I highly prefer UK shale investment, as it has all the political and legislative support it could ever hope for, at least it seems like it.
Dart Igas deal makes sense.
Superior however according to my assessment is Cuadrilla. In size it is smaller (UK acreage basis; internationally across Europe Cuadrilla has excellent acreage, with Netherlands as sweetspot for oil), but Cuadrilla has the best set up to succeed.
A lacking service industry has often been described as a shortcoming to shale development. Whilst I see the point, I am still confident that the industry will gear up rather quickly (in fact, because of all the delays they will have already..). The off shore oil and gas industry has suppliers that can also be relevant on shore.
Still, Cuadrilla has had the foresight to invest in its own equipment, and employs specialists that can drill and frack, as well as evaluate. I think this will prove a key differentiator to any other shale player. After all, dart was only focussed on CSG until recently... CSG is not the most likely way forward in the UK; the focus is on shale. And the Dart acreage has plenty, which was smartly identified by Igas.
Cuadrilla is part owned (around 50%) by AJ Lucas, AJL, but has not other direct way to get involved in.
All players in UK shale are undervalued significantly if one assumes that shale will be fully explored in the UK.
B2W also spain and danemark are starting to explore shale now, with Germany's parliamentary approval before the summer holiday.
DTE Price at posting:
17.5¢ Sentiment: Buy Disclosure: Held
