unconventional

A shortage of onshore drilling equipment capable of blasting into shale is contributing to double-digit inflation in some of the big U.S. unconventional plays, an issue expected to be played out over the coming weeks as North American exploration and production (E&P) companies unveil earnings for the first three months of 2011.

A shortage of onshore drilling equipment capable of blasting into shale is contributing to double-digit inflation in some of the big U.S. unconventional plays, an issue expected to be played out over the coming weeks as North American exploration and production (E&P) companies unveil earnings for the first three months of 2011.

Demand for oilfield services from North America’s unconventional resource drillers continues unabated and Halliburton Co. could complete contracts “in any terms we wanted to dictate at this point in time,” CEO Dave Lesar said Monday.

Louisiana’s Mineral and Energy Board collected more than $11.5 million in bonuses in its March lease sale in which buyers heavily favored tracts in South Louisiana as opposed to the northern part of the state.

Natural gas drilling in West Virginia’s Marcellus Shale already has enriched the state through new jobs and more revenue and is on track to create up to 20,000 jobs by 2015, according to a study by West Virginia University’s Bureau of Business and Economic Research (BBER).

Object Reservoir Inc., a services company providing complex reservoir modeling in unconventional gas plays, is rapidly expanding its Collaborative Exploitation Project (CEP) for the Marcellus Shale in northeast Pennsylvania and is looking into starting up a similar effort in the southwestern part of the state.

Liquids-rich unconventional gas plays, particularly shales, are continuing to drive midstream spending as evidenced by two announcements last week out of the Eagle Ford Shale as well as the Cana-Woodford Shale and Granite Wash plays.

Onshore unconventional natural gas producer Penn Virginia Corp. said Friday it will concentrate its exploration activities in oily and liquids-rich plays in 2011 and will spend 40% less than it did this year because of a “weak natural gas price environment and outlook.”

Fort Worth, TX-based Quicksilver Resources Inc. — which makes a specialty of targeting unconventional reservoirs, including gas shales — said more than half of its capital budget for 2011 of $455 million will be spent in Texas.