An important court case has ruled in favor of landowners against energy companies in New York State. Last Thursday, U.S. District Court Judge David Hurd ruled against Chesapeake Energy and Inflection Energy (and in favor of landowners) in a case where the companies had tried to extend leases beyond the original term by invoking “force majeure,” a legal phrase that means the terms of the lease could not be carried out due to extenuating circumstances.
Chesapeake and Inflection had argued that New York State’s moratorium on hydraulic fracturing of shale meant they could not drill on New York land for which they hold leases. But as with many things legal, the story is not so simple…
Norse Energy issued a press release last week to update stockholders and investors on where the company stands with its finances. Bottom line? Unless something changes, the company will run out of money in December. They have $1.5 million in the bank and that will get them through to December. If the people who have loaned them money (floated them bonds) don’t rework the financing, or if Norse can’t come up with more money from somewhere—like now—let’s just say it’s not good news.
Norse is still holding out hope that New York, where they have some 130,000 acres under lease, will finally allow fracking to commence. That gamble (so far) has not paid off. Here’s the Norse statement issued yesterday:
Where do Orange, Ulster and Sullivan county towns (in New York State) stand on the issue of fracking and gas drilling? All three of them could conceivably see drilling of some kind should it be allowed, although only Sullivan is squarely in both the Marcellus and Utica Shale boundary (Orange has just a small slice within the boundary, and perhaps half of Ulster, see the Marcellus and Utica Shale Databook Volume 2 for a map showing the boundaries). However, anti-drilling sentiments run deep the closer you get to the orbit of New York City, and all three counties are in that orbit.
The Middletown Times Herald-Record takes a look at the latest towns for and against fracking in Orange, Ulster and Sullivan counties:
In what is sure to tick off anti-drillers, the Ohio-based Muskingum Watershed Conservancy District (MWCD) announced Friday it will seek a lease with Antero Resources to allow shale gas drilling under 7,600 acres of district-owned land at Seneca Lake. The Muskingum River Watershed covers more than 8,000 square miles and drains into the Muskingum River. It is the largest wholly contained watershed in the state of Ohio covering about 20 percent of the state. More recently, the MWCD has been in hot water with anti-drillers over selling what amounts to a thimble-full of their vast water supplies to drillers in Ohio that use it for fracking Utica Shale wells (see this MDN story).
So, just how much will the MWCD get for leasing the Seneca Lake land?
Still more talk about an ethane cracker plant for West Virginia—this time from perennial ethane promoter Aither Chemicals. At last week’s Developing Unconventional Gas (DUG) East conference in Pittsburgh, Aither’s CFO said his company could build a new ethane cracker for a fraction of the cost Shell is proposing for their cracker in Monaca, PA. Another speaker expressed doubts that Shell will actually build their announced cracker plant in Monaca:
Two weeks ago MDN highlighted the opinions, as expressed in a book to be published in the spring, from an “expert” who says shale gas supplies in the U.S. will last less than 10 years (see this MDN story). We were a bit incredulous and doubtful—the book is written by an energy investment advisor, not a geologist. But we now have a second contrary voice to add to his—this one is Arthur Berman, a geological consultant with 34 years of experience in petroleum exploration and production.
Berman says, among other things, that the decline rates for shale oil are very steep and that unless we’re drilling thousands of new wells each year, we won’t even stay even with the oil we’re producing now. His opinion is in stark contrast to the IEA, EIA and other governmental organizations that predict the U.S. will soon surpass Saudi Arabia to be the world’s largest oil producer (we’ve already surpassed Russia to be the largest natural gas producer). Here’s some of Berman’s comments in an interview on shale gas and oil:
An article in the Pittsburgh Tribune-Review takes a pretty fair look at the troubles faced by PA State Rep. Jesse White and his attacks on Range Resources. Last week Range released some fairly damning emails in response to White’s attacks that seem to indicate White, who had previously courted Range, turned on them when they didn’t provide enough campaign money and support to his liking. The turning point seemed to be when Range turned down White’s request (which he now says was a joke) for a ride to the Super Bowl on a Range jet (see this MDN story).
Saturday’s Tribune-Review article quotes some in his own (Democrat) party expressing their doubts about White’s actions and words:
An editorial in yesterday’s New York Post takes aim at New York Gov. Andrew Cuomo’s indecisiveness on the issue of fracking. They mince no words when they say the problem is, in a word, “leadership.” Here’s a portion of the editorial:
Before the Marcellus Shale was actively drilled in Pennsylvania, starting with Range Resources in 2004, there was natural gas drilling in the state for many years. In fact, although about 5,000 Marcellus Shale or “deep” natural gas wells have been drilled in the past eight years, there are about 50,000 conventional or “shallow” natural gas wells scattered throughout the state, drilled over the past 50+ years. Ever wonder how conventional and unconventional wells stack up?
An article in the Pittsburgh Tribune-Review does a good job of comparing the two types of wells. Here’s a few interesting facts and figures: