[collapsenik]

$this->bbcode_second_pass_quote('ROCKMAN', ' ')So if the folks who got the McClure Shale production up to 160,000 bold when prices were much lower couldn't boost production with the higher prices I doubt someone in VA that has never drilled a well in CA knows better.

[ROCKMAN]

C - So it's very simple in your view: the bureaucrats in DC (who have never drilled a well in CA) know the production potential of the shales in the Monterey Formation better than the folks who have been horizontally drilling, frac'ng and producing those shales for more than 15 years. And the same folks who brought that production to a peak over a decade ago when oil prices were 1/3 of what they are today. And the same folks who are now doing very little development of the shales even though oil prices are 300% higher now then when they increased production to 160,000 bopd.

Interesting logic. So the folks who actually make a living drilling wells are intentionally leaving all that easy money in the ground the EIA, USGS and all those other east coast Monterey Formation experts have said is there.

[Graeme]

Pstarr, You're welcome. Glad to see that you like this post and that I've finally got one right! Best wishes, G.

[collapsenik]

$this->bbcode_second_pass_quote('ROCKMAN', 'C') - So it's very simple in your view: the bureaucrats in DC (who have never drilled a well in CA) know the production potential of the shales in the Monterey Formation better than the folks who have been horizontally drilling, frac'ng and producing those shales for more than 15 years.

[TheDude]

Thanks, ROCK, that clears things up.

[kuidaskassikaeb]

Rockman wrote:

$this->bbcode_second_pass_quote('', 'A')lso did you know that in some areas where folks were complaining about their water quality the state of PA had ruled it unfit for consumption long before the first well was frac'd in the area? Their water was naturally crap. And did you see the video of a guy in the Texas Barnett shale play flaming NG from the end of his water hose? A huge hit on YouTube. He filed a lawsuit against Ranger that frac'd a well close to him. And he wasn't lying either: the methane was really coming from his well. So Ranger asked the Texas Rail Road Commission to investigate and they found his fresh water was badly contaminated with methane...and had been naturally for decades before. He actually has his garden hose hooked up to a methane vent line he had installed long ago. The judge immediately threw the case out and the Texas Rangers had considered filing criminal fraud charges against him. But they decided to pass and let Ranger go after his lying ass. Which, uncharacteristically, Ranger did file a civil suite. Most companies just let such situations settle down and move on. But apparently the folks didn't appreciate the many thousands in legal fees they had to pay and took personal the attempt to soil their reputation.

[ROCKMAN]

K - Yep...the "facts" float around depending on which source is repeating what source. But the basic facts don't change: the fresh water in the area was contaminated with naturally occurring methane long before any drilling took place. And the indisputable "fact" that the methane in the aquifer is identical to the methane from the shale reservoir? Well, dah! LOL. Where do folks think the methane in the fresh water aquifer came from? The only "shocking report" would have been if it didn't match exactly. It's called "migration": IOW every cubic foot of NG and every bbl of oil that has filled every reservoir that's ever been produced migrated into it from the source rock which is usually deeper. About 20 years I developed a nice little NG field in the fresh water aquifer in Texas at 260' below ground level. And if you missed it before a year ago I discovered a 20' thick NG reservoir with a top just 46' below ground level. The pressure was too low to be commercial but had it been at 1500' it could have produced as much as $2 million in reserves. Hundreds of other very SHALLOW wells have been produced in this 600 mile long and 40 mile wide trend. That's 24,000 sq miles (or 15+ million acre) where it wouldn't be a surprise to find the fresh water aquifers to be contaminated with methane. Not finding methane in the aquifers would be a true shock.

I know I have a long background in petroleum geology and I shouldn't be held as the standard. But it still amazes me that folks are shocked to see both NG and oil trapped in the fresh water column knowing that billions of bbls of oil and trillions of cubic feet of NG has been produced from depths not much deeper. Heck...the billions of bbls of oil sand resources in Alberta is now sitting at ground level. Do they think it's a giant spill from the Exxon Valdez that washed shore? LOL. Mother Earth has contaminate the fresh water aquifers and soil with many times the amount of oil/NG that mankind has produced let alone spilled. If one understands the basics they would know running around claiming they found THE smoking gun is foolish to do so before investigating...and ruling out...natural causes IMHO.

