Southwestern Floats $1.1B of New Stock, Offers to Buy Back IOUs

southwestern energyEarlier this week MDN told you that Southwestern Energy, a major Marcellus/Utica driller, has cut deals with its banks and debholders to extend out the due date on loans coming due (see Southwestern Energy Buys More Time with Banks, Debtholders). Southwestern continues to aggressively manage its money and balance sheet. Yesterday the company announced it is floating $1.1 billion of new stock and plans to buy back outstanding notes (IOUs). We don’t pretend to understand why they would extend the due dates earlier this week and now attempt to buy back the IOUs. Perhaps it’s different sets of debt? Someone with a finance degree help us out here! At any rate, here’s yesterday’s set of announcements from Southwestern…
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Williams Admits There Will be no Merger, Suing ETE for “Damages”

As the World TurnsFinally Williams has admitted, in writing, that the attempted buyout/merger by Energy Transfer Equity (ETE) is, as we said yesterday, dead (see Dead as a Doornail: ETE Terminates Merger with Williams). Williams has also admitted (in so many words) what we’ve been saying for more than a month: the vote by Williams “for” the merger and all of the recent goings on have been legal posturing. Williams says they are suing ETE “for monetary damages” for “its breaches.” Here’s the Williams admission issued yesterday in response to ETE’s termination of the deal…
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Aborted Williams Merger/Shenanigans Take the Shine Off ETE’s CEO

ETE CEO Kelsey Warren

ETE CEO Kelsey Warren

Until now, Energy Transfer Equity (ETE) CEO Kelsey Warren has been the golden boy. By snapping up a series of small pipeline companies at just the right time, Warren has created the ETE empire and turned himself into a billionaire in the process. It seemed he could do no wrong when it came to midstream business deals. And then he bit off more than he could chew: Williams. Warren pursued Williams for more than six months before it became public (see Energy Transfer Makes “Indecent Proposal” to Buy Williams for $48B). It took another three months after that before he finally got them to agree to a merger (see Williams Accepts ETE’s “Indecent Proposal” – Price Went Down $10B). Whether it was rotten timing, or rotten planning, the natural gas market crashed and the deal turned from crowning jewel to albatross. Along the way Warren pulled some shenanigans, like creating a privileged class of stock that gave himself and his buddies a leg up on Williams shareholders (see Merger Turns Sour: Williams Sues ETE/CEO Kelcy Warren). A Bloomberg article chronicles the rise, and now fall, of the midstream’s golden boy…
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Shell Cracker will “Rebirth” Pennsylvania Manufacturing Base

PMACan a single petrochemical facility, like Shell’s proposed ethane cracker plant in Beaver County, “rebirth” all of Pennsylvania’s moribund manufacturing base? That would be a resounding “Yes!” according to Marcellus Shale Coalition president Dave Spigelmyer and Pennsylvania Manufacturers’ Association president Dave Taylor. Writing a column in the Harrisburg Patriot-News, the two Daves make the case for just how big a hairy deal the coming Shell cracker in PA really is…
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PennEast Responds to NJ Congresswoman’s Attempt to Stop Pipeline

PennEast in NJ

PennEast in NJ

Yesterday MDN told you about the political pandering by a liberal Democrat Congresswoman from New Jersey, Bonnie Watson Coleman (see Dem Congresswoman Wants to Stop PennEast Pipe by Neutering FERC). Because Coleman has a small group of vocal fossil fuel haters as constituents who object to the PennEast Pipeline, she’s floating a plan that would neuter the Federal Energy Regulatory Commission’s process in approving all pipelines, including PennEast. Kind of like using a nuclear bomb to swat a fly. PennEast has responded to Ms. Coleman’s political stunt with the following calm, measured and devastating statement that rips apart her false claims…
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Antis Use Fake Front Group to Issue PA-OH-WV Shale “Report Card”

