Barnett Shale

Links Between Drilling and Seismic Activity ?

"The panel that regulates the Texas oil and gas industry is waiting for more information before will accept that there are any links between increased seismic activity and drilling activity." Quote from the SFGate article. More at SFGate.com.

LNG: Another Way to Lose Your Shirt? Again?

One of the current debates in Washington [1] is about exporting natural gas from the United States. A few years ago companies were mothballing brand new LNG import facilities because massive shale plays started flooding the United States market with low cost natural gas. Now companies are lobbying the United States government for permission to export United States natural gas as LNG. The potential problem with that plan is that a lot of natural gas projects in other parts of the world have an enormous transportation advantage over natural gas shipped from the United States. Many of these new natural gas projects are in areas where there is very little local market and that gas will be sold as LNG. The information below is a sampling of how much natural gas might be going into LNG, FLNG and subsea pipelines in other parts of the world. The volume is surprising even though this list is far from complete. The high LNG prices in Asia might drop as all of this new gas enters the market. AUSTRALIA: Companies in Australia are busy developing LNG projects along the entire northern coast of that continent [2]. There is very little local market for some of these fields and they have a huge transportation advantage to Asia over LNG shipped out of the United States. An article on the Energy Information Administration website [3] reports that Australia expects to have nine new LNG projects that will use traditional natural gas and five that will use coal bed methane. EASTERN RUSSIA: There is a lot of natural gas under the seafloor off the eastern coast of Russia. There Exxon is partnering with Rosneft [4] to build LNG facilities that will export natural gas to the Asia-Pacific market. Gazprom, the state-controlled natural gas company of Russia, has developing or working LNG projects in the Sea of Japan near Vladivostok [5] and at Sakhalin Island [6]. CANADA: Lots of companies are looking at the Pacific coast of British Columbia for the export of Canadian natural gas. Early this month there were proposals for 14 LNG export plants [7] in the province. Chevron [8] and BP [9] are interested in exporting LNG from British Columbia. Shell is already in partnership agreements [10] with Asian customers. AFRICA: On the east coast of Africa, Anadarko and Eni have invested billions of dollars to explore one of the largest untapped natural gas resources in the world [11] off the coast of Mozambique [12], where there is only a small local demand. They plan to have a natural gas pipeline that connects the offshore fields to LNG plants on the continent. Statoil and Exxon are working off Tanzania's coast [13] on large gas discoveries where there is very little local demand. These will be developed for LNG. Similar natural gas resources could exist off the coasts of other nations on the east coast of the continent. USGS recently published an assessment of oil and gas in four East African geologic provinces [14]. Onshore the China National Offshore Oil Corporation is working to develop oil and natural gas resources in some of the the east African rift basins [15]. Western Africa has a lot of potential to export LNG. Based upon 2012 statistics, Nigeria was the fourth largest exporter of LNG [16] in the world. They are only capturing a fraction of the gas. Large amounts of gas are still being flared [17] off the coasts of Nigeria and other west African countries. Algeria [18] is a leading LNG exporting country and a major source to the Mediterranean. Although the country has its instabilities it has a lot of natural gas capacity that could go straight to LNG. Egypt [19] has been a leading LNG exporting country to Europe and has new sources of gas that should maintain or increase export levels. Data from the Energy Information Administration FLNG: Shell is developing a fleet of FLNG (floating LNG) vessels [20] that will have the largest hulls in the world. These are initially intended to capture and convert natural gas from fields that are off the coasts of Australia and Indonesia. A large market also exists for smaller floating LNG facilities [21]. These might be used in areas where natural gas would otherwise be flared. INDONESIA: Indonesia currently accounts for 7% of global LNG exports. In addition, the country produces a lot of natural gas offshore that is converted into LNG and transported to one of its own islands for consumption. A lot of natural gas is currently being flared in Indonesia but the percentage is dropping rapidly through the use of small LNG facilities. Shell plans to use some of its FLNG vessels in Indonesia. Companies from China, the United States and other countries are planning LNG export facilities in Indonesia. The government is requiring them to dedicated a portion of their production to local consumption. In addition to traditional natural gas, Indonesia has significant coal bed methane and shale resources on land. Coal bed methane is currently being produced and the government expects to increase production to 183Bcf/y by 2020. Details in an Energy Information Administration article [22]. PAPUA NEW GUINEA Exxon, partnered with companies from Australia and Japan, recently spent $17 billion on a new LNG export facility [23] in Papua New Guinea that is expected to produce up to 6.9 million tons of LNG at peak capacity. Exploration for more gas in PNG continues. CHINA: China has a diversity of natural gas resources. They have conventional gas in onshore and offshore basins, a shale gas resource that rivals the United States, and a growing coal bed methane production. They are acquiring expertise to develop their shale gas through Sinopec partnerships in several shale gas plays in the United States. One deal with Devon Energy [24] includes the drilling of 125 wells with hydraulic fracturing that will be drilled outside of the United States. If these wells can be successfully developed in China and replicated the need for LNG in China could fall [25]. The decreased need and new pricing models [26] for LNG could see much lower LNG prices going forward. In the East China Sea, natural gas fields hundreds of miles from shore are now being developed with natural gas pipelines on the seafloor that deliver the gas straight to urban centers. One is a 200-mile long subsea pipeline that delivers natural gas from the Pinghu Field straight to the city of Shanghai [27]. Although the South China Sea [28] has a lot of territorial disputes it is also thought to have about 200 trillion cubic feet of natural gas in proved and probable reserves. Abundant oil and natural gas is also present under the under the Yellow Sea. SOUTH KOREA: South Korea is a major energy importer, producing only about 5% of its domestic energy consumption. The Korea National Oil Corporation is launching projects worldwide to control at least a small portion of the global energy supply. They have projects in Africa, the Middle East, South America, Canada and Asia. In the United States they have projects [29] in the Gulf of Mexico, onshore in Alabama, Texas (23.7% of the Eagle Ford) and New Mexico. QATAR: Qatar, the world's largest exporter of LNG [30] is worried about keeping its LNG customers. The Bloomberg article says: "The greatest threat to Qatar’s enormous wealth is (LNG) competition." ALASKA: The Alaska Senate is debating the largest infrastructure project in the history of the state [31]. It will involve a pipeline delivering natural gas from the North Slope to the Pacific coast where it will be converted into LNG and exported. Presently, lots of natural gas on the North Slope is being flared because it has no access to market. A project like this might capture an enormous natural gas resources that is either undeveloped or wasted. If any US project to export natural gas should be approved this one is it. Hopefully it can be done at a profit. ARCTIC AND SUBARCTIC BASINS: Natural gas from Arctic and Subarctic Basins [32] and the world's largest petroleum basin [33] might be developed using the Alaska project as a model. With warming climate some of these areas are ice free for much of the year. GLOBAL SHALE GAS: Most of the natural gas included in the listings above is conventional natural gas. The amount of unconventional natural gas (mostly from shale) that could become available outside of the United States is phenomenal. The chart below from the Energy Information Administration [34] shows that lots of natural gas could be produced from shale in many parts of the world. Much of this gas is in areas without a significant market and much of it is in the LNG customer countries. METHANE HYDRATES: The people of Japan are not sitting on their islands waiting for others to deliver natural gas. "In March 2013, JOGMEC conducted the first successful testing of offshore methane hydrate production and confirmed Japan's estimates of 40 Tcf of methane hydrates in the Nankai Trough on the southeast