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Chesapeake Energy CEO: US soon to be awash in natural gas

What's on your mind?
General interest discussions, not necessarily related to depletion.

Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Sun 14 Jun 2009, 20:31:14

Here's a good website showing what these gas wells look like through their various development stages:
http://www.powernaturally.org/programs/ ... opment.asp

Here's what it looks like when it's done. When they're drilling it, it's a mess. But afterwards it's not bad at all.

Image

Judging from that web page it looks like NY state requires site remediation afterwards. From the bing.com bird's-eye photos I linked above it looks like Texas is more lax in that regard.
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Sun 14 Jun 2009, 20:42:44

Here's some completed Haynesville shale wells:
http://www.bing.com/maps/default.aspx?v ... &encType=1
http://www.bing.com/maps/default.aspx?v ... &encType=1

East of Shreveport there is a large collection of gas wells. Not sure these are Haynesville wells (I suspect they're a conventional gas field based on the spacing), but it gives an idea of how "bad" a completed gas well is. Click on the link and start scrolling through the neighboring photos:
http://www.bing.com/maps/default.aspx?v ... &encType=1

As in Texas, some landscaping requirements would be nice, but nonetheless I can think of a lot worse things to do to this land than develop it into a gas field.
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Sun 14 Jun 2009, 21:01:30

So here ya go pstarr - he with the solar panels on his roof. Which is more environmentally friendly?

A natural gas field?
Image

Or a solar farm?
Image

The choice is yours. :lol: :lol: :lol:
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Wed 17 Jun 2009, 17:47:04

:shock:

LINK
$this->bbcode_second_pass_quote('', 'J')UNE 17, 2009, 5:20 P.M. ET
U.S. Has Almost 100 Year Supply of Natural Gas
By BEN CASSELMAN

The amount of natural gas available for production in the United States has soared 58% in the past four years, driven by a drilling boom and the discovery of huge new gas fields in Texas, Louisiana and Pennsylvania, a new study says.

The report, due to be released Thursday by the nonprofit Potential Gas Committee, concludes the U.S. has more than 2,000 trillion cubic feet of natural gas still in the ground, or nearly a century's worth of production at current rates. That's a 35.4% jump over the committee's last estimate, in 2007, of 1,532 trillion cubic feet, the biggest increase in the committee's 44-year history.

The report comes as rising oil prices have again made energy a hot topic in Washington. On Wednesday, a Senate panel voted 15-8 in favor of an energy bill that would, among other things, open up new areas to offshore drilling. The House of Representatives may vote as early as next week on a new climate-change bill that would cap emissions of the gasses that contribute to climate change. The Senate must also approve the measure.

The natural-gas industry has promoted gas as a more environmentally friendly, domestically produced alternative to coal and oil. Industry supporters said the new report could bolster their case by showing that the U.S. can rely more heavily on gas without running out.

[...]
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby AirlinePilot » Thu 18 Jun 2009, 15:12:18

$this->bbcode_second_pass_quote('OilFinder2', ':')shock:

LINK
$this->bbcode_second_pass_quote('', 'T')he report, due to be released Thursday by the nonprofit Potential Gas Committee, concludes the U.S. has more than 2,000 trillion cubic feet of natural gas still in the ground, or nearly a century's worth of production at current rates.

[...]




I believe Dr Albert Bartlett would take issue with that little tidbit. I've always looked at claims like this with a very jaundiced eye when I see those few words:

"At current rates".

That's a meaningless and purely speculative comparison that we all know will change and could change significantly. Especially in the harsh light of oil depletion down the road.
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Thu 18 Jun 2009, 15:14:49

You're right AP - maybe our NG consumption will double overnight and therefore these reserves are only good for 50 years.

:|
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby TheDude » Sat 20 Jun 2009, 16:01:30

So what is the implication of this - from last October, at that:

As the Barnett Shale's Production Peaks, Economic Factors Weigh Heavily on Its Future-- Page:2

$this->bbcode_second_pass_quote('', ' ')For those that drill in urban areas or where the shale is thin, sustained prices below $6 or $7 per million British thermal units might trigger a halt.

In the core area of the play, where the shale is thick and rich with gas, a producer might not worry until prices hit $5 per million Btu.

"Most of the people talking about the Barnett Shale rolling over in the next while, I think that might reflect their own assets, their own acreage positions," said John Richels, president of Devon Energy Corp., the largest and one of the earliest producers of the Barnett Shale.

