Wednesday, November 27, 2013

U.S. Rig Count: +2 to 1,763

The Baker Hughes U.S. rig count was up two this week to 1,763.  Oil rigs were up four 1,391, gas rigs were down two to 367 and miscellaneous rigs were unchanged at five.  By type, horizontal rigs were unchanged at 1,127, vertical rigs were down four to 414 and directional rigs were up six to 222.  Among gas rigs, horizontal rigs were up one to 257, directional rigs were down two to 68 and vertical rigs were down one to 42.

EIA: Storage Down 13 Bcf to 3.776 Tcf

The EIA's working gas in storage showed a 13 decrease in natural gas storage, bringing the current storage level to 3.776 Tcf.  The weekly withdrawal was 11 Bcf greater than last year (-2 Bcf) and pretty much in line with the five year average (-15 Bcf).  The current storage level is 2.6% below last year (3.876 Tcf) and 0.5% above the five year average (3.759 Tcf).


Monday, November 25, 2013

Haynesville Shale Rig Count Unchanged at 25

Last week's Haynesville Shale rig count stayed at 25 working rigs.  Louisiana was down one rig (Encana) to 16, while Texas was up one rig (EOG) to nine.


LNG Says, "Hellooooo Cleveland!"

Last week, Cleveland's city council decided to purchase 240 new LNG powered buses for its citywide transportation fleet.  (OK, so Spinal Tap has nothing to do with this, but how can you resist one of the top ten lines from cinematic history - especially with Bo Diddley giving instructions?).  The city's total fleet is 415 buses, and the new natgas vehicles will be phased in over four years.

In moving to natural gas, the city made several important observations:

  • Natural gas prices are less volatile than diesel (who could have imagined saying that five years ago?).
  • LNG buses are more efficient (5-6 MPG vs. 2 MPG for diesel).
  • Natural gas is cheaper than diesel (~$1.29/ gallon equivalent vs/ $3.05 for diesel).
  • Natural gas buses emit 30% less greenhouse gas and 85% less nitrous oxide than diesel.

At $472,000 a pop, the buses themselves cost 11% more than diesel buses, but the city expects to recoup that in savings within two years.

Friday, November 22, 2013

U.S. Rig Count: -1 to 1,761

The Baker Hughes U.S. rig count was down one rig this week to 1,761.  Oil rigs were up two to 1,387, gas rigs were down one to 369 and miscellaneous rigs were down two to five.  By type, horizontal rigs were up 13 to 1,127, vertical rigs were down 10 to 418 and directional rigs were down four to 216.  Among gas rigs, horizontal rigs were up one to 256, directional rigs were down two to 70 and vertical rigs were unchanged at 43.

A User's View of CNG Vehicles

I was recently contacted by a reader from NW Louisiana who bought a CNG converted vehicle (a 2010 Ford F150 supercrew 4x4) that had been a fleet vehicle for Encana.  He is keeping a blog of his experience of owning the vehicle (learningcng.blogspot.com).  He only recently launched the site (he bought the truck not long ago), but so far, it's got lots of information.  I hope that it answers many of the burning questions many of us have about owning a natural gas vehicle.  Check it out.

Thursday, November 21, 2013

New Texas Completions (ALL with Liquids)

10/31 - 11/20:
  • Carthage Gas Unit 17 #15, Valence Operaring: 1.011 MMcf/day IP, 10.0 Bbl/day liquids, 16/64" choke, 1,415 psi; Perfs: 10,101-11,205 (also 8,618-9,506 in Cotton Valley), length: 1,104 ft.; Carthage Field (Haynesville Shale), Panola Co., Survey: DIAL, C, A-184 
  • Carthage Gas Unit 17 #10, Valence Operaring: 1.005 MMcf/day IP, 8.3 Bbl/day liquids, 20/64" choke, 740 psi; Perfs: 10,181-11,217 (also 8,630-9,514 in Cotton Valley), length: 1,036 ft.; Carthage Field (Haynesville Shale), Panola Co., Survey: DIAL, C, A-184 

New Texas Permits

10/31 - 11/20:
  • CGU 18-15-76 #76HH, Anadarko E&P; Carthage Field (Haynesville Shale), Panola Co. Co., Survey: SMITH, M, A-607 
  • CGU 18-5-15-77 #77HH, Anadarko E&P; Carthage Field (Haynesville Shale), Panola Co. Co., Survey: SMITH, M, A-607 

