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OH Attorney Predicts DMA Ruling to Come Soon, Settle Now

David J Wigham
David J Wigham

MDN has been reporting on the Ohio Dormant Minerals Act (DMA) for years (see Video: OH Lawyers Explain Dormant Minerals Act & Impact on Utica). In a nutshell, there are two DMAs in Ohio–one passed in 1989 that went into effect in 1992, and another in 2006 which added certain additional procedural requirements to the 1989 version. The DMA in its various versions provides for mineral rights that had previously been separated from surface rights to transfer back to the surface owner under certain conditions. The problem, for drillers and for landowners in Ohio, is in knowing which set of DMA rules to use (1989 or 2006) in determining who owns the mineral rights. A number of DMA cases have gone before the Ohio Supreme Court. Some of the minor cases have been decided (see Ohio Supreme Court Rules in Important Dormant Mineral Act Case). However, most of the big cases remain stalled at the Supreme Court. That is, until now. Ohio attorney David Wigham (Roetzel & Andress law firm) says there are signs that the Supremes are about to release a massive, all-in-one-go ruling on the DMA. He says if landowners (and drillers) were waiting to see which way the wind will blow, they may want to settle now before the Big Decision comes down…
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Open Season to Expand 2 Midwest Pipelines for More Marc/Utica Gas

NGPL Chicago Market Expansion Project
NGPL Chicago Market Expansion Project – click for larger version

In October 2014 MDN told you about plans by Kinder Morgan subsidiary Natural Gas Pipeline Company of America (NGPL) to expand their Gulf Coast mainline pipeline from the Rockies Express Pipeline (REX) interconnection in Moultrie County, Illinois, to points north on NGPL’s pipeline system, called the Chicago Market Expansion Project (see Kinder Morgan Plans Chicago Pipeline Expansion for Marcellus/Utica). In March of this year, the Federal Energy Regulatory Commission (FERC) approved it (see FERC Approves Pipeline to Move More Marcellus/Utica Gas to Chicago). Kinder Morgan is also planning a second project called the Gulf Coast Southbound Expansion Project to send Marcellus/Utica (and other shale locations) gas to the Gulf Coast. Two days ago NGPL announced a non-binding open season–a period of time when drillers and others seeking capacity for each project–can register their interest in each project. NGPL already has customers signed up for the Chicago Market Expansion Project. This new open season is an attempt to see if there’s interest in expanding the Chicago Market Expansion project even more–and to register interest from drillers going the other way–to the south–via the Gulf Coast Southbound Expansion Project. The timing of the announcement is interesting. Observers theorize that Kinder Morgan is trying to make up for recently announced canceled Northeast Energy Direct (NED) pipeline project in New England (see NED is Dead – Kinder Morgan Suspends $3.3B New England Pipeline). Kinder won’t comment. Here’s the details on the new open season…
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OH Landowners Urge BLM to Proceed with Wayne Natl Forest Drilling

Wayne National Forest
Wayne National Forest

As MDN told you last week, the Bureau of Land Management (BLM) is currently seeking public comments on a plan to allow drilling in Ohio’s Wayne National Forest, or WNF (see Another Baby Step in Fracking Ohio’s Wayne National Forest). WNF is a “patchwork” of public land scattered among private land. Some 60% of the mineral rights below WNF are privately owned. Those mineral rights owners have been denied the use of their property rights going on a decade. Ohio landowners are fed up with waiting for the federal bureaucracy to get off its rear-end and allow drilling. In response to the latest BLM call for public input, a group of Ohio landowners calling themselves LEASE–Landowners for Energy Access and Safe Exploration–praising the BLM for its favorable Environmental Assessment (EA) on WNF drilling, and calling on Ohio landowners to provide comments to the BLM during this period. LEASE is hoping a strong showing from Ohio landowners may push the groaning, creaking federal bureaucracy into action to allow drilling…
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PA-Based CELDF Looks for New Dupes in Meigs County, OH

