Re: j.j. on repeat, beano stops gas/NKC/CO/HAL/JJ
Hi Natty King Coal//whoever you are ....
Thanks for the post. I found it to be accurate (without nitpicking all). I think you posted the link to article before, or someone did.
Although 4 years old, still sounds reasonable.
The excerpt below does contrast with the link CO posted a bit earlier.
Unfortunately, unconventional shale gas is more expensive to produce than conventional gas, and only a small fraction of the potential makes economic sense when gas is selling for $3.75 per Mcf. According to global energy advisory firm Tristone Capital Inc., the average cost of production in the top nine North American shale plays is around $4.50 per Mcf.
Yet there are some producers who can still make a profit at these levels. For example, Atlas Energy reports its drilling costs in the Marcellus Shale—the most profitable of the shale plays, in New York and Pennsylvania—as running $1.49 per Mcf, so drilling continues there, albeit at a slower pace. The Haynesville formation is still profitable as well, but drilling in the Barnett and Fayetteville formations has all but stopped, as the cost of production there is too high. Barnett producers claim they need gas back in the $6-8 range before they'll resume drilling.
Your 4 year old article indicates that Barnett producers stopped drilling, see last sentence above. While the article CO posted earlier tonight:
link posted by CO on the 1.29 per 1000 cu. ft.
Which IS CURRENT indicates production in Barnett shale at 1.29 per Mcf. So, technology has improved over past 4 years or there are errors lurking in the articles.
So for now, if we take 1.30 as production cost, use 1.30 for delivery costs that leaves about 1.30 for profit which is close to the current NGN11 futures contract price.
So, doesn't sound too far out of whack to me at the moment. Most retailers mark up 100 percent. I have no clue what happens with crude in getting gasoline to the pump, but the pump prices seem to track the front month futures contract price increases to within a day or two !!!! And clearly the pump prices do not drop back nearly as quickly.
Another exercise !!!!
I wasn't going to say this, but changed my mind.
I found your post to be quite clear and constructive BUT I ALMOST DID NOT READ IT !!
The twisted subject and poster's "handle" made me "walk on by" at first.
So, thank you. It was a helpful post but just how Mike will decide to deal with fiddling around with posting "handles" I do not know, but if/when I get to vote, I want to know that I am spending my time constructively communicating with the "same person".