coast of the country. Japan hopes to begin production by 2018." Quoted from the Energy Information Administration [35]. India [36] has been working on projects to methane hydrates for the past several years. They believe that 900 trillion cubic feet of methane hydrates exist in their exclusive economic zone. Methane hydrates [37] are found in many parts of the world. When a technology is developed to capture them there will be a new natural gas revolution that will make shale gas look tiny. EXPORTING US NATURAL GAS? With all of the new sources of natural gas being discovered and LNG competition being developed, jumping into the LNG export business with a huge transportation disadvantage to the Asian and European markets seems to be fairly risky. The bottom line questions is: Does it make sense to spend a lot of energy compressing Marcellus gas on the US east coast, then spend a lot more energy shipping it across the planet to destinations where it will compete with a growing number of competitors? That certainly isn't good stewardship of the US natural gas resource and with all of the developing LNG, FLNG and subsea pipeline competition it might not make economic sense. Why ship it to Asia? That gas could be used ten miles from the wellhead! Wouldn't it make a lot more sense to take the billions of dollars to be spent on LNG plants and use it to coordinate pipelines, chemical companies [38], the auto industry, electric utilities and manufacturers within the United States? Or, converting it into alternative fuels [39] here in the United States? [1] http://thehill.com/policy/energy-environment/205710-dems-ask-obama-to-take-sides-on-gas-exports-as-energy-bill-teeters [2] http://www.appea.com.au/oil-gas-explained/operation/australian-lng-projects/ [3] http://www.eia.gov/countries/cab.cfm?fips=AS [4] http://www.reuters.com/article/2014/04/01/russia-rosneft-gas-idUSL5N0MT32R20140401 [5] http://www.gazprom.com/press/news/2014/march/article185616/ [6] http://www.gazprom.com/about/production/projects/lng/sakhalin2/ [7] http://www.theglobeandmail.com/news/british-columbia/woodfibre-lng-project-to-be-running-by-2017-premier-clark/article18503077/ [8] http://business.financialpost.com/2013/09/19/chevron-recommits-to-canada-with-kitimat-duvernay-shale-plans/?__lsa=c74d-fb38 [9] http://www.bloomberg.com/news/2013-09-09/bg-may-buy-gas-fields-in-canada-to-produce-lng-for-asia.html [10] http://uk.reuters.com/article/2014/04/30/shell-canada-lng-idUKL2N0NM1UC20140430 [11] http://www.reuters.com/article/2013/09/10/anadarko-mozambique-lng-idUSL3N0H60ZL20130910 [12] http://www.eia.gov/countries/regions-topics.cfm?fips=EEAE [13] http://www.marketwatch.com/story/statoil-exxon-mobil-in-gas-find-offshore-tanzania-2013-03-18 [14] http://pubs.usgs.gov/fs/2012/3039/ [15] http://www.eia.gov/countries/regions-topics.cfm?fips=EEAE [16] http://www.eia.gov/countries/cab.cfm?fips=NI [17] http://geology.com/articles/oil-fields-from-space/#nigeria [18] http://www.eia.gov/countries/cab.cfm?fips=AG [19] http://www.eia.gov/countries/cab.cfm?fips=EG [20] http://www.shell.com/global/future-energy/natural-gas/flng.html [21] http://fuelfix.com/blog/2014/05/07/is-a-boom-in-floating-lng-facilities-on-the-horizon/ [22] http://www.eia.gov/countries/cab.cfm?fips=ID [23] http://www.upi.com/Business_News/Energy-Resources/2013/09/03/PNG-natural-gas-project-nearly-complete/UPI-68891378212984/ [24] http://abcnews.go.com/Politics/money-chinese-investments-us/story?id=19347795 [25] http://www.cnbc.com/id/101646609 [26] http://www.bizjournals.com/houston/morning_call/2014/03/texas-shale-driving-global-gas-prices.html [27] http://www.eia.gov/countries/regions-topics.cfm?fips=ECS [28] http://www.eia.gov/countries/regions-topics.cfm?fips=SCS [29] http://www.eia.gov/countries/cab.cfm?fips=KS [30] http://www.bloomberg.com/news/2014-04-01/a-little-less-rich-qatar-gas-dominance-challenged.html [31] http://www.adn.com/2014/03/18/3381211/alaska-senate-passes-measure-to.html [32] http://geology.com/articles/arctic-oil-and-gas/ [33] http://pubs.usgs.gov/bul/2201/G/ [34] http://www.eia.gov/analysis/studies/worldshalegas/pdf/fullreport.pdf [35] http://www.eia.gov/countries/cab.cfm?fips=ja [36] http://fuelfix.com/blog/2014/02/14/methane-hydrate-the-energy-source-of-the-future-maybe/ [37] http://geology.com/articles/methane-hydrates/ [38] http://www.nytimes.com/2013/08/16/business/energy-environment/foreseeing-trouble-in-exporting-natural-gas.html?_r=0 [39] http://www.bizjournals.com/sanantonio/blog/eagle-ford-shale-insight/2014/05/heyco-will-build-91-million-plant-to-convert-eagle.html More at Geology.com.

