Marcellus Drilling News

American Energy Partners | Chesapeake Energy | Energy Companies

Aubrey McClendon’s Death Still a Mystery – Suicide or Distracted Driving?
March 15, 2016March 16, 2016

More details are coming from an investigation into the one-vehicle crash that killed Aubrey McClendon on March 2nd (see Stunned: Former Chesapeake CEO Aubrey McClendon Dies in Car Crash). From the beginning, investigators have implied McClendon’s death was a suicide. They didn’t say it outright–but they certainly indicated it with their language. He was going “at a high rate of speed” and “didn’t hit his breaks” before driving into the concrete wall holding up a bridge. We later found out his friends wouldn’t give him any more money, which seems to support the suicide theory (see WSJ: Aubrey McClendon was in Debt Up to His Eyeballs). The black box in Aubrey’s SUV has been examined (did you know your vehicle has a black box?), and investigators say Aubrey was driving at speeds up to 89 miles per hour, and when he crashed into the bridge support, he hit it going 78 mph. Although he tapped on the brakes a few times in the moments before hitting, Aubrey never pressed down on the brakes hard. However, friends say Aubrey was known to drive fast and multi-task, using his cell phone. So we’re still left wondering–was it suicide? Or distracted driving?…
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Anti-Drilling/Fossil Fuel | Athens County | Hydraulic Fracturing | Industrywide Issues | Litigation | Ohio | Regulation | Statewide OH

Mad Moms Hopping Mad Over Court Decision re Broadview Heights, OH
March 15, 2016March 15, 2016

In 2012 Broadview Heights, OH, a Cleveland suburb, passed an illegal “Community Bill of Rights” law that bans oil and gas drilling in their township. Ohio law specifically and plainly states that only the state–not local municipalities–have the sole right to regulate the oil and gas industry. The law was promptly thrown out by a lower court, which resulted in anti-drilling groups including the Ohio Community Rights Network (OHCRN) and Mothers Against Drilling in Our Neighborhoods (MADION), with Big Green money backing from the odious PA-based Community Environmental Legal Defense Fund (CELDF), appealing the decision. It eventually made its way up the chain to the 8th District Court of Appeals. The nutters were so ecstatic when the 8th District agreed to hear the case, they celebrated with “street dramatizations” (see Antis Celebrate OH Appeals Court Hearing with Street Dramatization). They’re not celebrating anymore. The 8th District has ruled against the Broadview Heights law. Not only that, the 8th District is the first court to directly address the so-called “bill of rights” argument. In a crushing blow to the nutters, the 8th District Court said, in essence, “No. Towns don’t have inalienable rights to create laws that supersede the state’s laws.” However, nutters never go away–they blat and bleat and carry on, as they are doing now with this decision. At least we have some resolution in Ohio. This decision is a resounding refutation of the CELDF and their predatory behavior of pressuring towns into passing “bill of rights” laws that ban drilling and fracking…
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Baker Hughes | Clinton County | Energy Services | Industrywide Issues | Jobs | Pennsylvania

Baker Hughes Closes $40M Facility in Clinton County, PA
March 15, 2016March 15, 2016

The slowdown in Marcellus drilling continues–and it continues to take a big bite out of local jobs and local economies. The latest victim comes in Clinton County. Baker Hughes has closed its pressure pumping facility in Lamar Township in Clinton County. That $40 million facility was only opened in 2012. The company, which has laid off thousands of people over the past year or so, says those who worked at the Clinton facility “may be eligible for redeployment.” Here’s the sad news…
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Ascent Resources | Energy Companies

Ascent Resources Sells More of Company to Pay Down Debt
March 15, 2016March 15, 2016

In what appears (to us) to be a complex financial transaction, Ascent Resources (formerly Aubrey McClendon’s American Energy Partners’ Utica Shale company) is floating 2.2 billion (with a “b”) common units in order to raise $500 million. Ascent then plans to use that money to pay off existing notes, or IOUs. What confuses us is that Ascent is an LLC, a Limited Liability Company (i.e. corporation). Common units are the equivalent of shares of stock for an MLP, or Master Limited Partnership–a different form of company often used for midstream companies. How can a corporation/LLC issue common units as if it’s an MLP? Perhaps one of our sharp MDN readers can enlighten us? The bottom line in all of the financial mumbo jumbo you’ll read below is this: Ascent is selling more of the company (equity) in return for retiring notes (debt). It is trading equity for debt. That’s the upshot of this latest offering…
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Coterra Energy (Cabot O&G) | Energy Companies | Industrywide Issues | Litigation | Pennsylvania | Statewide PA

