HERE WE GO AGAIN - THE LAST PARAGRAPH SUMS IT UP PRETTY WELL - Calgary Herald article, June 15, 2012

Apache discovers huge shale gas reservoir in northern B.C.

 

Firm calls find best on continent


One of three companies planning a $4.5-billion liquefied natural gas terminal at Kitimat on Thursday announced an "outstanding" new shale gas discovery in British Columbia's remote and largely unexplored Liard Basin.

The find by Apache Corp. is estimated to contain enough gas in itself to justify doubling the size of the Kitimat terminal it's proposing with partners Encana Corp. and EOG Resources. The company is calling it the best and highest quality shale gas reservoir in North America, based on the volume of gas three test wells are producing.

Apache, the second largest U.S. independent oil and natural gas producer by market value, said the tests suggest it has 48 trillion cubic feet of marketable gas within its Liard Basin properties.

By way of comparison, all companies active in the Horn River Basin, one of three other major shale gas basins that are in B.C., have marketable gas of 78 trillion cubic feet, giving one company alone a natural gas find that is twothirds the size of the entire Horn Basin.

One well alone produced 21 million cubic feet of gas a day over a 30-day period, the company said.

"This is enormous," said Gordon Currie, senior oil and gas analyst at Salman Partners. "Those are big, big numbers."

Based on Apache's calculations, the Liard could provide B.C. with enough gas to export "for many, many years to come," Currie said.

Bill Mintz, director of public affairs at Apache, said the Liard discovery provides the firm with enough gas to meet the needs of any future expansion at its proposed LNG terminal. Apache and its partners plan a five-million-tonne-a-year LNG plant which, if supply and demand warrant it, could be doubled to 10 million tonnes a year. The Liard alone could provide that additional five million tonnes of LNG.

The Liard find - tempered by low natural gas prices in North America - is not only large, but the Apache test wells are producing more gas from fewer hydraulic fractures, six per well, as opposed to 20 in the nearby Horn River Basin.

One of the Apache wells, D-34-K, "is one of the best shale wells we have seen in any play," Apache president Steven Farris said in making the announcement at the company's annual investors day.

"Our analysis indicates that the formation characteristics are remarkably consistent across this large basin," he said.

A slide presentation on the find says the drilling in the Liard is "believed to be the most prolific shale gas resource test in the world."

The Liard Basin is in northeastern B.C., west of the Horn River basin. Most drilling activity is taking place in the central part of the basin, 110 kilometres northwest of Fort Nelson, B.C.

According to a B.C. ministry of energy and mines report on shale gas activity in that province, it remains a relatively unexplored area covering 1.25 million hectares. Apache has drilling rights to 180,000 hectares.

"The good news is; they've discovered lots of natural gas up in northeastern British Columbia and you guys should be exporting that gas for many years to come," said Currie. "The bad news is that they have identified a lot of gas in northeastern B.C. and elsewhere and it has seriously depressed the price of the commodity."

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Permalink Reply by GoshDarn on June 15, 2012 at 14:10

And folks wonder why I'm agin anymore pipelines comin' down from Canada.

Uh-huh.  And I bet those hungry NG consumers over there in Asia are really salivatin', being as they can't wait to cha-ching some of that B.C. LNG into docking at their ports.

Nope, us La. NG landowners just can't seem to win for losing, can we?

  

Permalink Reply by LP on June 16, 2012 at 0:02

Sigh. I wonder if NG could become cheaper than free.

Permalink Reply by P.G. on June 17, 2012 at 10:18

You mean like when mineral owners start receiving bills in the mail for their proportion of production rather than royalty checks..?

Permalink Reply by Phillip Briggs on June 20, 2012 at 5:15

Shhhhhh... don't give em any ideas...

Permalink Reply by PJ on June 15, 2012 at 14:36

Better to elect folks to the decision-making chair who understand the weight and magnitude of USA becoming independent of outside fuel sources.

Permalink Reply by DrWAVeSport Cd1 on June 16, 2012 at 6:08

sesport II,

I DO.....

 

 

 

Permalink Reply by Bobi Carr ("parker") on June 18, 2012 at 7:13

Skip,

So........for those who are unleased, I guess it's worth waiting it out until we see $30,000 per acre again......like maybe 3012?

Permalink Reply by Skip Peel - Mineral Consultant on June 18, 2012 at 7:27

Very funny, parker!  I think natural gas will rise in price sufficiently for companies to start seriously drilling the Haynesville in 18 to 24 months.  The shale is still a world class asset and although bonuses will not approach $5K IMO they could well be over $1K per acre which we all thought was a big bonus before the Haynesville.

Permalink Reply by Bobi Carr ("parker") on June 18, 2012 at 7:38

I'm presently leased.  Just a tongue in cheek, reminder to folks who think it's extremely valuable if it's in the ground.

There are always folks who think the present BIG THING is the ONLY EVER big thing and their piece of it is worth a fortune.

Shall I mention Dutch tulips, California Real Estate and  Beanie babies?

 

Permalink Reply by Bobi Carr ("parker") on June 18, 2012 at 7:40

Mineral rights are just like owning stock.  It can be climbing or declining but it is ONLY WORTH WHAT A WILLING BUYER AND A WILLING SELLER NEGOTIATE FOR IT.

Permalink Reply by Skip Peel - Mineral Consultant on June 18, 2012 at 7:45

I agree.

Permalink Reply by dbob on June 18, 2012 at 8:00

I'd like to invest in California shale beanie babies with dutch tulip themes...

 

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