Chesapeake Caves to Pressure, Will Replace Half its Board

Chesapeake Energy, in a bid to keep the company from being sold, has caved to demands from its two largest shareholders to replace half of its board of directors. Investment firm Southeastern Asset Management, which holds 13.6% of Chesapeake stock, and corporate raider Carl Ichan, who didn’t own any Chesapeake stock a month ago but now owns 7.6%, have been very vocally challenging the company and calling for changes at the board level. Raider Carl will be one of those new board members—either him or someone he designates. The other three new board members will be appointed by Southeastern.

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PA to Grant $1.7B in Tax Credits for Shell Cracker Plant

The AP is at it again. This time they’ve taken aim at Pennsylvania Gov. Tom Corbett over the proposed new ethane cracker plant that Shell announced they would build in Beaver County, PA (see this MDN story for background).

The breathless headlines are that (gasp) Pennsylvania will have to grant Shell $66 million a year in tax breaks, for a total deal of some $1.7 billion in foregone taxes over 25 years (while at the same time that nasty Corbett keeps cutting previously scheduled obscene pay increases for teachers, never mind that the state is broke after years under Ed Rendell and Democrat control). That’s the sum total of the AP story running in hundreds of newspapers now.

Let’s provide some perspective, shall we?

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Is Frack Sand a Health Risk?

The hydraulic fracturing process uses sand—a lot of sand. The sand is used as a “proppant” to prop open the cracks created during the fracturing process.

But it’s not just your ordinary seaside sand that is used. It’s a special kind of sand that is almost 100% crystalline (pure). When that sand gets into the air, its particles are so fine they can irritate the lungs, and according to some, may cause lung cancer. This is generally not a problem for landowners or others who live nearby a drilling site, as any airborne sand would quickly fall to the ground. However, it may be a health risk for workers handling the sand if they are not properly protected.

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Gulfport Energy Gets Active in Ohio’s Utica Shale

Gulfport Energy Corporation is an Oklahoma City-based independent oil and natural gas exploration and production company. Most of Gulfport’s oil and natural gas drilling operations are located along the Louisiana Gulf Coast and in the Permian Basin in West Texas. However, Gulfport has acquired acreage and is starting to make moves the Utica Shale of eastern Ohio. They are currently in the process of drilling and completing their first five Utica Shale wells.

Yesterday Gulfport provided an operational update. Here are the relevant sections with respect to their Utica Shale operations:

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New IEA 5-Year Report Says Natural Gas Future is Bright

In a new report released earlier today at the World Gas Conference in Maylasia, the International Energy Agency (IEA) paints a rosy five-year picture for natural gas around the world. You may recall that last week the IEA released their “golden rules” for shale gas drilling (see this MDN story).

The report released today says a quarter of new gas demand over the next five years will come from China, and that electrical generating plants in the U.S. will convert and use gas as much as coal. The IEA also advocates for a global market price for natural gas and hints that a spot price for gas in Asia may be on the way.

From the IEA press release:

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