[shortonoil]

where are you getting your information from?

I was responding to Rockman's quote on long term operational costs. The comment was a generalization for condensate wells; not the the Duvernay specifically. PVT curves for the Duvernay won't be available until they have wells producing. There are not enough exploratory wells to get a good assessment of relative permeability for the area, and its effect on the wells' critical point. That will also be affected, of course, by the individual well's molar fraction distribution.

[Tanada]

Canadian natural gas production has faced many challenges in the last few years. The fall of commodity prices, competition with cheap US shale plays such as the Marcellus and Utica, and slowed oil sands growth due to postponed or canceled projects (a major source of Canada's natural gas demand) to name a few. If it weren't for the prolific Montney and Duvernay providing growth amongst an overabundance of cuts, gas production in Canada would be in even more trouble. But as prices stabilize and producers settle in, the big question is: What does 2017 look like for Canadian natural gas producers?

The chart below shows averaged daily production receipts for the main pipelines that serve British Columbia and Alberta (NGTL, Alliance, and West Coast pipelines). Together, these three pipelines account for the majority of gas produced in BC and AB. The receipts on these pipes show a large ramp of production in the last part of 2016 associated with the start of winter drilling season. It should be noted that compared to the last two years, October through December of 2016 reported a much larger growth in daily receipts during this ramp-up period. And despite all of the factors working against Canada, gas production managed to remain steady in 2016.

http://seekingalpha.com/article/4042183 ... store-2017

[ROCKMAN]

T - The Duvernay has one advantage that helps offset lower oil prices: it produces CONDENSATE. Despite the claims of the unsophisticated condensate is not "low valued" oil. The Canadians have to import about 130 million bbls of US condensate per year to blend with oil sands production to make pumpable dilbit. As the article points out the Duvernay condensate can garner prices as much as 30% higher the mid weight oil.

But it also suffers from the same problem the tcf's of other northern Canada PROVEN NG reserves: lack of pipelines. Have heard stories from Canadian geologists for DECADES about the huge conventional NG reservoirs in those northern areas that would be economic to develop IF there were sufficient pipeline capacity.

[rockdoc123]

But it also suffers from the same problem the tcf's of other northern Canada PROVEN NG reserves: lack of pipelines. Have heard stories from Canadian geologists for DECADES about the huge conventional NG reservoirs in those northern areas that would be economic to develop IF there were sufficient pipeline capacity.

economics also kills a lot of the more remote NG. As an example Horn River which is pretty far north requires around $5.50/Mcf or so. There was a fair bit of activity up north when NG was spiking above $10 a number of years ago, once it dropped below $4/MCF that activity slowed considerably.

[spike]

How old are you, Rockdoc? Remember Dome Petroleum? They accumulated huge acreage in northern Canada expecting it to feed LNG export projects in the 1980s. Major bankruptcy.

[rockdoc123]

How old are you, Rockdoc? Remember Dome Petroleum? They accumulated huge acreage in northern Canada expecting it to feed LNG export projects in the 1980s. Major bankruptcy.

I was working in the industry when that was all going on...the company I worked for at the time was a member of one of the consortia drilling in the Arctic. Calgary was a crazy place to be working at the time...downtown bars were full on a Friday evening and "three martini lunches" were commonplace at the Petroleum club.

There were a lot of moving parts to the industry at the time and the Dome story is a bit complicated. Dome had completed a lot of takeovers in the early eighties besides their activities in the Beaufort Sea and elsewhere. They were still a going concern but with lots of debt mainly due to acquisitions and then when the oil price collapsed in the mid-eighties they couldn't cover debts and there was nobody to buy the assets they would have liked to spin off. As a consequence Amoco rolled in and bought them out in the late eighties.

The story then isn't much different for a number of players today. Invested heavily during the heady days of high prices, over extended credit limits and then when prices dropped there were few options available in terms of selling assets of farming out interest in order to stay above water. That story has been shaking itself out for the last year and probably won't be done for some time.

[Tanada]

Is anyone building pipeline interconnections so the natural gas liquids can be moved from the Duvernay formation to say Fort McMurray for Dilbit? I am unclear on something, is the Duvernay in Alberta, British Columbia, or both? My understanding is Alberta sets all the rules for pipelines entirely inside the province but Ottawa sets the rules for all pipelines that cross provincial or federal borders.

[ROCKMAN]

T - See map of play and NG pipelines:

http://www.naturalgasintel.com/duvernayinfo

Not sure how critical oil pipelines will be given the short tanker truck run compared to hauling condensate from the Eagle Ford in south Texas.