XTO Energy, the largest natural gas producer in Arkansas, has begun employing a proppant-flowback arrester (PFA), which helps control proppant flowback and fines production and helps maintain highly conductive fractures and long-term productivity. The process combines new technologies that enable resin-treatment of proppant after it has been placed in the fracture. The service uses coiled tubing coupled with either pressure-pulsing or fluid-wave technology, and is a coiled-tubing deployed, rigless intervention. Projected value added, in the form of reduced workover-cleanout expense and increased production ranges from $210,000 to 440,000/well/year.
The US Department of Energy (DOE) completes the first edition of a National Atlas describing potential CO2 sequestration reservoirs and their capacities. These reservoirs include: depleted oil and gas reservoirs, unmineable coalbeds, and deep saline reservoirs. Theoretically, geologic reservoirs have the capacity to store all the CO2 produced by the large point sources of CO2 in the US and globally for hundreds of years.
Newark East field in North Texas, center of the Mississippian Barnett shale play, was Texas’s largest gas-producing field in 2006 and could become the largest in terms of ultimate recovery in the Lower 48. The field ranked third in the nation in reserves, after the entire San Juan basin in New Mexico and Colorado and Pinedale field in the Green River basin in Wyoming, and second in the nation in terms of production after San Juan. Discovered by the former Mitchell Energy Corp. in 1981 in Wise County, Newark East field attracted the drilling of only 100 wells between 1981 and 1990.
Light sweet crude - $63.30/bbl; Natural gas - $7.64/MMbtu; U.S. active rig count – 1,767
A Delta Air Lines Inc. subsidiary has agreed to buy the 185,000-b/d Trainer, Pa., refinery near Philadelphia from Phillips 66 Co. for $180 million. Delta said Monroe Energy LLC is buying the refinery to reduce the airline's fuel costs, and will convert the installation to primarily produce jet fuel. The acquisition is an innovative approach to managing Delta's biggest expense, CEO Richard Phillips said. "This modest investment, the equivalent of the list price of a new wide-body aircraft, will allow Delta to reduce its fuel expense by $300 million annually and ensure jet fuel availability in the Northeast," he explained.
Chesapeake Energy Corp. said its board will name an independent, nonexecutive chairman, as well as renegotiate the terms of the company's Founder Well Participation Program (FWPP) with Chairman and CEO Aubrey K. McClendon. The FWPP now is set to expire June 30, 2014, which is 18 months before the end of its original term. McClendon will receive no compensation of any kind for the FWPP early termination, but McClendon will continue as chief executive officer. The board also said it's reviewing financing arrangements between McClendon and entities with which he participated in the FWPP. The board has said it generally was aware McClendon used interests acquired through FWPP as security for his personal financing transactions.
BP PLC has five offshore rigs operating in the Gulf of Mexico, which is the same number as it had before the April 2010 deepwater Macondo well blowout, a BP executive told a breakfast audience at the Offshore Technology Conference. By yearend, BP expects to add three more rigs focused on exploration, appraisal, and development, said Bernard Looney, BP executive vice-president. BP is investing $4 billion in the gulf this year and hopes to invest at least that much every year for the next decade, Looney said.
Light sweet crude - $104.05/bbl; Natural gas - $2.05/MMbtu; U.S. active rig count – 1,945
Sec. of the Interior Ryan Zinke announces the start-up of expanded offshore drilling with Secretarial Order 3550 directing the US Bureau of Ocean Energy Management to develop a 5-year federal OCS leasing program that gives full consideration to tracts off Alaska, South and Mid-Atlantic states, and the Gulf of Mexico. Zinke instructs the BOEM to give expedited consideration to seismic testing on the OCS.
As Atlantic OCS exploration remains somewhat uncertain, offshore wind energy is entering the region, as Deepwater Wind powers up its Block Island Wind Farm off Rhode Island. The 30-Mw, five-turbine facility is the first offshore wind farm with commercial operations in the US. Despite the policy roadblocks faced by the oil and gas industry, energy is finding its footing on the Atlantic Coast.
Turning around a company whose sales are comparable to Uruguay's gross domestic product is no small task, especially when the company itself (Pemex) remains a primary source of revenue for its government owner. Crucial to achieving stable profits will be a reversal of course in companywide oil production, which has been falling steadily over the years. In 2004, Pemex produced 3.4 million b/d, of which 2.1 million came from the Cantarell field. Today, Pemex produces about 200,000 b/d from the field. The challenge is to replace Cantarell's dropping production with non-Cantarell production, which has increased by 54% during the same time period.
Light sweet crude - $47.21/bbl; Natural gas - $3.22/MMbtu; U.S. active rig count – 877
The Rest of the Yarn
This month, Connally overshadows Nixon at The Barbecue. “People frequently were annoyed by the fact that as they talked to him he appeared not to be listening,” Edna Ferber had written of Bick Benedict, idealized heir of the Reata ranch in her book, Giant. “He listened to nothing that did not vitally interest him….”
That description might also have applied to the gentleman rancher who led the President, seemingly a stranger in his own body, to view some of his prize bulls. Connally was clearly dominant. Nixon’s admiration for him was widely known—favor that amounted almost to adulation. Texans present at the White House when Connally took the oath as Treasury Secretary were pleased to see Nixon deferring to him, and at the same time amazed that the President of the United States would allow himself to be so overshadowed.
They had much in common, however. Both men were Southwesterners, born of large, poor families, who decided early to achieve material success, debating and acting their way through school. Both spent their entire adult life in politics, both were the beneficiaries of the actions and backing of older, influential men. They were inordinately ambitious. But perhaps the most important similarity between Connally and Nixon was their Sunbelt conservatism.
Indeed, Texas could boast of nurturing this new conservatism. Political favor was recognized as more effective—and more desirable—than economic proficiency in meeting with success. Money given to politicians espousing this conservatism was new, money donated for specific purposes by the new barons accustomed to speculating, but ever seeking security in all things. Next month, we meet another one of the new barons present at The Barbecue.
It was not incidental that the host’s favorite film was Giant. So impressed was he by spectacle that he overlooked Hollywood’s misrepresentations. He was himself an actor, and a romantic. That the theme song of Giant should become an integral part of his 1961 campaign for governor had been preordained, the music swelling and filling hundreds of high-school auditoriums across Texas as Connally entered the stage.
Next month, Connally overshadows Nixon at The Barbecue.
In what year did U.S. driller surpass the 20,000 ft barrier?
Answer to April’s Quiz
The first Texas offshore well was located two miles off Sabine Pass.
Congratulations to March's winner - Jim Honefenger with Consulting Assets LLC.