EV Energy Partners Emerges from Bankruptcy with New Name

EV Energy Partners (EVEP) has just emerged from bankruptcy court a mere two months after entering (see EV Energy Partners Files for Chapter 11 Bankruptcy). EVEP is joined at the hip with EnerVest, a private equity firm that owns a lot of acreage and wells (most of them conventional) in the Marcellus/Utica region. EVEP is EnerVest’s drilling subsidiary, with operations and assets in OH, PA and WV. According to the forthcoming Marcellus & Utica Shale Upstream Almanac 2018, EnerVest has or actively is drilling in Venango County in PA, and Caroll, Guernsey, Stark, Trumbull, and Tuscarawas counties in OH. EVEP is (or rather was) an MLP–a master limited partnership. On Monday EVEP emerged from bankruptcy with $355 million of debt erased and sporting a new name: Harvest Oil & Gas Corp. Also gone is the MLP organization and in its place, Harvest Oil & Gas is a corporation with shares of stock that will be traded over the counter on the “pink sheets.” Here’s the news about EVEP becoming HVST…
Continue reading

EnerVest & EV Energy Partners on the Rebound with $70+ Oil

Private equity firm EnerVest owns a lot of acreage and wells (most of them conventional) in the Marcellus/Utica region. In addition to investing in land and wells, EnerVest also has its own drilling subsidiary, EV Energy Partners (EVEP), with operations and assets in OH, PA and WV. EVEP is an MLP–a master limited partnership. While EVEP is joined at the hip with EnerVest, they are (on paper) two different companies. EnerVest has vast holdings and is in the top 25 oil & gas companies in the nation. Last July the Wall Street Journal ran a story that said EnerVest was worth nothing on paper. EnerVest pushed back on that story saying it wasn’t true–at least not completely true. EnerVest chief administrative officer, Ron Whitmire, said the company’s vast holdings are structured as more than a dozen companies. Although some of EnerVest’s companies are in trouble, the entire pie, according to Whitmire, is not in danger of bankruptcy. Conversely, Whitmire’s comment also meant that at least one or more of the EnerVest companies were/are in danger of bankruptcy. EVEP was one of them, filing in early April (see EV Energy Partners Files for Chapter 11 Bankruptcy). A new Bloomberg story takes a look at EnerVest and its 72 year-old CEO, John Walker. The article says Walker, “sees redemption ahead as oil prices rise and EnerVest gets its finances in order.” That’s certainly some good news for the company. We might summarize it this way: The current high price of oil has just pulled EV’s bacon out of the fire…
Continue reading

EV Energy Partners Files for Chapter 11 Bankruptcy

In the middle of March, MDN warned readers that EV Energy Partners (EVEP), a subsidiary company of EnerVest, would soon be filing for bankruptcy (see EV Energy Partners Filing for Chapter 11 Bankruptcy in Next 2 Wks). On Monday, the company succumbed and filed. At one time (in 2012), EVEP owned more than a half million acres in the Utica Shale alone (see EnerVest Puts 539,000 Utica Shale Acres on Auction Block). We couldn’t find updated statistics for the company, but we believe they still own a significant amount of Utica (and Marcellus) acreage. Here’s the EVEP announcement that the company has entered into a prepackaged bankruptcy deal…
Continue reading

EV Energy Partners Filing for Chapter 11 Bankruptcy in Next 2 Wks

Private equity firm EnerVest owns a lot of acreage and wells (most of them conventional) in the Marcellus/Utica region. In addition to investing in land and wells, EnerVest also has its own upstream (i.e. drilling) subsidiary, EV Energy Partners (EVEP), with operations and assets in Ohio, Pennsylvania and West Virginia. EVEP is an MLP–a master limited partnership. While EVEP is joined at the hip with EnerVest, they are (on paper) two different companies. EnerVest has vast holdings and is in the top 25 oil & gas companies in the nation. Last July the Wall Street Journal ran a story that said EnerVest was worth nothing on paper (see EnerVest Goes Bust, from $2 Billion to $0 – Impact in M-U). EnerVest pushed back on that story saying it wasn’t true–at least not completely true (see EnerVest Pushes Back Against WSJ “Bust” Story). EnerVest chief administrative officer, Ron Whitmire, said the company’s vast holdings are structured as more than a dozen companies. Although some of EnerVest’s companies are in trouble, the entire pie, according to Whitmire, is not in danger of bankruptcy. Conversely, Whitmire’s comment also means at least one or more of the EnerVest companies were/are in danger of bankruptcy. EVEP is one of them. On Wednesday, EVEP announced it has brokered a deal with debt holders to file for Chapter 11 bankruptcy within the next few weeks…
Continue reading

