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Ohio Utica Shale

Australia has most attractive shale outside U.S., company reports

By Bob Downing Published: January 20, 2014

From Bloomberg News on Friday:

By James Paton

Jan. 17 (Bloomberg) -- Australia has the most attractive shale gas prospects outside North America, according to Magnum Hunter Resources Corp., a Houston-based producer that says it has scoured the world looking for deposits of the gas that has revolutionized energy supply in the U.S.

"We’ve looked at Colombia, we’ve looked at Mexico, we’ve looked at Argentina, we’ve looked at Poland, and we’ve looked at China of course," Kip Ferguson, executive vice president of exploration at the U.S. shale operator, said in an interview in Sydney. "None of those areas are prepared to allow the unconventional technologies to develop these plays. They aren’t as far advanced as Australia."

The Cooper Basin, an area straddling the border of South Australia and Queensland states, has also lured investment from Chevron Corp. and BG Group Plc ahead of expected shortages of the fuel to feed more than $60 billion of liquefied natural gas projects in eastern Australia that will ship to Japan, South Korea and China.

Explorers Santos Ltd. and Beach Energy Ltd. are among Australian companies developing shale properties in the Cooper Basin as demand for gas on Australia’s east coast is forecast by the government to triple by the end of the decade.

’Tied Up’

"Within 12 months, you’re not going to have the ability to find a deal, or find acreage, in the Cooper," said Ferguson, whose company has shale gas stakes in the Marcellus, Utica and Williston and Bakken regions in the U.S. and Canada. "And North America is pretty well tied up."

Magnum Hunter agreed to become the largest shareholder of Perth-based New Standard Energy Ltd. last month, which will bring the company’s technical expertise to the Australian company’s planned Cooper Basin exploration program.

"The next 12 to 18 months are going to see some interesting scrambling going on in the Cooper," New Standard Energy’s Managing Director Phil Thick said in the interview.

Magnum Hunter shares rose 4.5 percent to $8.12 in New York yesterday. New Standard Energy, whose shares have dropped 60 percent in Sydney trading in the 12 months through yesterday, gained 8 percent to 13.5 cents as of 2:01 p.m. local time.

Santos climbed as much as 1.3 percent to A$14.55, and Beach advanced as much as 1.1 percent to A$1.39. Senex Energy Ltd., another explorer with unconventional gas assets in the Cooper Basin, increased as much as 1.5 percent to 68.5 cents. The benchmark S&P/ASX 200 Index dropped 0.2 percent.

’Big Play’

Australia has the seventh-biggest potential shale gas resources and sixth-biggest shale oil resources in the world, the U.S. Energy Information Administration estimated last June. The Cooper, with existing gas processing and transportation infrastructure, may be the nation’s first commercial source of shale oil and gas, according to the EIA’s report.

Producers globally are seeking to emulate the U.S., where horizontal drilling and hydraulic fracturing, or fracking, has unlocked oil and gas supplies trapped in shale rock formations.

Australia "is primed to become the next big play" in the fracking market, ahead of China and Argentina, Boston-based Lux Research said in a Jan. 14 report on its website.

The biggest obstacle in Australia is drilling well costs, which are as much as three times more than in the U.S., said Thick, whose company is also ConocoPhillips’s partner in a shale exploration program in Western Australia.

New Standard Energy said it expects to work with Magnum Hunter to evaluate future expansion opportunities in Australia.



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Ohio Department of Natural Resources' Division of Oil and Gas Resources Management State agency Web site.

ODNR Division of Oil and Gas Resources Management. State drilling permits. List is updated weekly.

ODNR Division of Geological Survey.

Ohio Environmental Protection Agency.

Ohio State University Extension.

Ohio Farm Bureau.

Ohio Oil and Gas Association, a Granville-based group that represents 1,500 Ohio energy-related companies.

Ohio Oil & Gas Energy Education Program.

Energy In Depth, a trade group.

Marcellus and Utica Shale Resource Center by Ohio law firm Bricker & Eckler.

Utica Shale, a compilation of Utica shale activities.

Landman Report Card, a site that looks at companies involved in gas and oil leases.FracFocus, a compilation of chemicals used in fracking individual wells as reported voluntarily by some drillers.

Chesapeake Energy Corp,the Oklahoma-based firm is the No. 1 driller in Ohio.

Rig Count Interactive Map by Baker Hughes, an energy services company.

Shale Sheet Fracking, a Youngstown Vindicator blog.

National Geographic's The Great Shale Rush.

The Ohio Environmental Council, a statewide eco-group based in Columbus.

Buckeye Forest Council.

Earthjustice, a national eco-group.

Stop Fracking Ohio.

People's Oil and Gas Collaborative-Ohio, a grass-roots group in Northeast Ohio.

Concerned Citizens of Medina County, a grass-roots group.

No Frack Ohio, a Columbus-based grass-roots group.

Fracking: Gas Drilling's Environmental Threat by ProPublica, an online journalism site.

Penn State Marcellus Center.

Pipeline, blog from Pittsburgh Post-Gazette on Marcellus shale drilling.

Allegheny Front, environmental public radio for Western Pennsylvania.