RE: another duster.....not“The largest gas well in the continental US is producing 30 mcfpd. This well will produce 25mcfpd from each well, they estimate at least 50mcfpd on the field. This isnt even including the valuable distillates, and a strong possibility of oil at greater depths. The Kirkuk field is exactly this type of field with both oil and gas outputs.”
There is no use comparing a gas well in the US to another somewhere else as it’s not about the production of a well. It’s the economics that that a field will generate and nat gas field economics in the US vs. Iraq are completely different. It’s those economics that state whether or not any field gets developed not the flow rates. The US has nat gas infrastructure all over the place. Iraq, especially Kurdistan, doesn’t. Meaning that the development costs will be multiples of what they would have been had there been a gas pipeline nearby. The greater the development costs the lower the probability of development.
Nat gas in the US goes for over $4.50/mcf. It’s less than a $1/mcf in Iraq.
If not for the vast amounts of oil in Kirkuk, 25 Bbo originally recoverable, it probably would not have been developed.
The difference between oil and nat gas is that oil is worth around US$80/bo and nat gas goes for less than $6/boe in Iraq. Meaning that the economics are 13.3 times greater if it was an oil find. And with oil infrastructure already in place the development costs are much much lower, leading to the greatly increased probability of development.
They did find condensates, which is much better than just a nat gas find. But are there enough volumes to justify development? No one knows as its way too early to tell with just 1 well as that’s why the market has bailed at this point. It wasn’t just 1 or 2 sellers that caused the fall. It was the entire market. And that tells you there’s a potential problem there.
Now if they find large quantities of light/ medium oil in the lower formations of the current well then all this doesn’t matter and the SP moves up.