EnerVest Pushes Back Against WSJ “Bust” Story

Earlier this week MDN brought you the news, via a Wall Street Journal article, that EnerVest, a huge private equity firm with its fingers in many shale (and conventional) pies across the U.S., has gone bust (see EnerVest Goes Bust, from $2 Billion to $0 – Impact in M-U?). However, when you peel back the onion, the story of EnerVest and their investments in various plays is much more nuanced than the headline suggests. NGI’s ace reporter Carolyn Davis does a masterful job of deconstructing what is really going on. According to an extensive interview Carolyn had with EnerVest chief administrative officer, Ron Whitmire, the Journal got it wrong–at least with some of the key points made in their article. Whitmire said Wells Fargo and other banks are not looking to seize assets to satisfy their investment. He also explained the complicated structure of the company. It’s not just one company, EnerVest and their vast holdings are structured as more than a dozen companies. Although some of those companies are in trouble, the entire pie, according to Whitmire, is not in danger of bankruptcy. Whitmire sees two options at this point for the EnerVest mothership and its “peer” companies: sell, or recapitalize…
Continue reading

EnerVest Goes Bust, from $2 Billion to $0 – Impact in M-U?

Private equity firm EnerVest owns a lot of acreage and wells (most of them conventional) in the Marcellus/Utica region. In addition to investing in land and wells, EnerVest also has its own upstream subsidiary, EV Energy Partners. In March of this year, EnerVest put 360,621 acres of leases and 1,100 wells in the Appalachian Basin up for auction (see EnerVest Selling 1,100 Wells, 361K Acres in Appalachia). Bids were due by the end of March. We never heard the outcome, but judging from the EnerVest website (Acquisitions & Divestitures), we don’t think they sold anything. Why go on about EnerVest and their Appalachian assets? Because EnerVest, which once had a value of $2 billion, is now worth nothing. Zero. Nada. Not because of their Appalachian assets, but because EnerVest took on heavy debt to finance purchases in oil plays–in Texas and Utah. Now investors, including pension funds and banks, have essentially lost their investments. They may see “pennies on the dollar” when it’s all over and done. So how does this affect the Marcellus/Utica?…
Continue reading

EV Energy Partners 1Q17 – $51M Loss, Borrowing Base Reduced $75M

In March 2016, MDN reported that EV Energy Partners (EVEP)–an upstream master limited partnership (MLP) created by EnerVest that holds enormous acreage in the Ohio Utica Shale play–was in survival mode (see EV Energy Partners: No New Utica Wells in 2016, in Survival Mode). In April 2016 the company quit paying unit holders (see Problem: EV Energy Partners Quits Paying Unit Holders). It’s been a while since we’ve last checked in on the company. EVEP released their first quarter 2017 update and held an earnings call earlier this week. It appears to us like the company continues to struggle. There is no mention of the Marcellus/Utica in the official update, although there is a brief mention on the earnings call that the company has sold 1,200 wells “throughout Appalachia.” We’re pretty sure most, if not all, of those wells are conventional (vertical only) wells. The company’s attention is mostly on the Eagle Ford (TX) Shale play–an oil play. As for EVEP’s financials, the company reported losing $51 million in 1Q17 versus losing $29 million in 1Q16. They also report their borrowing base (the estimated value of assets against which they can borrow money) has been reduced by $75 million–from $450 million to $375 million. Here’s the full update, along with a brief portion of the earnings call…Continue reading

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…
Continue reading

Problem: EV Energy Partners Quits Paying Unit Holders

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). EVEP has no plans to drill new Utica wells in 2016. Earlier this month EVEP announced they have had to decrease their borrowing base from $625 million to $450 million (see EV Energy Partners Lowers Borrowing Base by 28%). A company’s borrowing base is the value of its assets–in this case the value of the leases and oil/gas wells EVEP owns. Those assets are used as collateral to back up loans and IOUs. A lower borrowing base means a) they can borrow less money, and b) they will pay more in interest for the money they do borrow. The company continues in survival mode: They’ve just announced they are suspending cash payments to unit holders (think dividend payments to stockholders)…
Continue reading

EV Energy Partners Lowers Borrowing Base by 28%

As we reported in March, EV Energy Partners–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). EVEP has no plans to drill new Utica wells in 2016. The company is on an austerity budget–only spending to complete 10 already-drilled wells in the Texas Barnett Shale. Yesterday EVEP announced they have had to decrease their borrowing base from $625 million to $450 million–down 28%. A company’s borrowing base is the value of its assets–in this case the value of the leases and oil/gas wells EVEP owns. Those assets are used as collateral to back up loans and IOUs. A lower borrowing base means a) they can borrow less money, and b) they will pay more in interest for the money they do borrow. Here’s yesterday’s EVEP announcement…
Continue reading

