Range Resources 1Q18: Drills 2 Longest Marcellus Wells Ever!
Range Resources, the very first driller to sink a well in the Marcellus Shale, provided their first quarter 2018 update yesterday. And what an update it was! First thing that jumped out for us is that Range says they drilled “the two longest laterals to date by Range at 18,129 feet and 17,875 feet.” We checked, and the previous record holder for drilling the longest Marcellus well was EQT, which drilled a Marcellus well with a lateral of 17,400 feet long in Washington County last December (see EQT Drills Longest Marcellus Well Ever, Reveals 2018 Plans). Although Range isn’t claiming they’ve drilled “the longest Marcellus well ever”–they actually have! (Note to Range’s PR department–you’re missing an opportunity to toot your own horn.) Range did not say where (which county or counties) the long lateral wells were drilled–only that it was in southwestern PA. Our guess is Washington County. Range’s long laterals caught the attention of analysts on yesterday’s quarterly phone call. Range personnel were peppered with questions about the long laterals. Other news coming from yesterday’s update: The company made $49 million in profit during 1Q18, down 71% from the $170 million Range made in 1Q17. The company is still larded up with debt–$4.1 billion worth of debt. Range CEO Jeff Ventura said, “Our plan is to continue the process of high-grading our portfolio and accelerate the de-leveraging process by targeting non-core assets sales and the thoughtful monetization of under-appreciated inventory in our portfolio. We currently have processes underway, pursuing various transactions that would support our near-term goal of getting leverage below 3 times, as we ultimately move towards an investment-grade leverage profile.” Translation: We’re selling stuff as fast as we can that doesn’t make us a lot of money. Some of those sales likely will include Range’s Marcellus assets in northeastern PA…
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EQT, now the largest natural gas-producing company operating in the United States (since its acquisition of Rice Energy in 2017) issued its first quarter 2018 update yesterday. Among the flood of news coming from the update: EQT lost $1.6 billion in 1Q18, versus making a $164 million profit in 1Q17. But the big loss was not money out of pocket–it was a paper loss, mostly due to “writing down” the value of assets in the Permian (Texas) and Huron (Kentucky) shale plays. EQT is ending its flirtation with the Texas Permian, selling its Permian assets for a minuscule $64 million. The company refused to talk about whether or not they plan to sell or keep the Huron assets. Most of EQT’s drilling remains Marcellus Shale-focused. In 1Q18 EQT drilled 24 Marcellus wells, 2 Upper Devonian wells, and 6 Ohio Utica wells. Kind of funny (for us) was the way acting CEO David Porges described the current situation he finds himself in. Porges was CEO of EQT until early 2017 when Steve Schlotterbeck took over as CEO (groomed by Porges for the job). Porges has been Executive Chairman of the board since that time. But Schlotterbeck suddenly resigned in March when the board refused to pay him what other top energy CEOs make (see 
Part of the rush of first quarter 2018 updates released this week included an update from one of the biggest Marcellus/Utica drillers–Antero Resources. Antero drills in WV, OH and PA–but their main focus is on drilling in WV (see 
As EQT gets ready to split the company into two companies later this year, the midstream (pipeline & processing plants) portion of the company yesterday announced a complicated “drop down” deal to streamline the midstream operation. The short version is this: EQT has midstream assets spread throughout three companies on paper–EQT Midstream Partners, EQT GP Holdings, and Rice Midstream Partners. Yesterday the company announced all three are being merged under one umbrella–EQT Midstream Partners. As you’ll read in the EQT announcement, the entire deal is complex–with various entities buying assets from the others. One of the more interesting aspects of the deal is that EQT Midstream is buying EQT’s (the driller’s) Olympus Gathering System and EQT’s 75% interest in the Strike Force Gathering System. EQT Midstream is also buying out Gulfport Energy’s 25% interest in Strike Force, meaning EQT Midstream will now own 100% of Strike Force–a gathering pipeline system in the dry gas Utica covering 98,000 acres in Belmont and Monroe counties, in Ohio. Here’s the news that EQT is getting its midstream ducks in a row…
In February MDN told you that XTO Energy, the shale drilling arm of Exxon Mobil, has plans to begin drilling five new shale wells in Armstrong County, PA on a former golf course (see 
Unless they walk it back, the country of Canada may well have just shot its very large oil and gas industry in the head. How? By adopting new regulations that aim to cut methane emissions in the oil and gas sector in half by 2025. The problem is, Canada has no idea of how much methane the industry actually emits now. “Half of what?” is the question. But radical antis don’t let a little thing like actual measurements and real science get in the way. They already have an answer–they’ll simply make it up. They plan to “model” it, fantasizing about how much is emitted now, and then demand a cut of half that amount. All of which favors the U.S. oil and gas industry because (so far) we haven’t tipped over into lunatic methane regulations the way the Canadians just have. It was certainly tried under Obama (via the courts and the EPA), but under Trump, methane reduction edicts from the federal government have been walked back. Perhaps when Canada realizes it’s about to literally jump off a cliff and lose an entire industry, they’ll walk their regs back too. If not, oh well! We here in the U.S. will be more than happy to take over the markets previously served by the very dead Canadian oil and gas industry…
The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading: Northeast gas drillers focus anew on drilling efficiencies; Pittsburgh gas utility trying out fuel cell technology for customers; gas industry alive and well in Belmont County, OH; natgas taking the place of coal-fired power plants in Michigan; Trump tax revamp threatens to make gas pipeline companies pay $18.5 billion; U.S. LNG exports to Mexico “growing and enduring”; is $80 the new price for oil?; Chevron evacuates Venezuela execs following arrests; and more!