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Petroleum

Energy Giants Boost Budgets Amid High Gas Prices

Strategic Insights

— 1 min read

Energy giant Mitchell announced a $52 million increase in its capital budget, to $302 million, to drill more development wells and expand midstream infrastructure. This move is expected to boost gas sales by over 20% this year and next, according to Chairman George P. Mitchell. Meanwhile, Barrett Resources has also approved a 37% increase in its budget, to $227 million, to drill 1,224 wells, primarily gas wells in the Rocky Mountains.

Key Takeaways:

  • Mitchell Energy increased its capital budget by $52 million, to $302 million, to drill more development wells and expand midstream infrastructure.
  • The increased budget will allow for the drilling of 25 more development wells, bringing the total to 213 wells, and the recompletion or refracturing of an additional 128 wells.
  • The new budget will also enable the expansion and upgrade of midstream infrastructure in North Texas, including the construction of a 23-mile residue gas sales line.
  • The expansion of midstream infrastructure is expected to provide greater shipment flexibility, moving 300 million cubic feet/day of gas to intrastate markets.
  • Mitchell Energy aims to drill its large untapped resource base while gas prices are high, according to Chief Financial Officer David Peck.
  • Barrett Resources has approved a 37% increase in its budget, to $227 million, to drill 1,224 wells, primarily gas wells in the Rocky Mountains.
  • The increased budget for Barrett Resources will focus on drilling 1,088 wells in the Powder River Basin coalbed methane area, including 175 wells in 10 pilot programs targeting the Big George coal and other deep coals.
  • Another 23% of the budget will be allocated to the Piceance River Basin.

Statistics:

  • Mitchell Energy's increased capital budget: $52 million
  • Total gas wells to be drilled by Mitchel Energy: 213
  • Additional wells to be recompleted or refractured by Mitchell Energy: 128
  • Total midstream infrastructure budget: $302 million
  • Gas sales increase expected: over 20%
  • Barrett Resources' increased budget: 37% to $227 million
  • Total wells to be drilled by Barrett Resources: 1,224
  • Wells to be drilled in Powder River Basin coalbed methane area: 1,088
  • Wells to be drilled in pilot programs in Big George coal and other deep coals: 175

Sources:

  • [Mitchell Energy Press Release (date not specified)]
  • [Barrett Resources Press Release (date not specified)]

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