Reaction to Dimock Court Decision Continues
March 15, 2016March 15, 2016

Last week a brain dead, OJ-style jury awarded two families $4.25 million (one of the families already being millionaires) in the six year-old case claiming Cabot Oil & Gas contaminated water wells in Dimock, PA with their drilling activities (see Dimock Jury Levies $4.25M Judgement Against Cabot in Dimock Case). The jury rewarded the plantiffs for being unreasonable and refusing to allow their water to be fixed–because methane in water CAN be fixed. The plantiffs held out, hoping to shake down Cabot, and they got an obtuse jury to agree with them. The case is still generating shock waves with both supporters of shale energy, and irrational detractors of fossil energy. Below is reaction to the decision from the Pennsylvania chapter of the National Association of Royalty Owners (NARO), the litigious radicals at Food & Water Watch, and from Penn State’s Marcellus Center for Outreach and Research…
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Industrywide Issues | Pennsylvania | Statewide PA | Taxation

Education Doing Just Fine Without Marcellus Tax in PA
March 15, 2016March 15, 2016

Guess what’s just happened? The fiscal year for Pennsylvania is in its last four months. Republicans held firm against an out-of-control-spending governor, Tom Wolf, with no increase in income taxes and no new Marcellus severance tax. And schools went on as they always do. Teachers taught, students learned. The educational Holocaust didn’t happen without hundreds of millions of dollars being transferred from Marcellus drillers to teachers unions. And everything is just fine. Illustrating that Wolf lied about the need for a new/high severance tax. But don’t worry, Democrats are consistent if anything. Wolf is absolutely insisting on a 6.5% severance tax this year, instead of the 5% severance tax he wanted last year. He’s doubling down on the tax, even though it was just proved it’s not needed…
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Economic Impact | Electrical Generation | Industrywide Issues

Connecticut NatGas Electric Plant Gets Funding, Construction Soon
March 15, 2016March 15, 2016

Competitive Power Ventures (CPV) and GE Energy Financial Services announced last week they have closed financing on the 785 megawatt CPV Towantic Energy Center in the western Connecticut town of Oxford. Some 16 investors ponied up a combined $753 million and the project, green lighted back in 1999 but on hold until it made sense economically, will now be built. The plant will be powered by clean-burning natural gas. No doubt it will be Marcellus/Utica gas flowing to the plant to power it. The project represents one of the largest private-sector infrastructure projects in the state. And it’s all thanks to shale gas. Here’s the announcement with details…
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Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | Kinder Morgan | Lebanon County | Pennsylvania | Pipelines | Sunoco Logistics

Pipeline Opposition in Lebanon, PA Fading Away to Nothing
March 15, 2016March 15, 2016

Here’s what MDN notices about pipeline supporters and detractors. Not that long ago MDN editor Jim Willis attended a meeting in Afton, NY supporting the delayed Constitution Pipeline (see Cuomo Needs to “Snap on a Pair” and Approve the Constitution Pipe). Reports say there were over 300 people jammed into that meeting. Then we read about two anti-pipeline groups in Lebanon County, PA holding a meeting to oppose two different pipelines coming through their area–and they can barely scrape together 50 people. What does that tell you about opposition to pipelines? It’s nearly non-existent, except for a few loud mouths that are endlessly interviewed by mainstream media…
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Electrical Generation | Industrywide Issues | Research

NatGas is Killing Coal in Electric Generation Market – 2015 is Proof
March 15, 2016March 15, 2016

The U.S. Energy Information Administration (EIA), our favorite government agency, recently made an earth-shattering prediction. The EIA predicts that in 2016 natural gas will produce 33.4% of all electricity produced in the U.S., and coal will produce 32%. That is the first time, ever, that natgas will produce more electricity than coal for the entire year. There have been months when natgas surpassed coal in electric production, but starting this year natgas will dethrone king coal. And it’s no wonder. In 2015 some 80% of all retired electric plants were coal plants–mostly because of Obama’s war on coal via the EPA with strict new air standards that forced many older plants to close. However, the question is, will it continue? Natgas prices are really low right now. If those prices begin to rise again, coal may come roaring back…
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Industrywide Issues | Litigation | Pipelines

DB Brief on Court Decision re Driller Canceling Pipeline Contract
March 15, 2016March 15, 2016

Last week MDN brought you the news that midstreamers’ nightmare had come true–with a decision in a Texas court case that allowed a driller who had declared bankruptcy to cancel previously signed contracts for a pipeline gathering system (see Midstream Nightmare Comes True: Judge Lets Driller Cancel Contracts). The fear is that more drillers will use this new tactic of declaring bankruptcy in order to shed previously signed deals with pipeline companies. Is that fear legitimate? After all, this was a single case for a single driller/pipeline company. Will it be used as a precedent in other cases? We spotted a policy brief from powerhouse banking company Deutsche Bank, their Equity Research division, addressing the question of just what are the implications coming from the Texas decision…
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Best of the Rest

Marcellus & Utica Shale Story Links: Tue, Mar 15, 2016
March 15, 2016March 15, 2016

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Midstream investment continues in the Utica; SRBC fines Cabot; Chester County, PA loves natgas; WV pipeline gets favorable FERC review; Cheniere testing second LNG plant; Cheniere loading second export ship; fired Energy Transfer CFO sues; frack tech to the rescue; USPS gets CNG powered trucks; US pays $500 million to UN Green Climate Fund; and more!
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