PretendersLast December MDN ripped the mask off a group of extremely partisan, virulently anti-drilling Democrats who call themselves the innocent-sounding Multi-State Shale Research Collaborative (see The Pretenders: Multi-State Shale Research Collaborative). One of the chief ringleaders of this enviro-cabal, made up of hard-left groups including the Pennsylvania Budget and Policy Center, the West Virginia Center for Budget and Policy, and Policy Matters Ohio, is Jan Jarrett–the former president and CEO of anti group PennFuture (see Jarrett Out, Jugovic In as President & CEO of PennFuture). The entire anti community is a case study in political incest. The Multi-State Shale Research Collaborative (i.e. anti-drilling zealots) have just released a pair of “reports” (propaganda pamphlets), one of them a so-called report card on shale drilling in PA, OH and WV. The media, of course, laps it up and goes along with the lie…
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30 LibDem Mayors Ask States & Feds to Allow Frack Bans

LibDemLast weekend the United States Conference of Mayors held their annual conference in Indianapolis, IN. Following the meeting, a small group of 30 mayors–a few from larger cities like Pittsburgh and Charlotte, but most from small cities–signed a letter urging state and federal officials to allow local municipalities (like theirs) to ban fracking. It’s all couched in terms of “home rule” language, but the desire is to allow local governments to deny their citizens their Constitutional property rights. Near as we can tell, all 30 of the mayors signing the letter are liberal Democrats. The press release and letter were issued by the virulently anti-drilling Environment America, a Big Green group…
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Marcellus & Utica Shale Story Links: Thu, Jun 30, 2016

best of the restThe “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Pipeline work progresses in Stark County, OH; removing gas and oil leases from your land; red hot debate over tariffs on pipelines in New England; the importance of stripper wells; from natgas glut to shortfall in one year; EPA’s lack of respect for Supreme Court; and more!
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Dead as a Doornail: ETE Terminates Merger with Williams

It's Dead JimAs we previously reported, last Friday a Delaware court ruled that Energy Transfer Equity (ETE) has the right to terminate its merger agreement with Williams (see Court Says ETE Can Terminate Williams Merger; Williams Votes Today). But as we also said, at that time ETE had not officially announced they were terminating the merger. They now have. Yesterday ETE said they have filed the official paperwork to dump the merger/takeover of Williams. Williams is continuing to litigate to try and force ETE to do the deal by appealing the court’s decision (see Williams Shareholders Vote “For” ETE Merger; Appeal Court Ruling). This deal is as dead as a doornail and everyone knows it–including Williams. What’s going on is legal posturing so Williams can try and extract money from ETE over the now-abandoned takeover attempt. In some ways we don’t blame Williams–they resisted ETE’s overtures for nine months before caving and agreeing. Of course, Williams caved and agreed because there are evil corporate raiders on the board pressuring the company to do so. As we’ve maintained all along–no one comes out of this smelling pretty…
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Eclipse Resources Ramps Up Drilling; Floats More Stock to Raise $

Eclipse_logo_hiresYesterday Eclipse Resources, a Marcellus/Utica pure play driller headquartered in State College, PA (but drilling mostly in Ohio) released a mid-year update on its drilling program. It’s good news, for a change! Earlier this year Eclipse said they would drill only one new well and that they were curtailing, or shutting in, production from some of their wells (see Eclipse Resources Drilling 1 Well in 2016, Restricting Production). This latest update changes that. Eclipse says given the expected higher price for natural gas as reflected by the forward market, they now intend to drill 10-12 new wells this year, and they’re turning the spigots back on for the curtailed wells. The Eclipse board has also voted to increase the capital expenditures budget by $28 million. No doubt that money will come from a new stock offering the company also announced yesterday–floating 37.5 million shares of stock, looking to raise $131 million…
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Shell Exec Shares Inside Story of Why They Chose PA for Cracker

Ate-Visser

Ate Visser – Shell Chemical

Yesterday was the second and final day of the Northeast U.S. & Canada Petrochemical Construction Conference being held in Pittsburgh. And boy oh boy what a day it was! Ate Visser, vice president of Appalachia petrochemicals at Shell Chemical took to the stage and shared with attendees the behind-the-scenes reasons for why Shell elected to build a cracker plant in Pennsylvania. There were three reasons: (1) cheap ethane from the Marcellus/Utica; (2) close to major northeastern markets; (3) tax breaks offered by PA. Here’s comments made by Visser, as reported from several journalists in the audience…
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Dem Congresswoman Wants to Stop PennEast Pipe by Neutering FERC