As an early pioneer, Devon leased land in the sweet spot of the play, in rural areas in Denton, Parker, Johnson, Tarrant and Wise counties.

Devon paid less for its leases than other companies and hasn't faced as much drilling protest as those companies working in urban areas.

Mr. Richels expects Devon to double its production in the next few years. He's more optimistic than some of his peers.

But even Mr. Richels agrees that lower natural gas prices will constrict drilling budgets in the industry.

'One more year'

"Our view is that the Barnett Shale, as an aggregate, probably has one more year of decent growth, and that's 2009," said Mark Papa, chief executive of EOG Resources, a Barnett Shale production company.

"By year-end 2009, we believe Johnson County is going to be pretty well drilled up by all operators," Mr. Papa told analysts in July.

"That's going to remove a lot of the thrust."

Other production company brass put the peak a year or two later, but most agree that the natural gas field may have only a few more years of growth.

Already data from the Railroad Commission show production has been declining nearly every month this year.


Image

Original at Barnett Shale Maps. So the #3 operator in this area has already tapped out the potential of a major sector? And this resource is supposed to last us for centuries?
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Sat 20 Jun 2009, 21:45:03

A major reason why the Barnett shale is close to being maxed out is because everyone is moving their rigs to the Haynesville shale. In fact, your article noted precisely that:
$this->bbcode_second_pass_quote('', 'A')lready, Chesapeake has said it will move 10 of its 43 Barnett Shale rigs to the Haynesville Shale, a budding natural gas field in northern Louisiana.

And the reason why they're moving to the Haynesville is because the Haynesville is better.

Somewhere earlier in this thread Rockman pointed out there's a whole new section of the Barnett they're about to open up in the Permian Basin in west Texas (the current area of activity is in the Fort Worth basin).
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Sat 20 Jun 2009, 21:52:25

Ah, here it was, on page 8 of this thread. It was the Delaware basin, not the Permian basin. Whatever.
$this->bbcode_second_pass_quote('ROCKMAN', 'O')F2,

Speaking of Barnett Shale potential out side the FW Basin I thought you might find this intersting...especially XTO's involvement

Summary: "Hydrocarbon Potential of the Barnett Shale (Mississippian), Delaware Basin, West Texas and Southeastern New Mexico" -- You may know it well in the Fort Worth Basin. Come learn about the potential of the Barnett Shale in the Delaware Basin from XTO Energy.

ABSTRACT
The Barnett Shale (Mississippian) in the Delaware Basin has the potential to be a prolific gas producer. The shale is organic rich and thermally mature over large parts of the basin. Depths to the Barnett range from 7000 ft (2133 m) along the western edge of the basin to more than 18,000 ft (5486 m) along the basin axis. The Barnett Shale began generating petroleum about 250 Ma and reached its maximum temperature about 260 Ma. Present-day thermal maturity is indicative of maximum burial and temperature. Wells in northern Reeves County are in the gas window based on measured vitrinite reflectance values and kerogen transformation ratios. The shale can be divided into an upper clastic unit and a lower limy unit by changes in resistivity. The lower unit can be subdivided into five subunits by distinctive well-log markers. Preliminary analyses suggest that intervals in the lower Barnett marked by high resistivity and high neutron porosity readings on well logs have high gas contents. Areas in which to focus the future exploration in the lower Barnett can be delineated by mapping a net resistivity greater than 50 ohm m. The Barnett Shale contains significant gas resources in the Delaware Basin. Realizing the potential of these resources depends on the current efforts to optimize drilling and completion techniques for this shale-gas play.

Here's the location of the Delaware Basin. Note how far away from Fort Worth this is.
Image

So the Barnett shale has a looooong ways to go before they're done with it.
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby shortonsense » Sat 20 Jun 2009, 22:07:20

$this->bbcode_second_pass_quote('TheDude', ' ') And this resource is supposed to last us for centuries?


Gas shales are not restricted to Texas and the Barnett.

Isn't it funny that the last time we were running out of natural gas people ran around and proclaimed shales the latest and greatest?

http://www.dnr.state.oh.us/geosurvey/pu ... fault.aspx

Resource plays work like this.

When prices are high, people drill. When prices are low, people stop. Its pretty simple.

