Download - Marcellus Shale Strategic Analysis
Marcellus Shale Strategic Analysis
May 17, 2010
Tasking Companies involved in MS/ possible end-users
Possible strategic partners
Analysis of PA regulations regarding compression
Standards:Operating PressuresPipeline flowsFracturing practices
Methodology (cont’d)Identify companies involved
Open SourceSpecialized databases
Compare companies involved w/ other shale playsIndicates strength in industry
Identify compressor MFR’sProfile
Identify Compressor MFR’s association in MS
Methodology (cont’d)
Marcellus Other Shale
CompressorMFRs
Key Finding: Top Players1. Chesapeake Energy 2. Range Resources3. Seneca Resource /EOG4. Statoil5. Atlas Energy6. EQT Corp7. Chief Oil & Gas8. XTO Energy9. EXCO Energy10. Talisman/Fortuna11. Cabot12. East Resources
Low Hanging Fruit
(See Matrix Cover Sheet/Matrix Overview)
Strategic ProfileMFR compressor packages
Associations w/ MS
Other shale plays
Revenues $5 M – $25M
Not teamed w/ Ariel
Company Rankings1. Dearing Compressor & Pump2. Kinglsy Compression3. Sullivan Palatek4. Rix Industries5. McClung Energy Services6. Titan Compressor Systems7. Big Gas Compression8. ACI9. Brahma10. Compass Compression11. Natural Gas Compression Systems12. UE Compression13. Natural Gas Services Group
Dearing CompressorRevenue: $20 – 50 million
Employees: 93 w/ plans to add
Shale Affiliation: Marcellus
Products: GE, Gardner Denver, Ariel, Reliance
Location: Ohio
Kingsly CompressionRevenue: $10 million
Employees: 40 (2 branches)
Shale Affiliation: Unknown, actively marketing
Products: Ariel, Cummins, Ingersoll Rand, Quincy
Location: Ohio/Pennsylvania
End Users: EQT, Chesapeake, Range Resources
Sullivan PalatekRevenue: $23 million
Employees: 90 (last reported)
Shale Affiliation: Barnett Shale and Marcellus Shale
Products: OEM
Location: Indiana
Partner: Union Drilling
The Hanover CompanyPurchased by Exterran
Other Exterran Compression DistributorsGlobal Compression Universal CompressionWeatherford International
Ariel
Compressions Systems IncHeadquarters: Midland, TX
Locations: Midwest
Shale Affiliations: Likely
Products: Ariel, GE Gemini
State ManagementDecentralized, unorganized
No comprehensive overview
No method for sharing w/ connected states
Priorities:Water managementEnvironmental degradationConstruction codesReclamation
Future State IssuesSeverance tax
Increasing bond limitsSingle - $2,500Multiple - $25,000
“Disaster Watch”Fracturing
Home water well exploded by gas fracking in Dimock, PA. Source:
http://beavercountyblue.files.wordpress.com/2010/02/dimock-well-explosion-photo1.jpg
FracturingHorizontal wells (60% will increase)
Hydraulic dominant over airGreater access/Higher ROI$3.5 million per rig750 – 2500 psigMore accident prone
Vertical wells (40% will decrease)Limited access/Lower ROI$255 K50 – 350 psigEasier accident containment
Compressor RegulationsPennsylvania
None
OhioNone
West VirginiaNone
New York>125 psig requires
permit
= Good Faith Agreement
*intervene only if problems
Brownie Points - NGV Louisiana Act 469
Tax credit increases 20 to 50% on conversions $3000 for direct buy Payroll tax credit for workers
NAT GAS Act 2009 Sponsored by Rep. Dan Boren (D-OK), John Larson (D-CT)
AT&T Investing USD $565 M in natural gas hybrids 15K vehicles in the next 10 years
Congressional Natural Gas Caucus First hearing 10/2009
Tennessee Gas PipelineDominion Keystone Pipeline
Brownie Points (cont’d)
Wiki Tour
http://marcellusshale.wikispaces.com
Thank You
Questions?
Contact Information
Kathleen [email protected]
Zach [email protected]
Sladjana [email protected]
Casey [email protected]