Ascent Resources Spends $1.5 Billion to Buy OH Utica Acreage, Wells

Last Thursday, Ascent Resources, a company founded by Aubrey McClendon after he left Chesapeake Energy, announced it is buying 113,400 Utica Shale acres along with 93 operating wells located in eastern Ohio for $1.5 billion. The new acreage tips Ascent over the 300,000 Utica acre line and catapults the company into one of the largest privately owned drillers (exploration and production) in the U.S. The companies doing the selling are CNX Resources and Hess (selling a joint venture they co-owned, each selling their share for $400 million each, for a total of $800 million), Utica Minerals Development (a subsidiary of First Reserve, a private equity firm headquartered in Greenwich, CT, and EMG), and a fourth, unnamed mystery seller. The CNX/Hess acreage (78,000 net acres of the 113,400 acres) is located in the wet gas window of Belmont, Guernsey, Harrison and Noble counties. We’re not sure about the location of the other acreage. The CNX/Hess jv sale marks Hess’ total exit from the Utica Shale. So how will Ascent pay for all of their new shiny new assets? After all, they only just emerged from bankruptcy in April (see Ascent Resources Marcellus Exits Chapter 11 Bankruptcy). [Correction: Ascent Resources Marcellus was the part of the Ascent business that filed for bankruptcy and is not related to Ascent Resources Utica and this new transaction.] Ascent will pay for it by issuing $965 million in new shares of equity (private stock), and borrowing $535 million under their existing line of credit…
Continue reading

Update on Hess’ Activity in the Ohio Utica: Completing 5 Wells

It’s been a while–quite a while–since we’ve heard anything about Hess’ Utica drilling program. The last article we ran on Hess drilling in the Utica was in April 2016 when Hess management said that while they have “good rock” in the Utica, they would mothball their Utica operations until more pipelines are built. Looks like the pipelines are built. We spotted a story that gives new information about Hess’ plans in the Utica. They currently have 59 wells producing in the Ohio Utica. They’re working to complete another 5 previously drilled (in 2015?) wells, which will give them 64 producing wells “in the next month or so.” As for new drilling, the company will hopefully restart their program to drill new wells “hopefully in mid-2019.” Here’s what Hess’ “Utica operations area lead” guy had to say at a Kiwanis Club meeting last week in Steubenville about how much, and where, they’re drilling in the Utica…
Continue reading

Hess Utica Plans – No More Drilling Until Pipelines Get Built

Hess truck toyYesterday Hess Corporation released their first quarter 2016 update. A few years ago Hess sold off its downstream (refinery and filling station) business to Marathon Petroleum. Did you know the Hess Truck is no longer owned by Hess (see Marathon Petroleum Buys the Hess Truck! What Will We Do for Xmas?). Hess is now a 100% upstream or drilling company. They like to concentrate on oil and have a big presence in the North Dakota Bakken Shale. However, Hess still owns something like 22,000 acres of Utica Shale leases. Earlier this year the company said they would finish up drilling 5 Utica wells and then pull the plug for the rest of 2016 (see Hess Drilling 5 More Utica Wells 1Q16 Then Stopping). What does the latest update have to say? And what did Hess’ top management say on an analyst phone call yesterday about the Utica? We have it below…
Continue reading

Hess Drilling 5 More Utica Wells 1Q16 Then Stopping

stop signHess Corporation released their 2016 capital and exploration budget yesterday. Last October Hess said they would spend $2.9-$3.1 billion during 2016. Throw that out the door. They’ve now dropped the capex budget to $2.4 billion, which is 40% less than they spent in 2015. Hess has maintained an active drilling program in the Ohio Utica Shale. What part of that $2.4 billion do you suppose they plan to spend in the Utica this year? The number is $45 million, which will be spent on drilling five new wells and bringing a total of 14 wells online–all in the first quarter. After that? They’re releasing the single rig they now have under contract. So Hess is spending 1.9% of their budget on the Utica for 2016…
Continue reading

Hess Proud of Pleasing Those Who Want to Shut the Company Down

Has the world always been this screwed up? Perhaps. How do you explain one of the world’s largest fossil fuel companies, Hess Corp., trying to please the lunatics who are trying to shut them down? Do you call that self-loathing? Do you call it fear? Do you call it dysfunctional co-dependency? Whatever you call it, Hess is crowing about the “honor” of being recognized as a “leader” among S&P 500 companies for “climate change transparency”. This “honor” has earned Hess a position on something called the “2015 Climate Disclosure Leadership Index (CDLI)”–a hall of fame thing cooked up by a group of self-righteous global warming true believers called the CDP who would love nothing better than to see oil and gas companies like Hess go extinct…
Continue reading