[kuidaskassikaeb]

Rockman



$this->bbcode_second_pass_quote('', 't')he "facts" float around depending on which source is repeating what source. But the basic facts don't change: the fresh water in the area was contaminated with naturally occurring methane long before any drilling took place. And the indisputable "fact" that the methane in the aquifer is identical to the methane from the shale reservoir?

[ROCKMAN]

K - "You claim that the homeowner performed an intentional fraud. Not likely in my opinion, and you don't have any evidence." Sorry but the EVIDENCE presented by the judge, the Texas Rail Road Commission, the EPA and the confessions of the co-conspirators trump your opinion. It would appear you're lagging far behind the reality of the situation.

[dinopello]

$this->bbcode_second_pass_quote('ROCKMAN', 'D')ino - Cheniere became a capex black hole when their LNG import plan blew up in their face. And they are still losing money but have some prospects of creating some income...in about 18 months. I suspect much of the run up is the foolish hype that the US is on the verge of becoming a major LNG exporter despite the fact we are still a net LNG importer

[ROCKMAN]

"What's going on?" You tell me - for at least the last six years Cheniere has lost money y-o-y...between $0.44 to $3.13 per share. http://www.nasdaq.com/symbol/lng/revenue-eps

And will continue to lose money as a result of their LNG IMPORT business blowing up in their face. And what's the good news? By the beginning of 2016 they hope to be exporting a lot of LNG. And how will they get there: The Federal Energy Regulatory Commission approved an order yesterday that will let Cheniere build a $10 billion LNG export plant adjacent to its Sabine Pass gas-import terminal in Cameron Parish, Louisiana. The Houston-based company said its 91 percent owned Cheniere Energy Partners LP hired eight financial institutions to borrow $4 billion to help fund the construction. IOW Cheniere doesn't have an LNG export terminal today nor does it currently have the capital to build one. All it has is the gov't permission to build one and export LNG (if it has buyers once the plant is built). So now all they have to do is find folks who are willing to loan the $10 billion.

Of course how their books balance out will depend on how the LNG export market settles out over the next 10 to 20 years. Cheniere and others have high expectations for that dynamic. Just as high as their previous expectations for a booming US LNG IMPORT business. Remember it isn't important whether Cheniere stock prices increase or fall. It's your buying low and selling high that matters. Or just the opposite if you short them. IOW you makes your bet and take your chances. LOL.

Of course buying some of their bond might be a good investment if you would be happy making 5.75% interest...assuming they don't default in 10 years when it matures: Cheniere Energy Partners, L.P. announced that its wholly owned subsidiary, Sabine Pass Liquefaction, LLC has upsized and priced its previously announced offering of Senior Secured Notes due 2024 ("SPL 2024 Notes"). The principal amount of the offering has been increased from the initially announced $1.5 billion to $2.0 billion. The SPL 2024 Notes will bear interest at a rate of 5.75% per annum and will mature on May 15, 2024.

[Tanada]

Monterey Shale fell out of the discussion right at the beginning of the Glut because producing its resources was judged to be a great deal more difficult than first anticipated. Low oil prices in 2015-2017 kept it completely off the Radar, so to speak.

So now that prices are once again north of $60/bbl what are the prospects for development of the Monterey?

[AdamB]

$this->bbcode_second_pass_quote('Tanada', 'M')onterey Shale fell out of the discussion right at the beginning of the Glut because producing its resources was judged to be a great deal more difficult than first anticipated. Low oil prices in 2015-2017 kept it completely off the Radar, so to speak.

So now that prices are once again north of $60/bbl what are the prospects for development of the Monterey?

[ralfy]

The prospects for development will likely be based on what investors expect. In the last case, was it high prices for years?