Update
July 8, 2018: update here.
August 21, 2017: at 75 mn t/y, US LNG exports will soon rival Qatar's at 77 mn t/y. The competition will get intense.
October 6, 2016: the Utica and the Marcellus continue to defy skeptics.
October 29, 2011: Rigzone -- Musings on the NYT story on natural gas. This story refuses to die.
October 29, 2011: US to export LNG.
September 15, 2011: Rosy outlook for natural gas.
July 31, 2011: The New York Times trying to walk back the shoddy reporting they did on this story.
July 29, 2011: the New York Times folks need to read the 2Q11 CHK conference call transcript.
June 27, 2011: Here is the "source" for the article that started this whole thing.
The numbers on major shale companies financial statements do not add up, said Deborah Rogers, advisory council member for the Federal Reserve Bank of Dallas.
"I have to say that after all the work I've done I think there is some sleight of hand in the balance sheets," said Rodgers in a CNBC interview.
June 26, 2011: I think I was scammed! See "original post" below. Here's the real story, with dateline of June 26, 2011 (today):
Two unexpected gushers in northeastern Pennsylvania are helping to illustrate the enormous potential of the Marcellus Shale natural gas field.June 26, 2011: At the link below, look at the dates of the e-mails referenced (2009). In addition, the article is undated. It appears that the NY Times / MSNBC was completely off target. It appears this article was written back in 2009; since then the natural gas industry has exploded (no pun intended) and doing very, very well. It's also possible the entire article was a hoax. A big thank you to "Anon 1" for noting the dates on the e-mails that were the basis of this article.
Each of the Cabot Oil & Gas Corp. wells in Susquehanna County is capable of producing 30 million cubic feet per day -- believed to be a record for the Marcellus and enough gas to supply nearly 1,000 homes for a year. The landowners attached to the wells, who leased the well access, numbering fewer than 25, are splitting hundreds of thousands of dollars in monthly royalties.
"There was definitely excitement among the team that planned out these wells and executed their completion," said Cabot spokesman George Stark.
Drilling companies knew the Marcellus held a lot of gas. They just had to figure out a way to get it out, and they say they're getting better at it all the time.
Original Post
Link here. (Update, August 30, 2015: this is so interesting. The NY Times has removed this article.)
This story is definitely an "out-lier," a story that does not mesh with the vast number of articles suggesting the opposite.Natural gas companies have been placing enormous bets on the wells they are drilling, saying they will deliver big profits and provide a vast new source of energy for the United States.But the gas may not be as easy and cheap to extract from shale formations deep underground as the companies are saying, according to hundreds of industry e-mails and internal documents and an analysis of data from thousands of wells.
In the e-mails, energy executives, industry lawyers, state geologists and market analysts voice skepticism about lofty forecasts and question whether companies are intentionally, and even illegally, overstating the productivity of their wells and the size of their reserves. Many of these e-mails also suggest a view that is in stark contrast to more bullish public comments made by the industry, in much the same way that insiders have raised doubts about previous financial bubbles.
“Money is pouring in” from investors even though shale gas is “inherently unprofitable,” an analyst from PNC Wealth Management, an investment company, wrote to a contractor in a February e-mail. “Reminds you of dot-coms.”
Then I looked at the source of the article: the New York Times and MSNBC.
There are two facts that cannot be overlooked: a) the industry is finding more and more natural gas everywhere they look around the world; and, b) there is such a glut of natural gas in the US right now, the country is getting ready to export it overseas.
But maybe the Times and MSNBC are correct, and that's why the coal industry continues to thrive.
A big thank you to "Gary" for sending me the link.
The article is a scam.
ReplyDeleteIntent, or incompetence? Probably both.
Note the date of letters - back when some had those views.
Note the "names withheld."
Note the carefully extracted quotes out of context.
Note the lack of contrary quotes.
It is unbelievable. No credibility at all.
See real data omitted from the story:
http://www.eia.gov/dnav/ng/hist/n9070us2m.htm
Note the omission of purchases by those who he must think are foolish rubes who don't know anything - Exxon, Chevron, Shell, BG, Statoil, etc.
http://www.bizjournals.com/pittsburgh/news/2011/06/09/marcellus-acquisitions-joint-ventures.html
Is the author so incompetent that he examined old email, but did not google: marcellus acquisitions?
Or, is the omission part of his scam?
Yes, I believe that the article is a scam.
anon 1
http://finance.yahoo.com/news/Gushers-highlight-potential-apf-3807643486.html?x=0&.v=3
ReplyDeleteMichael Rubinkam, Associated Press, On Sunday June 26, 2011, 2:34 pm ED
"The result is that the Marcellus, a rock formation beneath Pennsylvania, New York, West Virginia and Ohio, has turned out to be an even more prolific source of gas than anyone anticipated. Energy firms are boosting their production targets, not only because new wells are coming on line but also because they're managing to coax more gas from each well."
anon 1
A big "thank you." I didn't pay attention to the dates of the e-mail referenced in the article (2009).
ReplyDeleteObviously NY Times blew it.
I'm glad you caught me on this one. Thank you.
I've update the post. The NY Times article was either a hoax or really, really outdated. Time has proved that article really, really wrong.
ReplyDelete