Would Exxon or BP be better or worse than Chesapeake for our area?

Do you think that Exxon or BP would be better than Chesapeake?

In my opinion the advantage would be that they have more money to drill.

I'm sure there are plenty of disadvantages, what are they?

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Permalink Reply by Les Bamburg on January 27, 2009 at 4:14
Baron, sorry but we export natural gas to Mexico rather than import.
Permalink Reply by Les Bamburg on January 27, 2009 at 4:33
BirdDawg, I know it is hard to believe but between 2000 & 2005 US gas production was declining while natural gas demand was increasing. To cover the difference the US was importing 15%+ of our gas needs from Canada. With this trend it was projected the US would need to increase its capability to import natural gas as LNG. LNG import facilities require 3-4 years to construct so the decisions to build new terminals were made in 2004-2005 before the new growth in domestic gas production. Six of those new LNG import terminals are being completed in the 2008-2009 time frame. With the change in gas import needs several other projects have "failed to launch".
Permalink Reply by Roy on January 26, 2009 at 12:53
They want to Import on tankers because we cant pipe enoudh to the consumer markets? Maybe?
Permalink Reply by Les Bamburg on January 27, 2009 at 8:00
Roy, that is relevant for the Northeast because historically there was not enough gas pipeline capacity to meet the Northeast's demand. This has required LNG imports into the Everett LNG terminal in Boston.
Permalink Reply by Les Bamburg on January 27, 2009 at 4:42
LP, unfortunately news people seem to always be behind times on reality. That story line is about 1-2 years out of date.
Permalink Reply by Les Bamburg on January 27, 2009 at 4:39
KB, you would not believe how strongly the anti-trust laws are enforced against the major O&G companies. Plus the companies have heavy internal safeguards and substantial training on the topic.
Permalink Reply by Bruce on January 26, 2009 at 10:54
Hey LP, I bet you saw that on CNN or MSNBC. It seems their thinking is anything that is good for the U.S. must be bad for the world and they seem to take a cavalier attitude like a "citizen of the world" instead of being proud of being an American. Excuse me for showing my colors but I guess anyone can see I don't care to watch either one.
Permalink Reply by George James on January 26, 2009 at 11:03
If Exxon/Bp acquire CHK's Haynesville assets (HIGHLY UNLIKELY) it will be developed at a MUCH SLOWER PACE. With the majority of their capex allocated to much larger international projects, they don't have the dire need to develop the play like CHK does.
Permalink Reply by Charles Bowman on January 26, 2009 at 17:28
Just something to consider! Exxon and BP would most likely just buy large positions in CHK stock get seats on the board and participate in the wells on a percentage basis. As long as CHK is in good financial shape, which should be the case if they pre-sold their production when gas prices were higher. NOW here is a RUMOR that is floating around the pipeline industry. The Federal Government is going to approve the construction of a new Nat Gas processing facility to be built on a military base in Texarkana. This facility will convert nat gas into a very clean burning diesel fuel and will be the largest of its type in the world. Can anyone confirm any of this?
Permalink Reply by George James on January 27, 2009 at 5:16
LNG imports have tanked in the last year...several key offshore LNG storage facilites have closed in the last year, and several deals have collapsed because investment capital was diminished for LNG terminals (EPA hasn't helped either).

Further, I think you're off on you're analysis of BP/Majors. IF BP acquires CHK's N. Louisiana assets (again highly unlikely that CHK will ever divest their highest quallity asset), BP will not pursue development as quickly as an independent with more at stake. The recent Woodford Shale acquisition is clear evidence.

Exxon and Chevron have operated, and continue to operate, several fields scattered across East Texas. They may pick up some additional interests in the area if an opportunity arrises. Exxon does not pursue onshore, domestic acquisitions unless you come to them first....this is a fact.
Permalink Reply by Caiman on January 27, 2009 at 7:11
This morning at 10:10 AM Energy Transfer Partners (ETP) said it reached a deal with CHK to build an interstate natural gas pipeline to transport gas from Haynsville shale.The "Tiger Pipeline" will cost 1 to 1.2 billion to build and will have an initial capacity of at least 1.25 billion cubic feet per day the companies said in a press release .The line will streatch 178 miles through the haynsville shale from an Energy Transfer Partners system near Carthage to interconnections with several interstate pipelines in Louisiana.The line is expected to be in service by mid 2011.The pact includes a 15 year comitment for Chesapeak to furnish gas-transportation capacity of about 1 billion cubic feet A day.

Mark Long Dow Jones Newswires;201-938-4427

This came off of a paid Morningstar Finantual site I subscribe.Doesn't sound like a company thats selling all of it's interests, real soon anyway.I've been trying to link it to you guys but im just not that computer literate it seems.

msn FINANCE IS EXPECTIG EXON TO AQUIRE SOMEONE SOON AS IS THEIR mo WITH SUCH A LARGE AMOUNT OF FREE CASH(Sorry I wasn't watching and hit caps lock)They were saving while oil prices were up instead of over producing like some competition.Again following what they have done in the past to grow by aquisition.Insider tradeing as per morningstar shows little tadeing among CEO'S or any company management for that matter.It looks like a wait and see as company stock has allways been unless of coarse we call Martha Stewart.
Permalink Reply by Les Bamburg on January 27, 2009 at 8:06
George, the LNG receiving terminals are onshore rather than offshore. They have not actually closed but rather some are just receiving very few cargos.

The cancellation of some import terminal projects was more a function of a tight supply market and reduced need for US LNG imports.

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