EQT Retains Shale Rights in Recent Diversified $575M Deal in WV

On June 19 MDN exclusively brought you the news that Diversified Gas & Oil had purchased EQT’s Huron Shale assets in Kentucky, Virginia and West Virginia for $575 million (see Diversified Gas & Oil Adds to Conventional Assets in KY, VA, WV). The original announcement didn’t name the seller–that information was available only here on MDN. It wasn’t until June 29 that EQT admitted to the world that they were the seller (see EQT Confirms Sale of Huron Shale to Diversified for $575M). EQT said the sale includes nearly 12,000 wells with 200 million cubic feet per day of natural gas production and 2.5 million (!) acres of leases and some 6,400 miles of gathering pipelines. The sale also includes 8 field offices and 250 employees. But like an onion, more details about this story keep getting peeled back one layer at a time. Here’s the newest detail that (until now) we were not aware of: The massive $575 million deal for 2.5 million acres does not include or transfer the right to drill in the deeper shale layers that may exist under that 2.5 million acres. Instead, EQT is retaining those rights…
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Chesapeake’s $2B Exit from Ohio Utica “Is a Good Thing”

Last week MDN shared the blockbuster news that Chesapeake Energy is exiting the Ohio Utica, selling all of its Ohio assets for $2 billion (see Stop Press: Chesapeake Sells ALL of its Ohio Utica Assets for $2B). The buyer is Encino Acquisition Partners, a joint venture between Encino Energy and the Canada Pension Plan Investment Board. At the time we speculated this may be good news for Ohio’s landowners signed with Chesapeake–that perhaps landowners now stand a better chance of seeing new drilling. That was just speculation/hope on our part. Looks like we’re not the only ones thinking that way. A couple of industry experts are saying the same thing. One of them said Chesapeake’s sale and exit “is a good thing” because it means Encino will sink money into new drilling programs in a way that Chesapeake, larded up with debt, could not…
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PA Briggs “Rule of Capture” Case Turns on Concept of Drainage

In April, MDN brought you the news that Pennsylvania Superior Court had handed down a decision (known as the “Briggs” case) that has the power to greatly restrict, perhaps even stop, Marcellus drilling in PA (see PA Superior Court Overturns “Rule of Capture” for Marcellus Well and PA “Rule of Capture” Case has Power to Limit Marcellus Drilling). The issue, in brief, is that the Superior Court decision disallows using an age-old principle called the “rule of capture” when it comes to shale drilling and fracking. It opens the door to a myriad of frivolous lawsuits claiming that a fracture, a crack created during fracking, is draining gas from a neighbor’s property without justly compensating the neighbor for the gas. Southwestern successfully argued in a lower court that the odd crack here and there that may slip under a neighbor’s property is permissible. The landowner appealed to Superior Court and three judges heard the case. Two of the three overturned the lower court and sided with the landowner. Southwestern, following that decision, petitioned the Superior Court to have all of the sitting justices (called en banc) hear the case. Sadly, in June the Superiors proved they aren’t so superior after all, declining to rehear the case (see PA Superior Court Rejects Southwestern “Briggs” Trespass Appeal). Southwestern then appealed the case to the PA Supreme Court in early July (see Southwestern Appeals “Briggs” Trespass Case to PA Supreme Court). No word yet on whether or not the Supremes will take the case. In the meantime, this case and its ultimate effect on drilling in PA and beyond is still a hot topic of discussion throughout the industry. We spotted two recent articles tackling it–one from a lawyer who does a great job of crystallizing the important elements in the case–that this case turns on the concept of drainage, and the other article which tackles the broader topic of how energy law in PA is charting its own path separate from Texas and other big oil/gas states…
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NEXUS Pipeline Update – Now 80% Complete, on Schedule for 3Q18

NEXUS map – click for larger version

The NEXUS Pipeline project, owned by DTE Energy and Spectra Energy (Enbridge), is a $2 billion, 255-mile interstate pipeline that runs from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada. NEXUS got final approval for the project from the Federal Energy Regulatory Commission (FERC) in August 2017, the first major pipeline to get approved following a newly restored quorum at FERC (see New FERC Quorum Votes Final Approval for NEXUS Pipeline). However, radical environmental groups have fought the project tooth and nail. CORN (Coalition to ReRoute Nexus), and the far-left Sierra Club, launched lawsuits and regulatory actions against the pipeline. The City of Green, OH initially blocked construction, but later cut a deal to allow the pipeline through the area after NEXUS agreed to pay the city $7.5 million and donate 20 acres of land that sit next to an existing city park (see Antis of Green, OH Finally Face Reality – Will Allow NEXUS Pipe). So just how is the project doing? On a recent quarterly analyst phone call, DTE’s president and chief operating officer, Jerry Norcia, answered that question. He said, in brief, that the pipeline is now 80% built and on track to go online in the third quarter of this year…
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ME2 Landowner/Protester Admits to Some of Her Crimes, $25K Bail

