OH is catching up to PA in the rig count

According to the October 24th Baker Hughes rig count report, there are 52 rigs in PA and 44 rigs in OH. PA has 47 rigs in the Marcellus and 5 in the Utica while all the rigs in OH are in the Utica. I think the rig count in PA is under reported because E&P Companies are drilling in the Devonian Shale, but Baker Hughes is not reporting those rigs. PA could have a few more rigs. What is difficult to understand is the permitting activity in PA versus OH. There is considerably more activity in PA than in OH. PA is averaging between 30 to 40 permits per week. OH has between 5 and 15. We know that the drilling in PA has become incredibly efficient. For instance, PA is producing 20% more nat gas in 2014 than it did in 2013. Last year this time there were 57 rigs in the Marcellus and 2 in the Utica. This past week the count was 49 in the Marcellus and 5 in the Utica. One has to wonder if the election has any impact on the rig count in PA. It looks like Tom Wolf, the Democratic gubernatorial ca
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Oil Price Decline Will Not Impact Drilling until 2015

I attended Evonik’s Oil & Gas Symposium in Houston this past week. There were presentations by two companies, Spears Associates and Wood McKenzie, which track oil and gas production in the U.S. Both presentations commented on the fact that oil would have to go to $70 or below to seriously impact the production in the U.S. If cutbacks in production were to occur, it would probably be the second half of 2015 before we began to see the impact of the drilling cutbacks. I have stated in previous newsletter that the reductions in oil drilling could result in the rigs being moved back to PA for more natural gas drilling. I asked Jeff Spears of Spears Associates if that could occur. Spears stated that natural gas production is so efficient in the PA that there is no need for any more rigs. Marcellus production is up 20% over last year so there’s no need for more rigs. Joseph BaronePresidentShaleDirectories.com 610.764.1232 jbarone@shaledirectories.com www.shaledirectories.com The post Oil
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Utica Summit II Highlights

We held our second annual Utica Summit II this last Tuesday at Kent State Stark. The key observations of some of the presenters are: The current Utica Shale production could support four cracker plants. The biggest opportunities from the Shale Play game changer are going to be downstream. The U.S. will have considerable price advantage over the rest of the world in manufacturing and chemicals/plastics. The U.S. has so much oil, gas and coal reserves it’s unbelievable. Technically Recoverable Resources* 206 Years of Oil 120 years of Nat Gas 464 years of Coal In-place Resources* 586 years of Nat Gas 536 years of oil 9,844 years of coal  * Institute for Energy Resources Analysis of U.S. Government Data Joseph BaronePresidentShaleDirectories.com 610.764.1232 jbarone@shaledirectories.com www.shaledirectories.com The post Utica Summit II Highlights appeared first on Shale Directories.
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Oil down but Nat Gas holding steady

The price for oil at the start of trading today is $80 which is 20% below the June price. The two questions everyone in the energy industry is asking: How low will it go and when will it rebound. The key issue for the U.S. energy market will be the impact on drilling for oil in the major shale plays – Eagle Ford, Permian and Bakken. Will rigs be laid down or will they be moved to the Marcellus and Utica to drill for Nat Gas. The price of Nat Gas has remained steady trading in a range of $3.80 to $4.00 in spite of the somewhat mild weather in early fall. In this price range, we’ll monitor to see if rigs move from TX to the Marcellus and Utica. Joseph BaronePresidentShaleDirectories.com 610.764.1232 jbarone@shaledirectories.com www.shaledirectories.com
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Badlands Cracker

The governor of North Dakota just announced that a $4 billion dollar cracker plant will be built in North Dakota by Badlands NGL’s, LLC. With all the gas buying burned off in the Bakken, it made sense that someone would eventually make an investment to capture all that Nat Gas. The company intends to market the majority of the polyethylene products to U.S. markets, which are closer to North Dakota than a Gulf Coast PE facility, but product will also find its way to global markets, including Southeast Asia. Joseph BaronePresidentShaleDirectories.com 610.764.1232 jbarone@shaledirectories.com www.shaledirectories. The post Badlands Cracker appeared first on Shale Directories.
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Elk herd loves fracking

Nearly seven years into Pennsylvania’s Marcellus Shale drilling boom, wildlife officials say the state’s elk population continues to flourish despite concerns about industrial footprints, wildlife displacement and habitat degradation. “It hasn’t disturbed any habitat, in fact, it probably creates more than there was to begin with,” said Pennsylvania Game Commission elk biologist Jeremy Banfield, referencing companies who cover defunct well pads with grass, prime elk habitat. The elk population has nearly doubled since 2008, when the state’s Marcellus Shale drilling boom began, rising from 500 to more than 880 and increasing every year. The number is expected to reach 1,000 in 2015. In all the scenarios explored when fracking began, everyone predicted considerable harm to the environment. No one expected nature flourishing like the elk herd. It looks like the oil and gas companies are sensitive to the environment and work hard to protect it. Joseph BaronePresidentShaleDirec
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Boone Pickens Gives Perspective on Falling Energy Prices

