tarrant County, Texas
 |
| Gas drilling continues on a cold winter's night at Chesapeake Energy's LA #1-H unit in far southern Tarrant county. |
 |
| Work continues 24/7...just happened to be passing tonight and grabbed these photos. |
Rule 37, Rule of Capture, Correlative Rights - What Does it All Mean?
Mike Norman, editorial director of the Arlington and Northeast Tarrant County Star-Telegram provides his take on this topic, and what it all means to those owning mineral rights in the Barnett Shale.
Keller P&Z rejects XTO request for Sky Creek pad site | Barnett Shale | Dallas Business,...
The zoning commission in Keller falls in step with other communities by blocking a proposed XTO Energy drilling pad site in the Barnett Shale.
Wednesday, January 05, 2011
Southlake extends discussion on first gas well until Feb. 1 | Barnett Shale | Dallas Bus...
A second public hearing on Southlake's first gas well was tabled on Wednesday, January 5, 2010. A third hearing to continue the discussion and has been rescheduled for February 1, 2010.
Arlington City Council tables vote on proposed Chesapeake gas well near Cowboys Stadium | ...
Possible heavy truck traffic through the city's entertainment district prompts decision to table a vote on Chesapeake's permit to drill near Cowboy Stadium.
Monday, January 03, 2011
Eagle Ford Shale Attracts Huge Interest
South Texas shale attracts interest, billions of dollars
By Brett Clanton, Houston Chronicle
Published: 10:12 a.m., Monday, January 3, 2011
Although still facing uncertainty on many fronts as 2011 begins, the oil and gas industry knows one thing: It likes what it sees in South Texas.
That's the site of the Eagle Ford shale formation, a vast underground network of dense rock layers, discovered only recently and now thought to be one of the nation's biggest oil and gas fields.
To this point, the formation has existed in the shadow of other big domestic shale formations best known for their supplies of natural gas, including the Barnett Shale in the Dallas-Fort Worth area.
But that is almost certain to change next year as Eagle Ford's large quantities of valuable crude oil and natural gas liquids attract more interest and dollars.
"I expect the Eagle Ford would probably be the hottest single area in all the lower 48 states in 2011," said Mark G. Papa, chairman and CEO of Houston's EOG Resources, one of the largest leaseholders in the region.
Oil and gas companies of all sizes are trying to shift resources to the hunt for oil while natural gas prices remain weak.
And some of the world's biggest oil companies - including Shell, BP, Norway's Statoil and China's CNOOC - recently have entered the Eagle Ford and are helping to put it on the global energy map.
Surge in permits
On an actual map, the Eagle Ford shale play extends about 400 miles across South Texas in a 50-mile-wide band, from the Mexican border, below San Antonio and up into East Texas.
Though drilling has occurred in the region for decades, geologists recently discovered big deposits of oil and gas in deeper, dense rock layers once thought too difficult to reach - and it didn't long for others to take notice.
In 2010 in the Eagle Ford, 1,018 drilling permits were issued through November, up from 94 the year before, and output of crude oil, condensate and other liquids nearly quadrupled to 3.9 million barrels, according to Texas Railroad Commission data.
About 115 rigs are working in the area now, and companies so far have drilled several hundred wells.
While that's still below more developed shale plays, it's likely a small taste of what's to come. Many oil and gas companies plan to boost spending significantly and increase the number of drilling rigs they're deploying to the area next year, even as they're pulling back in gas fields elsewhere.
"The Eagle Ford Shale in 2011 will really hit its stride," said Ralph Eads, head of Jefferies' energy investment banking group in Houston.
Take EOG, which in 2010 averaged seven rigs in the Eagle Ford and drilled 110 wells. This year, it expects to have 14 rigs and drill 256 wells, Papa said.
Major deals signed
Oklahoma City's Chesapeake Energy, the largest leaseholder with 625,000 acres, also expects to double the dozen rigs it has working in the area. Ditto for Houston's Petrohawk Energy, which expects to spend more than twice as much as it did in the region in 2010. And ConocoPhillips, another major leaseholder, just leaped from seven to 11 rigs in the region.
"It does appear it will be a very busy year in the Eagle Ford," said Jim Lowry, a spokesman for the Houston-based ConocoPhillips.
U.S. shale plays, including the Haynesville in Louisiana and Marcellus in the northeast, are expected to provide a major boost to domestic natural gas supplies in coming years. But with gas prices low, some operators have been forced to curtail output.
And Eagle Ford, with its high content of valuable crude and natural gas liquids, has proved a haven for those who bought in early.
"The economics in the Eagle Ford are probably better than in almost any other play in the world," Eads said. "The returns are stunning."
That helps explain a recent surge of big-ticket deals there.
In October, China's CNOOC agreed to pay $1.1 billion for a 33 percent stake in Chesapeake's Eagle Ford acreage, marking its first U.S. onshore asset purchase. That same month, Statoil said it was joining forces with Canada's Talisman and would pay Enduring Resources $1.3 billion to develop Eagle Ford acreage.
In June, India's Reliance shelled out $1.3 billion to buy acreage and form a joint venture with Pioneer Natural Resources Co. And earlier in the year, BP and Shell bought into the play. Exxon Mobil Corp., the world's largest public oil company, also has a position in the Eagle Ford.
"We have high hopes for that area," Statoil CEO Helge Lund told the Chronicle in a recent interview in Houston.
But along with the optimism, some operators worry that growth could be held back by equipment constraints and a potential lag in building new pipelines, processing plants and other infrastructure. Right now, for instance, it's difficult to get hydraulic fracturing crews at a well site, Papa said.
Billions invested
Hydraulic fracturing uses a high-pressure mix of water, chemicals and sand to crack open dense shale rock and release oil and gas through a well.
