Daily Archives: September 11, 2010

9/10/2010 Estimated Alaska North Slope Netback Values

Market Bbl MMBtu
Oil $67.48/BOE* $11.63/MMBtu*
Gas (AGIA) Negative $1.48/BOE Negative $0.26/MMBtu
Gas (Valdez LNG) Negative $2.07/BOE Negative $0.36/MMBtu
Gas (Bullet Line) $0.20/BOE $0.03/MMBtu
Henry Hub (netback reference for L48 gas) $21.98/BOE $3.79/MMBtu

*Based on 9/8/2010 closing price for ANS oil.  Updated price for 9/10/2010 not available on DOR website at time of publication.

Beginning with prices posted on September 10, 2010, this page started including the “Henry Hub” price effective for the same day.  The reason for including that price is explained at “Reason for Adding the Henry Hub Price,” http://bit.ly/dj6oEo.  The remaining prices represent estimated values, netted back to the field level, for Alaska North Slope (ANS) oil and gas marketed through various options, based on closing prices for the relevant markets on the indicated day.  For an explanation of the basis for all of the estimated netback values, see “Basis for Estimates of Alaska North Slope Netback Oil & Gas Values (rev. Sept. 6, 2010),” (Sept. 6, 2010) http://bit.ly/cNqYw5.

Why is the “Henry Hub Price” Included in the Daily Estimates

Beginning with the posting for September 10, 2010, this page also will start including, for reference, the “Henry Hub” price reported for the same day.  The “Henry Hub” price will be taken from the same source as used for the value of “ANS West Coast” oil in the calculation of the estimated netback value of ANS oil.  Both are reported on the homepage of the Alaska Department of Revenue, Tax Division (http://www.tax.state.ak.us/).

The reason that the Henry Hub price will be included on this page is to provide a frame of reference for assessing the effect on oil and gas investment decisions of the estimated netback values of Alaska gas.  In most instances, estimates of future levels of the Henry Hub price are used by oil and gas companies as a starting point for assessing alternative investment options.   Generally speaking, investment decisions are based on a relative analysis of the options – in other words, I could invest a dollar here or I could invest a dollar over there, which will give me the better netback and return. Continue reading

9/10/2010 Estimated Alaska North Slope Netback Values

Market Bbl MMBtu
Oil $67.48/BOE* $11.63/MMBtu*
Gas (AGIA) Negative $1.48/BOE Negative $0.26/MMBtu
Gas (Valdez LNG) Negative $2.07/BOE Negative $0.36/MMBtu
Gas (Bullet Line) $0.20/BOE $0.03/MMBtu

*Based on 9/8/2010 closing price for ANS oil.  Updated price for 9/10/2010 not available on DOR website at time of publication.  These prices represent estimated values, netted back to the field level, for Alaska North Slope (ANS) oil and gas marketed through various options, based on closing prices for the relevant markets on the indicated day.  For an explanation of the basis for all of the estimated netback values, see “Basis for Estimates of Alaska North Slope Netback Oil & Gas Values (rev. Sept. 6, 2010),” (Sept. 6, 2010) http://bit.ly/cNqYw5.