Pace

Master limited partnerships (MLPs) in the energy sector have been growing at a rate of about 30% a year, and some might expect the pace to soon begin to flatten out or even decline. But don’t count on it. If anything, MLPs are poised to not only continue to multiply and expand within the energy sector, but they are also developing in what once was an unlikely arena: the exploration and production (E&P) sector.

With master limited partnerships (MLPs) in the energy sector growing at a rate of about 30% a year, some might expect the pace would begin to flatten out or even decline. But don’t count on it. If anything, MLPs are poised to not only continue to multiply and expand within the energy sector but they are also developing in what once was an unlikely arena: the exploration and production (E&P) sector.

Southwestern Energy Co. said gross production from its Fayetteville Shale wells in Arkansas has reached about 50 MMcf/d, up from about 20 MMcf/d May 1. The increase was due to the increased pace of development as additional drilling rigs were placed in service and improved fracture stimulation techniques. Southwestern said it expects continued improvement as development proceeds.

Federal and Native American royalties did not keep pace with the escalating oil and natural gas prices between 2001 and 2005 largely because the production volumes on which royalties are based “declined substantially” during that period, according to a report issued by the Government Accountability Office (GAO) Friday. It also cited as a factor the drop-off in royalty rates due to the move away from shallow-water drilling in the Gulf of Mexico, where rates are higher, to the deepwater.

Federal and Native American royalties did not keep pace with the escalating oil and natural gas prices between 2001 and 2005 largely because the production volumes on which royalties are based “declined substantially” during that period, according to a report issued by the Government Accountability Office (GAO) Friday. It also cited as a factor the drop-off in royalty rates due to the move away from shallow-water drilling in the Gulf of Mexico, where rates are higher, to the deepwater.

Calling the recent pace of oil and gas producer merger activity “breathtaking,” Standard & Poor’s Ratings Services (S&P) weighed in with the reasons for the robust deal activity.

Calling the recent pace of oil and gas producer merger activity “breathtaking,” Standard & Poor’s Ratings Services (S&P) weighed in with the reasons for the robust deal activity.

With so much money on the table and no other logical outcome, the pace of mergers and acquisitions among oil and natural gas companies will pick up again this year, and capital investment in the upstream sector will grow by at least 25%, according to a new report by energy research firm John S. Herold Inc.

The pace of returning Gulf of Mexico and Gulf Coast gas production appeared to have quickened over the weekend, and gas futures and cash prices reflected that trend in light trading on Columbus Day (Thanksgiving Day in Canada). Cash points tumbled between a nickel and 30 cents in the Northeast, 15-45 cents in the Gulf Coast, and 10-55 cents in the Midwest and Midcontinent.