Export

Oil, the latest growth engine of the U.S. unconventional boom, is spurting up from the ground at an exceptional pace, which is leading many operators to rethink where — and how — they want to deliver their reserves for the best prices.

Alaska Gov. Sean Parnell on Wednesday filed legislation intended to provide cheaper energy to Interior Alaskans by giving the Alaska Industrial Development and Export Authority (AIDEA) the ability to provide up to $275 million in financing for a natural gas liquefaction plant and for a liquefied natural gas (LNG) distribution system within the Fairbanks North Star Borough.

Petronas Carigali Canada Ltd. and Progress Energy Resources Corp. provided more details on their proposed Western Canada liquefied natural gas (LNG) export facility, including its name, and said the project’s throughput could increase by 60% if regulators approve the companies’ proposed merger.

An official with Range Resources Corp. said he believes the federal government will eventually allow the export of liquefied natural gas (LNG) but cautioned that the industry shouldn’t be complacent and just assume exports will be approved.

Spectra Energy’s Texas Eastern Transmission LP is proposing a pipeline expansion project to carry natural gas produced in the Eagle Ford Shale of South Texas across the Mexican border.

“It would be reasonable” for the Federal Energy Regulatory Commission (FERC) to weigh the public interest of new liquefied natural gas (LNG) export facilities when considering applications, but it might not take that step with applications to modify existing LNG facilities for exportation, according to FERC Commissioner John Norris. Adapting existing facilities “involves minor modifications,” Norris said during testimony before the Senate Energy and Natural Resources Committee, which is considering his renomination to FERC. The committee also heard testimony from Tony Clark, who currently is chairman of the North Dakota Public Service Commission and is being considered to replace former FERC Commissioner Marc Spitzer; Adam Sieminski, chief energy economist for Deutsche Bank, who has been nominated to be Energy Information Administration administrator; and Marcilynn Burke, deputy director for policy and programs at the Bureau of Land Management, who has been nominated to be an assistant secretary of the Department of the Interior.

The Interior Department’s first assessment of the shale potential of Alaska’s North Slope found the potential for up to 2 billion bbl of undiscovered, technically recoverable oil and 80 Tcf of undiscovered, technically recoverable gas, according to the U.S. Geological Survey (USGS). “We looked under the entire North Slope of Alaska,” said USGS Director Marcia McNutt, who called it a landmark study. The results will enable industry to make “good seismic decisions,” will guide their investments, said Anne Castle, assistant secretary of water and science. Alaska’s shale resources “hold great promise,” but production has never been attempted due to the infrastructure challenges, Castle noted. Three source rocks of the Alaska North Slope were assessed in the study: the Triassic Shublik Formation, the lower part of the Jurassic-Lower Cretaceous Kingak Shale, and the Cretaceous pebble shale unit-Hue Shale, according to USGS. It said those shale formations are known to have generated oil and gas that migrated into conventional accumulations, including the Prudhoe Bay field. But the shales also likely retain oil and gas that did not migrate. If the shale gas should be developed, it’s remains an open questions as to whether it could make its way to the United States, which lacks pipelines and/or a West Coast liquefied natural gas (LNG) import terminal for the gas to be delivered. The nation’s sole export terminal, located in Kenai, AK, exports LNG to Asian markets.

With stranded ethane in the Appalachian Basin starting to find markets, Sunoco Logistics Partners LP is looking at ways to move other natural gas liquids (NGL) from the region.

An investor group led by Kohlberg Kravis Roberts & Co. LP (KKR) has agreed to pay $7.2 billion for Samson Investment Co. of Tulsa, one of the largest privately held exploration and production (E&P) companies in the United States. The deal gives KKR and its partners stakes in a number of unconventional resources plays.