Continued

With an emphasis on oil over natural gas, Los Angeles-based Occidental Petroleum Corp. (Oxy) continued to shatter company production records in barrels of oil equivalent (boe) globally and domestically, Oxy senior executives said Thursday. At 755,000 boe Oxy’s daily oil/gas production was the highest in its history; and its U.S. totals of 455,000 boe set a record for the sixth straight quarter.

Williams management said Thursday it is primed for continued growth from the Marcellus Shale because producers want more natural gas takeaway capacity and stalwart Transcontinental Gas Pipe Line (Transco) is ready to deliver the goods.

Physical natural gas prices continued lower and on average lost about 5.5 cents in Friday trading for weekend and Monday deliveries. A few points were unchanged, but all other pricing points failed to make it out of the loss column. Mild weather projections prompted downward movement at not only West Coast points but other locations servicing westbound gas to California. Eastern gas fell as well as monthly basis differentials slid.

The outlook for takeaway capacity from the Marcellus Shale continued to brighten this week, with FERC approving three pipeline expansion projects — two requested by National Fuel Gas Supply Corp. and another by Texas Eastern Transmission — designed to feed Marcellus gas to Northeast markets.

Major oil and natural gas groups continued to lobby the White House last week to change pollution standards for oil and gas operations, which the Environmental Protection Agency (EPA) is scheduled to issue Tuesday (April17). They called for the administration to postpone the final rule on the standards until more accurate emissions data is gathered.

Given the continued weak outlook for U.S. natural gas, explorers with exposure to high rates of return (ROR) in liquids-focused plays, both in the onshore, as well as the shallow waters of Gulf of Mexico’s Outer Continental Shelf, provide the best upside going forward, according to the energy team at Credit Suisse.

Physical gas prices continued to slide Thursday at nearly all points, likely helped lower by the screen’s milestone Wednesday of dropping below $2. Moderating weather in the Northeast Thursday pulled the plug on any price gains prior to the release of inventory data, and western locations weakened as well.

ConocoPhillips, one of the four partners in the long-planned C$16.2 billion Mackenzie Gas Project (MGP), said Friday the co-venturers have suspended funding because of “a continued decline in market conditions and the lack of acceptable commercial terms.”

ConocoPhillips, a partner in the long-planned C$16.2 billion Mackenzie Gas Project (MGP), said Friday the co-venturers have suspended funding because of “a continued decline in market conditions and the lack of acceptable commercial terms.”