“Visitors from countries such as Germany, Poland, Argentina and Canada might be streaming into downtown Fort Worth to utilize XTO’s expertise,” said an article in the Star Telegram this week.

ExxonMobil is developing plans in all those regions to tap unconventional shale deposits.

“Some of the [international] shale plays will be brought into Forth Worth for review,” said former XTO President Vaughn Vennerberg at a Dallas energy conference this week.

XTO is currently one of the biggest and most lucrative producers of shale gas in North Texas’ Barnett Shale play.

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“Our goal is to take what we are now learning in Marcellus and transport these skills to other parts of the world,” said John Knight, head of Statoil’s Global Unconventional Gas Department. “Our current joint venture with Chesapeake is giving us an opportunity to train our people in the US shale gas industry.”

Statoil has been a joint-venture partner in Marcellus with Chesapeake Energy since 2008, and currently has 118 wells in production in the Pennsylvania shale play. This year, Statoil acquired even further interest in the play adding 59,000 acres to its current 600,000 acres. In addition to its operational wells, Statoil also has 105 wells awaiting completion and infrastructure.

Helge Lund, Statoil’s CEO, said his company chose a joint venture with a company such as Chesapeake rather than an outright acquisition to gain technical know-how. Now, along with Chesapeake, Statoil is taking that know-how and looking for potential unconventional reserves in under-serviced areas.

“We are now completing a two-year analysis of shale cores from around the globe,” said Knight, including shale plays in China, South Africa and the Gulf of Mexico.

SOURCES:
E&P Magazine: “Statoil Outlines Plans for US Marcellus Operations”

“Historically gas has been undervalued in the market,” said Tony Meggs, former head of technology for BP and moderator of the MIT conference. “Getting the gas to the consumer was a serious pain in the ass compared to a barrel of oil. Two things are changing gas markets: the climate debate [and] the shale gas boom.”

A shift to cleaner and more renewable energy sources is undoubtedly making shale gas an attractive option said Jeff Fisher, Senior Vice President of Production for Chesapeake Energy, the leading player in the new gas industry.

“Combined with wind and solar energy, [shale gas provides] a long-term viable renewable energy mix,” he said.
Henry Jacoby, a professor at MIT who studies the ongoing interaction between energy and the environment agreed with that statement, and said with cap and trade or regulatory climate policies in place, “gas will displace coal” and grow as a cleaner alternative. Natural gas is the least carbon intensive of all fuels.

However, the environmental impact isn’t the only reason shale gas is “a game changer,” said David Fleishacker, an expert on energy policy. Shale’s abundance is a major factor in highlighting a switch from coal-based energy to gas-based energy.

“Shale gas is widespread, easy to find, and produced at a rate and cost that is economic,” he said.

To date, 32 of 50 states produce natural gas. Some experts estimate there is a 100-year supply on shale gas at current consumption rates.

And the technology to extract the gas – the combination of hydraulic fracturing and horizontal drilling – is driving the market as well.

“Advancements in technology and innovation have unlocked vast supplied of unconventional gas resources,” said Fisher.

While an energy future that is based on minimal to no reliance on fuel at all, the panelists agreed, shale gas is the best option on the table to help the US get to that point.

“The low carbon economy is further away than we think,” said Fleishacker. “Natural gas is here now and will be an essential element in the bridge to the low carbon future.”

Watch the entire conference:

SOURCE:
Go Marcellus Shale: “MIT Energy Conference 2010 – Unconventional Natural Gas”

Rex’s shares climbed 7.2% to $11 on the midafternoon disclosure.

The deal is the Japanese trading house’s second shale deal as a wide variety of international players are seeking exposure to the hot natural gas assets. A surge in output from the one-time unconventional drilling prospects have helped keep a lid on natural gas prices and inventories have surged the past several years.

Meanwhile, Rex gets to become debt free and have “substantial” cash on hand. The oil-and-gas company, which has most of its operations in the Illinois and Appalachian basins, returned to black ink in the most recent two quarters after posting a string of losses since commodity prices fell from record highs in 2008.

“We believe that this will enable us to continue to aggressively develop our assets, while maintaining one of the cleanest balance sheets in the industry,” said Rex President and Chief Executive Benjamin Hulburt. Meanwhile, the company announced Tuesday that its lenders have agreed to boost Rex’s credit line by 25% to $125 million while extending the maturity a year to September 2013. As of Tuesday, $65 million had been borrowed from it.

With the sale, Rex reduced its third-quarter guidance to average daily production by 5% while the year’s target was reduced by up to 20%.

Beyond paying the $88.4 million for the joint venture stake, Sumitomo will also cover 80% of Rex’s remaining Marcellus drilling and well-completion costs up to $52 million. The deal is set to close next month.

SOURCE:
The Wall Street Journal

Though OIL hasn’t said which US company the joint venture would include, the agreement will help OIL access shale gas not only around the world, but also in India.

Presently, OIL, a Navaratna company, has over 1-lakh sq kilometer of area for its exploration and production activities in India, most of it in the north-east, which accounts for its entire crude oil production and majority of gas production.

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George P. Mitchell, founder of Mitchell Energy & Development Corp, is the man who pioneered shale gas drilling in the US by developing the hydraulic fracturing technique that has triggered a shale boom in America, and also around the world.

But in a recent profile in the Philadelphia Inquirer, Mitchell says these accomplishments are only secondary to his real passion: sustainability.

