Exploring Hydrocarbon Depletion
ROCKMAN wrote:DC - I did make on goof by not pointing out my numbers were for oil only and didn't include NG or ngl's. But since they tend to be somewhat proportional to the oil volumes they give one a sense of magnitude. Working on a tablet at the moment it's not as easy to run the DrillngInfo in Excel. When I'm back next week I'll try to ship you the raw data so you can cook yourself.
Oil companies are hitting the brakes on a U.S. shale land grab that produced an abundance of cheap natural gas -- and troubles for the industry.
The spending slowdown by international companies including BHP Billiton Ltd. (BHP) and Royal Dutch Shell Plc (RDSA) comes amid a series of write-downs of oil and gas shale assets, caused by plunging prices and disappointing wells. The companies are turning instead to developing current projects, unable to justify buying more property while fields bought during the 2009-2012 flurry remain below their purchase price, according to analysts.
The deal-making slump, which may last for years, threatens to slow oil and gas production growth as companies that built up debt during the rush for shale acreage can’t depend on asset sales to fund drilling programs. The decline has pushed acquisitions of North American energy assets in the first-half of the year to the lowest since 2004.
“Their appetite has slowed,” said Stephen Trauber, Citigroup Inc.’s vice chairman and global head of energy investment banking, who specializes in large oil and gas acquisitions. “It hasn’t stopped, but it has slowed.”
North American oil and gas deals, including shale assets, plunged 52 percent to $26 billion in the first six months from $54 billion in the year-ago period, according to data compiled by Bloomberg. During the drilling frenzy of 2009 through 2012, energy companies spent more than $461 billion buying North American oil and gas properties, the data show.
Bottom line: if they are only talking about the sale of producing oil properties slumping then that’s a red flag for optimism by the companies drilling and producing. OTOH if there were a surge in the sale of producing shale fields that would be a clear sign of trouble ahead for the companies IMHO. Either they are running out of sweet spots to drill and/or they can’t handle the debt load. For instance it been reported that Chesapeake’s balance sheet is looking better these days. But look at the details: analysts have reported that 2/3 of their improvement has come from liquidating assets and only 1/3 from new operations. I stopped counting over a year ago when CHK had sold over $25 billion in assets at that point in order to just keep the doors open and operations going forward.
So your point RD is that CHK knew all along that the shale-bidness was a fast bubble, and they intended to keep the good stuff for themselves? You mean they planned to hire the media, pols, and internet trolls to promote the rest, and sell off the junk to clueless investor-types (mom and pop) before the market collapsed? Wow! That is some savvy sh#t
ROCKMAN wrote:DC - Didn't see a PM from you. Might been me. I haven't been able to send a PM for a while.
dcoyne78 wrote:I agree on the PA lack of taxes, I don't understand why northern states don't just adopt TX oil and gas policies, no need to reinvent the wheel. I guess PA has been doing oil and gas for a while (1859 I believe), but a lot of Americans think tax is a four letter word .
ROCKMAN wrote:DC - Not silly at all. Models are OK. But they are also like masturbating: nothing wrong with it as long as you don't start thinking it's the real thing. LOL.
I don't make fun of anyone's prediction until I see if they are correct or not. If correct I admit I thought they were right the whole time. If wrong then I'll blast them. That's the only way to not look foolish in the prediction game IMHO.
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