As you know, I’m a CNBC junkie and Boone Pickens was on Thursday and gave his perspective on the oil and gas prices. As I’ve stated some CNBC commentators think the Saudis are trying to kill fracking in America. On Thursday, the price of oil closed at $84.06. Boone thinks the price of oil will go below $80, but not below $70.   The price below $80 will cause some consternation at the E&P Companies. Boone does not think the Saudis will do anything until the November OPEC meeting where a decision will be made as to whether the Saudis will cut production and support the price or keep production up and drive the price down. The second option to keep production up will to squeeze the E&P Companies. We’ll have to watch to see how the E&P Companies will respond. There are 1922 rigs drilling in the U.S.; around 1600 are drilling for and the remainder for gas. Will rigs be laid down or will they switch to gas or will they keep drilling for oil? Joseph BaronePresidentShaleDirectories.co
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Saudis trying to kill fracking

The slide in oil prices has many wondering the role of the Saudis in the price decline. An article in the WSJ on Saturday said that the Saudis are sending mixed signals. At times they are stating that they are reducing output, but many question if this is really happening. I’m a “CNBC junkie.” It’s always on when I’m in the office. It’s interesting that about 20%-30% of CNBC’s reporting is about energy – oil, natural gas and shale plays. As the price of oil has declined, all of the commentators on CNBC say that the Saudis are trying to kill fracking. The Saudis are trying to maintain market share which is becoming more difficult as more oil comes on the market and demand softens. Many CNBC commentators seem to agree that if the price of oil gets to $65 or $70 a barrel, drilling in the U.S. will decline. The Saudis in the ‘80’s drove the price of oil down to again stop drilling in the U.S. If oil prices decline to the $65-$70 range what does that mean to oil rigs in
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ExxonMobil reacts to Ebola dangers

Exxon Mobil announced today that they will be limiting their off-shore drilling in West Africa out of concern for their employees.   Its off-shore drilling is supported by those located in areas that have had Ebola cases. Exxon is prohibiting all traveling to these areas as a safety precaution for employees. It appears Exxon will be rethinking their commitment to this area. When evaluating the Ebola issue and ExxonMobil’s problems with the latest sanctions facing the Russia which impacts its drilling there.   Will ExxonMobil focus more on the U.S. with XTO’s holdings in the Marcellus and Utica where it’s been very successful? We’ll keep you informed on any moves that ExxonMobil makes. Joseph BaronePresidentShaleDirectories.com 610.764.1232 jbarone@shaledirectories.com www.shaledirectories.com The post ExxonMobil reacts to Ebola dangers appeared first on Shale Directories.
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WV Oil & Gas Expo Big Success

The WV Oil & Gas Expo yesterday in Morgantown was a big success. There was considerable buzz throughout the day. In speaking with a number of exhibitors, everyone seemed pleased with the event. I know a number of E&P Companies and midstream company representatives were walking the aisles. Congratulations to Asayo for a great Expo! The consistent theme throughout the Expo was lack of resources for the continued drilling and midstream activity. The E&P Companies and midstream companies are looking for more companies to come into the business. Vendors are looking for qualified workers. If you are a company thinking about getting into the Marcellus and Utica Shale business, I encourage you to jump in now. The phenomenon is just beginning. Historians will look back 50 years from now and call this a “Golden Age” for the energy industry in America. Joseph BaronePresidentShaleDirectories.com 610.764.1232 jbarone@shaledirectories.com www.shaledirectories.com The post WV Oil & Gas Expo Big
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WV Oil & Gas Expo off to a good start

Yesterday was set up day for the WV oil and gas expo which is the Marcellus Shale expo in WV. All the booths have been sold and there was a last minute surge from companies to get a booth which indicates the importance of this event to companies working on well sites and pipelines. Based on the exhibitor networking reception last night, there is considerable buzz about drilling and midstream activity in WV. It’s tough to get data on drilling and midstream activity in WV so this event will be a good source of fact and “rumor” information. EQT is the only E&P Company with booth at the expo. It will be interesting to see if any other E&P and midstream companies will be walking the aisles. Joseph BaronePresidentShaleDirectories.com 610.764.1232 jbarone@shaledirectories.com www.shaledirectories.com The post WV Oil & Gas Expo off to a good start appeared first on Shale Directories.
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