“There’s no doubt this nation is strong because of oil and gas,” Mitchell told the paper. “But sustainability is the most important thing I’m working on.”

While some may consider the combination of oil/gas exploration and environmental sustainability a bit of an oxymoron, Mitchell relishes the effect of a global glut of shale gas, the Inquirer says. Less reliance on imported oil and coal also means less pollution and greenhouse-gas emissions.

“If we don’t start waking up, in 2050 we’re in trouble, because you’ll have nine billion people worldwide,” he said. “And if you can’t make the world work with six billion people, how can you make it work with nine?”

Mitchell also says the shale industry must rise to the challenge of environmentalists by finding a way to create greener fracking fluids that can also be recycled and reused.

“If you can reuse it, it’ll cost you a little money, but it’s a good thing,” Mitchell said. “Because the environmentalists will give you hell, and I think they’re right, they should give you hell.”

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There is a new source of energy which is really a primary focus of the State Department right now,” said David Goldwyn, U.S. State Department Coordinator for International Energy Affairs. “And that’s natural gas”.

In an interview with Voice of America, Goldwyn says natural gas from shale is an excellent source of energy for many nations “so they’re not dependent on one country or one pipeline.”

The State Department recently hosted the Global Shale Gas Initiative to discuss expanding the safe use of shale gas. Twenty nations as well as US federal, state and local regulators met in Washington, D.C to discuss the importance of shale gas development for the 21st century.

In addition to helping the United States wean itself from its dependence on oil, the Obama administration believes that increased shale gas development will help reduce greenhouse gas emissions.

Other studies have also concluded that increased shale gas production in the United States and Canada could also help lower the price currently charged by Russia and Persian Gulf countries.

“This is not only a huge boon for energy security and economic development,” said Goldwyn, “but also, potentially for climate security if countries are able to move away from older coal plants and to natural gas instead.”

As Coordinator for International Energy Affairs at the State Department, David Goldwyn is at the center of U.S. energy security policy. His office supports initiatives that reduce U.S. dependence on foreign oil and also mitigate the impact of climate change.

Source: Natural Gas for Europe

Representatives from Armenia, Bulgaria, China, India, Indonesia, Jordan, Lithuania, Morrocco, Poland, Romania, South Africa, and Ukraine arrived in Williamsport, PA Tuesday to learn about shale gas development.

“Other countries want to develop their own shale gas deposits, but lack the experience needed to do it safe and efficiently,” David Goldwyn, coordinator for the State Department’s office on Internal Energy Affairs told the Sun Gazette. “The conference was held so we could teach them what they need to know.”

The delegates attended a luncheon hosted by Texas-based Chief Oil and Gas and then went on a bus tour of Chief gas operations in the eastern part of Lycoming County. The tour was moderated by company communications specialist Daria Fish, who attendees barraged with questions about shale gas development, including seismic testing, regulations, leases, landowner issues, pipelines and the financial viability of shale gas development, according to the paper.

“I think shale gas will be the future of energy in the world,” said Bahjat S. Aladwan, president of the Jordanian Geologists Association and Arab Geologists Union.

Aladwan said the technology needed to develop shale gas is new to his country, about half of which is over a shale deposit.

“I’m hoping we’ll be successful in producing that gas,” he told the Sun Gazette. “At the same time we are looking for support and help from the USA to develop the shale.”

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US officials believe that developing shale gas would provide fast-growing energy sectors in these countries with a cleaner alternative to coal, according to AFP.

Aside from being an untapped natural resource that experts say could dominate the gas market by 2030, shale gas could also lead to energy independence for some.

“The main reasons for doing it are national security and climate security,” David Goldwyn, the State Department’s coordinator on international energy affairs, said of the conference. “For China and India, it’s both climate security and economic security, because they have large demand for resources and the market is volatile.”

The US has been leading the shale gas boom, becoming one of the first countries to access the unconventional gas. Last year, the United States overtook Russia for the first time in decades as the world’s top gas producer.

Over the past few months, China has reached out to shale experts in the US to learn about shale development, and India’s biggest private oil and gas company, Reliance Industries, has invested nearly 3.5 billion dollars in joint ventures for fields in the United States.

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Penn West stated that since 2006, it has accumulated a significant shale gas position in the Cordova Embayment. Initial drilling results in the area were promising and led to an expansion of the land held.

As part of the Agreement, Mitsubishi will commit approximately $850 million to the 50-50 Joint Venture.

Penn West will sell Mitsubishi 50% of its working interest in its Wildboy conventional gas assets, 550,000 gross acres of land including approximately 120,000 acres targeting shale gas in the Cordova Embayment, the Wildboy gas processing facility, a sales gas pipeline and associated infrastructure for approximately $250 million in consideration.

The Wildboy assets currently have production of approximately 30 million cubic feet per day of natural gas.

In addition, Mitsubishi will fund approximately $600 million of the first $800 million of exploration and development capital expenditures in the Joint Venture.

The Mitsubishi deal comes after Penn West signed a similar partnership earlier this year with China Investment Corp., which will pay $1.25-billion for a 45-per-cent stake in northern Alberta heavy oil property.

Mitsubishi joins China National Petroleum Corp. and Korea Gas Corp., which have both partnered with Encana Corp. to speed production of British Columbia’s enormous gas fields.

The mounting Asian interest in northeastern B.C. comes as EOG Resources Inc. and Apache Corp. work to build a $3-billion port that would export liquefied natural gas from the West Coast.