ConocoPhillips nudged long-time leader BP plc out of first place in U.S. natural gas output during the third quarter, according to a survey of top producers.
Strong but moderating U.S. onshore natural gas growth lifted third quarter production 1.1% sequentially from the previous quarter and jumped output by 3.5% from the same period a year ago, the survey of 39 producers indicated. The survey, by energy analysts John Gerdes and Michael Dane of SunTrust Robinson Humphrey/The Gerdes Group (STRH), accounts for about two-thirds of the trend in U.S. gas output after considering royalties and working interest.
The analysts said their numbers “consistently” understate U.S. gas production, yet lower emphasis on Gulf of Mexico (GOM) output and a reemphasis by the majors on North American gas development has aligned the survey with actual production trends in recent periods.
The upward movement is all due to onshore growth, said the duo.
“In 2007, we anticipate U.S. natural gas production will increase 1.5 Bcf/d, which assumes an increase in onshore natural gas production of about 1.7 Bcf/d and a decline in GOM production of roughly 0.2 Bcf/d,” said Gerdes and Dane. They estimated well productivity declines for this year at 5%, which is close to their long-term average productivity decline of about 5-6%.
“Notably, given recent weakness in drilling activity, our 1,475 ’07 average rig count assumption may be slightly elevated,” they wrote.
ConocoPhillips’ 3Q2007 output was 2,219 MMcf/d, which was 4% lower year-over-year and flat from 2Q2007, according to STRH. BP’s gas output was slightly below the leader at 2,186 MMcf/d, down 6% year-over-year and up 1% from the previous quarter.
Chesapeake Energy Corp., which reported 1,851 MMcf/d in the quarter, moved into third place with a 23% rise in year-over-year gas output and a gain of 6% sequentially. Devon Energy Corp. ranked fourth at 1,783 MMcf/d, which was up 10% from a year ago and 5% higher than the previous quarter. Rounding out the top five was Chevron Corp., which reported production of 1,695 MMcf/d, down 8% from a year ago and flat from the previous three months.
In sixth place was Anadarko Petroleum Corp., which reported 1,637 MMcf/d for the quarter, which was down 13% from a year ago and down 3% sequentially. XTO Energy Inc., in seventh, grew its gas output by 29% from a year earlier to 1,560 MMcf/d, and it was up 7% from the previous quarter. In eighth place was ExxonMobil Corp., which reported output of 1,435 MMcf/d, which was 8% lower than a year ago and 6% lower sequentially.
EnCana Corp. ranked ninth in the survey, reporting 1,305 MMcf/d for the quarter, 9% higher than a year ago and flat from the previous three months. In tenth place was the Shell Group, which reported 1,131 MMcf/d, about 5% lower than a year ago but 4% higher than in 2Q2007.
However, as the analysts pointed out, the volumes gained or lost from the previous year or the previous quarter may not have resulted from drillbit gains or losses but rather from acquisitions and divestitures.
For instance, ConocoPhillips acquired a load of U.S. gas-weighted assets from Burlington Resources Inc. in 1Q2006, and it began ramping up production in the past year. BP has divested U.S. gas properties since early 2003 that led to a decline of about 342 MMcf/d. Meanwhile, Chesapeake has added 267 MMcf/d through acquisitions since late 2005, while Devon has sold 156 MMcf/d and acquired 49 MMcf/d since mid-2005. Chevron has announced no sales or acquisitions since 3Q2005, when it acquired Unocal Corp.
Anadarko, which acquired about 1,100 MMcf/d of production when it purchased Kerr-McGee Corp. and Western Gas Resources Inc. in 3Q2006, also sold a lot of gas volumes in the past year — 466 MMcf/d — according to the survey. XTO, however, has been on a buying spree, purchasing assets that have added about 273 MMcf/d since late 2005.
ExxonMobil, which is more focused on its international assets, announced sales in mid-2005 that were bringing in about 12 MMcf/d in volumes. Meanwhile, neither EnCana nor the Shell Group have announced the sale or the purchase of any gas properties for at least three years prior to the survey. EnCana earlier this month bought out its partner in the Deep Bossier gas play in East Texas, but that was not included.
Â©Copyright 2007Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.
© 2023 Natural Gas Intelligence. All rights reserved.
ISSN © 2577-9877 | ISSN © 1532-1266 |