Coterra 1Q: Makes $608M in Profit, Drills 22 New Marcellus Wells
Coterra Energy, the new name for the merged Cabot Oil & Gas and Cimarex Energy, issued its first quarter 2022 update yesterday. Like other large Marcellus/Utica drillers, Coterra lost a bunch of money on derivatives (bad bets on the future price of oil and gas). However, unlike other large M-U drillers, Coterra still made money in 1Q22–a LOT of money. The company made $608 million in 1Q22 vs. making $126 million in 1Q21–nearly 5X as much. How? The price of natgas nearly doubled over the past year, that’s how. Coterra generated a massive $961 million in free cash flow, returning most of it to shareholders via dividends ($0.60 per share) and stock buybacks.
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With all due respect, Equitrans Midstream, builder of the 94% completed Mountain Valley Pipeline (MVP), is making a big mistake, in our humble opinion. Equitrans issued its first quarter 2022 update this morning. The big announcement from the update is that the company plans to file for new permits from the U.S. Fish and Wildlife Service (USFWS) and the Bureau of Land Management (BLM) to allow MVP to build through 3.5 miles of the Jefferson National Forest. The radically left U.S. Court of Appeals for the Fourth Circuit (4th Circuit) has ruled against MVP and those same permits twice before. Equitrans CEO Thomas F. Karam says he thinks the third time will be the charm. We say, don’t hold your breath.
JobsOhio, a private nonprofit largely funded by the profits from state liquor sales, is dedicated to attracting new jobs and investments to the state. JobsOhio has been a big part of the plan to get an ethane cracker built in the state, a project currently on hold. JobsOhio still believes there will be an ethane cracker plant built on a site prepared for that purpose in Belmont County, Ohio. PTT Global Chemical is supposed to be the one building the plant. However, a stray comment by the President and CEO of JobsOhio, JP Nauseef, confirms what we’ve thought for a long time…
Pipeline giant Energy Transfer (builder of the Rover and Mariner East pipelines here in the M-U) is planning a large-scale LNG export facility in Lake Charles, Louisiana located on the Calcasieu ship channel. The project will convert Energy Transfer’s existing Lake Charles LNG import and regasification terminal to become an LNG export facility. In March, ET announced it had signed a pair of 20-year deals with ENN, a Chinese company, to deliver a total of 2.7 million tonnes (MT) per year to the Chinese Communists (see 
As a way of avoiding the pain of worldwide sanctions against his country over the invasion of Ukraine, murdering thug dictator Vladimir Putin has demanded that countries he sells natural gas to (namely in Europe) pay him in roubles. Most countries have refused his demand, so last week Putin began cutting off natgas shipments–so far to Poland and Bulgaria. However, more European countries are in Putin’s crosshairs to cut off supplies. If that happens, you can expect the price of natural gas worldwide to skyrocket, says an analyst with Rystad Energy.
MARCELLUS/UTICA REGION: Energy prices are going up, but so are the service providers’ costs to the shale industry; NATIONAL: The U.S. shale patch is facing a plethora of problems; Even woke cancel culture won’t help Democrats; INTERNATIONAL: As of 2021, China imports more liquefied natural gas than any other country; Oil is soaring. Will the majors stick with net zero?