Gas prices continue to fall and are about where they were in Feb. 2010. The graph below shows gas prices of regular gas in Austin, Texas and Los Angeles, California from December 1, 2004 to December 1, 2014.
Tag: Fracking
Texas oil boom continues as Australian oil and gas exploration successfully drills in Eagle Ford area
According to a company press release, New Standard Energy Limited announced that it reached target depth at its second well in the Eagle Ford shale the Peeler Ranch-6H well.
The company stated that the they completed the wells within expected time and budget forecasts. According to the company, the two wells were drilled in parallel lateral lengths, targeting the same Eagle Ford hydrocarbon bearing zone to maximize production and minimize associated drilling, hydraulic fracturing and production tie-in costs.
The company will shift operational focus to fracture stimulation in April.
The company anticipates stimulating both wells together using the
“zipper frac” method. The zipper frac method alternates fracture stages between the two wells, and causes an incremental increase in fracture interaction, leading to better recovery.
More on zipper frac method:
The economics of ending oil export bans: who wins and who loses
A recent article in the New York Times explored the brewing debate concerning the current U.S, ban on exporting oil outside of the U.S.
In a nutshell, the producers want to export oil while the refiners want to keep the oil in the US
The refiners: The refiners want to keep the oil in the US so they have more oil to refine. Keeping the oil in the U.S. also keeps refining competition from abroad in check.
Keeping the export ban would possibly lower prices for oil and gas products, refiners argue. To refiners exporting oil cuts into their bottom line.
Oil producers: On the other side of the equation the oil producers are concerned that having the restriction to only selling the United States will eventually lower their profits by reducing the price of crude oil in the U.S.
Natural gas in the price of natural gas has seen that same type of phenomena over the last decade as Shale and hydro-fracturing has led to much lower natural gas prices in the US
The concern among oil producers is that the lower price (that results from the export ban) would eventually cut into their bottom line as more and more crude oil is put on the market with the new discoveries in South Texas and other places in the United States
In the long run producers are concerned that there would be an exit of producers and or a reduction of new finds in the United States. Since the price that they would receive for crude oil would be lower.
The natural gas market is a good example of the potential impact that crude oil producer see. The natural gas industry faced and continues to face lower prices in part due to the fact that it is not as easy to export natural gas. As a result of not being able to export natural gas readily from United States the large number of hydro-fracturing finds in the United States have stayed in United States. As a result the price of natural gas products has fallen. That is clearly the concern that is clearly the concern of the crude oil producers in United States.
Keystone XL Pipeline gets a powerful new supporter and loses a powerful adversary all in one day.
The Former head of the US Geological Survey (USGS), now editor-in-chief ofScience magazine (Marcia McNutt), looked at the economics and re-evaluated her position on the Keystone XL project. She now endorses building a pipeline to transport crude oil from Canada’s oil sands to the United States.
Listen to the full NPR interview with Ms. McNutt.
Marcia McNutt discusses in the interview with NPR, that if the Keystone XL pipeline were not built, the oil would be carried by rail and road tankers, which would be more environmentally damaging.
Texas oil expansion continues as Phillip 66 invest $3 billion in two new facilities 60 miles south of Houston
According to FuelFix, Phillips 66 approved a $3 billion investment in two facilities 60 miles south of Houston.
- A planned liquefied petroleum gas export terminal in Freeport capable of exporting 4.4 million barrels of products like butane and propane overseas every month by 2016.
- A new fractionation facility in Old Ocean that will separate natural gas liquids into chemicals used in plastics manufacturing and other industries.
Combined the two Brazoria County facilities would create 50 permanent jobs in southeast Texas, Phillips 66 says. The economic impact of the expansion is magnified as the money flows through the area and creates additional jobs and economic opportunities for supplies and other vendors related to the Oil an Gas industry.
Review of Bracewell Giuliani’s ShalePlay App on the Shale industry
Bracewell Giuliani’s ShalePlay app for IPhone is a one stop information source for professionals who are interested in learning more about the Shale industry. The app has three main sections: Drill Down, Where to Play, and How to Play.
The ‘Drill Down ‘section contains news, information on legislation, studies, and analysis from the attorneys and energy professionals at Bracewell Giuliani.
The ‘Where to Play’ section is an interactive map that allows the user to get information on a specific Shale Plays by just clicking on the map. A single touch provides name and age information on play. In future versions of the program it would be nice to get more information, like rig count and drill permits.
Touching and holding a location on the map gives more information provides news from the State that the play is located in. Hopefully future versions will provide more specific information for each play. Right now, all plays within a state present the same news.
The ‘How to Play’ section provides informational and educational sources to learn more about the Shale industry. There is a detailed glossary, listing of industry links and blogs, and a history of Fracking. People new to the industry will most likely find this section very helpful. Hopefully, this section will continue to grow as the app develops.
Week in Energy
- SolarWorld looks to close alleged loopholes in tariffs against Chinese solar manufacturers
- Zuckerman’s Frackers presents a balanced, informative and detailed insights into the industry.
- Sweetwater, Texas gets ready for drillers
- City of Fort Worth sues driller over natural gas royalties
SolarWorld looks to close alleged loopholes in tariffs against Chinese solar manufacturers
The New York Times reports that SolarWorld, a major maker of solar panels, is asking the Commerce Department to impose new duties on imported modules made of certain components from China or Taiwan.
Learn more about the complaint and the US agency responsible for pursuing it (USIT.gov): (Google Search)
Zuckerman’s Frackers presents a balanced, informative and detailed insights into the industry.
Frackers is a lively but informative book about the recent development of the hydro fracturing industry. The stories focus mainly on developments from 1990 to 2013. Zuckerman provides the necessary detail to get the reader to be able to understand the technology without boring them to death. The fast moving biographical sketches of some of the key figures, such as George Mitchell, makes the tale interesting on a personal level. Zuckerman does all this without editorializing (until the end of the book which is an optional read). Great book for anyone interested in learning about the fracking industry.
Sweetwater, Texas gets ready for drillers
Austin American Statesman: http://www.mystatesman.com/news/news/opinion/as-shale-oil-drilling-draws-closer-sweetwater-lead/ncPNX
Sweetwater Economic Development: http://www.sweetwatertexas.net/cline-shale-oil-play
City of Fort Worth sues driller over natural gas royalties
City of Fort Worth hires the well know Fort Worth law firm of Cantey Hanger to pursue royalty lawsuit.
How far down do water rights go?
Some say down to the center of the earth. Other say that it is ok to drill and capture water that spills over to another’s land.
The Texas Supreme Court will hear arguments in Jan 2014.
From The Texas Tribune:
The Texas Supreme Court is scheduled to hear arguments on Jan. 7 in a dispute between a company that operates injection wells in Liberty County and a nearby rice farm that says wastewater from those wells has migrated into a saltwater aquifer below its land. It calls the migration trespassing, for which it should be compensated.
Suncor increases sand tar oil production; using rail instead of pipeline to move product
The New York Times reports that Suncor, a leading Canadian oil sands producer, will increase production in 2014. The company anticipates using rail instead of pipeline to move oil to its refineries.
The Suncor website provides a detailed description of the oil sands process.
From their website:
Near Fort McMurray, Alta., Suncor recovers bitumen from oil sands through its mining and in situ operations. The bitumen from both operations is then upgraded to refinery-ready feedstock and diesel fuel.
The in situ process uses horizontal wells to reach the oil sands ore. The top well injects steam to heat the reservoir, allowing the bitumen to flow to the lower well where it is collected and piped to upgrading facilities. Graphic:
