On Wednesday Devon Energy Corp. confirmed it’s selling off all of its holdings in both the Ohio Utica and Louisiana Tuscaloosa Marine Shale. Between the two shale plays, the company is hoping to raise about $3 billion. Devon’s Utica Shale holdings include 244,000 gross acres (195,000 net) in eastern Ohio in the liquids-rich portion of the play. Devon has hired Scotiabank’s Scotia Waterous (USA) Inc. M&A division to handle the sale. A map of Devon’s eastern Ohio Utica property is embedded below.
Corporate raider Paul Singer is pushing Hess Corp. to get out of shale drilling. Singer’s company, Elliott Management Corp., is one of Hess’ largest investors owning 4% of company stock. On Jan. 25, Elliott Management gave notice it’s buying another $800 million of company stock and would make a play to replace some board members in order shake up management at the company.
Hess announced earlier this week it’s selling off it’s last refinery and getting out of the refining business and will become an exploration and production company. As for selling off their operations in the Utica, Bakken or Eagle Ford Shale plays and getting out of shale? Hess CEO John Hess tells Singer, no thanks buddy…
Each year the Pittsburgh Business Times ranks the “top 25” drillers in southwestern PA according to the total number of wells they’ve drilled to date in the Marcellus Shale. The 2013 list was published today.
Here’s the top five from that list—with driller name and the number of wells drilled:
Shell was supposed to purchase land in Monaca (Beaver County), PA to build a new $2 billion ethane cracker plant (a multi-year project) by Dec. 31, 2012, but instead Shell and the owner of the site signed a six-month extension to (according to a Shell spokesperson) give Shell more time to assess the site’s suitability and time to crunch the numbers to provide Shell “confirmation that the project is economically robust and competitive” (see Shell Ethane Cracker in PA Still Not a Done Deal).
The six-month delay has led to rumors that the deal for Monaca may be in doubt. Wednesday after a speech at the Marcellus Midstream Conference in Pittsburgh, PA Gov. Tom Corbett said contrary to those pesky rumors, Shell is not checking out other states to build the ethane cracker plant and that the delay in purchasing the land is due to lawyers “dotting I’s and crossing T’s.” Here’s how it played out:
It never ceases to amaze MDN the kinds of businesses that benefit from Marcellus and Utica Shale drilling. Here’s yet another one we bet you didn’t know about: The West Virginia manufacturer sells a 6,000-pound “cattle stop” to the Marcellus and Utica drilling industry.
Er, what is a cattle stop, and who does this manufacturer sell them to? Read on…
Another stellar column from Seeking Alpha blogger and energy analyst Richard Zeits—this one delving into the thorny topic of, “At what natural gas commodity price is it profitable for a driller to continue drilling?” In particular, at what price in the Marcellus Shale.
His column begins this way:
Drilling company Antero Resources continues to grow its presence and commitment to the state of West Virginia. Gov. Earl Ray Tomblin issued is 2013 annual doing business in WV report (called the West Virginia Edge Business Report) yesterday. In the report we found this interesting brief statement about Antero building a new office complex in Bridgeport:
Chesapeake Energy has won an important appeal before the Ohio Supreme Court that ruled the Ohio Oil and Gas Commission did not have jurisdiction to hear an appeals case from a landowner over a permit issued to Chesapeake from the OH Division of Oil and Gas Resources Management to drill on the property. It was a case of the wrong agency sitting in judgment—the wrong “referee” if you will:
When was the last time local governments, labor unions, businesses, chambers of commerce and construction contractors were all on the same page? Yeah, we can’t remember that time either. Except it’s here—now. And it’s happening in Stark County, Ohio were all of those groups have come together to kick off a new initiative they call Choose Stark—an outreach to encourage Utica Shale drilling and fracking in Stark County.
We say that’s pretty cool and a lesson for other regions to consider:
The Pennsylvania Game Commission voted on Wednesday to approve oil and gas drilling agreements on state land in five PA counties—some of the deals are new and some are extensions/renewals of existing deals. That’s newsworthy in and of itself (and sure to drive anti-drillers bonkers).
The news for landowners in this story, however, is the royalty percentages for the new land deals. Some impressive numbers:
Yesterday Dominion, a large utility and midstream (pipeline/processing plant) company headquartered in the “Old Dominion” state of Virginia, yesterday announced full year 2012 earnings. Dominion made a profit of $581 million in 2012. Which is impressive! But not so impressive when you consider they made a profit of $1.41 billion in 2011. Why the tumble? Investments in major projects during 2012, accounting this and that—the usual.
As always, MDN is interested in what they say about their projects in the Marcellus and Utica Shale. From the entire (lengthy) press release from yesterday, we have one paragraph that touches on Marcellus & Utica:
The Pennsylvania Dept. of Environmental Protection (DEP) yesterday announced final revisions to the “general permit” (GP-5) that governs air emissions for pipeline compressor stations and for drill sites. The new allowable limits, endorsed by the PA drilling industry, are “75 to 90 percent stricter than current limits” and go beyond federal rules according to the DEP.
The new DEP rules will allow the industry to install and use more engines at compressor stations and on the drill pad (engines powered by the natural gas being produced) to encourage the overall reduction in pollution. Here’s the announcement from the DEP:
Yeah, we know it’s a press release from a law firm (we see them every day!). But this one, MDN reckons, is noteworthy. The 12th largest oil and gas law firm in the country, Steptoe & Johnson (with offices about everywhere in the Marcellus & Utica Shale), is conducting a study of legal trends for businesses working to develop the Marcellus, Utica and other shale plays. The results are due to be released in April and should be interesting.
Here’s the details about the new study (and how you can participate) from Steptoe & Johnson:
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading: