Petrohawk Energy reported 34% increase in 2010 hydrocarbon production over 2009; Announced $2,300 million Capital Program for 2011; Plan to double its liquid production in 2011

Petrohawk produced an average of 562 Mmcfepd during 2010. The midpoint of full year 2011 production guidance is 885 Mmcfepd, representing an estimated 31% year over year increase and a 57% year over year increase pro forma for 2010 divestitures. The midpoint of first quarter 2011 production guidance is 770 Mmcfepd.

Petrohawk announced $2,300 million capital program, of which $1,900 million (82%) is allotted to drilling and completion activities.

Eagle Ford Shale:

- Planned 12 rigs for 1H 2011 and 15 rigs for 2H 2011. ~347,600 risked net commercially productive acres

Black Hawk:

- Estimate of ~73,600 risked commercially productive net acres. Currently operating eight rigs ramping to 10 rigs by June 2011

Hawkville Field:

- Currently operating 5 rigs with plan to hold constant in 2011. Risked estimate of ~224,000 commercially productive net acres

Red Hawk:

- Five wells scheduled for 2011, two waiting on completion. 

Haynesville Shale:

- Estimated ~225,000 risked commercially productive net acres; 75% operated. Operated rig count currently 16 and will hold thru 1st half 2011, 7 in 2ndhalf of 2011; leasehold requirements primarily met by mid-year

Lower Bossier Shale:

- Estimate ~150,000 risked commercially productive net acres. The company anticipates initiating Bossier development once Haynesville lease capture complete in mid-2012

PDC Energy 2011 IPAA OGIS New York

- Projecting 19% year-over-year growth in production (over 20% if successful partnership repurchase).

- 9 wells planned in 2011, all drilling capital provided by partner and JV liquidity


http://docsearch.derrickpetroleum.com/files/11900/PDC%20Energy%202011%20IPAA%20OGIS%20New%20York.pdf

Lukoil planning Shale JVs in 2011

Lukoil is scouting for oil and natural- gas investments in U.S. shale fields, President Vagit Alekperov said.

Lukoil joins a line of companies looking at the NorthAmerican shale industry, as much to get the drilling technology as the oil andgas. Exxon Mobil Corp. (XOM) bought shale gas producer XTO EnergyInc. for $41 billion and PetroChina Co. last month made its biggestoverseas investment of $5.4 billion for a stake in Encana Corp.’s Canada shalefield.

Lukoil is hunting for new ways to recover oil

Through JVs Lukoil wants to access the technology and be able to apply those techniques tooil-rich shale deposits in Russia. Lukoil already is experimenting in theBazhenov formation in West Siberia, which has liquids.

Russia has seen a burst of transactionsthis year.

BP Plc agreed a $7.8 billion stock swap withstate- controlled Rosneft Oil Co., though it’s being challenged byBP’s Russian partners in TNK-BP. On March 3, France’s Total SA agreed to pay $4billion for 12 percent of Russia’s NovaTek. Both groups aim to developfields in the Russian arctic.

Lukoil pioneered such transactions, with ConocoPhillips taking a stake that at one point reached 20 percent. ConocoPhillipshas since sold out as part of a larger asset- disposal program.

Source: Derrick Petroleum E&P Transactions Database

Joint Ventures byRussian and Asian companies to continue

Joint ventures will continue to be used by international oiland gas companies, particularly for most Russian and Asian companies wanting to acquire shale acreage in the U.S. Companies won’t want the negative political backlash that CnoocLtd. went through when it tried to buy Unocal Corp. in 2005. The next round ofjoint ventures may come from Russian,Japanese and South Korean companies.

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Stone Energy 2011 IPAA Oil & Gas Investment Symposium

Strategy
Leverage high cash flow generated from existing Conventional
Shelf GOM assets to:
1.  Maintain relatively stable GOM Shelf production,
2.  Profitably grow gas reserves and production in price-advantaged basin (Appalachia, Gulf Coast Basin)
3.  Profitably grow oil reserves and production in material impact areas (Deepwater GOM and Rocky Mountains

http://docsearch.derrickpetroleum.com/files/11898/Stone%20Energy%202011%20IPAA%20Oil%20&%20Gas%20Investment%20Symposium.pdf

Apache 2011 IPAA Oil & Gas Investment Symposium

- 13‐17% Production Growth Expected
- $7.5BN Initial Capital Program
Significantly below plan cash flow->1/3 future growth capital: no ‘11 production
http://docsearch.derrickpetroleum.com/files/11897/Apache%202011%20IPAA%20Oil%20&%20Gas%20Investment%20Symposium.pdf

Brazil to unleash its presalt potential in H2 2011

Brazil's government will auction rights to develop mammoth offshore oil and gas blocks in this year. The first auction of presalt fields could be held in the second half of the year, although new legislation on how much would be charged as a royalty on production, and how that money would be distributed among state and municipal governments would have to be approved first. 

