Haynesville, Do I Hear $50,000/Acre?Excerpt from Energy Matters: (Click on the Link above to read entire article)
Think $25,000 an acre is top of the market for the Haynesville play? Don’t stop there.
When looking at Chesapeake Energy Corp.’s deal with Plains Exploration & Production, one may think acreage prices are “topping out,” says Deutsche Bank Securities Inc. research analyst Shannon Nome in her report “From Shale To Shining Shale: A Primer On North American Natural Gas Shale Plays.”
Instead, “we believe Chesapeake’s monetization was simply motivated by a pressing need for cash, and not a statement that $25,000 to $30,000 per acre is a high-water mark for leasehold values; in fact, we see ample room for rising acreage value from here.”
She estimates for the play a base case of $14-million per-well net present value, incorporating an industry-standard 10% discount rate.
When looking at Chesapeake Energy Corp.’s deal with Plains Exploration & Production, one may think acreage prices are “topping out,” says Deutsche Bank Securities Inc. research analyst Shannon Nome in her report “From Shale To Shining Shale: A Primer On North American Natural Gas Shale Plays.”
Instead, “we believe Chesapeake’s monetization was simply motivated by a pressing need for cash, and not a statement that $25,000 to $30,000 per acre is a high-water mark for leasehold values; in fact, we see ample room for rising acreage value from here.”
She estimates for the play a base case of $14-million per-well net present value, incorporating an industry-standard 10% discount rate.
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