Note:  This is a lot of information and graphics.  I have excerpted the beginning to the article and provided a link.  Then comes an excerpt from the graphics introduction with a link to the graphics.  For those who are interested just click on each link in turn to read the post in full and skip the excerpts.

OIL AT $75 MEANS PATCHES OF TEXAS SHALE TURN UNPROFITABLE - bloomberg.com by isaac arnsdorf nov 19, 2014 11:00 pm ct

With crude at $75 a barrel, the price Goldman Sachs Group Inc. says will be the average in the first three months of next year, 19 U.S. shale regions are no longer profitable, according to data compiled by Bloomberg New Energy Finance.

Those areas, which include parts of the Eaglebine and Eagle Ford in East and South Texas, pumped about 413,000 barrels a day, according to the latest data available from Drillinginfo Inc. and company presentations. That compares with the 1.03 million-barrel gain in daily national output over the past year, government figures show.

The expansion of U.S. oil supply to more than 9 million barrels a day is contributing to a global glut, driving down prices by as much as 32 percent since June. The data compiled by BNEF, which take into account the costs of drilling, royalties and transportation, show that certain shale patches fail to make money at the current price. Companies such as SandRidge Energy Inc. (SD) and Goodrich Petroleum Corp. (GDP) said they expect to pump more oil for less money so they can withstand the rout.

Link to full article:  http://www.bloomberg.com/news/2014-11-20/oil-at-75-means-patches-of...

SHALE PROFITS AT RISK IN THE SOUTHERN PLAINS & GULF STATES

Drilling for oil in 19 shale regions loses money at $75 a barrel, according to calculations by Bloomberg New Energy Finance. Those areas pumped about 413,000 barrels a day, according to the latest data available from Drillinginfo Inc. and company presentations.

Link to graphics:  http://www.bloomberg.com/infographics/2014-11-19/shale-profits-at-r...

Views: 1437

Reply to This

Replies to This Discussion

Skip, thanks for posting this. I was looking at one of the graphics and I do not see the Haynesville Shale listed at all.The Brown Dense and TMS both look very good on these charts.

The Haynesville boom really kickstarted the fracking and yet I don't find it even mentioned in the article. Have we become irrelevant in the big picture? The Brown Dense and TMS both come out looking good.

http://www.bloomberg.com/infographics/2014-11-19/shale-profits-at-r...

I'm still Hopeful about Natural Gas - but some days it sure ain't easy.

HANG

You're welcome, HANG. The Brown Dense is in limbo from a development perspective.  It has bigger challenges than the price per barrel break even.  The TMS looks more risky every day owing to high well costs and weak crude prices.  It had the misfortune to be in the early delineation/HBP  phase when the price dropped.  And the Haynesville Shale is not mentioned because this is an article about the price of a barrel of oil and therefore only covers plays that produce oil.

Here is a recent discussion on NG supply/price that gives some idea of what's ahead - it's good for consumers but not so good for energy companies, stockholders or royalty recipients.

http://www.gohaynesvilleshale.com/forum/topics/r-i-p-henry-hub-marc...

Too bad they don't push NG for transportation.
Seems like that would be one way for drillers to bypass the Arabs influence.

for example, we could convert our fleets of public transit buses to run on natural gas. Maybe that would draw protests today, but it would be smart for many reasons.

Many municipalities where natural gas production exists have already begun transitioning their fleets.  Not just buses but garbage trucks and other maintenance vehicles.  Shreveport/Bossier where I live being a good example.  In moving to NG fueled vehicles they have built re-fueling stations that are available to the public.  Although the fuel savings for the municipalities is significant there are few private vehicles to use those facilities.  It will be a long time before vehicle use moves the demand needle and even then it won't move it far.  The key to balancing NC supply to demand is increased demand through the phase out of coal.  It's a no brainer except for the politics of those who  make enough money from coal to ignore the health hazards.

RSS

Support GoHaynesvilleShale.com

Not a member? Get our email.

Groups



© 2024   Created by Keith Mauck (Site Publisher).   Powered by

Badges  |  Report an Issue  |  Terms of Service