Resource plays are so huge in size that they act like these big reservoirs of readily available gas, to get it, you just need to pay a high enough of a price to get people to drill it. Which they do...until price collapses. Then they stop and wait for the price to go back up. Repeat as necessary. Apparently they did their jobs so well between 2005 and 2008 that we now have too much. Give it a year of little or no drilling ( because we now have a surplus 35 years after peak natural gas! Sound familiar? ) and suddenly more nonsense like High Noon For Natural Gas or the Oldavui stuff will start circulating again. Repeat as necessary. Resources of this stuff are measured in centuries of use at current rates, if not millennia
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Sat 20 Jun 2009, 22:14:52

Here's someone else's take on how long drilling in the Barnett will last:
http://www.expertsreviewof.com/
$this->bbcode_second_pass_quote('', '[')b]How Long Will Drilling In The Barnett Shale Last?

In an interview with the American Association of Petroleum Geologists, Larry Brogdon, exploration manager for Four Sevens Oil Company, had this to say; "We will all be dead and folks will still be drilling Barnett wells," he said. "There are literally thousands of infill wells to be drilled in the core areas and operators will continue to push its limits."

That does not necessarily mean it will continue to *grow* in production as spectacularly as it has in the past, but there's more than enough gas in the thing to let them continue drilling it . . . pretty much as long as they want.

From the same link, here's a map showing the extent of the Barnett. They aren't going to run out of drilling spots in this thing any time soon.

Image

Resource plays like this are as much a real estate venture as a gas-drilling venture. They will start to tap the thing dry when they start running out of real estate to drill on. Which could be . . . who knows when.
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby TheDude » Sat 20 Jun 2009, 22:42:48

That's great, but most of the intervening space isn't part of the BS. Was going to show the same map you did.

Also the formation thins out as you head west:

Image

Production has only been ramped up in the last decade:

Image

Johnson Co. has only really been worked over for half of that:

$this->bbcode_second_pass_quote('', 'I')n 2005–2007 horizontal drilling in the Barnett Shale extended south into Johnson, Hill, and Bosque counties, with a 100 percent success rate on completed wells. An experimental vertical well is being drilled in McLennan County (near Waco) to assess the potential for development along the Ouachita Fold, a geological barrier which defines the southern limit of the Barnett Shale.


All of this leads me to question how truly viable these plays are. Or do you have an alternate interpretation of the EOG CEO's statement?

Of course you do.

$this->bbcode_second_pass_quote('', '&')quot;By year-end 2009, we believe Johnson County is going to be pretty well drilled up by all operators," Mr. Papa told analysts in July.


Image

Image

We're not going to secure a dependable energy supply on this decline rate treadmill. This may be a cyclical business, but not that cyclical, or cycles of that nature haven't been seen long term at low frequency, which will be too much for the drillers, I believe; this isn't picking strawberries. Like the Bakken I think you're mostly here to pump stocks, often the same operators too. At least you're discussing energy, unlike so many of the freaks that inhabit this board.
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Sat 20 Jun 2009, 23:06:18

Here, I've highlighted the approximate size and extent of Johnson County in the map I showed above. Let me know when they run out of real estate for them to drill on. 8)

Image

While we're at it, let me know when they run out of spots to drill in the Marcellus shale. :lol: Even if only 1/4 of this is "really good, thick shale with high organic content," it will take them forever to drill this thing.

Image
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Sat 20 Jun 2009, 23:28:36

Now if that weren't enough, here's another one. I started a thread on this not long ago but I'll post it here.

A guy (who posted here briefly a while ago) has a blog in which, among other things, he discussed energy issues (he works in the oil/gas biz). Not long ago he did a blog post on the Eagleford shale:
http://openchoke.blogs.com/open_choke/2 ... relim.html
$this->bbcode_second_pass_quote('', 'O')K, so I am learning about the Eagle Ford. It is pretty dang interesting. I found a bunch of old production data from the 1940's on Drilling Info in some interesting areas that I am evaluating. I have heard about lithologic limits... plastic versus brittle frac'ing and such, but the play produces widely and doesn't seem to have a problem producing liquids... a nice thing in this era of gatherers and gas plant folks unzipping on us producers with impunity. Here is a starting point. A map showing the outcrop, where existing production is, and an inferred zone that is depth correlative to the interesting wells in LaSalle thus far.

