We have acreage leased with EnCana in the Holly Field. EXCO is rocking and rolling in nearby sections. Any idea when EnCana will return to this market
Until this week I would have said don't expect to see any activity out of Encana in the near future. However, with natural gas future topping $5.50/mmbtu's, anything is possible. What is the S-T-R of your lease in Holly Field?
we are in several sections of T14 R14 which had super wells.
Not according to this.
Who is buying these NG leases and lands? The article JMAN posted has an interesting quote - Asia.
"Encana also plans to put most of its natural gas assets on the chopping block. Jettisoning these low return assets will provide a quick boost to profitability. And with growth hungry Asian majors expanding their presence in North America, these properties will likely secure a decent price."
If you drive around Gloster/Grand Cane and see an Exco sign by a well site, it is likely you will see Topco (Tokyo Power Co.). I think that is driving the Exco exploration in that area. Exco bought a lot of the Chesapeake stuff & is going full throttle on drilling that.
This seems to say that they are planning to sell that they plan to sell the dry gas assets of which are what Haynesville wells are. Assuming another company buys these assets, where does that leave us?
Should we start selling our mineral interests if our only interest is the ROI? Are they worth anything now? (I wouldn't anyway, I am just asking.) If I were to talk to a financial manager what would they say?
Is there a small chance some new technology in the future will make dry gas marketable and worth drilling and building out the play to ore than one well per unit?
VSC DeSoto -
Mineral interests within the proved Haynesville/Bossier shale, they are certainly worth something. Export in significant quantity is only about 18-24 months away, which should help stabilize gas prices.
The trick in the Hayneville now is that it is a waiting game and a game of dollars.
Haynesville Shale is being drilled just not on a wide spread basis. Operators are drilling Cross Unit Laterals which gives a false impression to the public as each CUL well is equal to 1.6 of the wells drilled in the past. Fewer wells drilling but producing more acres per each. Also operators are drilling multiple wells in the same unit (alternate unit wells). CULs drilled as alternate unit wells contribute to the economics of the play at depressed natural gas prices. The combination produces an mcf for the lowest cost. Furthermore the operators are generally drilling in their best rock so the areas being drilled are limited, not widely spread. Those who own minerals in the right spots are getting multiple wells while those in less productive areas live with a single well holding their leases in force. Increased natural gas prices will eventually lead operators to drill more Tier One and Two acreage. New demand such as LNG export will help however the delay in getting those facilities built is providing time for new pipelines to bring competing Marcellus gas to the same markets.