INFORMATIVE ARTICLE FROM OIL & GAS JOURNAL
IPAA: Unconventional gas changing US supply picture
Paula Dittrick
Senior Staff Writer
HOUSTON, Nov. 12 -- Shale gas plays helped US natural gas production increase within the last year, while US oil production continues to decline, said speakers at the Independent Petroleum Association of America's annual meeting Nov. 11.
"This is the era of shale gas plays in North America," said Jeff Wojahn, president of EnCana Oil & Gas (USA) Inc.
Wojahn spoke during a chief executive roundtable at the IPAA meeting in Houston along with Mark Papa, chairman and chief executive officer of EOG Resources, and Porter Bennett, president and chief executive officer of Bentek Energy LLC.
Papa said, "It will be interesting to see how many additional resource plays will be found and how they will develop…. Technology that started in the Barnett shale (of North Texas) is now migrating to Canada and to the rest of the world."
The US Geological Survey classifies the Barnett as an unconventional gas play. Barnett shale wells are known for long-lasting production and a high drilling success rate. Two other sale plays, Haynesville in Louisiana and Texas, and Marcellus in the US Northeast, also are expected to boost US production.
"Geologic risk is now very low," Papa said, and it's not as difficult to find significant quantities of gas as it was 10-15 years ago. He expects more plays to be found, and that large independents will be the primary developers of regional unconventional plays.
Wojahn said horizontal drilling and advances in hydraulic fracturing technology has enabled oil executives to devote more time to cost management and efficient operations than to finding the gas in the first place.
Papa said horizontal drilling has been "the biggest game changer" that he has seen in his 40-year career in oil and gas.
"There always will be a place for conventional oil and gas," Papa said. "But if you stay away from horizontal drilling, as an independent you are dealing with a smaller portion of the pie."
Barnett shale
The Barnett shale has been the single biggest driver in US gas production growth, Papa said. Barnett shale production is about 4.4 bcfd today compared with 1 bcfd in production 4 years ago, he said.
EOG estimates Barnett shale production will peak next year at 4.8 bcfd and then hold at a plateau for 2-3 years before gradually winding down. Papa notes that estimates vary and that some within industry expect the Barnett to peak at 6 bcfd.
Johnson County, Tex., "will be drilled up like a pin cushion" by yearend 2009, he said.
Wojahn said EnCana is staying out of the Barnett shale peaking discussion. But he noted that emerging technology typically finds a way to sustain production for long periods.
"The Barnett shale may not be that big driver of growth as it has been, but it will remain a source of supply," said Wojahn.
Porter said the US now has abundant, predictable gas supplies, but that lawmakers who are keen on promoting alternative energy probably do not understand the availability and the economics of natural gas.
Wojahn said, "I think all of us collectively as natural gas independents have to step up to the plate and start educating the government."
Contact Paula Dittrick at paulad@ogjonline.com
To access this article, go to:
http://www.ogj.com/articles/article_display.cfm?ARTICLE_ID=345168&a...
Copyright © 2008: PennWell Corporation, Tulsa, OK; All Rights Reserved.
Paula Dittrick
Senior Staff Writer
HOUSTON, Nov. 12 -- Shale gas plays helped US natural gas production increase within the last year, while US oil production continues to decline, said speakers at the Independent Petroleum Association of America's annual meeting Nov. 11.
"This is the era of shale gas plays in North America," said Jeff Wojahn, president of EnCana Oil & Gas (USA) Inc.
Wojahn spoke during a chief executive roundtable at the IPAA meeting in Houston along with Mark Papa, chairman and chief executive officer of EOG Resources, and Porter Bennett, president and chief executive officer of Bentek Energy LLC.
Papa said, "It will be interesting to see how many additional resource plays will be found and how they will develop…. Technology that started in the Barnett shale (of North Texas) is now migrating to Canada and to the rest of the world."
The US Geological Survey classifies the Barnett as an unconventional gas play. Barnett shale wells are known for long-lasting production and a high drilling success rate. Two other sale plays, Haynesville in Louisiana and Texas, and Marcellus in the US Northeast, also are expected to boost US production.
