Ohio Republicans About to Go Goose Hunting with Severance Tax?

goose with golden eggIt seems MDN is not alone in encouraging the weak-kneed Republican politicians in Ohio to not screw up the economic miracle happening in their state by imposing an overzealous severance tax on Utica Shale drilling.

The editorial writers at the Wheeling News-Register think Gov. John Kasich and the House Republicans should tread lightly and make double-dog sure whatever new taxes they vote for, they don’t kill the goose laying the golden eggs in Ohio…
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NY Update: Norse/JLCNY Lawsuit Hearing Date Set for April 25

Sadly, politics in New York State have become so corrupt that even the State Attorney General, Eric Schneiderman, actively works against the interests of the people he’s sworn to protect–the citizens of New York State. Late last year Norse Energy sued Gov. Andrew Cuomo, DEC Commissioner Joe Martens and State Health Commissioner Nirav Shah over their collusion to stop shale drilling in the state (see Norse Energy Sues Gov. Cuomo to Force Release of Fracking Regs). Later, the 70,000-member Joint Landowners Coalition of New York joined that lawsuit (see D-Day: JLCNY Files Lawsuit Today Against Cuomo, Martens, Shah).

How has AG Schneiderman reacted? By filing to dismiss the lawsuits and delay (see NY Attorney General Files to Dismiss Norse Lawsuit, More Delays). It’s utterly shameful. The lawsuit was scheduled for a hearing first in January, then moved to February, then March, and now April. It appears Norse and the JLCNY, whose cases are now tied together, will finally get a hearing at the end of April–on the 25th…
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MWCD Close to Signing Utica Lease for Piedmont Lake, OH Property

In early January MDN brought you the delicious news that the Muskigum Watershed Conservancy District (MWCD) is planning to lease a large tract of District-owned land in and around Piedmont Lake (in Belmont, Guernsey and Harrison counties) for Utica Shale drilling (see MWCD Open House on Leasing Piedmont Lake Property for Drilling). The original 6,600 acres has now turned into 6,700 acres and the lessor will be Antero Resources, according to an announcement issued by the MWCD last Friday.

According to the MWCD board, they will likely vote on the lease at their next meeting scheduled for April 18. An update on the Piedmont Lake lease from the MWCD is below, along with the draft copy of the lease from Antero. Noticeably missing from the draft lease are the terms…
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Cracker Plant Talk Spurs Economic Growth in Beaver County, PA

Over the past couple of years the prospects for an ethane cracker plant in Beaver County, PA have swung from wild optimism to wild pessimism and everything in between. Most recently the pendulum has once again tilted negative (see Shell’s Shale Pessimism Signals Worry for Some re PA Cracker). But don’t talk negative to the businesses setting up shop and expanding in Beaver County. The mere talk that it’s possible Shell will build the $2-$3 billion ethane cracker in Monaca has caused a significant uptick in the local economy. One Realtor has said for businesses looking to get a piece of the coming economic pie–you’re already late! Many have already grabbed up space and it’s increasingly difficult to find commercial real estate in the county.

Here is the story of the economic boom already under way in Beaver County just from talk–talk that Shell may build a cracker plant there…
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Judge Rules Bluegrass Pipeline Cannot Use Eminent Domain in KY

On Monday MDN brought you the news that the Kentucky House had voted to strip the right to use eminent domain from natural gas liquids pipelines (see Kentucky House Votes to End Eminent Domain for Bluegrass Pipeline). An alert MDN reader predicted the measure wouldn’t get signed into law because the KY Senate president said with only 10 days left in this session, it’s not likely to come up for a vote in the Senate (see Bluegrass Pipeline bill passes House).

Looks like it won’t matter what the KY legislature does. Last December a lawsuit was filed by a group calling itself KURE (Kentuckians United to Restrain Eminent Domain), to prevent the Bluegrass Pipeline from using eminent domain in the Bluegrass state (see Bluegrass NGL Pipeline’s Eminent Domain Challenged in KY Court). Yesterday Franklin Circuit Judge Phillip J. Shepherd ruled in KURE’s favor and said the Bluegrass cannot use eminent domain to force landowners to allow the pipeline to be buried under their property…
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Best Way to Kill Drilling in PA/OH/WV: “Uniform” Severance Tax

A few weeks ago MDN said the plan floated by lefties and libs to create a so-called uniform severance tax across PA, OH and WV is one of the dumbest things we’ve heard in a long time (see Stupid Idea of the Year: Create Uniform Severance Tax in PA-OH-WV). The plan as proposed means all three states hold hands and jump off the economic cliff together. Apparently it’s more fun to die together (economically) than alone.

