Director's Cut Scheduled To Be Released Today -- August Data -- October 13, 2016

Director's cut  is scheduled to be released Thursday, October 13th, at 2:00 p.m. Central Time. Any guesses on the over/under one million bopd.

Active rigs:

	10/13/2016	10/13/2015	10/13/2014	10/13/2013	10/13/2012
Active Rigs	33	67	191	184	192

RBN Energy: primer on Texas pipelines.

It will come as no surprise to you that, over time, the high [Texas] intrastate prices encouraged surpluses to develop in that sector while shortages were experienced in the interstate market because the regulated gas prices in that market were kept artificially low.

By the 1970s, natural gas, which traditionally had been in plentiful supply in the U.S., was not available in sufficient volumes to fully satisfy the demands of markets served by interstate natural gas pipelines.

In an effort to fix this mess, Congress and the Carter administration enacted the Natural Gas Policy Act of 1978 (NGPA), a well-meaning but heavy-handed system that established 27 different categories of gas, each with different prices––set by the statute and its regulatory rules––that ranged from about 40 cents/Mcf to about $7.00/Mcf.

The NGPA did its job, and by the 1980s the interstate gas shortages were essentially over. But the complex system of government-set prices made commercial transactions very difficult and prone to errors, and led to market chaos as purchasing pipelines tried to blend 40-cent gas with $7.00 gas to average out to a rational market value.

Eventually this system was dismembered with full price decontrol finally implemented with the Natural Gas Wellhead Decontrol Act of 1989, which was signed into law by the first President Bush.

The Federal Energy Regulatory Commission (FERC) completed the natural gas commodity decontrol process in 1992 with Order 636, which created the market we know today.

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Huge Asian/African Natural Gas Buildout

Data points from Reuters:

• CBI Energy and Chemical; $3.8 billion shipbuilding project; 20 LNG carriers
• floating LNG production and import facilities as part of ambitious plan for Asia and Africa
• company says there is a need to custom-build specialty LNG carriers
• CBI plans include natural gas extraction, pipelines, marine transportation logistics, LNG plants, rail transport, power generation, chemical plants, and an LNG distribution network, including retail gas stations

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Polish Firms Concede Defeat in Search For Shale Gas Riches

Link here. Nothing more than a footnote in history. Political squabbling was the final nail in that coffin.