This week in Pierce Points:
A fund and a major miner bought gold projects. Waterton Global and Kinross will purchase Barrick’s Nevada mines for $720 million.
LNG got more difficult on two coasts. Canada proposed a shipping ban on the Pacific, and New York blocked a project.
Sumitomo unveiled ambitious copper plans. Japan’s integrated producer wants to add 125,000 tonnes of yearly production by 2021.
India proposed new oil and gas contracts. The country will increase natural gas prices and allow open bidding for new licenses.
Analysts confirmed a record year for resources. Stats show that $54 billion has been raised for resource funds so far in 2015.
A Web Link To The Future Of Shale Oil And Gas
I’m off to Asia this weekend. To do something that — last time I tried it — brought me face-to-face with a barbed wire bunker and soldiers carrying machine guns.
Namely, have a meeting with a government oil company.
That happened in Thailand’s capital Bangkok, in April 2014. When I arrived to meet with state energy firm PTTEP.
The catch was, I arrived in the city just as the military was taking control ahead of what would become a full-blown coup. I remember walking down Rama IV street and watching the army setting up checkpoints as it prepared to take power.
Of course, coups are actually a fairly common occurrence in Thailand — the country has had 12 such events since 1932. So even with this unfolding, I still made my way to the PTTEP offices on a Monday morning.
Only to find that the front gate had been barricaded, covered in barbed wire, and reinforced with soldiers — just in case anyone tried to attack the government office during the power changeover.
That scuttled my attempt at a meeting. Which had to be rescheduled for several months later, when I finally was able to meet with officials from this key player in the Asian oil and gas market.
I’ve been persistent though, because I believe this part of the world has major potential for oil and gas. Specifically, of the unconventional variety.
That’s because of something a few Houston petroleum insiders mentioned to me in passing years ago.
These oil and and gas pros were talking about how, after the offshore industry took off in America during the 1960s, the next place U.S. drillers looked to was Southeast Asia.
Because the rocks here are almost exactly the same as those in the Gulf of Mexico.
That’s a very interesting observation. Because it suggests that Asia’s sedimentary basins have similar geologic conditions to those in America — and that in turn could make this a spot to watch for shale.
When I began investigating this theory during trips to Thailand, Myanmar and other parts of this region, I found several interesting things. Including a meeting with a drilling professional who told me that unconventional, directional drilling is (quietly) advancing very rapidly for natural gas in Indonesia.
That’s a great sign. Showing that services needed for shale are developing in this region — which should provide the necessary expertise (at reasonable costs) needed to make shale work, the way it’s starting to in other emerging plays like Argentina and Australia.
I’m very interested to see what intel turns up on my trip the next two weeks. Especially because it now looks like Asian shale opportunities are coming available for licensing.
Here’s one of the most important web links you might see on this front: to Indonesia’s current list of oil and gas projects open for bids.
Scroll to the bottom, and you’ll see a section called “WK Migas Non Konvensional” — the first three unconventional blocks offered for licensing by the Indonesian government.
The links at the right provide full information on these groundbreaking projects. Which are being offered at fairly reasonable terms — $1 million in signature bonus, and commitment to drill one vertical well during the initial three-year license.
Decent terms like that, plus a decent oilfield services sector and strong Asian natgas pricing makes this an opportunity to watch. It could be a sleeper surprise in the global race to bring the North American shale miracle to international basins.
We’ll see who comes up with the winning bids (wink, wink).
I’m looking forward to seeing a number of you over the next two weeks, and discussing all this and more. Have a great weekend, and all the best to everyone until we see each other next.
Here’s to a fracking good time,