toobad41

Natural Gas Gains: Not Convinced of Sustainability

I am no longer privy to inside information on natural gas production but I do know that much of the gas we are talking about is old gas...i.e. gas that has been producing to the pipeline for years. For the operator that gas is virtually free. Yes there is some overhead but that is little cost. I suspect that a lot of the drilling going on today is new exploration or lease obligation wells. Lease obligation wells are drilled to save a lease from going to the original owner or to someone else. Some of the drilling may also be aimed at proving up the lateral extent of a new discovery. Sure all of this hearsay on my part but it has been true in the past and I tend to believe it is still going on. Also I would like to point out that most oil or gas operators are not in consort with anyone else and they could care what other operators are drilling unless it is just across the highway from their lease. Sometimes operators will have a relationship with other companies if they have a mutual area of interest. But that rarely happens onshore. It does happen offshore where it costs so much to drill and produce. That is my two cents... For what it is worth.

Is Exxon Betting on $100 Oil?

Exactly...you are absolutely correct in your assessment. Mergers and acquisitions by very large corporations in the petroleum business is their salvation. Without this they cannot find enough reserves to continue as large multi-national corporations. The cost for this kind of activity will pale in comparison to what is coming down the road.

Plenty of Natural Gas: Exploration and Production Companies Keep Increasing Oversupply

Your sentence "The action by E&P Companies as a whole could be short sighted" is a flat out stupid sentence. E&P Companies are independent of each other and seldom (if ever) act as a whole.

Six Companies Poised to Gain from a Natural Gas Auto Mandate

Natural gas, like oil, is a limited resource and is difficult to store for future use. Natural gas needs a distribution system in the form of a pipeline (underground) at a cost of over a million dollars a mile. So you need big reserves to justify laying a pipeline. Most of the natural gas is gone (at least in the US), vented or burned to the atmosphere. What companies go afer now is the last of that product. The reason companies go after natural gas is because it is not as regulated as oil, it requires no ugly pump jack, no tubing in the hole and is not subject to spills. Like oil today, gas will have to be imported by container ships. You are right that this is a needed commodity to help with the environment. But it won't be cheap.