A number of mammoth oil fields have been discovered off the southeast coast of Brazil, lying in ultra-deep water and below more than three miles of sand, rocks and a shifting layer of salt. The area is estimated to hold between 50 billion and 100 billion barrels of oil.

The auction is expected to include some of the reserves discovered in the massive Libra area, estimated by Brazil's Oil Regulatory Agency ANP to hold recoverable reserves of between 3.7 billion and 15 billion barrels of oil equivalent. These fields will be handed over under different terms from the more traditional concessions used in the oil.

Final approval for the planned 2011 auctions is still required from the country's National Energy Policy Commission, or CNPE, which will also define exactly which areas will be put up for auction. 

Why Pre-salt auctioning?

The only way for Brazil to make the most of its oil reserves is by farming out contracts to international exploration firms with the expertise and technology to break through the deep, compressed salt layer. But before Brazil opens up its reserves and takes bids from oil industry giants, the country’s parliament is hoping to secure Brazil’s financial future by ensuring the Petrobras, which owns a majority stake in the oil in question, benefits from any oil extraction programme.

The government, which owns Petrobras, will fund the exploration of pre-salt oil to the tune of $200-$220 billion (£140 billion), and will allow the firm to enter into any number of joint ventures with third parties capable of extracting oil. However, one of the major stipulations is that Petrobras will maintain a minimum of 30 per cent share in every exploration agreement it enters into.

Key Brazilian deal in last 3 years

Announce Date	Heading	Deal Value ($MM)
01-10-2010	Sinopec acquires 40% interest in Repsol’s Brazilian business	7,109
11-03-2010	Devon Energy divests Brazilian operations to BP	3,200
21-05-2010	Sinochem acquires 40% interest in Peregrino oil field from Statoil	3,070
23-12-2010	SK Energy divests Brazilian operations to Maersk	2,400
04-03-2008	StatoilHydro acquires interest in Brazilian oil property from Anadarko	1,800
27-11-2007	OGX awarded eleven exploration blocks in Brazil	754

Source: Derrick Petroleum E&P Transactions Database

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Sinopec and Petrobras collaborate to develop offshore Brazilian blocks!! Petrobras plans $224 billion investment through 2014.

Sinopec will team up with Petrobras to develop offshore areas of the Para-Maranhao basin in northern Brazil after negotiating for a year. Petrobras is planning to invest $224 billion in the five years through 2014, the largest spending plan of any oil company, to increase oil and gasoline output. “Petrobras is seeking international partners because as its production is expected to double in the next 10 years to reach 4 million barrels per day", said Petrobras’ CEO Gabrielli. He said Petrobras' strategic planning foresees the order of 169 platforms, 504 support vessels, 53 drills and 48 oil tankers until 2020.

Source: Global E&P Transactions 2010 Review

In 2010, Petrobras announced a preliminary agreement to sell stakes in two blocks, BM-PAMA-3 and BM-PAMA-4, to Sinopec. Last October, Sinopec made an entry into Brazil by acquiring 40% interest in Repsol’s Brazilian business for $7.1 billion. “Sinopec is keen to expand its overseas oil and natural-gas operations”, said Sinopec President Wang Tianpu. The keenness is justified by the following snapshot.

Source: Derrick Petroleum E&P Transactions Database

South America- the new playground for Chinese!!

The 2010 M&A activity in South America took a gigantic step by clinching deals worth $36.1 billion, a 91% increase from 2009 value of $3.2 billion. South America accounted for 17% of the total 2010 M&A value of $211 billion and was ranked the second largest region globally for the M&A activity. Brazil was the top country with several large sized transactions totalling $16 billion. 10 transactions were recorded above $1 billion, with Chinese oil and gas companies involved in five of these worth $23 billion in total.

Brazil needs fund and China needs oil & gas resources to meet the growing demand. Here ends the story - Robust Collaboration between Sinopec and Petrobras. Expecting an even more aggressive activity from South America in 2011!

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