Geology of the Voca Frac Sand District

"One of Texas’ major frac sand [1] production areas is near Voca, Texas, where sands are produced from the Cambrian Hickory Sandstone on the northwestern flank of the Llano Uplift." Quoted from the Arizona Geological Survey Repository. Related: What is Frac Sand? [2] [1] http://geology.com/articles/frac-sand/ [2] http://geology.com/articles/frac-sand/ More at Arizona Geological Survey Repository.

Drilling Slows in the Barnett Shale

Drilling in the Barnett Shale of Texas is at its lowest level since 2000. There are currently only about 25 rigs operating there, compared with over 2000 during the 2007-2008 peak. More at Star-Telegram.com.

Production Declines in Natural Gas Wells

Lots of property owners who signed a lease in one of the natural gas shale plays are now receiving monthly or quarterly royalty payments. Many of these people were pleasantly surprised with the size of their first royalty check -- but then shocked to see the size of subsequent checks fall rapidly. What's happening? More at Geology.com.

Shale Sweet Spots and Production Declines

Some people think that a few "sweet spots" are supporting most of the production in the oil and gas shale plays. They point to the huge annual production declines and speculate that the "shale boom" will not last very long. More at USA Today.

George Mitchel

We normally do not report obituaries. George Mitchel, pioneer of producing natural gas and oil from tight shale formations passed away at the age of 94. Here is an article about his work from 2008 by Marc Airhart, Jackson School of Geosciences. More at Jackson School of Geoscience on Geology.com.

George Mitchel

We normally do not report obituaries. George Mitchel, pioneer of producing natural gas and oil from tight shale formations passed away at the age of 94. Here is an article about his work from 2008 by Marc Airhart, Jackson School of Geosciences. More at Jackson School of Geoscience on Geology.com.

Foreign Investments in US Shale

Since 2008, foreign companies have entered into 21 joint ventures with U.S. acreage holders and operators, investing more than $26 billion in tight oil and shale gas plays. More at Energy Information Administration.

Drilling for Gas Under an Airport

Consol Energy has reached an agreement that will allow it for drill for natural gas on 9,000 acres of land at the Pittsburgh International Airport. This isn't the first time airport property has been drilled for natural gas. In 2006 land surrounding the Dallas/Fort Worth International Airport was part of a drilling deal. More at Centre Daily Times.

TCO Appalachia and Henry Hub Gas Prices at Parity

"Natural gas at the TCO Appalachia index has historically been priced about $0.25 per million British thermal units above Henry Hub. However, the spread between these two points in spot markets reflects rough parity now, and in forward markets TCO is priced less than at the Henry Hub." Quoted from the Energy Information Administration website. More at Energy Information Administration.

AASG on Hydraulic Fracturing

"After decades of hydraulic fracturing-related activity there is little evidence if any that hydraulic fracturing itself has contaminated fresh groundwater. No occurrences are known where hydraulic fracturing fluids have moved upward from the zone of fracturing of a horizontal well into the fresh drinking water." Quoted from the Association of American State Geologists statement. More at Association of American State Geologists.