New Louisiana Completions

  • Long 3 #2-ALT, EXCO Operating: 7.723 MMcf/day IP on 15/64 in. choke at 6,007 psi; Perfs: 12,393-16,656, length: 4,263 ft.; Caspiana Field, DeSoto Parish, S10/T14/R14; res. A, serial #246299 
  • Long 3 #3-ALT, EXCO Operating: 9.182 MMcf/day IP on 16/64 in. choke at 6,823 psi; Perfs: 12,283-16,547, length: 4,264 ft.; Caspiana Field, DeSoto Parish, S10/T14/R14; res. A, serial #246300

CEO Out at EXCO

EXCO Resources announced this morning that Douglas Miller resigned as Chairman, CEO and board member effective yesterday.  Another board member was named interim CEO and a search for his replacement will commence immediately.  Miller led the group that acquired EXCO through a leveraged buyout in 1997 and spearheaded a failed attempt to take EXCO private again a couple of years ago.

Given the lack of news coverage surrounding the news release, the resignation was sudden and most likely the result of internal strife.  Usually a failed LBO by the sitting leader doesn't end well for that person...but I'll update with more later as news comes out.

Gas in Storage Peaks This Week

The EIA reported that working gas in storage was down 45 Bcf to 3.789 Tcf.  This is the first withdrawal of the season and the timing was largely in line with past years (although the quantity was more substantial).  The weekly withdrawal was 25% greater than last year (-36 Bcf) and considerably higher than the 2 Bcf withdrawal of the five year average.  The current storage level is now 2.3% below last year (3.878 Tcf) and 0.4%. or 15 Bcf, above the five year average (3.774 Tcf).


Tuesday, November 19, 2013

Haynesville Shale Rig Count Unchanged at 25

For the third straight week, the Haynesville Shale rig count did not budge from 25.  But XTO Energy moved a rig from Texas to Louisiana, giving Texas eight working Haynesville rigs and Louisiana 17. Geographically, the new XTO rig is working in Bienville Parish, where there hasn't been a new well drilled since June 2012.  This also marks the first time since I started collecting rig data that there hasn't been a Haynesville rig working in Shelby or San Augustine Counties, TX.  The only TX Haynesville rigs are in Panola (seven) and Nacogdoches (one).


Monday, November 18, 2013

Freeport LNG Gets a Boost

Last week, the DOE increased the amount of natural gas that Freeport LNG can export from its facility in Quintana Island, TX from 1.4 to 1.8 Bcf/day.  The total amount of LNG export approved for export to countries without free trade agreements with the U.S. now stands at 6.8 Bcf/day.

Friday, November 15, 2013

U.S. Rig Count: +8 to 1,762

The Baker Hughes U.S. rig count was up eight rigs this week to 1,762.  Oil rigs were up two to 1,385, gas rigs were up five to 370 and miscellaneous rigs were up one to seven.  By type, horizontal rigs were unchanged at 1,114, vertical rigs were up 11 to 428 and directional rigs were down three to 220.  Among gas rigs, horizontal rigs were up two to 255, directional rigs held at 72 and vertical rigs were up three to 43.

Thursday, November 14, 2013

CSX to Test CNG Locomotives

CSX announced yesterday that it will commence a pilot program in 2014 in partnership with GE Transportation to test natural gas locomotives.  The locos will be powered by liquefied natural gas.  Other major railways testing LNG locomotives are CN and BNSF.

In the aforementioned press release, CSX's chief operating officer compares the potential for use of LNG to the conversion of trains from steam to diesel in the 1950's.  That's pretty strong language, especially before a pilot project has even started, but natural gas is attractive to railroads because it allows trains to travel longer distances before refueling and it is considerably cleaner than diesel.  Railroads have made considerable market share gains over the past decade and being able to promote an even more environmentally friendly transport method would certainly help the industry make greater gains.

EIA: Working Gas in Storage +20 Bcf to 3.834 Tcf

The EIA reported this week that working gas in storage was up 20 Bcf to 3.834 Tcf.  The weekly injection was 32 Bcf higher than last year (a withdrawal of 12 Bcf) but in line with the five year average (+19 Bcf). The current storage level is now 2.0% below last year (3.914 Tcf) and 1.5% above the five year average (3.776 Tcf).