Yesterday we told you that a Pennsylvania landowner from Huntingdon County, PA, Ellen Gerhart, was arrested on Friday for violating a court order to not interfere with Mariner East 2 (ME2) pipeline work being done on her property (see Central PA Landowner Arrested, Jailed for Violating ME2 Court Order). Although Gerhart is due for a hearing before a judge on Friday, there was a preliminary hearing yesterday. Gerhart “attended” by video conference because she’s being held in a neighboring county jail (Huntingdon doesn’t have facilities to house female prisoners). Under questioning, Gerhart admitted her actions were intended “to annoy and harass” ME2 workers by her actions. What were those actions? She admitted placing meat close to the construction site in order to attract bears. She also admitted setting small fires in bottles/cans, hinting to workers that they might explode (like a Molotov cocktail). She remains in jail, for now. Yesterday the judge set bail at $25,000…
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DC Circuit Court Denies Anti Request to Rehear AIM Pipe Approval

The Algonquin Incremental Market (AIM) pipeline project is an expansion of the existing Algonquin pipeline system designed to carry 342 million cubic feet of natural gas per day to New England states that badly need the gas. On March 3, 2015 the Federal Energy Regulatory Commission (FERC) issued their final approval for the project, allowing it to go forward. Construction began in 2015 and, following extreme opposition from New York State over a small portion of the project, it finally went online in late 2016. New York’s radical, anti-drilling governor, Andrew Cuomo, tried to stop the Algonquin using the flimsy excuse that some of the drilling for the pipeline would happen a half mile from a nuclear power plant–a plant that’s shutting down anyway. A few weeks after Cuomo requested FERC shut it down, FERC told him “no”–which was the cue for Big Green groups to file an appeal with the District of Columbia Court of Appeals to force FERC to rehear/reconsider their approval (see Radical Enviro Groups File Appeal to Stop AIM Pipeline in NY/CT). They asked the D.C. court to tell FERC to deny AIM after all because, they say, the project should have been lumped in with consideration of a second project, called Atlantic Bridge. Hope springs eternal for antis. Even though the completed project has been up and running for a year and a half, they still hoped they could roll back the clock and stop the extra gas flowing through AIM with their lawsuit. Those hopes were dashed on Friday when the D.C. court denied the rehearing request…
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Berkeley/Johns Hopkins Publish Junk Study on Fracking & Depression

The usual suspects from Johns Hopkins University, working with researchers from the University of California, Berkeley, have completely soiled themselves this time. It’s really kind of embarrassing. In a “study” just published in Nature, researchers claim they have found a link between living near fracking sites in Pennsylvania and an increased incidence of being *mildly* depressed. We get mildly depressed just reading this drivel. Maybe there’s a link between junk science and mild depression? Launch a study! The research team this time around includes a fellow from the Post Carbon Institute, a rabidly anti-fossil fuel organization that has called fracking a “virus.” You can tell just how biased and false this study truly is just based on the wackos who published it. The “study” is titled, “Associations of unconventional natural gas development with depression symptoms and disordered sleep in Pennsylvania” (full copy below). It’s not even real research. They used a bunch of medical records from a local hospital network (Geisinger) and didn’t actually interview anyone themselves. Totally made up. Total fiction. That’s what you need to know about the latest attack on Marcellus drilling…
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Energy Stories of Interest: Tue, Jul 31, 2018

The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading: UGI CNG filling station will lower customer natgas bills; Pittsburgh energy attorney nominated by Trump for U.S. District judge seat in PA; judge dismisses San Fran’s climate lawsuit because global warming is a global issue; U.S. energy costs are going down, thx to shale; U.S. crude oil production/exports hit record highs; U.S. GDP through the roof thx to shale; Supreme Court refuses to toss children’s climate lawsuit; Congress wants to give FERC workers a raise; Saudi-Russia mega cartel just a pipe dream; Europe pledges to take more U.S. gas; and more!
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