Montney article I (& maybe some others) have missed It is two months old but not outdated:
Ten years ago, when explorers began punching holes in the Montney gas play south of Dawson Creek, B.C., nobody could have predicted it would become the engine of Canada’s natural gas industry.
But that’s exactly what happened.
“In 2009-12, we still didn’t know what the Montney was capable of doing. At that time it looked exciting, and it was all about land accumulation and just building up acreage,” TD Securities’ Juan Jarrah told a recent conference in Denver.
“In the period from 2013 to 2015, there was not a whole lot of [mergers and acquisitions], and there are a couple of reasons for that. Gas prices were weak, fine. But the second reason was that I think most of the companyies were trying to digest their inventory; trying to figure out, ‘OK, what do we really have here? How good is this asset, and how scalable and how repeatable is it?’
“Fast forward to 2016, and we’ve seen massive reserves growth year-over-year and production growth. Now we know what we have. But now it’s all about creating economies of scale,” Jarrah said.
In 2016, there were a number of high-profile deals in the Montney, including Seven Generations’ July acquisition of production and lands from Paramount Resources for $1.9 billion.
In October, Tourmaline Oil scooped up Montney assets in B.C. and Alberta from Shell Canada for just under $1.4 billion, while in June, Birchcliff Energy paid $625 million for Encana’s wells and leases in the Gordondale area of Alberta.
The assets are located in the Peace River Arch region, and the target formations are the Montney and Doig resource plays.
Jarrah believes the trend toward consolidation in the Montney that began to take hold in 2016 will continue.
“Operators are buying offsetting interests, and that’s because you get improved access to capital via a bigger company. You get better access to infrastructure, better management of your growth and building plants and taking firm capacity on pipelines. And you can reduce your cost structure while you’re doing it,” he said. “So I think we’re going to see more of that. Most of the transactions we’ve seen have been in Alberta, but it’s not an Alberta-focused thing. It could be in B.C. as well. There’s lots of operators in B.C., and B.C. is probably due in my mind.”
https://www.jwnenergy.com