Click on the link and look at the guy's map. He's placed dots where old well logs have intersected the Eagleford. They go all the way from south of San Antonio along the Mexican border to northeast Texas. I have actually seen a stratigraphic chart for an area along the Louisiana-Mississippi border north of Baton Rouge showing that the Eagleford goes all the way over to there.

How many square miles are we talking about here? Between the Barnett, the Eagleford, the Haynesville and some other shales, it's looking like all (or most) of the state of Texas is underlain by gas shales. Probably some other states, too (such as West Virginia in my Marcellus map above).

If that weren't enough, in a lot of these spots a well can intersect two and sometimes three good shales. In the Eagleford shale thread I started was one such example: Wells drilled there can intersect both the Eagleford shale and the Pearsall shale.

My last post in the Haynesvile thread has another example:
$this->bbcode_second_pass_quote('', 'E')nCana Corp. says early drilling results indicate it is sitting on a potentially massive natural gas resource in the southern United States – one that's stacked on top of the already lucrative Haynesville shale of east Texas and western Louisiana.

EnCana said Wednesday it believes the so-called mid-Bossier shale could rival the size of the Haynesville reserve, which the U.S. Department of Energy has estimated contains 251 trillion cubic feet of recoverable natural gas. That's enough to supply the entire continent for 10 years, although only a fraction of technically recoverable gas is usually profitable to produce.

The bonus for EnCana is that the mid-Bossier and the Haynesville are what the industry calls a “stacked play.” Depending on location, the Haynesville shale lies between 3,200 and 4,100 metres below the surface. The mid-Bossier is 150 metres above it. Many wells drilled to obtain access to the Haynesville pass through the mid-Bossier.

So, you drill about 3,000 meters and strike the Bossier shale, which, according to preliminary drilling, seems to have tons of gas in it. Then you drill another 150 meters or so, and strike the Haynesville shale, which everyone already knows has tons of gas in it.

So when you look at these maps of the Barnett or the Woodford shale, it isn't a case of "that it" and once you've sucked one shale dry you're out of luck. Nope, in a lot of cases you've still got another 1, 2 or maybe 3 other shales you can tap in the same location.
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Sun 21 Jun 2009, 22:08:01

The Barnett shale is dead.

Not. 8)

>>> LINK <<<
$this->bbcode_second_pass_quote('', 'P')osted on Fri, Jun. 19, 2009
Barnett Shale is top U.S. natural gas producer, Chesapeake CEO says
By JACK Z. SMITH

Chesapeake Energy Chairman and CEO Aubrey McClendon said Friday that the Barnett Shale has surpassed the venerable San Juan Basin as the biggest natural gas producer in the United States.

He also said the Barnett, which has speckled North Texas with roughly 10,000 natural gas wells, "will be producing at least 50 years" and "probably" for a century.

McClendon made the comments in a speech to the Rotary Club of Fort Worth and in a brief telephone interview with the Star-Telegram.

He said Chesapeake officials estimate Barnett production at 5.5 billion cubic feet a day but acknowledged that no one knows precisely. The San Juan is in the Four Corners region of the Southwest, with production concentrated in northwestern New Mexico and Colorado.

Gene Powell, publisher of the Barnett Shale Newsletter, has estimated Barnett production at 4.9 billion cubic feet per day, but that was as of Jan. 1. Barnett drilling activity has been centered most heavily in Tarrant and Johnson counties but also extends into Hood, Palo Pinto, Parker, Somervell, Denton, Jack, Montague and Wise counties.

[...]
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Re: Cheapeake's massive shale (gas) find in Louisiana

Unread postby copious.abundance » Tue 23 Jun 2009, 20:53:00

Robin: Holy billowing founts of methane gases Batman, the best thing since sliced bread could get even better!! 8O

Batman: What's that Robin?

Robin: A company examined some old well logs and discovered that the Haynesville Shale goes all the way over to Mississippi!

Batman: Excellent find, Robin.

Robin: But there's more, Batman. Those well logs indicated the Haynesville is at least 2500 feet thick over there! 8O

Batman: Great work. We need to keep an eye on this one. I have a hunch this thing will someday turn out to be even better than sliced bread.

>>> Rigzone <<<

It's time to say
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Re: Cheapeake's massive shale (gas) find in Louisiana

Unread postby AirlinePilot » Tue 23 Jun 2009, 23:31:27

Could be Huge!

Yup it could be. And it might not be either.

