Some PA Landowners Resell Royalty Rights – Good or Bad Idea?

good idea bad ideaA few weeks ago the Pittsburgh Post-Gazette ran an article about a relatively new trend happening in shale country: landowners reselling their already leased royalty rights (see the PPG story Pennsylvania landowners can get cash on spot for mineral rights). It’s sometimes referred to as “flipping” their royalty rights. In essence, it works like when a person wins the lottery but the payments are stretched over a period of years–like 15-20 years–but the winner would prefer to have their money now. There are companies that will pay the winner a discounted price for the right to receive the future payments. Maybe the winner would have ended up getting $1 million when all payments are made, but the company is willing to pay them, say, $600,000 right now. So the winner takes the money now and signs over the future payments to the company. The winner gets half or more now, the company pockets a nifty sum but has to wait to get it.

Something similar is happening with potential (not even actual) royalties from shale drilling in the Marcellus–except the stakes are higher, and the risk much greater…
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Dueling Documentaries: FrackNation v Gasland 2 Counter Screenings

The fantastic, fact-filled (pro-fracking) documentary FrackNation will go toe-to-toe against the newly released, fact-deficient (anti-fracking) documentary Gasland 2 with “counter screenings” across the country, according to FrackNation creator and director Phelim McAleer. First up is a counter screening in Santa Barbara, CA later this week, on May 31. Next week: a counter screening in Binghamton, NY on June 5 (yeah!). MDN is written from Binghamton, so we look forward to the dueling documentaries that will be in town next Wednesday. Phelim McAleer will be in Binghamton for the FrackNation screening. Josh Fox will also be in town screening Gasland 2.
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New Pipeline, Wells Coming to Upshur & Barbour Counties in WV

Drilling for natural gas in the largely dry gas West Virginia counties of Upshur and Barbour is about to pick up–a lot. How do we know? CONE Gathering, the midstream part of a joint venture between CONSOL Energy and Noble Energy, is constructing a new 24-inch, 37-mile gathering pipeline through the heart of both counties. When that pipeline is done, it will start to connect a flurry of new wells drilled by CONSOL and Noble.

Construction on the new pipeline is set to start in six to nine months and will be completed another six to nine months after that. So the new pipeline may be online as early as a year from now…
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Ohio Hits Milestone: 100 Utica Wells Now Online & Producing

As of May 25, Ohio has issued 686 Utica Shale drilling permits. Of the permits now issued, 335 (half) of the wells have been drilled. And of the half now drilled, Utica has 100 wells (15% of those permitted, 30% of those drilled) now online and producing natural gas, gas liquids and oil. Hitting the 100-mark is a true milestone.

During the week of May 19-25, the Ohio Dept. of Natural Resources (ODNR) issued 10 new permits. Here’s where the permits were issued, and the companies that received them:
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Judge Rescinds Request for WV Supremes to Rule on Surface Rights

In early April, MDN told you about a case referred to the West Virginia Supreme Court by a federal district court judge. Judge Irene Keeley requested the WV Supreme Court rule in a case over whether or not a driller can build a drill pad on a surface owner’s land for the purpose of getting the gas underneath a neighbor’s property (for background, see District Court Judge Asks WV Supremes to Rule in Surface Rights Case).

We have a new development in the case. Judge Keeley has changed her mind and told the supremes to forget about it–at least for now. She wants the lawyers for both sides in the case to submit more “facts” before she decides on whether she’ll rule or resubmit it to the high court…
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Halcón Resources Issues Utica Shale Well Production Update

Last week Halcón Resources issued an operational update for their Utica Shale wells. The company attempted to put a good spin on the news, but since then, some analysts have reacted with less than glowing remarks about the performance of the wells (see NGI’s Shale Daily article: Halcon’s Utica Test Wells Disappoint Analysts; EVEP Charges On).

Here is the Utica update from Halcón from last week, along with a handy map of their well locations:
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ACC: Shale-Related Petrochem Projects Mean $72B Invest, 530K Jobs

Last week the American Chemistry Council (ACC) released the third report in a series that examines the economic benefits of U.S. chemical industry investments linked to abundant and affordable supplies of shale gas. The latest report, titled “Shale Gas, Competitiveness, and New U.S. Chemical Industry Investment—An Analysis of Announced Projects” (full copy embedded below), analyzes 97 chemical industry investment projects that have been announced through the end of March 2013.

According to ACC, in just five short years the U.S. has gone from one of the world’s highest-cost producers of petrochemicals to one of the world’s lowest-cost producers–thanks to the miracle of hydraulic fracturing and horizontal drilling. The economic implications are as astonishing as they are profound. According to the report, the U.S. is on track for $71.7 billion in investment and more than half a million permanent new jobs due to just 97 chemical industry projects related to shale gas.
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Americans Against Fracking Targets/Pressures Democrat Governors

With apologies to the inimitable Judy Collins: Where are the clowns, Send in the clowns, Don’t bother, They’re here…

MDN recently introduced you to the confederation of mostly small and single-member “groups” flying under the banner of Americans Against Fracking (see 100 “Americans Against Fracking” Badmouth Energy Nominee Moniz). The clowns are at it again. In an undated but recent press release (we assume from May 23), the so-called Americans Against Fracking (AAF) targeted five Democrat governors and the Democratic Governors Association–accusing the DGA of taking $3.5 million of “dirty” money from legitimate American corporations (oil and gas companies).
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