Posted on 03/11/2014 8:54:23 PM PDT by ckilmer
(Excerpt) Read more at bizbeatblog.dallasnews.com ...
One of the big question hanging over the oil and gas industry right now is whether the hydraulic fracturing or shale boom enjoyed by the United States can be replicated abroad.
Argentina, China, Central Europe, even Great Britain all are believed to contain considerable shale deposits.
But Rob Franklin, president of Exxon Mobil Gas and Power Marketing Company, expressed doubt those plays would be developed any time soon at the IHS CERAweek energy conference in Houston Wednesday.
Franklin’s point was property rights abroad are vastly different from the United States, where land owners also own the mineral rights beneath them. But in countries like Great Britain that is not the case, providing no clear incentive for property owners to agree to having a drilling rig operating on their land.
“The key component in the United States is the royalty system that alligns the interest of the land owner with the resource developer,” Franklin said. “Do you want a well fracked in your back yard and get nothing for it? Probably not. You need to come up with something where the landowners interests are aligned.”
And what shape such a system would take is as yet unclear.
As it is, fracking abroad already faces a litany of challenges. From a lack of insfrastructure in places like Argentina to an intense political opposition in countries like France.
Chris Finlayson, CEO of BG Group, said logistically there was no other country in the world that came close to the United States in terms of infrastructure and equipment availability.
“There’s 100 years of data in the United States, because the unconventional areas are often the same places where they’ve always drilled,” he said. “And if i want to drill a lease in the US I can have someone on site in 24 hours.”
But Sam Laidlaw, CEO of the British energy company Centrica, was more optimistic. He said he believed there was a way to get the public behind fracking for its job creation and economic benefits.
“It’s all going to come down to the productivity per well,” he said.
fyi
Government ownership of mineral rights doesn’t hinder exploration activity in Canada. The landowner is compensated for the cost and disruption.
I think Exxon was talking about Europe especially—but generally places away from north America.
I sat next to an XOM guy at a dinner to discuss fracing not too long ago. He had managed a project to test in East Europe. They could not live with frac sand sourced locally, so they AIRLIFTED FRAC SAND INTO THE COUNTRY to frac the test wells. This is a true story.
Thats not how its done. Better faster cheaper is how its done. The small independents have the competitive technical advantages: its actually a giant science fair specific to each basin. The Research Department of MAJOR OIL CO cannot ever fly in enough solutions to do it better, faster and cheaper. The super-mario frac brothers living in the man-camps in Pecos and Pearsall are the ones who figure out optimal lateral length, number of stages, amount of sand per stage, pumping parameters, flowback techniques, etc etc.
I agree it doesn’t sound like a show stopper....but....my brother worked in Belgium, France and Italy opening those countries up to mini-storage. It was very difficult. It’s much more ‘buyer beware’ in Europe, not transparent, and they think differently than we do in a lot of other ways.
Any and all productive areas worldwide will be drilled at some point, until something better comes along.
This is not news. Watch what the big players do and not what the morons in the media say. More lies have been spread about oil and gas since this Ukraine crisis started than Satan himself could conjure up.
Exxon has withdrawn from Ukraine, where the geology is similar to Poland, which has been a bust, but they are going all in in Russia. The big money in America is in on Russian energy stocks. Anyone actually think these people are going to flush that vast stream of future revenue down the toilet over Crimea? This is all a dog and pony show.
The NW Siberian fields are next and then in the long term, the remote and vast Lena river basin in NE Siberia. Look it up on satellite maps. That’s where the gas Asia needs will come from in a few decades. The Vladivostok LNG export terminal will be like a Niagara Falls of cash. No worries about local property owners or environmentalists in northern Siberia.
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