Friday, July 3, 2009

Canadian Companies Prefer Drilling In U.S.

Here is another oddity. The Canadian Government is in effect subsidizing companies to produce gas in Canada, while one Canadian comany, EnCana, plans to spend $290 million in the Haynesville Shale Gas Play in northwestern Louisiana while cutting its drilling activity elsewhere.

Someone should tell the Obama Administration there is a shale gas "boom" going on in the U.S. Developing this resource can create jobs, increase revenue to State, Local, and the Federal Governments. The pipelines are there, the drilling rigs are there, the technology exists, the trained workers are there, ready to go. Mr. Obama, what are you waiting for?

This natural gas can be used to power buses, trucks and cars. It will reduce America's dependence on foreign oil, and last but not least, it will pacify some environmentalists because it is a "clean" source of energy.
Peter

Alberta Extends Natural-Gas Incentives to Compete With Shale
By Gene Laverty (source)

June 25 (Bloomberg) -- The province of Alberta, the biggest foreign supplier of natural gas to the U.S., said it will extend by one year incentives to boost drilling for the fuel to make it more competitive with U.S. shale gas deposits.

The province will charge producers a flat rate of 5 percent during the first year of output from new wells, a government statement said. Drillers will also receive a royalty credit of C$200 ($172.64) for each meter (3.28 feet) of new well depth drilled.

The programs had been set to expire in March 2010, Energy Minister Mel Knight said in the statement. They will be extended to March 2011.

Companies including EnCana Corp., the nation’s biggest gas producer, are shutting wells amid a 70 percent decline in New York gas futures in the last year. Companies are using new methods to tap gas large gas deposits trapped in shale in Texas and Louisiana that are closer to U.S. consuming regions. Calgary-based EnCana plans spend $290 million on its Haynesville Shale properties this year while slashing drilling in other regions.

To contact the reporter on this story: Gene Laverty in Calgary at glaverty@bloomberg.net.

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