Great Economic News From Shreveport, Louisiana (Courtesy of the Haynesville Shale Gas Play)

More good news is the Haynesville Shale Gas Play is having very strong positive economic effects in the Shreveport area of northwestern Louisiana. This is not pie-in-the-sky, wishful thinking for creating jobs and energy supplies, such as windmills and solar farms. This activity is not a government "make-work" project. This is the real deal.

Shale gas is an available resource being exploited using existing technology. We need this kind of good economic good news in America, badly. Someone should invite President Obama down to Shreveport and give him a tour.
Peter

July 1, 2009 Shreveport-Bossier among best for a fresh start, Web site says By Curtis Heyen cheyen@gannett.com (source) Shreveport-Bossier City has been ranked 15th among the top 20 places in the U.S. to begin a new career or a new life, according to the Web site BusinessWeek.com. The Web site cites Shreveport-Bossier City for having a low cost of living and seeing new jobs coming from the natural gas industry and the movie business. The listing reinforces what local leaders have believed for a long time, said Kurt Foreman, president of the Northwest Louisiana Economic Development Foundation. "We certainly feel like this is a great place to start over, build a business or grow a career. "I'm pleased that these national magazines are seeing what we have seen for a long time." The recession has not negatively impacted Shreveport-Bossier City as much as other parts of the nation, Bossier City Mayor Lo Walker said. "We do have job opportunities. ... We've had a net increase in population and jobs. "This news can only encourage people to be more receptive to coming to this region." The BusinessWeek.com article notes that a number of movies, among them "W.", include scenes filmed in Shreveport and the surrounding area. In fact, Oliver Stone shot most of his movie in Shreveport. Another example not noted by the Web site is "Year One," which was filmed near Sibley and on a Shreveport soundstage. That moving, starring Jack Black, opens in theaters today. But the local film industry has slowed significantly this year. The next major project is "Straw Dogs," a Sony Screen Gems picture slated to begin filming here this summer. On the other hand, interest in the Haynesville Shale in northwest Louisiana continues to fuel employment in the region. The natural gas formation, trumpeted as perhaps the largest in the nation, has pumped millions of dollars into some property owners' pockets -- including local governments -- since the discovery was announced in April 2008. A recently completed economic impact study estimates Haynesville Shale activity created about 32,742 jobs, about $2.4 billion in business sales statewide and nearly $3.9 billion in household earnings, including almost $3.2 billion in lease and royalty payments to private landowners, in 2008. Topping BusinessWeek.com's list is the Anchorage, Alaska, metropolitan area. Also among its top five are Provo-Orem, Utah; Kennewick-Richland-Pasco and Yakima, both in Washington; and Omaha, Neb.-Council Bluffs, Iowa. The Web site ranked metropolitan areas based on the percentage of companies planning to hire in the third quarter, according to a survey by Milwaukee staffing firm Manpower of 28,348 U.S. employers that was conducted April 6-29. Businessweek.com says it eliminated Barnstable, Mass. (Cape Cod), which would have topped the list, because the surge in expected hiring in the next quarter is likely due to seasonal hires. In cases where areas have equal percentages of companies planning to hire, the Web site says, the unemployment rate was used to break the tie. The best job prospects for each area also were pulled from the same survey. Home prices used for the BusinessWeek.com's list were provided by Zillow.com, 2008 population is based on U.S. Census Bureau data, and the March unemployment rate comes from the U.S. Bureau of Labor Statistics.

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.

The U.K's BG Buys A Stake (From EXCO) In The Haynesville Shale Gas Play

This is good news for those of us in the service sector who depend on drilling activity. It is also good to have foriegn money coming into the U.S and creating jobs. The price this U.K. natural gas company is paying to enter the Haynesville Shale Gas Play may seem steep, but they are surely counting on the price of gas and leases to increase.

Also, and not insignificantly, they're paying for the science and technology that has been developed to extract this "unconventional" source of gas. By this I mean primarilly horizontal drilling and hydraulic fraturing. This would also, I hope, include the "steering" of these horizontal wells into the optimum stratigraphic layers of rock.
Peter


BG Buys Exco Stake for $1.06 Billion to Tap Shale Gas (Update3)

By Eduard Gismatullin

June 30 (Bloomberg) -- BG Group Plc, the U.K.’s third- largest natural-gas company, bought assets from Exco Resources Inc. for $1.06 billion to develop its first U.S. shale gas project. Exco shares rose 16 percent.

BG Group acquired a 50 percent stake in 120,000 net acres in East Texas and northern Louisiana, the company said today in a statement. The purchase includes part of the Haynesville Shale gas formation and adds 2.6 trillion standard cubic feet to BG’s resources, with current net output of 78 million standard cubic feet a day.

“We expect BG will use this shale gas to meet U.S. contract commitments, thereby releasing Atlantic basin LNG cargoes for higher-priced global” markets, said Oswald Clint, a London-based analyst at Sanford C. Bernstein & Co.

BG will compete with larger rivals including Royal Dutch Shell Plc, BP Plc and StatoilHydro ASA in the development of U.S. shale deposits. It has also expanded oil and gas resources in Australia and Brazil and forecasts production will rise between 6 percent and 8 percent a year and reach 1.6 million barrels of oil equivalent a day in 2020.

“This alliance brings material new resources and supply to our existing U.S. business at a competitive price and in a prime location at the heart of the world’s largest gas market,” Chief Executive Officer Frank Chapman said in the statement. “The transaction increases BG Group’s exposure to long-term unconventional gas resources and skills.”

Marketing LNG

Dallas-based Exco rose $1.80 to $12.92 in New York Stock Exchange composite trading. BG Group fell 19 pence, or 1.8 percent, to 1,018 pence in London.

Shale gas is natural gas stored in organic rich rocks such as dark-colored shale, interbedded with layers of shaley siltstone and sandstone, according to BG.

BG has been marketing liquefied natural gas in the U.S. and supplied 55 percent of all LNG cargos imported into the country in 2007, according to its Web site. The company also generates power in the U.S. to customers in New England.

A total of $655 million will be paid on completion, plus $400 million as a carry of 75 percent of Exco’s future costs to develop the Haynesville Shale gas, the Reading, U.K.-based company said. The partners agreed to co-operate on further development and BG expects its production in the area will rise to 250 million cubic feet a day in 2012.

‘Expensive’ Deal?

The British company will pay $19,000 per acre for the Haynesville Shale gas assets. It may also buy a 50 percent interest in gas-gathering and transportation assets from Exco for $249 million to supply the fuel to U.S.’s Midwest and Eastern regions.

“Recent deals in the shale gas play have been around $15,000 per acre,” said Bernstein’s Clint. “Hence this deal at $19,000 per acre could be viewed as expensive on that basis.”

The acquisition of the gas assets is conditional on the purchase of the transport infrastructure, BG said.

To contact the reporter responsible for this story: Eduard Gismatullin in London at egismatullin@bloomberg.net