CELDF logoWe’ve written plenty in the past about the PA-based radical anti-drilling group called CELDF–Community Environmental Legal Defense Fund (see our CELDF stories here). CELDF seems to have a lot of success in tricking people in Ohio into believing they can pass a so-called Community Bill of Rights to ban fracking, injection wells, etc.–illegal under Ohio state law. When such legislation is passed and then gets challenged, it loses in court. Every time. And when private companies sue for damages, taxpayers end up footing the bill and the CELDF is nowhere to be found (see Anti Group CELDF Won’t Help Grant Twp Pay $1M Judgement). The CELDF is trying their trickery again–this time in Meigs County, OH and in the City of Waterville (in Meigs County). As Forrest Gump said: Stupid is as stupid does…
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Marcellus/Utica Keeps Trailer Park Operator Busy AND Profitable

UMH Properties logoWe occasionally write about a New Jersey-based real estate investment company, UMH Properties, Inc., because they keep buying trailer parks in the Marcellus/Utica with the express hope that drilling activity in the region will lead to high occupancy rates (see our UMH stories here). You might think with the rapid slowdown in drilling UMH’s strategy is in peril. But you would be wrong. Net income for the company was up 165%–from $718,517 in the first quarter of 2015 to $1,906,469 in 1Q16. How can that be? Samuel Landy, president and CEO of UMH, says that the abundance of cheap shale gas has improved the economic lives of people living in their trailer parks. He also said even though there’s less drilling, there’s more pipeline work going on and in those areas UMH’s trailer parks have strong demand. The future looks bright for UMH–thanks to hitching its wagon to the Marcellus/Utica…
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EIA: By 2040 World Energy Use Goes up 48%, Fossil Fuels Provide 75%

EIALet’s put this “keep it in the ground” and “we can use 100% renewables now” nonsense to rest, once and for all. Environmentalists–some of them well-meaning (some just stark raving mad) believe fossil fuels are evil and the cause of all sorts of problems. The opposite is true. Fossil fuels are what run this world, and without them, we’d be living in the Stone Ages again. Nothing points out the fallacy and fantasy of ridding ourselves of fossil fuels more than the International Energy Outlook 2016 (IEO2016), released yesterday by the U.S. Energy Information Administration (EIA). IEO2016 predicts that energy use across the planet will go up 48% from 2010 to 2040, based on their research. The fastest growing (percentage-wise) power source will be renewables. Yeah! But by the end of that 30-year period, fossil fuels will STILL be providing some three-fourths of all the earth’s energy needs. There is no escaping the fact that fossil fuels will be around, powering the planet, for the next 2-3 generations–minimum. Here’s what the EIA said yesterday…
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Marcellus & Utica Shale Story Links: Thu, May 12, 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: PES eyes fossil fuel expansion in Philly; natgas comes to Riverside, PA; EPA gets ready to screw o&g industry again; Bill McKibben & friends flirt with inciting violence; the difference between Trump & Clinton as president – 1 million bbl/d; France considers banning US natgas imports; and more!
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Rex Energy 1Q16: Lost $62M, but Still Drilling in the Marc/Utica

Rex EnergyRex Energy Corporation released its first quarter 2016 update yesterday. The company reported operating revenues were down 44% year over year. Although Rex lowered some of their expenses, the company lost $62 million in 1Q16. Production during the first three months of the year stayed just about the same as 1Q15–approximately 200 million cubic feet equivalent per day (Mmcfe/d). Rex spent $30.6 million drilling and completing wells in their various locations in the Utica and Marcellus during 1Q16–so at least they’re one driller who’s still drilling in our region. Here’s the update with details…
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TETCO Pipeline Up & Running Post-Explosion; Antis Exploit Accident

