EV Energy Partners, part of EnerVest Ltd., is in the final stages of a deal to sell its interest in 539,000 Utica Shale acres in Ohio, according to EV founder and chairman John Walker. (See this MDN story for background on how EV amassed such a large stake in the Utica.) When the final deal is done, it may bring in as much as $6 billion for EV.
Here’s what we know about the deal and what motivated it, from an investors call with Walker on Friday:
One month ago Halcon Resources purchased Carrizo Oil & Gas’ northern Utica Shale acreage (15,000 acres) for $43 million (see this MDN story). Halcon is not letting any grass grow under their feet. They are already working on their first Utica Shale well—preparing the site—in Trumbull County, OH. When completed, it will be the first active Utica Shale well in the county:
Grassroots Environmental Education, a leftist anti-drilling organization in New York State, released a biased report last week that says, in essence, if fracking is allowed in New York, radiation will poison us all for centuries to come. Another week, another faux report issued by a “scientist” with the viewpoint that all fossil fuels are evil. Film at eleven.
(Yes, we grow tired of reporting this claptrap, but you need to know about it because mainstream media is too lazy to evaluate it critically.)
Duquesne University (Pittsburgh) is hosting a conference on the effects of shale gas drilling in a “Boom and Bust” conference being held today and tomorrow at the university. Although the conference flies under the banner of “science” and will share the results of a “scientific study,” it is any but. It’s about the findings of a so-called study that interviewed 14 hand-picked anti-drilling women about their feelings and attitudes toward drilling. They were interviewed twice each.
MDN has shared its view—for years—that the federal Environmental Protection Agency under Obama has become a rogue agency, attempting to usurp the U.S. Constitution by taking over regulation of that which belongs to the states. Namely, oil and gas drilling. How? By using the federal Clean Water Act and federal Clean Air Act to control drilling (among a plethora of other federal laws). The EPA’s favored target is and has been hydraulic fracturing.
The EPA is currently conducting a multi-year study on fracking. An interim report will be released in the next month or so, and if a high-ranking EPA official’s comments about it are any indication, the energy industry has reason to be concerned:
Very important for landowners in and around Trumbull County, Ohio: Halcon Resources, which took possession of some 31,000 acres of 20-50 year old gas drilling leases in northeastern Ohio, is approaching landowners about amending their leases to allow drilling in the Utica Shale. It’s a good opportunity for landowners to make money from drilling, but also a good opportunity to negotiate new protections.
A new landowner group has just formed in Lordstown, OH to help landowners navigate the offers being made by Halcon:
On a conference call last week, Gulfport Energy’s CEO James Palm called the Utica Shale a “once-in-a-lifetime play … and a company changer.” He said the company plans to invest $225 million next year in Ohio’s Utica Shale to drill 50 new wells. The eventual goal? They plan to drill 400 Utica Shale wells in the next four years.
Last week Rex Energy Corporation reported its third quarter financial and operating results. Among Rex’s notable results: The company’s first Utica Shale well averaged a 30-day sales rate of 731 Boe/d (70% Liquids). Counter to many other energy companies, Rex’s 3Q12 revenues were up 14% from the same period last year.
Below are relevant sections of the Rex 3Q12 update:
Could Ohio (and for that matter West Virginia) still get their own ethane cracker plant? That would be a “yes” according to Cal Dooley, CEO of the American Chemistry Council. He was interviewed last week by Columbus Business First reporter Jeff Bell.
According to Dan Fitzsimmons from the Joint Landowners Coalition of New York (JLCNY), the elections last week produced an excellent result—at least locally in the Southern Tier of New York State. The most visible anti-drillers—candidates running on an anti-drilling platform—went down to defeat.
Here’s the letter sent out by the JLCNY late last week:
A sobering and excellent article in the Coshocton Tribune takes a look at how the re-election of Barak H. Obama will negatively impact small businesses and the Utica Shale drilling industry in Ohio. We highly recommend you read the entire article to gain an understanding of the implications for all types of small businesses—businesses that are the economic backbone of our country.
Here’s a small portion of the article that deals with federal impacts on shale gas drilling in Ohio:
In May 2012, MDN told you about a new $400 million cryogenic processing plant to be built in Hanoverton (Columbiana County), Ohio by a joint venture between Chesapeake Energy, M3 Midstream and EV Energy Partners (see this MDN story). The plant will collect and process shale gas, separating out natural gas liquids like propane, butane and ethane. In early October we told you construction had begun and the first phase of the new plant is due to come online in May 2013 (see this MDN story).
Last week an official for M3 Midstream, one of the partners in the project, visited the construction site and said things are track to meet the “very aggressive” May 2013 opening date: