Rosetta Resources Plans to Spend $735 Million in the Eagle Ford in 2014

December 19, 2013 R.T. Dukes

Rosetta Resources Eagle Ford Acreage Map By Area

Rosetta Resources will spend approximately tw0-thirds of its $1.1 billion budget in 2014 in the Eagle Ford.

The company will spend $735 million running 4-5 rigs, with plans to drill and complete 90-95 gross wells. Approximately half of the activity will target the Eagle Ford from the company's Gates Ranch leases.

As a result of Eagle Ford and Permian Basin growth, Rosetta expects production to grow 20-30% to 60,000-65,000 boe/d.

“The 2014 capital plan is structured to deliver between 20 and 30 percent combined production growth from our Eagle Ford and Delaware Basin assets. The program reflects increasing activity as we initiate broader scale horizontal development in Reeves County and further expand development in new areas of our current Eagle Ford position,” said Jim Craddock, CEO. “We will continue to focus our efforts on integrating our West Texas assets while continuing to efficiently execute the development of our Eagle Ford leases.”

Rosetta will run six rigs and spend $265 million in the Permian Basin in 2014.

Also read:Rosetta Has Yet To Complete 23% of Its Eagle Ford Wells

Fourth Quarter Operational Delays Impact Production

Rosetta's fourth quarter 2013 production was negatively affected several issues that are estimated to have lowered production by ~4,000 boe/d. Rosetta expects fourth quarter production will average 52,000 boe/d and full-year 2013 production will average 50,000 boe/d.

Operational issues on a third-party gathering system
Operational issues at a third-party processing plant
Wells shut-in due to adjacent well completions
Rosetta compressor station fire

Jim Craddock, CEO, commented, "Our strength is our people and our personnel have done a great job of minimizing the impacts of several external hurdles we faced this quarter. We look forward to discussing our fourth quarter results, as well as our outlook for 2014, with investors in February."

Corpus Christi LNG Plant One Step Closer To Being Built - Cheniere

December 17, 2013 R.T. Dukes

Cheniere's Corpus Christi Liquefaction Project

A proposed Corpus Christi Liquefaction Plant (LNG Export) is one step closer to becoming a reality.

Cheniere signed a 20-year LNG sale and purchase agreement (SPA) with Pertamina for 0.8 mtpa (90 mmcfd). The deal accounts for just 5% of the plant's proposed capacity, so more contracts are needed before the $12 billion project will be financed.

Pertamina will pay Henry Hub prices plus an undisclosed fixed component. The 20-year deal starts with the first commercial delivery of LNG and can be extended 10-years.

Cheniere will need many more commitments of this size or a few larger commitments to make the LNG plant a reality.

Pertamina Could Get Gas From Sabine Pass if that Facility Is Expanded

While it is exciting news for the Corpus Christi Liquefaction project, it doesn't set any thing in stone. If Train 6 (an expansion) of Cheniere's Sabine Pass LNG export facility is approved and permitted, Pertamina's contract will void and the company will enter an equivalent agreement at Sabine Pass.

Watch More

Read the full press release announcing the SPA at

cheniere.com

Penn Virginia Sells Eagle Ford Midstream Assets to ArcLight Capital - $100 Million

December 16, 2013 R.T. Dukes

Penn Virginia Eagle Ford Operations Update - Dec 2013

Penn Virginia is selling its natural gas midstream assets in the Eagle Ford to an affiliate of ArcLight Capital Partners (American Midstream) for $100 million.

The deal includes gas gathering, a gas lift system, 119 miles of pipelines and associated facilities in Gonzales and Lavaca counties.

ArcLight has several active midstream investments and will likely make future acquisitions in the area or sell this to a larger midstream operator in the next five years.

ArcLight Capital has raised over $10 billion for energy related investments since 2001.

H. Baird Whitehead, CEO, stated, "The divestiture of our natural gas midstream assets is the first step in a series of potential divestitures which will reduce our indebtedness, improve our liquidity and fund further investment in our oily Eagle Ford Shale play."

Read the full press release at pennvirginia.com

NET Midstream Gets FERC Approval for NET Mexico Pipeline to Export Eagle Ford Gas

November 21, 2013 R.T. Dukes

NET Midstream has received FERC approval for border crossing facilities that will allow the NET Mexico Pipeline to export Eagle Ford natural gas to Mexico. At capacity, the pipeline could double U.S. natural gas exports to Mexico.

The Net Mexico pipeline is a 42-inch, 124 mile pipeline from Nueces County to Starr County in South Texas.

The pipeline is backed by a 2.1 Bcfd transportation contract with MGI Supply ltd (PEMEX Subsidiary).

Read - Net Midstream Plans Eagle Ford Pipeline from Mexico to Nueces County

“We were pleased to receive this timely authorization from FERC last week. Receipt of the Presidential Permit was an important regulatory milestone for NET Mexico.” said Joe Gutierrez, Co-President of NET. “Development and financing of the pipeline is on schedule, with mainline construction beginning in the first quarter of 2014, and mechanical completion in October.”

Much of the pipeline will be 42 inch pipe, but approval has been granted for a 48-inch pipeline into Mexico.

Read the full press release at netmidstream.com

Cheniere Energy's Port of Corpus Christi LNG Plant Will Cost $12 Billion

November 13, 2013 R.T. Dukes

Cheniere Energy is closer to making a decision on final investment in its Corpus Christi Liquefaction project.

Cheniere received a turnkey construction commitment priced at $800/tonne of liquefaction. The engineering and construction company Bechtel submitted the contract in September.

Cheniere has plans for up to six trains with 4.5 mtpa capacity each in Corpus Christi, but initial plans call for three trains with capacity of 13.5 mtpa (~1.8 Bcf/d).

At $800/tonne, the construction costs will be $800 x 13,500,000 tonnes = $10.8 billion. Add financing costs and the price tag will easily reach $12 billion.

Read:Port of Corpus Christi Booms on the Back of Eagle Ford Growth

Construction contracts are negotiated early in the process, but a final investment decision will be made by year-end 2014. The decision will come after commercial export contracts are agreed, all regulatory approvals are received, and financing is in order.

Read the company's full third quarter press release at cheniere.com

Cheniere Energy is based in Houston and is further along in buildinga LNG export terminal at Sabine Pass.

Bechtel is a worldwide engineering, construction, and project management firm based in San Francisco. The company has participated in the development of LNG projects in Australia, Equatorial Guinea, Russia, and Trinidad.