Temperatures last week in the Lower 48 averaged 51.0 degrees, which was 2.1 degrees warmer than last year and 1.1 degrees warmer than average.

Tuesday, November 12, 2013

There's an App for That! (and a Web Site too)

In these pages, we always talk about how the adoption of CNG for passenger cars is a chicken and egg situation:  consumers won't be comfortable with CNG until there are more fueling stations, but businesses will not build new filling stations until there are more natural gas vehicles.  While there is no critical mass of CNG stations, there are more than a handful out there, and now there's an app to find them.


Released by the DOE, the app helps drivers find natural gas and electric fueling stations.  The DOE's web site also has a helpful station locator built into a Google map:

Monday, November 11, 2013

Haynesville Shale Rig Count: Unchanged at 25

Last week's Haynesville Shale rig count was unchanged at 25.  Louisiana held at 16 and Texas at nine.  But within Louisiana, Chesapeake was up one rig to three while Encana was down one rig also to three.  It is interesting to note that this is CHK's highest level of drilling activity since June 2012.



Friday, November 8, 2013

U.S. Rig Count: +12 to 1,754

The Baker Hughes U.S. rig count was up 12 this week to 1,754.  Oil rigs were up seven to 1,383, gas rigs were up five to 365 and miscellaneous rigs held at six.  By type, horizontal rigs were up ten to 1,114, vertical rigs were up nine to 417 and directional rigs were down seven to 223.  Among gas rigs, horizontal rigs were up one to 253, directional rigs were up one to 72 and vertical rigs were up three to 40.

Thursday, November 7, 2013

New Louisiana Completions

Another paltry week for Louisiana completions, with only two new entries.  One was from the paper and hasn't even been officially reported by DNR:
  • EDWL 11-14-15 H #2-ALT, Chesapeake Operating: 12.984 MMcf/day IP on 22/64 in. choke at 5,815 psi; Perfs: 12,070-16,445, length: 4,375 ft.; Caspiana Field, DeSoto Parish, S11/T14/R15; res. A, serial #243819 
  • Johnson 19-14-15 H #1, Chesapeake Operating: 15.048 MMcf/day IP on ?/64 in. choke at 6,148 psi; Perfs: 11,866-16,337, length: 4,471 ft.; Bethany Longstreet Field, DeSoto Parish, S19/T14/R15; res. A, serial #245518

EIA: Gas in Storage +35 Bcf to 3.814 Tcf

The EIA reported this week that working gas in storage was up 35 Bcf to 3.814 Tcf.  The weekly injection was 30% higher than last year (+27 Bcf) but in line with the five year average (+36 Bcf).  The current storage level stands at 2.9% below last year (3.926 Tcf) but 1.5% above the five year average (3.757 Tcf).


Tuesday, November 5, 2013

Encana Cuts (and Re-Re-Focuses on Liquids)

Encana announced its new operating strategy under CEO Doug Suttles (Gulf Coast residents might remember Mr. Suttles' tenure at BP during the 2010 Macondo oil spill).  Here is a link to the presentation.  There is lots of businesspeak mumbo jumbo in there, but the bottom line is that Encana will focus almost entirely on liquids plays, cut its dividend to try to maintain its investment grade rating, cut staff by 20% and spin off a Canadian asset.

Go figure:  another company shifting to liquids-rich plays.  Encana will consolidate its reduced U.S. operations to Denver, which is closer to its new favored plays in the Rockies, the DJ Basin in Colorado and the San Juan in New Mexico, and shutter its Dallas office, which was responsible for  the Haynesville Shale, among other things.  Also "in" is the Tuscaloosa Marine Shale.  Here's what they have to say about that play:

Monday, November 4, 2013

Haynesville Shale Rig Count: Unchanged at 25

The Haynesville Shale rig count was unchanged last week at 25.  Louisiana held at 16 and Texas was unchanged at nine.


Friday, November 1, 2013

U.S. Rig Count: +4 to 1,742 (Gas Rigs Down 16)

The Baker Hughes U.S. rig count was up four rigs this week to 1,742.  Oil rigs were up 19 to 1,376, gas rigs were down 16 to 360 and miscellaneous rigs were up one to six.  By type, horizontal rigs were up six to 1,104, vertical rigs were up 17 to 408 and directional rigs were down 19 to 230.  Among gas rigs, horizontal rigs were down 10 to 252, directional rigs were down four to 71 and vertical rigs were down two to 37.