Spectra blazeAn update on Spectra Energy’s Texas Eastern Transmission’s “Delmont Line 27” which exploded in Westmoreland County, PA on April 29 (see Texas Eastern Pipeline Explodes near Pittsburgh, Antis Celebrate). We previously told you that not only was Line 27 out of commission, so too were three other pipelines running through the same corridor, meaning 1 billion cubic feet of natural gas per day is not reaching certain mid-Atlantic markets (see Update on Spectra Pipeline Explosion Near Pittsburgh). The early evidence points to corrosion along welded seams, although the jury is still out and the exact cause may not be known for months (see Preliminary Guess on TETCO Pipeline Explosion Cause: Corrosion). That doesn’t stop antis from engaging in wild speculation and “I told you so” statements, as they are now engaged in. THE Delaware Riverkeeper, which opposed the expansion of horsepower/capacity at a compressor station close to the explosion, is now saying the increased flow rate through the pipeline caused the corrosion. Which all sounds reasonable–until you read the words “I can’t say for certain there is a cause-effect relationship between the increases in [compressor] horsepower and the pipeline explosion, but it is information that should be part of the public discussion about this incident and pipeline safety in general.” Translation: “We won’t let this crisis go to waste. It doesn’t matter what the real cause was, we’ll amp up this explosion in sympathetic anti-drilling news outlets like the Pittsburgh Post-Gazette and spread fear everywhere we can–so we can shut down natural gas in this country.” Below is an update from Spectra Energy that one of the four pipelines is now operating again, along with the latest attempt to demagogue and unfortunate accident with absolutely no evidence…
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Potter County, PA’s First Utica Well Fracked & Flowing

JKLM logoAn MDN reader recently alerted us to a little-known fact: JKLM Energy has successfully drilled and is flowing gas from Potter County, PA’s first Utica Shale well. JKLM is owned by Terry Pegula, the guy who sold most of his Marcellus assets and used the money to buy the Buffalo Bills (see Buffalo Bills Stay in Buffalo, Thanks to $1.4B of Marcellus Money and Buffalo “Marcellus” Bills – Team Sold to Fracker for $1.4B). Pegula’s former company is East Resources. JKLM is Pegula’s way of keeping his finger in the Marcellus/Utica pie. We reported in Feb. 2015 that JKLM had signed a lease deal in Potter County (see Potter County, PA Hospital Leases Land to JKLM for Utica Drilling). There was an unfortunate incident during the drilling process (see JKLM Energy Accident Contaminates 5 PA Water Wells with Soap and PA DEP Issues Notice of Violation to JKLM Energy for Spilled Soap). But that got cleared up earlier this year (see DEP Gives All Clear for JKLM-Contaminated Water Wells in PA). Now, the first-ever Utica well in Potter County is flowing gas, and has been since January. Here’s the details…
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Latest SEC Filing Shows Chesapeake Doesn’t Rule Out Bankruptcy

Chesapeake EnergyChesapeake Energy, the second largest natural gas driller in the U.S. (behind Exxon Mobil) and one of the largest in the Marcellus/Utica, has been on a roller coaster for the past few years. Corporate raider Carl Icahn bought himself a big slice of the company, and along with another corporate raider/Chesapeake investor, Mason Hawkins, they tossed CEO Aubrey McClendon out the door. The two then installed their own guy, Doug Lawler, who proceeded to slash jobs and sell assets–all in a bid to prop up the company’s stock price so these two corporate raiders can make a buck on their investment. We call it disgusting. Others call it business as usual. The result? Chesapeake’s stock tanked and there were rumors of an impending bankruptcy (see Chesapeake Energy: We’re Not Filing for Bankruptcy…Yet). But then Chessy’s bankers decided to keep a $4 billion line of credit open in April (see Lifeline: Chesapeake’s $4B Line of Credit Reaffirmed by Banks). That helped set off a rally in the company’s stock. But the rally has evaporated like St. Elmo’s fire. In a recent filing with the Securities and Exchange Commission, Chesapeake spoke plainly about the possibility that if the price of natgas does not recover soon, they may not be able to meet their debt obligations in 2017. In other words, “We may be heading for bankruptcy next year, if…”
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EVEP 1Q16: Lost $62M, Production Up 17%

EVEP logoAs we reported in March, EV Energy Partners (EVEP)–an upstream master limited partnership (MLP) created by EnerVest that holds enormous acreage in the Ohio Utica Shale play–is in survival mode (see EV Energy Partners: No New Utica Wells in 2016, in Survival Mode). In April the company quit paying unit holders (see Problem: EV Energy Partners Quits Paying Unit Holders ). Yesterday EVEP issued their first quarter 2016 update. In 4Q15 EVEP lost $71.3 million. In 1Q16 they lost $61.7 million–so at least their losses are getting smaller. However, total debt remains concerningly high–at $638 million. One small bright spot: EVEP’s production increased 17% year over year from 172.5 million cubic feet equivalent per day (Mmcfe/d) in 1Q15 to 201.4 Mmcfe/d in 1Q16. Here’s the latest update…
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Gov Cuomo Turns NY into Sacrifice Zone with Frack & Pipeline Bans