Texas: Injection Wells and Earthquakes

"Most earthquakes in the Barnett Shale region of North Texas occur within a few miles of one or more injection wells used to dispose of wastes associated with petroleum production such as hydraulic fracturing fluids, according to new research from The University of Texas at Austin. None of the quakes identified in the two-year study were strong enough to pose a danger to the public." Quoted from the University of Texas at Austin press release. More at University of Texas at Austin.

Truthland

The natural gas industry has prepared a movie, "Truthland", that responds to the HBO movie "Gasland". More at Truthland@YouTube.

Water Quality Where Hydraulic Fracturing is Used

The United States Geological Survey has published: "Water Quality Studied in Areas of Unconventional Oil and Gas Development, Including Areas Where Hydraulic Fracturing Techniques are Used, in the United States." More at United States Geological Survey.

Rouge Fractures

"The chances of rogue fractures due to shale gas fracking operations extending beyond 0.6 kilometres from the injection source is a fraction of one percent, according to new research led by Durham University. The analysis is based on data from thousands of fracking operations in the USA and natural rock fractures in Europe and Africa." Quoted from the Durham University press release. More at Durham University.

Hydraulic Fracturing Isn’t the Problem

"Hydraulic fracturing of shale formations to extract natural gas has no direct connection to reports of groundwater contamination [...] many problems ascribed to hydraulic fracturing are related to processes common to all oil and gas drilling operations, such as casing failures or poor cement jobs." Quoted from the University of Texas at Austin press release. More at University of Texas at Austin.

Dry Shale Gas Production Trends

The EIA Natural Gas Weekly Update has an interesting graph that tracks the month-by-month dry gas production growth from various shale gas fields in the United States. For example, it shows that production from the Haynesville Shale started to increas... More at Energy Information Administration.

Texas: Fracking Chemicals and Water Consumption Reports

A new regulation will require drillers in Texas to report the chemicals in their hydraulic fracturing fluid and the amount of water used to frack each well. More at The Texas Tribune.

Declining Royalty Payments from Natural Gas Wells

Many property owners are very surprised when the royalties that they receive from a natural gas well on their property decline sharply. They are learning about production decline curves. More at Geology.com.

Learning about Oil and Gas Leases

An article in the New York Times reviews some potential rewards and problems that occur when a landowner decides to lease his property for oil and and gas development. Related: Mineral Rights [1] [1] http://geology.com/articles/mineral-rights.shtml More at New York Times.

Declining Production from the Barnett Shale

An article on the Star-Telegram.com website explores declining production from the Barnett Shale of Texas - the rock unit that supported the first important use of horizontal drilling and hydraulic fracturing. More at Star-Telegram.

Barnett Shale: 100,000 Jobs and $65 Billion

An article on the BizJournals.com website summarizes the economic impact of natural gas development in the Barnett Shale of Texas. More at BizJournals.com.

Oh No! Who Really Owns the Natural Gas in Shale?

Is natural gas part of the shale or is it a fugitive commodity that is not an integral part of any specific rock unit? Will a refined legal definition of natural gas in Pennsylvania overturn thousands of historic leases? More at Business Week.

35 Wells on One Barnett Shale Drilling Pad

Devon Energy has drilled over 4,700 wells in the Barnett Shale field since 2001. Today they are in the process of drilling 35 horizontal wells, all at different compass directions, from a single 12-acre pad. This is believed to be the largest number ... More at Star-Telegram.com.

Geographic History of Barnett Shale Drilling Activity

The Energy Information Administration has an interesting animated map on their website that shows the geographic spread of drilling activity in the Barnett Shale around Fort Worth, Texas. It also shows the introduction and spread of horizontal drillin... More at Energy Information Administration.

