One more oil and gas major exits a U.S. domestic shale play via a sale of assets, while the EIA shatters the hopes and dreams of many in central California. Bakken oil may be safe to transport by rail and drillers partner with environmental groups in the Marcellus.
Shell, in a move to cut losses, will sell 106,000 net acres in the Eagle Ford Shale to Sanchez Energy Corp. for $639 million. The deal includes 176 producing wells, with proved reserves of 60 million barrels of oil equivalents, and 24,000 barrels per day of production. “I think what makes us comfortable with the asset is our experience with our nearby assets, and we felt that what we had seen from a development standpoint both on cost and well performance was something we could apply here in an efficient manner,” said Tony Sanchez III, president and CEO of Sanchez Energy.
The U.S. Energy Information Administration (EIA) cut estimates by 96% for recoverable oil in the Monterey Shale, an oil play in California. Originally, it was thought that 13.7 billion barrels could be extracted resulting in several million jobs and billions in annual tax revenues. The EIA now estimates the Monterey Shale to have 600 million barrels of extractable oil.
The North Dakota Petroleum Council, through a study by Turner, Mason & Co, concludes that Bakken crude is in fact similar to other light, sweet grades of North American oil and is safe to transport by rail. According to Kari Cutting, Vice President of the NDPC, this is the third independent study that confirms Bakken crude does not pose a greater risk than other flammable liquids that are allowed to be transported by railroad.
Oil and Gas drillers are partnering with environmental groups in the Marcellus. Yes, you read that correctly. In an effort to promote voluntary new standards, the uncommon partners have created a certification program designed to add to existing government regulations on drilling practices in the Marcellus Shale. According to the Center for Sustainable Shale, one drilling company has submitted an application with the hopes of being certified.