Karen Moreau
Karen Moreau

Yesterday API (American Petroleum Institute) New York Executive Director Karen Moreau held a conference call with reporters to discuss the importance of investing in energy infrastructure in the Empire State. By the way, API New York used to be called the API New York State Petroleum Council. Moreau spoke about Gov. Cuomo’s reckless actions in banning shale drilling, and now in preventing an important pipeline project–the Constitution–from being built. She pointed out that New Yorkers pay an average of 50% more for our electricity than residents in other states–mostly because of lack of pipelines and infrastructure in the state. When everyone thought Cuomo was about to allow fracking in select counties on a trial basis, antis called those counties “sacrifice zones.” We’re going to borrow their own language and use it against them. Gov. Cuomo has turned upstate NY into one, big economic sacrifice zone–sentencing residents to a life of poverty and enslavement. Why? To appease the people who vote him into office every four years (mostly located in New York City). A quid pro quo. Here’s an update on what Moreau said yesterday to reporters…
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Latest Case of Duke U Bought & Paid “Research” by Park Foundation

Duke logoIt’s good to know that “research” can still be purchased at the once-great Duke University. For years now the radical Park Park Foundation has been buying its research from a few select professors at a few select universities. One of the scientists for sale is Avner Vengosh, professor of geochemistry and water quality at Duke University’s Nicholas School of the Environment (see Duke Hit Piece on Shale Water Usage from Same Park-Sponsored Prof). Here’s how it works: Park funds Dr. Vengosh’s “research,” and he conveniently “discovers” all sorts of nasty things about shale fracking, publishing his “research” in obscure, peer reviewed journals. Mainstream media picks it up and runs it. Readers who only scan headlines get the impression fracking is evil. Mission accomplished for Park (another hit on fracking) and for Vengosh (another buck in his pocket). That’s how it works in the world of bought-and-paid-for fractivism. The latest is Vengosh’s claim that he found evidence of shale wastewater contamination downstream from a wastewater injection well in Fayette County, WV…
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Radical NJ Democrats Want to “Constitution” the PennEast Pipeline

PennEast in NJ
Click map for larger version

Anti-drillers (most of them liberal Democrats) haven’t wasted any time in adopting Gov. Andrew Cuomo’s tactic of delay, deny and death. Antis in New Jersey took notice of how Cuomo first delayed, then denied the Constitution Pipeline stream crossing permits, effectively killing the project (see NY Gov. Cuomo Refuses to Grant Permits for Constitution Pipeline). The leaders of radical Big Green groups in NJ, including the New Jersey Conservation Foundation and the New Jersey Sierra Club, along with several Democrat members of the NJ legislature, want the state Department of Environmental Protection to deny permits for a different pipeline project–the PennEast Pipeline. Hey, if it worked in NY, why wouldn’t it work in NJ? Problem is, NJ has a Republican governor and the DEP is an executive agency. That won’t stop the antis from trying…
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Sec. of Interior Calls “Keep it in the Ground” Protesters “Naïve”

Sally Jewell
Sally Jewell

Sally Jewell, Obama’s Secretary for the Dept. of the Interior, has not endeared herself with anti-drilling zealots who inhabit (infest?) her own Democrat Party. Last week Jewell told a reporter that the “keep it [i.e. fossil fuels] in the ground” movement is “naïve” and there is NO WAY we will transition to 100% renewables any time soon. Oooo, harsh words! From an Obamadroid! One of the key issues, according to Jewell, is transportation. She said we don’t yet have solar-powered automobiles. And before someone embarrasses themselves to ask “What about electric cars?”…we’ll remind you that more than 70% of all electricity produced in the U.S. comes from burning fossil fuels. The electric in the battery of an electric car got there by burning coal and/or natural gas. If we “leave it in the ground” it won’t be long before you’re walking or riding horseback to get from point A to point B. You’d also have to give up television, radio and a host of other things powered by electricity. Unless you want to watch and listen when the sun is out. Here’s some tough words from Sec. Jewell for the crazies in her own party…
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