Shell's loss of interest in Marcellus Shale.
What will happen to the undeveloped wells/units now that Shell has lost interest in Marcellus shale production? Will Shell sell out to other companies? Timeframe?
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Replies to This Discussion
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Permalink Reply by Gas Boy on
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I heard back in January from an employee at Western Land Services (company who did Shells leasing in PA) that they were pulling out. Shell has a new CEO, promoted from within, and he stated that Shell is an offshore company, not an onshore company (their forte' is offshore drilling, not onshore land drilling). Shell only got into the Marcellus mainly because everyone else was, and it was supposed to be "the" next Big thing (in certain areas that is true). The Western Land Svcs. employee stated that he expects Shell to sell off all of their assets mid to late 2014. Even though the Shell "cracker" plant in Beaver Co., PA is slowly moving forward, that venture is under a different holding or subsidiary of Shell - I believe the company was Shell Chemical. The E&P company is Shell Western Exploration & Production Inc.
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Permalink Reply by Mark McGrail on
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Since Shell and Hilcorp have worked together by swapping acreage I wonder if Hilcorp will take Shell acreage in Western PA ?
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Permalink Reply by Jim Litwinowicz on
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Western Land does the leasing for Hilcorp, not Shell. Shell uses Long Consulting, I believe. But it is true that Shell has their lease holdings up for sale, from what I here around the area.
Some may go to Hilcorp, some may go to Rex, or maybe Chevron where these companies already have leases. Who knows, some other firm may buy it all. All we can do is wait and see.
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Permalink Reply by Philip Thackray on
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I get notified of new permit activity here in Butler County PA. Several of the Shell permits are being reactivated (at least that is what it looks like). See here: http://www.ahs.dep.pa.gov/eFACTSWeb/searchResults_singleAuth.aspx?A...
There have been quite a few of these for various Shell wells. I'm not in that part of Butler County so I have not checked this out any further
Phil
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Permalink Reply by Glenda Willard Strong on
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I live in north central PA, Tioga County. Activity in close proximity is nil.
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Glenda, not sure what constitutes "activity" to you, but for months landmen have been scooting around eastern Potter and western Tioga, striving to nail down leases for $300 AC. Absurd amount for anyone to settle on unless dire need necessitates the signing. This of course as folks are coming off former leases that never reached the development stage. The company employing many of them is new to PA ... an offshoot of Shell.
Fortunately many are staying sav vy and avoiding these deals. Personal belief is that companies want to see the outcome of Bill 1684 before numbers and lease wording are nailed down, unless a $300 AC lease is something locals are willing to fall for.
Last year was the year for growth in the infrastructure sector because having wonderous wells does no one any good w/o processing plants and pipelines for getting the gas/oil to market. May the growth continue!
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Permalink Reply by Tom Brian on
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My outlook from N.C. Tioga County Pa.
The main reason for the slowdown is success. too much gas too few
customers .Wells drilled , completed and no pipe lines to take it to
market .Pads all over the place with 1 vertical hole. Someone will
be drilling here long after all of us are long gone. Keep in mind that
You are looking at 2-300 years of gas under these hills. Many of
these 640 and 1240 ac. plots will not be producing this Century.
Sad for many landowners but good for the world and the USA in general.
Shell has not left yet and are still quietly renewing old leases.
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Permalink Reply by Trapper on
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So Shell would rather purchase ethane from other suppliers (middle men) than go the vertically integrated route and drill for their own ethane? So much for the old tried and true axiom "cut out the middle man"! May be true but I'll have to see it to believe it.
Northeast PA , in the dry gas region , maybe........but here.......?
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Permalink Reply by Jim Litwinowicz on
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If smaller, more agile companies can produce ethane faster and cheaper then leviathan multinationals then that is what Shell will go with. Small independents can move quickly in developing new fields and may be better at improving new techniques to increase production. Shell and other multinationals are better at large capex projects like off shore drilling.
Look how quickly Range and CHK moved in and developed new fields and better fracking techniques. Look at how quickly Hilcorp is moving. Shell and the bigs take years just to get through all their internal red tape. Dealing with them is like dealing with the government.....too many layers of approval necessary and no one that cut through it.
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