Gas Supply / Gas Demand Outlook The Renaissance Esmeralda ...napca.com/webfiles/NAPCA - 2010...
Transcript of Gas Supply / Gas Demand Outlook The Renaissance Esmeralda ...napca.com/webfiles/NAPCA - 2010...
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Gas Supply / Gas Demand OutlookThe Renaissance Esmeralda Resort & Spa
Indian Wells, California
Agenda• Shale Gas Outlook• Cost of Gas Supply • LNG & Kitimat• Alaska & Rex Pipeline• Oil Pipelines• Gas Demand
Edward Kallio, Director, Gas [email protected]
(403) 234-4275
April 9, 2010
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 2
How Unconventional Gas is Different:It’s ‘Engineered’ or ‘Manufactured’ with New Technologies
Fracture Truck
Reservoir
Vertical WellDual-Completion
2 Fracture
Horizontal WellMulti Stage
Fracture
Horizontal Pad Drilling28 Hz Wells / Pad
Multi Stage Fracture
Multi Stage Hydraulic Fracture Stimulation
Reservoir
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 3
Laramide Thrust
Belt
Laramide
Thrust Belt
Oui
chita
Thru
st B
elt
Appa
lach
ian
Thru
st B
elt
Shale Gas Basins
Devonian/ MississippianShale Fairway
Calgary
Denver
New Albany
Antrim
Ohio
Lewis
0
2
MMcf/d Marcellus
3.2
Map Source: SPE/Holditch Nov 2002, Hart Publishing, 2008Forecast: Ziff Energy
Shale Gas Initial Well Productivity, MMcf/d
10.0
0
2
4
6
8
10
MMcf/d Horn River
2.6
0
2
MMcf/d Woodford
1.4
0
2
MMcf/d Barnett
2.1
0
2
MMcf/d Fayetteville
8.0
0
2
4
6
8
10
12
14
MMcf/d Haynesville Shale
15+
3.0
0
2
MMcf/d Eagle Ford
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 4
Cost of the Natural Gas “Hamburger”
Total Total
PRICE:
COST:
$3.00 / Hamburger US$4.00 / Mcf Gas
$1.25
Beef Finding & Development0.50 2.50
Tomato Operating0.10 1.40
Lettuce Royalty & Production Taxes0.05 1.00
US$7.20
$ $
Cheese Return: 15% BIT 0.20 1.40
Pickle Overhead 0.15 0.40
Bun 0.25 Basis Differential 0.50
COST RECOVERY (2007): 2.4X 0.7X
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 5
New Gas Supply Cost Curve, Q4 2007
0
2
4
6
8
10
12
1 17 33 49 65 81 97 113 129 145 161 177 193 209 225 241 257 2730
2
4
6
8
10
12
FULL CYCLE COST:Cash Cost +Capital Cost+Overhead+Return
CASH COST:Operating ExpenseProduction TaxesRoyaltiesDifferential
US$/Mcf US$/Mcf
New Gas Supply Added
2008 Henry Hub Price$9.05
Canadian Plays
HH/09 $3.95
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 6
170+ Benchmarking Studies (1986 – 2010)
Netbacks(Corporate)
1989 -1996
8
NETBACKS
North AmericanFollow Ups
2000+
10+RFOC
1998+1998+
U.S. OFFSHORE StudiesGulf of Mexico
(Deepwater RFOC)(Shelf RFOC & F&D)
14F&D
RFOC RFOC
U.S. ONSHORE Studies
25+
’98
EastTexas
RFOC
’98
OnshoreGulf East
RFOC
’99
Rockies
RFOC
’99
Alaska
RFOC
’01, ’06
Gulf Coast
Onshore
RFOC
SouthTexas
’99, ’05
RFOC
SouthTexas
DRILLING
’02’02
Anadarko
RFOC
’96, ’98
Mid-Continent
RFOC
Permian
’96-’07
Custom
RFOC
2000+
RFOCRFOCRFOC
6
Heavy Oil (Canada)
1994-98, 2008
HEAVY OIL
BENCHMARKING
People Productivity(Head Office Staffing)
1991-95, 2001
8
2003(International)
PEOPLE
PRODUCTIVITY
BRAZ
IL
INTERNATIONALImproving Field Performance/ Best Practices
40+
1999+
ARGEN
TINA
VENE
ZUEL
A
COLO
MBIA
BOLIV
IA
TRINI
DAD
AUST
RIA
INDO
NESIA
INDI
A
BANG
LADE
SH
GERM
ANY
AUST
RALIA
CHIN
A
THAI
LAND
VIETN
AM
TURK
MENI
STAN
1997
GasMarketing
Costs
GAS
MARKETING
COSTS
1997
Energy CapitalProjectBench-marking
ENERGY CAPITAL
PROJECT
BENCHMARKING
1997(with
WMC)
Oil & GasHR
Bench-marking
OIL & GAS HR
BENCHMARKING
2003(with
TowersPerrin)
HRStudy
HR STUDY
Improving FieldPerformance (IFP)
(Canada)
16
1994+
IFP
Finding & Development Cost(Canada)
23
1987+
F&DCOST
MEXICO
COLO
MBIA
DRILL
ING
WesternCanadaDrilling
WESTERN
CANADA
DRILLING
2005(withSBC)
SAGD
DRILLING
2009
SAGDDrilling
GHG
2010
GHG
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 7
Ziff Energy Operations Analysis
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 8
Kinder/Sempra/ConocoPhillips1.8 Bcf/d US$4,900 MM
1,663 miles 42” pipeHeat Content 950 – 1,150
Rockies Express Pipeline
Princeton
PEPL
Opal
Cheyenne
Phase 1 – Apr. 2008
Operating SegmentsCurrently 500 MMcf/d750 MMcf/d later 2007
330 miles 42” pipe
Phase 2 - Jun 2009
Phase 3 – Nov 2009
Top 5 Firm Shippers:
EnCana – 500 MMcf/dConocoPhillips – 400 MMcf/dBP Energy – 300 MMcf/dSempra Energy – 200 MMcf/dUltra Resources – 200 MMcf/d
All 10 Year Contracts
Wamsutter
Meeker
Zone 1US$0.24/Mcf
Questar Overthrust 625 MMcf/d leased Option for 1.5 Bcf/d
Zone 2US$0.54/Mcf
Zone 3US$0.88/Mcf
Clarington
Missouri
Lebanon
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 9
Growing Oil Production
0
1
2
3
4
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 20300
1
2
3
4
MMBbl/d
In-Situ
MMBbl/d
Mining
Sunco r
( A t habasca)
Syncrude
C N R L Horizon
EnC ana
Imp erial C o ld Lake
C N R L C oP Surmont
N exen Long Lake
Husky Sunrise
Sunco r
East Coast Offshore 2%
Conventional Oil (Slow Decline)18%
57%
29%
14%
2.6
4.0
2.1
Shell A lb ian
Oil Sands(Strong Growth)
80%Imp erial Kear l4 Ot her M ining
4 1 Ot her Pro ject s
Growing 8.6%/yr
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 10
Proposed Western Canada Oil Export Pipelines
B.C. AlbertaSask. Manitoba
Fort McMurray
Anacortes
Edmonton
Hardisty
Montreal
Express
Enbridge
Rangeland
TransMountain
Kitimat
Kerrobert
Cromer
Gretna
Superior
Lewiston
Delavan
ChicagoFlanagan
Patoka
Sarnia
Cushing
To US Gulf Coast
Clearbrook
Prince George
ExistingEnbridgeKinder Morgan ExpressKM Trans Mountain
ProposedKM Trans Mountain – Anchor LoopKM Trans Mountain – TMX-2KM Trans Mountain – TMX-3KM Trans Mountain – Northern Leg Kinder Morgan – Express Option 1, 2Kinder Morgan – Chinook PipelineTransCanada - Keystone
Regina
WoodRiver
ProposedAltex - Altex SystemEnbridge – AB ClipperEnbridge – Line 4Enbridge – S Access Exp.Enbridge – S Access Ext.Enbridge – S LightsEnbridge – Gateway
ExistingPacific Energy Partners LP - Rangeland TransCanada - KeystonePegasus
Kinder Morgan – Express BulletTransCanada – AB-USCGTransCanada - AB-California
Potential
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 11
Keystone – TransCanada Oil Project
Portland
Chicago
Hardisty
Chicago
Patoka
Edmonton
Proposed Keystone
Liquids Line
TCPL Mainline
Enbridge
Liquids Line
Burstall
B.C.
Cushing
Proposed Keystone XLLiquids Line
Scotford
Montreal
Dawn
TCPL Mainline
Houston Port Arthur
Wood RiverSteele City
TimeQ3 2007Q2 20082009Q2 2010Q1 20112011Q1 2013
Activity Total CapacityApproved by NEB Sept. 2007Start ConstructionKeystone XL Regulatory ApprovalSystem in Operation 435,000 Bbl/dayKeystone XL Start ConstructionCushing Extension In-Service 590,000 Bbl/dayKeystone XL In-Service 1,100,000 Bbl/day
Expected Costs: US$ 12 Billion
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Slide 12
4th International OperationsExcellence Seminar
October 13 & 14, 2010 Houston, Texas
Production Reliability: Achieving Operations
Excellence
World Class Speakers in 5 Sessions:• Executive Perspectives on Excellence• Production Operation Challenges• Future Production Challenges• Deepwater & Offshore Assets• Onshore Assets (Gas & Oil) with a focus on Unconventional Resources
Meet Sr. Operations Executives from North America & Around the Globevisit www.ziffenergy.com for regular updates
10ZG-1501-04 COPYRIGHT 2010 ZIFF ENERGY GROUP
Gas Supply / Gas Demand OutlookThe Renaissance Esmeralda Resort & Spa
Indian Wells, California
Agenda• Shale Gas Outlook• LNG & Kitimat• Cost of Gas Supply• Alaska & Rex Pipeline• Gas Demand
Edward Kallio, Director, Gas [email protected]
(403) 234-4275
April 9, 2010