GE/Statoil Announce Winners of Sand-Alternatives Contest
Quick–what two things do you need in abundance in order to horizontally drill and frack a well? Yep–water and sand. The two together make up 99.5% of what goes down the borehole to drill and frack a shale well. Water is used to fracture or break open the rock and deliver the sand, which is called a proppant because some of it stays behind and “props open” the fractures in the rock, allowing gas and oil to escape into the borehole. The vast majority of truck trips to a well pad are to deliver water and sand. GE and Norwegian giant Statoil have teamed up to run an “Open Invitation Challenge” which is a contest for technology innovators to propose alternatives to water and sand, to reduce the amount of each and therefore reduce truck trips to and from well pads. The results are in for the sand challenge and five winners will each take home a check for $25,000. The winners have some fascinating technologies and if they meet certain other criteria are eligible for more money to develop and commercialize their technologies. And what are some of these interesting bits of tech? How about a polymer that swells to 10 times its initial size when liquid is added. Or a ceramic proppant that’s shapped in the form of an X acting like a tiny steel girder to keep rock fractures propped open. This is truly creative and potentially industry changing stuff…
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Two Butler County, PA landowners with a combined 245.7 acres of land leased to XTO Energy have sued XTO claiming that XTO is breaking the lease agreement by paying royalties below 1/8 of what XTO receives in revenue for the gas. So far we’ve heard about Chesapeake Energy being the focus of these types of lawsuits for their shenanigans of inflating post-production costs from the pipeline company and then receiving a “kick back” of investments by the same pipeline company (see 
Following up on our CONSOL Energy/Noble Energy rumor from last Friday, MDN now has a second source that delivers a bit more information about the rumor–refining it for us. We told you on Friday that a persistent rumor among those working for or with CONSOL Energy is that Noble Energy is lining up to buy the gas division, CNX (see 
With all of this talk about CONSOL Energy and Noble Energy and mergers/acquisitions and workforce reductions, we came across an interesting story and analysis by SNL Financial summarizing a Goldman Sachs Global Investment Research report issued last Friday. The Goldman report evaluates 38 exploration and production (E&P) companies on their suitability and desirability as mergers and acquisitions candidates based on asset quality, potential upside returns to the buyer as oil and gas prices improve, and low break-even operations. That is, of all the E&Ps out there, which ones are most likely to be targeted for a takeover, and by whom? The surprising answer is that Cabot Oil & Gas and Range Resources, both huge Marcellus drillers, are among the takeover targets. And the super majors interested in doing the taking over? Exxon Mobil and Statoil…
Just when you’ve think you’ve heard it all when it comes to how evil and nasty fracking and shale drilling are, along comes another story of the horrors of shale drilling. An article in the most recent issue of the journal Invasive Plant Science and Management says shale and pipeline drilling in Colorado’s Piceance Basin (pronounced “pee awns”, located in northwestern Colorado) disturbs the dirt and because the dirt gets disturbed it gives non-native, “invasive” plants a chance to grab hold and choke out all other vegetation–or some such thing. Apparently the housing boom in Colorado that digs up more dirt than all of the drill pads and pipelines combined doesn’t have the same effect on the invaders. Maybe invasive plants don’t like the construction workers and backhoes that dig up dirt for a house foundation like they do construction workers and backhoes that dig up dirt for a drill pad or pipeline. Wait–they’re the same construction workers and backhoes? Shhh. Don’t tell the invasive plant species…
MDN doesn’t do this (too) often, but we’re going to engage in a little Friday idle speculation. A tad bit of rumor mongering. So take this for what’s it worth. MDN has a contact in the Pittsburgh region that tells us that *all* of CONSOL Energy’s field engineers received an email at 3:30 am–this morning–requesting that they report to the center in Canonsburg, PA to discuss dismissal packages. Our contact says CONSOL’s plan is to lay down the rest of their active drilling rigs as soon as existing wells are completed and that they will not drill any new wells for the next 18 months. The really big bombshell is this: rumors are swirling that CONSOL’s CNX gas division is getting ready to sell itself to Noble Energy…