The Weekly Update: 23rd July 2012
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Statoil: US the most attractive country for oil/gas development A stable and transparent regulatory environment, private mineral-rights ownership, and lower taxes than Norway all combine to make the US Statoil's most attractice location for further investment. With $20 billion in assets acquired domestically in the last few years, Statoil is counting on the US to maintain its production levels as its legacy wells offshore of Norway experience high declines. Article here
API: Q2 number of oil well completions grew 13% from last year, while gas well completions fell 24% Drilling and completion activities for oil continue to increase in 2012, with 7,195 wells completed in the second quarter of this year. Gas completions took a dive for a total of 2,472 for the second quarter. Article here
Gas and oil prices will de-link with the advent of global gas trading The global price for natural gas has traditionaly been derived from the price of oil, due to their close production association. Analysts expect that association to change, with the US's growing export capacity. Sabine Pass will be the first US LNG export terminal to come on-line in 2015, with more to follow shortly. With a market released from its dependance on pipeline delivery, gas will be traded at prevailing market prices. Cheniere Energy Inc., which plans to export LNG from the Sabine Pass terminal in the US by 2015, already used Henry Hub pricing for its LNG export contracts. Article here |
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SHALE NEWS
Texas' Eagle Ford has 280 rigs drilling for gas and oil
Receiving more attention than any resource play in the US right now, the Eagle Ford continues to increase its rig count, even as North Dakota has plateaued around 200 rigs. Of the 280 drilling rigs, 263 are drilling horizontally and 71 target natural gas. Article here
Analyst says Bakken's largest driller are reducing their rig counts
Barclays analyst Amrita Sen said in a note last week that although companies are not publicly announcing it, rig counts for the Bakken's largest drillers will come down this month. This is largely due to anxiety over the stability of oil prices, currently around $88 per barrel, and the high cost to drill a Bakken well, around $10 million. If oil were to drop below $80, a larger reduction could be expected. Article here
Natural gas-fed fertilizer plant proposed for North Dakota
The North Dakota Corn Growers Association is in the planning stages for a world-class fertilizer plant for the North-South Dakota market. The plant would utilize natural gas from the nearby Bakken fields as feedstock to produce 2,200 tons of fertilizer a day. Estimate cost for the plant is $1.5 billion. Article here
ENVIRONMENT & SAFETY NEWS
Illegal North Dakota wastewater injection well generates fines and criminal charges
The President of Executive Drilling LLC faces criminal charges for deceiving inspectors and knowingly injecting drilling wastewater down a well not approved for these activities. The well is owned by Halek Operating ND LLC, who had been told by state regulators to stop wastewater injections, but continued. The connection between the two companies is unclear at this time. Lynn Helms, Director for the ND DMR, said this this was the most significan environmental case in North Dakota that he was aware of. "It's a very serious violation and it needs to be dealt with in a very serious manner," Helms said. Article here
ACQUISITIONS & MERGERS NEWS
Private equity group Riverstone invests $500 million into midstream company Meritage Midstream Services II
The company provides transportation and processing to E&P companies in the US's emerging shale plays. Article here
RIG COUNT
|
This Week |
Change from last week |
12 weeks ago |
One year ago |
|
|
Arkansas |
17 |
0 |
26 |
34 |
|
California |
52 |
0 |
45 |
46 |
|
Colorado |
65 |
-1 |
68 |
70 |
|
Kansas |
27 |
-2 |
26 |
31 |
|
Montana |
20 |
+1 |
17 |
11 |
|
N. Louisiana |
25 |
+2 |
41 |
91 |
|
New Mexico |
86 |
-5 |
85 |
82 |
|
North Dakota |
198 |
-1 |
195 |
158 |
|
Ohio |
18 |
-1 |
12 |
12 |
|
Oklahoma |
202 |
0 |
201 |
177 |
|
Pennsylvania |
78 |
0 |
101 |
116 |
|
Texas |
900 |
-10 |
929 |
864 |
|
Utah |
40 |
0 |
40 |
29 |
|
West Virginia |
24 |
-3 |
22 |
21 |
|
Wyoming |
47 |
+2 |
40 |
51 |
|
Total US |
1935 |
-18 |
1972 |
1916 |
|
Total Canada land |
326 |
+34 |
146 |
375 |
The Oil & Gas Weekly is compiled by Todd Erickson. Todd is a veteran executive manager in the North American E&P market. He has management experience in high-growth oil & gas service organizations performing a leadership role in operations, strategy, and corporate development with a track record of identifying opportunities and best-practices, creating execution plans, then developing effective teams and leaders to execute them.
Learn more about Todd here
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