Current drilling and production technologies allow extraction of less than 5 percent of the oil in place in the dense shale rock.
But equipment and service providers say they're determined to keep up with customer demands in the Eagle Ford.
"We think we're in a position to take care of their needs during this ramp-up period," said Jim Teague, the chief operating officer of Houston-based pipeline giant Enterprise Products, which so far has announced $2 billion in infrastructure investments in the region and expects more soon.
Considering the way things are looking for 2011 in the Eagle Ford, it may not be a long wait.
Read more: http://www.beaumontenterprise.com/default/article/South-Texas-shale-attracts-interest-billions-of-934092.php#ixzz1A1Yww4Ta
By Brett Clanton, Houston Chronicle
Published: 10:12 a.m., Monday, January 3, 2011
Although still facing uncertainty on many fronts as 2011 begins, the oil and gas industry knows one thing: It likes what it sees in South Texas.
That's the site of the Eagle Ford shale formation, a vast underground network of dense rock layers, discovered only recently and now thought to be one of the nation's biggest oil and gas fields.
To this point, the formation has existed in the shadow of other big domestic shale formations best known for their supplies of natural gas, including the Barnett Shale in the Dallas-Fort Worth area.
But that is almost certain to change next year as Eagle Ford's large quantities of valuable crude oil and natural gas liquids attract more interest and dollars.
"I expect the Eagle Ford would probably be the hottest single area in all the lower 48 states in 2011," said Mark G. Papa, chairman and CEO of Houston's EOG Resources, one of the largest leaseholders in the region.
Oil and gas companies of all sizes are trying to shift resources to the hunt for oil while natural gas prices remain weak.
And some of the world's biggest oil companies - including Shell, BP, Norway's Statoil and China's CNOOC - recently have entered the Eagle Ford and are helping to put it on the global energy map.
Surge in permits
On an actual map, the Eagle Ford shale play extends about 400 miles across South Texas in a 50-mile-wide band, from the Mexican border, below San Antonio and up into East Texas.
Though drilling has occurred in the region for decades, geologists recently discovered big deposits of oil and gas in deeper, dense rock layers once thought too difficult to reach - and it didn't long for others to take notice.
In 2010 in the Eagle Ford, 1,018 drilling permits were issued through November, up from 94 the year before, and output of crude oil, condensate and other liquids nearly quadrupled to 3.9 million barrels, according to Texas Railroad Commission data.
About 115 rigs are working in the area now, and companies so far have drilled several hundred wells.
While that's still below more developed shale plays, it's likely a small taste of what's to come. Many oil and gas companies plan to boost spending significantly and increase the number of drilling rigs they're deploying to the area next year, even as they're pulling back in gas fields elsewhere.
"The Eagle Ford Shale in 2011 will really hit its stride," said Ralph Eads, head of Jefferies' energy investment banking group in Houston.
Take EOG, which in 2010 averaged seven rigs in the Eagle Ford and drilled 110 wells. This year, it expects to have 14 rigs and drill 256 wells, Papa said.
Major deals signed
Oklahoma City's Chesapeake Energy, the largest leaseholder with 625,000 acres, also expects to double the dozen rigs it has working in the area. Ditto for Houston's Petrohawk Energy, which expects to spend more than twice as much as it did in the region in 2010. And ConocoPhillips, another major leaseholder, just leaped from seven to 11 rigs in the region.
"It does appear it will be a very busy year in the Eagle Ford," said Jim Lowry, a spokesman for the Houston-based ConocoPhillips.
U.S. shale plays, including the Haynesville in Louisiana and Marcellus in the northeast, are expected to provide a major boost to domestic natural gas supplies in coming years. But with gas prices low, some operators have been forced to curtail output.
And Eagle Ford, with its high content of valuable crude and natural gas liquids, has proved a haven for those who bought in early.
"The economics in the Eagle Ford are probably better than in almost any other play in the world," Eads said. "The returns are stunning."
That helps explain a recent surge of big-ticket deals there.
In October, China's CNOOC agreed to pay $1.1 billion for a 33 percent stake in Chesapeake's Eagle Ford acreage, marking its first U.S. onshore asset purchase. That same month, Statoil said it was joining forces with Canada's Talisman and would pay Enduring Resources $1.3 billion to develop Eagle Ford acreage.
In June, India's Reliance shelled out $1.3 billion to buy acreage and form a joint venture with Pioneer Natural Resources Co. And earlier in the year, BP and Shell bought into the play. Exxon Mobil Corp., the world's largest public oil company, also has a position in the Eagle Ford.
"We have high hopes for that area," Statoil CEO Helge Lund told the Chronicle in a recent interview in Houston.
But along with the optimism, some operators worry that growth could be held back by equipment constraints and a potential lag in building new pipelines, processing plants and other infrastructure. Right now, for instance, it's difficult to get hydraulic fracturing crews at a well site, Papa said.
Billions invested
Hydraulic fracturing uses a high-pressure mix of water, chemicals and sand to crack open dense shale rock and release oil and gas through a well.
Current drilling and production technologies allow extraction of less than 5 percent of the oil in place in the dense shale rock.
But equipment and service providers say they're determined to keep up with customer demands in the Eagle Ford.
"We think we're in a position to take care of their needs during this ramp-up period," said Jim Teague, the chief operating officer of Houston-based pipeline giant Enterprise Products, which so far has announced $2 billion in infrastructure investments in the region and expects more soon.
Considering the way things are looking for 2011 in the Eagle Ford, it may not be a long wait.
Read more: http://www.beaumontenterprise.com/default/article/South-Texas-shale-attracts-interest-billions-of-934092.php#ixzz1A1Yww4Ta
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