Proxy Firm, CNX Accuse Each Other of Lying re Paris Goals Proposal
The proxy firm hired by California hotel owner Jon Handerly is accusing CNX Resources of lying about its attempt to silence CNX CEO Nick DeIuliis. Handerly, using Proxy Impact, is attempting to get CNX shareholders to pass a proposal requiring the company to file annual reports on how the company measures up to the cockamamie “Paris goals” of reducing carbon dioxide emissions (see Calif. Hotel Liberal Pressures CNX to Report on Loony Paris Goals). When you dig into the proposal, it’s actually an attempt to silence DeIuliis–to stop him from openly criticizing leftists and environmental wackos.
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Last week CNX Resources issued its first quarter 2023 update. The company generated $710 million of net income versus losing $923 million in the same quarter last year. However, actual revenue for selling gas and NGLs was down from a year ago ($456 million vs. $745 million). The net income figure also includes gains and losses on derivatives (hedging). In 1Q22, CNX lost $1.7 billion on its derivatives, but in 1Q23, the company made $762 million on derivatives. Production fell in 1Q23, down to 135.9 Bcfe (or 1.51 Bcfe/d), versus 150.9 Bcfe (1.68 Bcfe/d) in 1Q22.
The war of words continues. Two days ago, MDN told you that the liberal owner of two hotels in California, Jon Handerly, who happens to own a few thousand shares of CNX Resources stock, wants shareholders to approve his cockamamie proposal to force the company to produce an annual report detailing the company’s “efforts” to comply with the nonsensical “Paris Agreement” to reduce so-called greenhouse gas emissions (see 
Free cash flow (FCF) refers to a company’s available cash repaid to creditors and as dividends and interest to investors. Companies typically use FCF to buy back shares of stock, pay fatter dividends, or pay off creditors. When the price of natural gas went through the roof last year, natural gas drillers were rolling in the FCF. Now with natgas commodity prices in the basement, FCF money has been wiped off the table. How much? For six large natural gas-focused drillers (five of them focused on the Marcellus/Utica, one on the Haynesville), some $8 billion of FCF is “now off the table” according to an article by Bloomberg.
New shale permits issued for Apr. 10-16 in the Marcellus/Utica picked up two from the prior week. There were 20 new permits issued in total last week, up from 18 in the prior week. Last week’s tally included 13 new permits for Pennsylvania, 4 new permits for Ohio, and 3 new permits in West Virginia. Last week the top receiver of new permits was Coterra Energy, with 6 new permits issued in Susquehanna County, PA. EQT was number two with 5 new permits, all of them issued in Greene County, PA.
Yesterday MDN told you about the recently-filed application by the State of Pennsylvania to attract one of 6 to 10 so-called hydrogen hubs to the Keystone State (see 
The ARCH2 (Appalachian Regional Clean Hydrogen Hub) project, the West Virginia-led effort to attract government funding for one of 6-10 regional hydrogen hubs, took a leap forward today with the announcement by Adams Fork Energy, Haldor Topsoe, and CNX Resources Corp. of a plan to build a “multi-billion-dollar” clean ammonia manufacturing facility in southern West Virginia. CNX will provide natural gas to the plant, tentatively scheduled to begin construction in 2024 in Mingo County, WV. The ammonia plant will be an “anchor project” in the ARCH2 Hydrogen Hub application currently under consideration by the U.S. Dept. of Energy.
CNX has reached a settlement with the Municipal Authority of Westmoreland County (MAWC) in a lawsuit brought by MAWC in 2016 claiming that CNX (and partner Noble Energy) claimed post-production deductions from royalties that should have been paid to MAWC. The original lawsuit sought combined damages of $3.6 million. The final number to be paid by CNX, according to reports, is $600,000.
The sharp analysts at RBN Energy have sifted through the announcements and “guidance” statements from 42 of the country’s major publicly-traded oil and natural gas drillers for 2023. Among them are 11 gas-focused drillers, nine of which have operations in the Marcellus/Utica region. Looking at the list of 11 gas-focused drillers, RBN finds production will be just about the same in 2023 as it was in 2022–projecting a dip of 1% this year. The analysis also finds collectively that the 11 gas-focused drillers will spend around 9% more on drilling this year due to Bidenflation. Spending more to produce the same–not a winning formula for a politician to run on.