X Shareholders were victimized by the worst executive in the History of American Business. John Surma. Anyone writing a book about this clown. I think an in depth analysis of his fitness to lead a corporation may steer other corporations from hiring such an inepto. Did he have character flaws? What were his leadership skills? Was he just dumb? I would like to read such a book.
Shell says they have been producing two Utica wells in Tioga County pa since February and are drilling four more. One well came in at 26.5 mf/day and the other at 11.5. Shell says they are very pleased with what they have and say the results match what people have been getting in Southern Ohio. I infer it is dry gas but cannot say for sure. Last month Shell sold their Butler acreage to Rex and picked up more land in Northern PA from Ultra. I saw a map that RR produced that listed this area as being a strong Utica region.
So this sure does complicate the definition of the Utica shale field. Strong in the SW and now strong in the NE. Still a lot of disappointment in between, especially north central Ohio. There is a lot of drilling going on in Mercer PA. I suspect Shell will team up with Seneca to supply the gas for the new proposed line to Ontario.
I wish I could buy them all. Nice research on the Reliance shipping question. It just seems every week someone is coming up with a new way to spend several billions in this industry. I see where Shell has filed their clean air permit for the Monaca Cracker. People who have seen it say the planning and description of the facility are laid out in detail in the filing.
Nice to see they mentioned the need to build transport trips. The first one arrives in late 2016. I would say the full scale transportation of ethane will not arrive before 2018. But you have to start sometime. I am somewhat curious on where they will ship from.
Anyone following this company? They are doing work on a process to convert dry gas to ethylene and then on to liquid fuels. Today there are a number of articles claiming the cost will be about $1.00/gallon. They have attracted a number of name investors and are signing demo deals with some large companies including Braschem. They also have a development jv with Linde.
The process is called ocm which has been worked on for years without anyone able to control it. The process uses catalysts for conversion at lower temps then in a Cracker. Siluria is using new tools from the Nano world and have been able to make it work at low temps. The chemistry is explained on their website. If it is scalable it will be very disruptive technology. Of course history is full of failed tech that has not quite made it. I have been patiently waiting for fusion power since 1960.
There is a short book out called "Game Changers" which is a nice summary of a number of tech advancements in the energy field. The authors are Schultz and Armstrong from Stanford and MIT. I like to keep up with what is happening in tech just so I am not completely blindsided when something disruptive hits.
It does. People have gotten some good Utica results that far East. There is also the Genesee (Upper Devonian) which has been yielding good results. This lies above the Burnette in SW PA where they have been getting good wells. Just to the west of what they purchased NFG is doing an extensive drilling program in the Marcellus. Well results on a recent 8 well pad averaged 8.5 million a day per well. They plan to bring a huge line into the area to service the newly planned lines to Ontario.
Sold all their Haynesville for 1.3 Billion plus their Wyoming acreage. I wonder if this means they are getting rid of their Gulf Chemical assets. LOL. They are also picking up 185 thousand more acres in Tioga and Potter counties in PA from Ultra. They had a jv with Ultra in this property.
Interesting quote is that they claim they are picking up more acreage where they have been getting their best Utica wells. NFG is actively drilling just to the west of where they have the JV with ultra.
The interesting thing about that area is that the reports I have read say geologist are not sure that is an extension of the chainman shale or something completely new and uncharted. Cabot in the chainman and Noble are the only two active companies in the area. It definitely is something I am paying attention to.
Some of us are not freaking out with the drop in market prices. I look forward to buying more mlp's with a yield of 7%. I think that yield is more commensurate with the risk one takes in buying these securities
Countries around the globe have a lot more cheap land, low taxes, cheaper labor and less snow than Texas. (ie Mexico.) I can see the whole SE NGL market looking much different when the Eagle Ford shales extending into Mexico start to produce. This could very well be in 5 years.
I just don't see ethane being the great money maker for energy companies in five to ten years. There are just too many shale deposits in the world and from what I have read many of these will produce liquids including ethanes. I value MWE but not for the ethane in the NE. I think in the long run they will make more from propane and condensate. In fact I am a little concerned that with the Marcellus and Utica projected to be producing 800k barrels of ethane a day in five years, will the producers be able to move it anywhere in the world. The two local cracker projects will take only about 120k a day. The big worry I have is will NE ethane be able to compete with SE Gulf ethane to supply the Gulf cracker needs or will it be out priced by SE producers. Forget the world markets. That will be a whole different #$%$ shoot.
Diversification is the way I have chosen.
For me diversification is the way to invest in this industry.
I take it the ships have already been built to transport the methane? LOL. The time line for all this to happen (including the Appalachian crackers) is five years away. Shell is awarding contracts for site prep on their cracker and the WVA cracker is moving forward. I would say looking at the situation today the Appalachian crackers will have the lowest cost at least to supply the NE and Mid west. But one does not have the luxury of looking at the situation today. What the landscape is five plus years in the future is what concerns me. I see too many uncertainties to bet on any one area or company.
I am enjoying the weakness in today's markets. Diversification is what I have been doing. WPZ is what I have been buying. I am not selling anything in the energy area.
In my original post I stated: " I would infer the Appalachian area in several years will become the low cost production area for plastics." I don't believe there are any plans to use Naptha as the feedstock in the Appalachian crackers. It is not the price of ethane that is the issue it is the transportation cost to ship it, refrigerate it, and build the ships to transport it. Unless I am missing something I don't believe we will see refrigerated ethane vessels passing the golden triangle in Pittsburgh.
Now as to who cares about the WVA and Shell crackers I for one care. I want to not only see the jobs that these projects can bring to the area but I also look forward to paying less for sewer and water due to pipe plants locating in this area. From what I have read local E&P companies and midstream companies such as MWE look forward to the these projects.
As to your comment that "the ethane train as left" I hope this is a figure of speech. I don't want to be anywhere near an ethane train. Unfortunately what has not left the docks are the number of refrigerated ships required to transport the ethane. This whole scenario is five years in the future. By then the ethane landscape may have changed again as shale deposits like Duvernay come on line. Appalachia could be producing 800k barrels a day with only about 120 being used locally.
I saw some numbers where the plant will cost around $5 billion so I do believe they plan a major rework. There was a major chemical industry in the region until the Sabic Plant was shut down. It was a joint venture between Dupont and Shell up until 1993. I know Shell had a chemical plant up the river from Parkersburg in the 60's. I visited it on an inventory observation in 1967. They made plastic parts for the furniture industry that looked like wood.
One thing about shipping ethane that caught my attention is that shipping it is one thing. Once in place it has to be refrigerated. It all looks kind of expensive to me.
After reading the recent articles about how difficult and apparently expensive it is to transport and store ethane I would infer the Appalachian area in several years will become the low cost production area for plastics. Especially for overseas markets. The cost of the refrigerated shipping vessels has to be enormous.
I personally think the Internet of Things is one of the next most fruitful areas for investment. Who is situated to make a bundle off of this. Intel. Revenues over a half billion and growing. I like this stock.