Shale Gas and U.S. National Security

The Baker Institute for Public Policy at Rice University has published a report titled: “Shale Gas and U.S. National Security”. “This study assesses the impact of U.S. domestic shale gas development on energy security and U.S. national security, with emphasis on the geopolitical consequences of rising supplies of U.S. natural gas from shale and the implications for U.S. foreign policy.” Quoted from the report summary.

Brine Contamination Associated with Oil and Gas Production in the Williston Basin

“U.S. Geological Survey scientists and cooperating partners are examining the potential risk to aquatic resources by contamination from saline waters produced by petroleum development in the Williston Basin of Montana, North Dakota, and South Dakota.” Quoted from the USGS publication release.

Chesapeake Energy: Land Acquisition Machine

A post on the Seeking Alpha blog details how successful Chesapeake Energy has been at rapidly leasing enormous acreages in all of the major natural gas shale plays in the United States. They author calls them a “land acquisition machine”.

Impact of Barnett Shale Development on Groundwater Resources

The impact of hydraulic fracturing on ground water supplies is a concern in almost every area where the well stimulation method is employed. The Texas Water Development Board has published an informative study: Northern Trinity/Woodbine GAM Assessment of Groundwater Use in the Northern Trinity Aquifer Due To Urban Growth and Barnett Shale Development. Get the report here.

Which is the Leader? Barnett or Haynesville Shale?

The Energy Information Administration recently reported that production from the Haynesville Shale had surpassed Barnett Shale production. Now, energy statisticians are arguing over the numbers. More at Platts.com.

EPA vs Texas Railroad Commission

The Railroad Commission has jurisdiction of natural gas drilling in Texas and the commission disagrees with the United States Environmental Protection Agency on the cause of domestic water well contamination in North Texas. EPA claims that Barnett Shale drilling has caused the problem. More in the Washington Post.

Haynesville Shale is the Top Shale Gas Producer

According to an article in the Houston Chronicle, the Haynesville Shale of Louisiana is now producing more natural gas than the Barnett Shale of Texas, running at a rate of about 5.5 billion cubic feet per day.

How Much Gas in the Utica Shale?

The Utica Shale has a larger geographic extent than both the Marcellus Shale of the Appalachian Basin and the Barnett Shale of Texas. It is also has a much larger total volume. Will its gas producing potential exceed that of the Marcellus and Barnett. An article on the Seeking Alpha blog explores this question.

Side-effects of Shale Drilling

An article in the Houston Chronicle titled: “We Can Minimize Negative Side-Effects of Shale Drilling” explores some ways to mitigate some of the problems encountered in developing the Barnett Shale, Eagle Ford Shale and Haynesville Shale in Texas.

Landowners Sue Chesapeake Energy for Backing Out on a Deal

Several landowners in Texas are going after Chesapeake Energy for promising to lease their Barnett Shale properties and then backing out of the deal. More on a Christopher Helman blog post at Forbes.com.

Can the Nitrogen Content of Natural Gas Determine Its Source?

Natural gas has been found in two private water wells in Parker County, Texas. The nitrogen content of the gas may determine if Barnett Shale drilling activity by Range Resources is the source or if the source is shallower rock units. More in the Washington Examiner.

Where Did That Gas Come From?

Two household water supplies in Parker County, Texas are contaminated with methane. EPA says that the gas came from Range Resources wells drilled into the Barnett Shale. Range Resources says that the gas came from the Strawn Formation which is much shallower. More in a Star-Telegram.com article.

Master Plan for Barnett Shale Pipelines

In a competitive rush to lease natural gas properties a pattern of drilling is established. Then pipelines to transport the gas to market must be built to service that pattern with companies still competing instead of cooperating. An editorial in the Fort Worth Star-Telegram calls for a pipeline master plan.

Texas Rule 37 and Holdout Landowners

The Texas Railroad Commission’s Rule 37 is the subject of an editorial in the Fort Worth Star-Telegram. The author explains how this rule that regulates the spacing of oil and gas wells seems to be used to as a way to avoid dealing with Barnett Shale holdout landowners.