Ohio 2Q16 Utica Production – Who Produced O&G Where & How Much

ODNR2QaThe Ohio Dept. of Natural Resources (ODNR) has just issued production numbers for the second quarter of 2016. Compared with second quarter 2015, production numbers in 2Q16 were a mixed bag. Oil production in 2Q16 dropped by 19%–that’s the bad news. But natural gas production from shale is up 51% year over year–that’s the good news. CONSOL Energy’s CNX Gas division had the #1 producing gas well in Monroe County, the Brewster well, producing 1.6 billion cubic feet of natgas during 2Q16. Eclipse Resources had the #1 producing oil well in Guernsey County, the monster Purple Hayes, which produced an astonishing 71,072 barrels of oil in 2Q16. Below we have the ODNR’s high level overview of the numbers, along with MDN’s own exclusive analysis showing: the top 25 producing gas wells, the top 25 producing oil wells, and then the top 25 gas and oil wells as ranked by average production per day. There is a difference!…
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Rice Energy Prime Prospect for M&A Buyout?

Rice EnergyOne of the lowest cost producers that gets some of the highest prices for its natural gas in the Marcellus/Utica is Rice Energy. The difference between what it costs Rice to produce gas ($0.90/thousand cubic feet, or Mcf) verses what they sell it for (an average $3.12/Mcf) means Rice makes a whopping 247% internal rate of return, or IRR–which is THE most profitable driller among 10 of the largest Marcellus/Utica drillers surveyed (see today’s companion post on Hedging Gas Prices in the Marcellus/Utica). The Rice boys’ stellar performance has not gone unnoticed by analysts at investment and research firms. In fact, one such analyst, from Wolfe Research, says Rice “could be” a target for takeover/buyout by a larger competitor. Which competitor? Let’s name names…
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PIOGA Loses Court Case Challenging PA DEP Standards for Permits

courtgavel.jpgUPDATE: PIOGA sent MDN an exclusive statement about the case. They intend to appeal. Read PIOGA’s statement below…

In 2013 a RINO justice on the Pennsylvania Supreme Court, Chief Justice Ron Castille, sold out the Marcellus industry and joined with three Democrats on the state’s high court to overturn a large and important part of the newly minted Act 13 drilling law, in a case known as Robinson v. Commonwealth of Pennsylvania (see PA Supreme Court Rules Against State/Drillers in Act 13 Case). Part of the Act 13 law was left intact, but part of it, the part that directed local municipalities to craft zoning laws to include certain statewide uniform provisions concerning the location of oil and gas operations, was tossed (see What Does PA Supreme Court Decision on Act 13 Mean?). In June of this year, the Pennsylvania Independent Oil & Gas Association (PIOGA) argued a lawsuit against the PA Dept. of Environmental Protection (DEP) based on the tossed Act 13 case. PIOGA argued that part of the Act 13 law–the part that granted the DEP sweeping power to consider proposed impacts a well might have on public and natural resources when considering whether or not to issue a permit–was no longer valid. PIOGA said those parts of the law are directly related and intertwined with the part struck down by the Supreme Court. In other words, Act 13 in its original form, as passed, said the DEP could consider impacts on public and natural resources as part of the decisional process for issuing permits, but the Supremes struck down that part of the decisional process because they said it could not be implemented consistent with Act 13’s intent. PIOGA’s lawsuit pointed out that public natural resources were still protected by other laws operators must comply with and that the Supreme Court’s invalidation of Section 3215(c) meant that DEP ould no longer impose conditions in permits related to these other laws. A Commonwealth Court in PA ruled yesterday against PIOGA’s argument (full copy of the ruling embedded below). In essence, the court is picking and choosing which parts of a law that was duly passed it wants to have enforced, and the parts it doesn’t like it willy nilly tosses, which is bass ackwards. DEP must obey the Supreme Court’s rulings just as everyone does, but not for now courtesy of the Commonwealth Court…
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Why CONSOL Energy Chose Ohio Utica as Place to Restart Drilling

CONSOL EnergyIn 2015 CONSOL Energy temporarily quit all new drilling activity. In July of this year, they said they would restart their drilling activities, targeting the Ohio Utica (see CONSOL Energy to Restart Drilling in August – Mainly in Utica). The drill bit is now chewing away. CONSOL, once a coal company, has been a huge driller in the Marcellus. Why did it change focus to the Utica? What, about the Utica, turned CONSOL’s head in that direction?…
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Hedging Gas Prices in Marcellus/Utica – Who Hedges & How Much?