Bonnie_Watson_Coleman_official_portrait

US Rep Bonnie Watson Coleman – wants to neuter FERC

Today, far-left Democrat U.S. Rep. Bonnie Watson Coleman (from New Jersey) will introduce a bill in the U.S. House of Representatives intended to hamstring the approval process of new pipelines at the Federal Energy Regulatory Commission (FERC). Coleman’s bill, which doesn’t stand a snowball’s chance in hell of getting passed, is a ploy to block the PennEast Pipeline. Since that won’t happen, what this really is, is a political stunt–to improve Coleman’s chances of getting re-elected. She’s playing to her fringe/left base of supporters–people who irrationally hate fossil fuels and want to block anything to do with natural gas…
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Big Green Groups Try to Stop 3 TG Pipeline Projects in PA

TGP logoThree radicalized environmental groups–the Allegheny Defense Project, the Appalachian Mountain Advocates and Damascus Citizens for Sustainability–have filed a motion with the Federal Energy Regulatory Commission (FERC) to challenge FERC’s approval of three tiny pipeline expansion projects in Pennsylvania. Kinder Morgan’s Tennessee Gas Pipeline’s 300 line is proposing to expand three different segments of the line, serving different customers, and rightfully asked FERC to consider the three projects as separate and to not commingle them together. The radicalized groups are insisting FERC evaluate all three bundled together, in an attempt to slow down and hopefully stop progress on the projects…
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Kinder Morgan Gets a 50% Partner for Utopia Ethane Pipeline in OH

Utopia map

Utopia map – click for larger version

In December 2013 Kinder Morgan announced they plan to build a new 12-inch ethane pipeline through Ohio, dubbed “Utopia” for Utica To Ontario Pipeline Access (see UTOPIA is Coming! The UTOPIA Pipeline, that is…). Utopia will run ~215 miles and will only be built in Ohio, before it connects to another pipeline that goes to Canada, therefore the Federal Energy Regulatory Commission (FERC) won’t be involved in permitting the pipeline. Utopia has been less controversial than other pipeline projects in Ohio, like NEXUS (see Why is UTOPIA Pipeline Less “Controversial” than NEXUS in Ohio?). The 50,000 barrels per day of ethane flowing through it will go to NOVA Chemical’s Corunna cracker plant in Sarnia–a plant we wrote about just yesterday (see Canadian Cracker Eyes Utica Ethane, Adding $2B Polyethylene Plant). Kinder Morgan has announced they are taking on a joint venture partner in the Utopia project. Riverstone Investment Group will become a 50% owner in the project in return for putting up 50% of the cost–or $250 million out of the $500 million it will take to build it…
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Maryland Holds Hearings on Fracking, Crazies Turn Out to Complain

MDELogo_Horizontal_GreenTextMaryland is a lot like New York–populated with lefty liberals who love to tell other people how to live their lives. Maryland is at least, and perhaps more, “progressive” than New York. So it’s no surprise to us to read how the Dem libs are having a cow over proposed regulations that would allow fracking to begin in the state starting in October 2017. Maryland went through a years-long process, just like New York, and eventually released what would likely be the strictest drilling regulations in the nation, in late 2014 (see Fracking in Maryland (!) in 2015? Quite Possibly). On his way out of office, then-Gov. Martin O’Malley (a Democrat!) published the regs and prepared the state to frack (see Maryland Gets Ready to Frack! Gov O’Malley Files New Regulations). But then the Maryland legislature passed a temporary moratorium which the newly elected Republican Governor, Larry Hogan, allowed to become law (see Maryland’s Pusillanimous Gov Allows Frack Moratorium to Become Law). Hogan and the Maryland Dept. of the Environment (MDE) are back, with more tweaks which tighten the proposed regs even more–to the point no one would want to drill and frack anyway. But still the crazies are bleating and blating like wounded animals. Typical…
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NatGas Industry Steps Up with $350K to Help WV Flood Victims

WV floodIf you watch the evening news, you cannot escape the story of devastating floods in West Virginia last week. The floods raged across several counties and killed at least 23 people. Very sad. It seems it is during our darkest hours and trials that sometimes the brightest light shines. A group of 21 Marcellus/Utica companies have stepped up and have donated a collective $350,000 to the Red Cross to aide in flood disaster relief. Put a gold star next to their names. Here’s the list of companies that stand out for doing the right thing…
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