EV Energy Partners: No New Utica Wells in 2016, in Survival Mode

EV Energy Partners, an upstream master limited partnership (MLP) created by EnerVest that holds enormous acreage in the Utica Shale play, released their fourth quarter and full year 2015 update yesterday. Company mucky mucks also held an earnings phone call with analysts. What did we learn? EV has no plans to drill new Utica wells in 2016. The company is on an austerity budget–only spending to complete 10 already-drilled wells in the Texas Barnett Shale. EV will spend between $10-$18 million on exploration and production in 2016. You read that right, $10-$18 million, NOT $100-$180 million. In other words, essentially nothing. According to EV’s Chairman, John Walker, “Needless to say we all should be running our companies today for survival.” Indeed. Below is yesterday’s EV Energy update, along with a portion of the analyst phone call transcript…
Continue reading

EV Energy Partners Buys $259M in Wells/Leases from Parent EnerVest

mothershipEV Energy Partners (EVEP), an upstream master limited partnership (MLP) created by EnerVest, announced they will purchase oil and natural gas properties from the mothership EnerVest in four different locations, one of them being Appalachia (i.e. Marcellus/Utica). EVEP will pay the parent company $259 million for properties in Appalachian Basin, San Juan Basin, Michigan and Austin Chalk with cumulative estimated proved reserves of 302 billion cubic feet equivalent (Bcfe)…
Continue reading

EVEP’s John Walker: NatGas Demand & Prices Heading Higher in 2016

EV Energy Partners (EVEP) is a master limited partnership, or MLP, which distributes profits to “unit holders” instead of plowing profits into more projects. They like to invest in mature, already drilled wells and pipeline companies–things that act like an annuity throwing off profit with very little risk. Over the years EVEP amassed a huge amount of acreage in Ohio–before the Utica was known–mostly for conventional (vertical only) wells. That acreage is held by production and can also be drilled for unconventional/Utica Shale wells. Since 2009 EVEP has been trying to sell some/most of their Utica acreage. Seems like every year we hear “this is the year” from EVEP. Will 2015 be that year? Possibly. EVEP Chairman John Walker, in wide-ranging remarks during a quarterly earnings analyst conference call on Monday hints that new deals are coming, both third party and “drop down” deals where they sell things to themselves on paper. Most interesting to MDN were Walker’s remarks that he believes demand for natural gas will begin to really take off in 2016, and along with it, prices will go higher (more demand than supply)…
Continue reading

Williams Buys Less of Utica East Ohio than Previously Planned

In April MDN told you that Williams would buy out EV Energy Partners 21% share in Utica East Ohio (UEO)–a midstream/pipeline company operating in Ohio (see Williams Buys Out EVEP Interest in Utica East Ohio Midstream for $575M). The original press releases in April, from both Williams and EVEP, clearly state that Williams would buy the entire 21% EVEP share in UEO. But that didn’t happen. Yesterday Williams announced they have closed on an additional 13% from EVEP (not 21%) and for $357 million (not $575 million). The Williams press release says the other 8% share went to the other partner in the venture. You have to read the EVEP press release to learn that the other partner is M3 Midstream, otherwise known as Momentum. Seems a funny thing happened on the way to the forum…
Continue reading

EVEP Reports Waterless Fracked OH Well is a Bust

disappointmentReading through earnings calls transcripts (hey, somebody has to do it), we discovered what we believe no one else has (yet) discovered or reported. On an earnings call yesterday, top management from EV Energy Partners, one of the largest acreage holders in the Utica Shale, shared interesting initial results from the test Utica well they drilled in Tuscarawas County, OH–a well drilled using waterless fracking technology from GASFRAC (see Details on GASFRAC’s Waterless Frack Test in OH Utica). The theory being tested by EVEP is that using water during fracking of a well targeted for oil recovery somehow damages the chances of oil recovery. GASFRAC used a mix of 75% butane and 25% mineral oil to frack EVEP’s “Nettles” well. The results? On yesterday’s earnings call EVEP Chairman John Walker revealed that after 90 days in production, the Nettles well is producing about half the production of a similar nearby well fracked using water. That is–the waterless frack job was a big disappointment…
Continue reading

Williams Buys Out EVEP Interest in Utica East Ohio Midstream for $575M

small potatoesIn early February, MDN told you that EV Energy Partners, a company with a huge amount of leased acreage in the Ohio Utica Shale region, was looking to sell its 21% interest in Utica East Ohio (UEO)–a midstream/pipeline company operating in Ohio (see EVEP Wants to Sell Interest in Utica East Ohio/More Utica Acreage). Yesterday EV announced they found a buyer–none other than Williams, EV’s partner in UEO. Williams currently owns 49% of UEO and is paying EV $575 million in cash to relieve them of their 21%, for a grand total operating interest of 70% ownership…
Continue reading