MDN is not the only voice to point out the lunacy of this plan. The head of the PA Chamber of Business and Industry also says the proposed mega-tax is nuts. As Gene Barr highlights in the following letter to the editor, it’s apparent the people proposing such a plan–including the Pennsylvania Budget and Policy Center–are ignorant of how taxes in PA and other places actually work. You would think an organization with a name that includes the word “budget” would employ at least one economist or accountant. Apparently they don’t. They are economic illiterates who don’t realize what they are proposing is anything but fair–especially to Pennsylvanians…
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Company Targets OH Landowners – Buy Future Royalties for Cash Now

Gateway Royalty is back and has $58.5 million on the bank they can’t wait to give landowners in the Ohio Utica Shale in return for future royalty payments. MDN told you about Gateway last summer. They were the company that the town of Carrollton, OH sold 1/4 of their royalty rights to (see OH Town Votes to Give Up 1/4 Royalties for Cash Payment Now). The way it works, in brief: Gateway pays landowners a lump sum now in return for the right to receive that landowner’s future royalty payments for years to come. You (the landowner) get your money now, they (Gateway) get the money you would have gotten dribbled out over time. Of course the money you receive now is discounted and in all likelihood far less than you would have gotten if you had waited just a few years (the bulk of royalty payments come in the first four years). It’s a bit of a gamble by both parties because no one really knows how much a well will produce.

Still, there are reasons why someone may want to get cash up front–pay off debt, ill health, etc. So in that vein, we bring you the latest press release from Gateway announcing they are ready, willing and waiting to give Ohio Utica Shale landowners money now. Specifically they are targeting landowners in Washington, Noble, Guernsey, Monroe, Belmont, Harrison, Carroll and Columbiana counties…
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Anti-Drillers Attack Crude-by-Rail Traveling Through PA

The leftist anti-drillers at the Pennsylvania news organization called PublicSource, backed by the likes of Teresa Heinz Kerry, is taking aim at shale-produced crude oil that travels by railroad. In a hit piece in which they begin by doing a bait-and-switch, starting with a derailment of ethanol (nothing at all to do with oil or gas), they then parry and say derailments of oil in Pennsylvania are an imminent threat and danger to PA residents. The hue and cry has gone up: Either have the feds regulate shale oil on railroads out of existence, or preferably just stop shipping crude by rail. Who wants all that nasty crude from North Dakota anyway? Funny how the answer is always the same no matter the question: just stop extracting fossil fuels.

Here’s how the latest PublicSource hit piece begins…
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Birthplace of Fracking (NE USA) Once Again Leads O&G Innovation

Fracking as a concept has been around for a long time. Would you believe us if we said the first rudimentary forms of fracking date back to the 1860s–around the time of the American Civil War? That’s when liquids were first used to fracture “shallow, hard rock wells” in places like PA, NY and WV. Somewhere along the way oil and gas drilling drifted to places like Texas and Louisiana and Oklahoma. In the modern era, fracking started to be widely used commercially in 1947. Oil and gas drilling “grew up” in, and innovations came from, drilling in the southwestern part of the U.S.

Shale drilling is a more recent development–the combination of fracking and horizontal drilling. Shale drilling has been around commercially for 15-20 years, and yes, it was first pioneered and developed by George Mitchell in the Barnett Shale of Texas. However, drillers in Texas and other locations are now learning from innovations coming from the Marcellus and Utica Shale. The country and indeed the world now looks to how companies like Cabot Oil & Gas are able to economically drill for gas in a low-price environment. The innovation that started in the northeast “once upon a time” some 150 years ago has finally returned to its birthplace in the northeast, and the northeast is showing the world how to do it better, faster, and safer than ever before…
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