S&PS&P Global Market Intelligence recently conducted research on 10 of the largest Marcellus/Utica drillers to discover which have “hedged” their 2017 production, and for how much. Hedging is a concept of pre-selling the gas you produce at a price you agree to now, in advance. Although that may sound risky, it’s actually an exercise in risk avoidance. It’s less risky to lock in favorable prices in advance rather than wait and potentially get far less. How do these drillers know what the prices will be a year from now? They don’t know, for sure, but there is something called the forward market, that predicts what prices will be at future dates. In fact, traders create contracts now based on prices in the future, and those contracts are reported by various news and data services, like NGI’s Forward Look publication. The S&P analysis finds that Antero Resources has hedged all of its 2017 production–in fact MORE than all (111% of it). National Fuel Gas Company’s Seneca Resources has hedged or pre-sold 87% of its 2017 production. A related and important question is, How much does it cost these drillers to produce their gas? Profit is the difference between what it costs to produce an Mcf (thousand cubic foot) of gas and what you get paid for it. Below is a VERY interesting table outlining those details for 10 of the top drillers in the Marcellus/Utica…
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Crews Work Around the Clock on Carroll County Gas-Fired Elec Plant

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Carroll County Energy power plant – artist rendering

In July 2013 MDN brought you news that Carroll County Energy in Carroll County, OH–a subsidiary of Advanced Power Services–would spend $800 million to build a new 700-megawatt natural gas electric generating plant in the county to be fed by Utica Shale gas (see New NatGas Powered Electric Plant Coming to Carroll County, OH). It took a while, but in July 2015, two years later, officials held the official ground-breaking ceremony for the plant (see $800M Utica Gas-Fired Electric Plant Breaks Ground in Carroll Cnty). What about since then? Today crews are “working around the clock” on the plant. Here’s an update on yet another new natgas-fired electric plant getting built in the Utica/Marcellus…
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Mon Power Completes Project to Support WV Shale Industry

antero resourcesLast week MDN provided an update on Antero Resources’ $275 million state-of-the-art frack wastewater treatment plant in Doddridge County, WV (see Update on Antero’s $275M Wastewater Facility in WV). Things are progressing very nicely at the facility. Another important piece has just fallen into place for the facility. In order to operate it, you need LOTS of electricity. Enter Mon Power. Mon has just completed a new substation and power lines–a $5 million project–to provide electric service to the Antero frack wastewater treatment plant being built…
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EID Destroys Johns Hopkins “Research” on Marc. Fracking & Asthma

jhu_new_logo_largeLast week MDN alerted you to yet another study, in a long line of such studies, issued by anti-drilling zealots pretending to be researchers at Johns Hopkins University (see Johns Hopkins Junk Science: Fracking Gives You Headaches). In July this same group of agenda-driven researchers released a report supposedly tying Marcellus drilling to asthma (see Sham “Study” from Johns Hopkins Says Fracking Makes Athsma Worse). An opinion article run on the mighty United Press International wire, authored by Energy in Depth’s Dr. Katie Brown, takes Johns Hopkins to the woodshed. In Brown’s article, she obliterates the so-called research done by this group, in particular their shoddy report on asthma, and exposes them for the agenda-driven environmental frauds they are. It is a superb article…
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Marcellus & Utica Shale Story Links: Fri, Sep 2, 2016

best of the restThe “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: FERC rejects open bidding exemption for Access Northeast; MPLX’s plan to move northeast condensate and natural gasoline; pipeline cybersecurity issues in the Marcellus; PA says NY’s Cuomo is screwing PA’s energy industry; NY AG is hiding something; Utica rig count & permits up; natgas vehicles in OH; LNG pricing changes ahead; French shale gas? Maybe!; and more!!
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