Why dont you put up a post documenting the first commercial flow rates when they come on line?

Maybe I'll pay attention then, until I see that this is just more Corny BS.
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Re: Cheapeake's massive shale (gas) find in Louisiana

Unread postby copious.abundance » Wed 24 Jun 2009, 00:12:42

AP, see article on previous page entitled, "Haynesville Shale producing extraordinary numbers."
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Re: Cheapeake's massive shale (gas) find in Louisiana

Unread postby copious.abundance » Wed 24 Jun 2009, 00:16:34

^
Oops, I see the link from my earlier posting has expired. Here's another copy.

>>> Haynesville Shale producing extraordinary numbers <<<
$this->bbcode_second_pass_quote('', '[')...]

According to the latest data from the Louisiana Department of Natural Resources, the top producing well for the month of December belongs to Petrohawk. The well, in Red River Parish, produced about 713.4 million cubic feet of natural gas that month. That translates to about 23 million cubic feet of natural gas per day.

It's not the only well producing extraordinary numbers.

There are 266 wells permitted to drill in the Haynesville Shale. Forty-four of them are active and producing, according to data from Natural Resources.

Of those 44, eight produced from 100 million to more than 700 million cubic feet of natural gas in December.

Ray Lasseigne, president of TMR Exploration in Bossier City, said these are phenomenal numbers, especially compared to conventional, vertical wells drilled in other natural gas formations, like the Elm Grove and Caspiana fields.

A good well in those fields could produce 2 million to 3 million cubic feet of natural gas a day, Lasseigne said.

"Obviously, the shale wells are up to 10 times better than the typical wells drilled over the last five or six years," he said. "These are phenomenal wells. Even the major players are pleasantly surprised by the quality of these wells."

[...]

$this->bbcode_second_pass_quote('AirlinePilot', 'W')hy dont you put up a post documenting the first commercial flow rates when they come on line?

Maybe I'll pay attention then, until I see that this is just more Corny BS.

It would appear it's past time for you to start paying attention.
Stuff for doomers to contemplate:
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Re: Chesapeake Energy CEO: US soon to be awash in natural gas

Unread postby copious.abundance » Fri 24 Jul 2009, 18:07:26

$this->bbcode_second_pass_quote('OilFinder2', 'I') don't think they can control themselves.

I'm not the only one who thinks they can't control themselves:

>>> WSJ Blogs <<<
$this->bbcode_second_pass_quote('', 'J')uly 23, 2009, 12:34 PM ET
Natural Gas Glut: Stop Me Before I Drill Again
By Russell Gold

Second-quarter earnings reporting season is in full swing – and the data points suggesting more natural gas supply is on its way just keeps coming.

Here’s a quick, selective sampling:

» If the emergence of big new gas fields such as the Haynesville, Barnett and Horn River weren’t enough, now comes the Granite Wash. It’s not a newfangled unconventional gas field, but it’s yielding some big wells. Newfield Exploration said on Wednesday night that its first seven horizontal wells in the Granite Wash play that straddles the Texas/Oklahoma border had average initial production rates of 22 million cubic feet a day. Those are big, big wells.

» Add another growing gas field that you probably never heard of: the Eagle Ford. Down in South Texas, near Laredo, companies are beginning to drill horizontal wells into the shale formation with encouraging results. A couple weeks ago, St. Mary Land & Exploration said one well was flowing at the oil and gas equivalent of 5.6 million cubic feet a day. More news should be coming when Petrohawk, an Eagle Ford participant, reports its earning in the next few weeks.

» Range Resources recently said that its development of the Marcellus Shale, a big wedge of gas-bearing rock that covers much of Pennsylvania and bits of adjacent states, was going very well. The company is producing the oil and gas equivalent of 50 million cubic feet a day from the Marcellus – and expects to nearly double that by year-end 2009 and double it again by year end 2010.

So, what does this all mean? The natural gas glut that we’ve flagged shows no signs of letting up. Indeed, if anything it’s getting worse. The U.S. Energy Department reported on Thursday a lot of gas in storage and natural gas prices can’t seem to break above the $4 a million British thermal unit level.

[...]
Stuff for doomers to contemplate:
http://peakoil.com/forums/post1190117.html#p1190117
http://peakoil.com/forums/post1193930.html#p1193930
http://peakoil.com/forums/post1206767.html#p1206767
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