"Geologic risk is now very low," Papa said, and it's not as difficult to find significant quantities of gas as it was 10-15 years ago. He expects more plays to be found, and that large independents will be the primary developers of regional unconventional plays.
Wojahn said horizontal drilling and advances in hydraulic fracturing technology has enabled oil executives to devote more time to cost management and efficient operations than to finding the gas in the first place.
Papa said horizontal drilling has been "the biggest game changer" that he has seen in his 40-year career in oil and gas.
"There always will be a place for conventional oil and gas," Papa said. "But if you stay away from horizontal drilling, as an independent you are dealing with a smaller portion of the pie."
Barnett shale
The Barnett shale has been the single biggest driver in US gas production growth, Papa said. Barnett shale production is about 4.4 bcfd today compared with 1 bcfd in production 4 years ago, he said.
EOG estimates Barnett shale production will peak next year at 4.8 bcfd and then hold at a plateau for 2-3 years before gradually winding down. Papa notes that estimates vary and that some within industry expect the Barnett to peak at 6 bcfd.
Johnson County, Tex., "will be drilled up like a pin cushion" by yearend 2009, he said.
Wojahn said EnCana is staying out of the Barnett shale peaking discussion. But he noted that emerging technology typically finds a way to sustain production for long periods.
"The Barnett shale may not be that big driver of growth as it has been, but it will remain a source of supply," said Wojahn.
Porter said the US now has abundant, predictable gas supplies, but that lawmakers who are keen on promoting alternative energy probably do not understand the availability and the economics of natural gas.
Wojahn said, "I think all of us collectively as natural gas independents have to step up to the plate and start educating the government."
Contact Paula Dittrick at paulad@ogjonline.com
To access this article, go to:
http://www.ogj.com/articles/article_display.cfm?ARTICLE_ID=345168&a...
Copyright © 2008: PennWell Corporation, Tulsa, OK; All Rights Reserved.
Views: 23
Replies to This Discussion
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Permalink Reply by jffree1 on
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Good article, Skip. I think this comment is key to our future in the HS. JF
Wojahn said, "I think all of us collectively as natural gas independents have to step up to the plate and start educating the government."
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Permalink Reply by Skip Peel - Mineral Consultant on
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J. We should all find some way to support natural gas as the centerpiece of a new national energy policy. It will help our economy. Locally and nationally. Energy Independence is a priority that we all can agree on. Will we demand it?
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Permalink Reply by Grice on -
Maybe the IEA report will help invoke more attention...
http://www.iea.org/Textbase/speech/2008/Birol_WEO2008_PressConf.pdf
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Permalink Reply by North LA on
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There is only one way to get things done in Washington and that is to lobby. The NG players need to form a strong lobby group.
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Permalink Reply by Skip Peel - Mineral Consultant on
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North LA. I imagine that there is a lobby effort underway in D.C. Considering your nifty CNG-themed home page, you obviously have a strong interest. Would you consider finding some contact information for the members?
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Permalink Reply by LP on
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I agree also. Those of us involved in one way or another in supporting the production of NG as well as promoting the expanded use of NG are up to speed on the this as a real, now and ready option. The problem is that we are preaching to the choir when we need to go out and proselytise to the less informed politicians.
There are many articulate contributors on this GHS site that could direct educational comment to the state and national politicians and help get their heads out of the oil hole and/or discharged from the battery.
Go forth and spread the word, boys !
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Permalink Reply by Grillin' - MmmMmm on
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The IPAA is just that group. They spend a lot of time and money lobbying in D.C. Unfortunately, except for congressmen/Senators from oil/gas states, all lobbying done by the oil/gas industry is either ignored or villified by the power from Eastern seaboard, the greenie weenies and the socialists. IPAA could spend 1000 hours showing Henry Waxman, Nancy Pelosi and Chucky Shumer all the great things about NG but those lug nuts wouldn't ever consider these ideas and worthy of their agenda!
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Permalink Reply by Spring Branch,mineral owner on
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You are 1000% correct.
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