Lloyd Noble’s namesake Noble Energy (founded in 1932) has long been an important and innovative operator in Oil & Gas Exploration and Production. Their current portfolio of international and domestic projects include offshore Gulf of Mexico and West African operations, as well as leadership positions in the US Marcellus and Niobrara plays. They are also one of the first players to take advantage of the current oil price climate with their recent acquisition of Eagle Ford and Permian Basin Operator Rosetta Resources for $2.1 billion.
That acquisition and their recent presentation at UBS prompted me to take a deeper look at some of their US operations.
The NiobraraThe Niobrara in Northern Colorado/Southern Wyoming has been getting a lot of attention for its tight oil formations – in fact recently small cap operator Bill Barrett declared that $55-$65 oil will be a perfectly adequate environment for their E&P.
Noble is one of the dominant producers in the DJ Basin and the Niobrara in general, having made a commitment to the play for the past 5 years. Currently they are running 4 rigs, and are optimizing their operations with a focus on lengthening their laterals and decreasing time to drill.
The Geology of the Niobrara is quite complex, and has multiple formations that are prospective for hydrocarbons. To give you an idea of this complexity, take a look at this SW to NE geological cross-section in Weld County (from our Drillinginfo Niobrara Geology Play Assessment) flattened along the base of one of these formations (in this case the purple line/marker shows the base of the B Bench). Notice the general thickening of the Bench (the top of the B Bench is the red line, the pink is the “peak” or midpoint) as we move to the northeast.
In 2011 Noble partnered up with coal-giant Consol to develop gas acreage in the heart of the Marcellus. With a strong presence in both liquids-rich and dry-gas focused counties of northern West Virginia and western Pennsylvania, Noble continues actively drill and innovate in their completions, showing an improved horizontal volume up 330% vs. their 2012 completions. Recent upgrades to the pipeline network, as well as Dominion Cove Point’s continued progress towards a Liquefied Natural Gas (LNG) liquefaction terminal in Maryland are only going to increase Noble’s options in the future.
Speaking of liquefaction, The Sabine Pass and Corpus Christi LNG projects are well underway, which is good news for the acquired Rosetta Eagle Ford acreage in The Southern counties of Dimmit and Webb which is in the heart of the dry gas acreage for the play. The balance of the Rosetta acreage in both the Eagle Ford and Permian Basin plays are very promising for oil production, with additional long-term stacked-pay potential in the Permian Acreage. It will be interesting to see what Noble’s commitment to optimizing their engineering practices will bring to Texas.
Noble Energy is well-diversified across onshore US tight oil plays with a strong drive to innovation, and the ability to capitalize on lessons-learned. Add to that an aggressive and smart global offshore exploration program – with new developments off of Israel and the Falkland Islands – and you have an operator worth watching, perhaps for another 80 years.
What do you think? Leave a comment below.
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