Friday, June 15, 2012

New Major Shale Gas Discovery in Canada

The  Calgary Herald is reporting today that the Apache Corporation has just discovered a huge shale gas reservoir in northern British Columbia.

"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. 

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."
MP: The "shale revolution" is just beginning. 

HT: John Sturges

16 Comments:

At 6/15/2012 12:10 PM, Blogger Unknown said...

I was just looking through Apache's June investor presentation, and they've got some pretty hefty numbers of resources in various US plays.

LINK

- 3.8 billion boe and 34,500 drillable locations in the Texas/NM Permian Basin. According to this that's about 70% liquids.

- 5.4 billion boe and 32,500 drillable locations in the TX/OK panhandle area. According to this that's about 29% liquids.

- 2 billion barrels of oil and 7,200 potential drillable locations in the KS/NB Mississippian Lime. I didn't know this one went all the way to Nebraska, I'd been reading it's just in OK and KS. If it also goes to NB, it's gotta be huge! The map shown here shows it going to south-central Nebraska (middle-ish page of document).

- Plus 1 billion barrels and 1,900 drillable locations in the Wiliston Basin on the Montana side.

 
At 6/15/2012 12:11 PM, Blogger # 56 said...

Another win for APA, and their director of Special Projects, Sean Bolks.

 
At 6/15/2012 12:45 PM, Blogger Jon Murphy said...

Good for Apache. Just when you think you've hit the motherload (Bakken), something else comes along.

 
At 6/15/2012 1:05 PM, Blogger Les Johnson said...

More than the motherlode. The gas, when its converted to LNG in Kitimat, will be stripped of the NG liquids. These liquids will be piped back to Alberta, and used to dilute heavy oil. The diluted heavy oil will then be piped back to Kitimat, for sale to China.

There is hundreds of billions of this heavy oil, just waiting for a market.

 
At 6/15/2012 1:26 PM, Blogger Buddy R Pacifico said...

"These liquids will be piped back to Alberta, and used to dilute heavy oil. The diluted heavy oil will then be piped back to Kitimat, for sale to China."

There is significant reisitence to the transportation and shipping of oil to China from British Columbia.

Many in B.C. have the opinion that their province gets much of the risk, but little of the benefit from this plan.

 
At 6/15/2012 3:10 PM, Blogger Les Johnson said...

The people in BC don't realize that it will be shipped, one way or another. By pipeline, or by rail. Rail does not need any approval process, unlike pipelines.

I don't think the government will pass up the potential, though. Even the native communities are signing up.

Most polls show that a majority of BCers and Canucks support the pipeline.

The risk is highly overstated. There is currently 100,000s of km of pipelines in north america.

Do they break? Yes. Do trains derail or planes fall from the sky? Yes.

 
At 6/15/2012 3:17 PM, OpenID chuquito said...

Professor Perry,

What do we do about the Global Warming?

 
At 6/15/2012 3:20 PM, Blogger Jon Murphy said...

What do we do about the Global Warming?

Drill more gas. Natural gas has emits about one-half to one-third (depending on who you ask) the amount of carbon coal and oil do.

 
At 6/15/2012 3:36 PM, Blogger Hell_Is_Like_Newark said...

Chuquito:

If anything, we have been in a mild cooling trend for the past decade. AGW is a scam.

 
At 6/15/2012 3:45 PM, Blogger Jon Murphy said...

If anything, we have been in a mild cooling trend for the past decade. AGW is a scam.

Random fact of the day: According to NOAA, the average annual temp in 2011 was only 0.3 degrees higher than 1900. However, it was also about 1 degree below the historical median temp over that 111 years.

 
At 6/16/2012 7:42 PM, Blogger VangelV said...

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."

This is a lot like saying that they found the best horse at the glue factory. Compared to conventional reservoirs shale formations are expensive and deplete too rapidly. While the core areas could produce some nice profits there is little hope of an economic supply for more than 10% of the formation.

 
At 6/16/2012 9:12 PM, OpenID db5c344a-b821-11e1-929a-000bcdcb8a73 said...

Vange, you should just have your stock comments on your clipboard so you can cut and paste them here multiple times a day. You and Benji rarely add anything new to the conversations, but simply regurgitate your mantras...over and over and over.

 
At 6/16/2012 9:18 PM, Blogger Mark J. Perry said...

Amen.

 
At 6/17/2012 8:03 AM, Blogger VangelV said...

Vange, you should just have your stock comments on your clipboard so you can cut and paste them here multiple times a day. You and Benji rarely add anything new to the conversations, but simply regurgitate your mantras...over and over and over.

What you guys should do is look at the facts beginning with the huge negative cash flows and the high depletion rates. If the sector is not self financing after a decade of operation you have a serious problem that you are ignoring.

 
At 6/17/2012 8:12 AM, Blogger Mark J. Perry said...

Why are you the only one who seems to have this radical view? Do you have partners in your fantasy world?

 
At 6/17/2012 5:12 PM, Blogger VangelV said...


Why are you the only one who seems to have this radical view? Do you have partners in your fantasy world?


Looking at the balance sheet to check the growth of debt and looking at the cash flows to see if operations are self financing is not radical. It is what investors are supposed to do in the real world if they want to survive. And if you look at history you will find that investing in the early stages of a bubble can lead to success even if the activities that are being financed are not economic. All you need to do is to take your equity out by going public and getting investors to take the risk.

 

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