Tuesday, June 28, 2011

Follow-up: "Nat Gas: bubble, boon or break-even? *updated*" (APC; CHK; DVN; RRC)

Industry responds to the New York Times articles linked in yesterday's "Behind Veneer, Doubt on Future of Natural Gas" (Leaked Documents. E-mails) UNG; CHK; SWN;".
From the Houston Chronicle:

The New York Times continues its series taking a skeptical look at the natural gas shale boom with pieces Sunday and Monday on whether industry has been over-hyping the economics of the business.
Industry didn’t waste any time with a counter-punch.

Aubrey McClendon, CEO of Chesapeake Energy, wrote a letter to company employees over the weekend refuting the articles’ claims and saying it is “… the handiwork of the same group of environmental activists who have been the driving force behind the NYT’s ongoing series of negative articles about the use of fracking …”

John Hanger, a Pennsylvania attorney with some deep energy background provides an impassioned foil to the New York Times pieces, pointing out good things about shale gas the stories don’t get into.
Nick Grealy of No Hot Air says the article is not the Wiki Leaks of shale that it purports to be.
The analysts at investment bank Tudor Pickering & Holt say the stories cherry pick information from “peripheral industry observers (not shale gas experts)”:
“Saying shale gas not easy/cheap to extract is cheap shot with no back up info and rehashing discredited arguments.  But calling it Enron?  Better back it up with more than this article does.  Remember, Barnett shale production (see below) is currently at record levels, even with rig count one-half of peak levels.  Shale gas is real.  Disregard this as an unsubstantiated NYT hit piece.

Kyle Isakower, the American Petroleum Institute’s vice president of regulatory and economic policy, said in a conference call Monday the organization was “doing some fact checking ourselves.”...MORE