Some Marcellus/Utica Drillers Make Money Selling Gas at $0!
The ace reporters and analysts at Natural Gas Intelligence (NGI) recently came through yet another quarterly earnings season with their sanity mostly intact. 😉 MDN editor Jim Willis works with NGI expert analyst Patrick Rau on occasion. Pat is a terrific guy and one of the sharpest energy analysts Jim has had the pleasure of meeting. Pat sat through dozens of quarterly earnings calls for drillers, oilfield services companies and more over the past month or so. What did Pat learn from all those calls? Are there trends emerging? That was the upshot of an article written by NGI reporter Leticia Gonzales last week. It's a must-read article (see The Worst May Be Over, But NatGas Recovery Will Be Slow, Sometimes Painful). Letty not only interviewed Pat, but other analysts from other sources as well, including RBN Energy, Genscape and Wood Mackenzie. Among the eye-popping news coming from this wide-ranging article is this: Marcellus drillers can make money even at super low prices for natural gas--typically around $2-2.50 per thousand cubic feet (Mcf). In some cases, because drillers extract NGLs (natural gas liquids) along with dry gas (methane), and they can GIVE AWAY the methane for NOTHING and STILL make money! Here's a short excerpt that was, for us, a revelation...
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