Hess COO Sells $540K of Company Stock

From time to time we tell you about so-called “insider selling” or “insider buying”–by which we mean someone in top management or on the board of directors is buying or selling stock in the company for which they work. We’ve just had another instance. In September, first a Hess board member John H. Mullin III purchased $381,430 worth of company stock (see Hess Board Member Buys 7K Shares, Now Owns $3.2M in Hess Stock), then Hess CEO John Hess bought a whopping $7.5 million worth of company stock (see Hess CEO John Hess Buys 144K Shares of Co. Stock for $7.5M). Now we get word that Hess COO Greg Hill has just sold $540,180 worth of stock…
Continue reading

Hess 3Q15: Utica is Now Just an Afterthought for Hess

afterthoughtIt’s obvious that Hess has pretty much given up on its Utica Shale drilling program. Just last week we told you that Hess is shopping the rest of its remaining Utica acreage (see Hess Quietly Shops the Rest of Their Ohio Utica Acreage). In releasing their third quarter 2015 financial and operating update yesterday, we were interested to see what Hess was saying, on the record, about the Utica. We found four references in their extensive update, which we’ve extracted out below…
Continue reading

Hess Quietly Shops the Rest of Their Ohio Utica Acreage

for sale signIn January 2014 Hess Corporation sold 74,000 of its 95,000 100%-owned Utica Shale acreage leases to Aubrey McClendon’s American Energy Partners for $924 million (see Hess Sells 74,000 OH Utica Shale Dry Gas Acres to Mystery Buyer). After the sale, Hess still owned 21,000 acres of leases plus a 50% share of a joint venture with CONSOL Energy in another 65,000 acres. In January of this year, Hess (like other drillers) cut way back on their budget for Utica drilling (see Hess Cuts Utica Drilling Budget 42% for 2015). It appeared that Hess was still in love with the Utica as recently as August when Hess’ top managers said some flattering things about their Utica acreage (see Hess Says Harrison County, OH “Truly the Sweet Spot” of the Utica). Perhaps that was a buildup to selling their remaining position–because that’s exactly what they’re now doing. According to unnamed sources who have seen an offering document being circulated, Hess is shopping all of their remaining Utica acreage, including the jv with CONSOL…
Continue reading

Hess CEO John Hess Buys 144K Shares of Co. Stock for $7.5M

born richWhat’s going on at Hess? On Monday MDN told you that one of Hess’ board members, John H. Mullin III, had purchased 7,000 shares of Hess stock for $381,430 (called “insider buying”), bringing his total holdings of Hess stock to $3.2 million (see Hess Board Member Buys 7K Shares, Now Owns $3.2M in Hess Stock). That pales in comparison to the purchase just made by Hess CEO John B. Hess. Mr. Hess just purchased another 143,900 shares of company stock in an insider trading deal for $7.5 million. Hess’ new grand total for the stock he owns in the company that bears his name is $92 million! Rockefeller…Hunt…Getty…Hess. Sure must be nice to be born into a rich oil family…
Continue reading

Hess Board Member Buys 7K Shares, Now Owns $3.2M in Hess Stock

all inWe occasionally bring you news of when senior management or members of the board of directors for an upstream (drillers) or midstream (pipelines) company either buy or sell shares of stock in their own company. It’s called “insider trading.” There are good reasons to do both–buy or sell. But let’s be honest, if you see upper management/board members repeatedly selling their shares of stock, it just doesn’t look good (see Carrizo Oil & Gas “Insiders” Continue to Sell Company Stock). When you notice someone buying their own company’s stock, and spending hundreds of thousands of dollars, it just kind of inspires confidence that, “Hey, if they believe in the company that strongly, maybe I should too.” Such is the case with a recent purchase by John H. Mullin III, a member of the board of directors at Hess, which drills in the Utica Shale. Mullin just bought 7,000 shares of Hess for $381,430. That brings Mullin’s total holdings of Hess stock to $3.2 million. One might say Director Mullin is “all in” when it comes to the company he helps direct…
Continue reading

Hess Says Harrison County, OH “Truly the Sweet Spot” of the Utica

Last week Hess released their second quarter 2015 earnings and operations update. It didn’t really say too much at all about their drilling program in the Ohio Utica Shale. We did, however, get some color commentary from CEO John Hess on last week’s conference call with analysts. We learned from that call that Hess drilled, with joint venture partner CONSOL Energy, just 10 wells in 2Q15. They completed 15 wells (some previously drilled) and brought 9 wells online into production. Hess is dropping from 2 active rigs in the Ohio to just 1 rig for the balance of 2015 but even so, they expect to bring 25-30 new wells online for all of 2015. The interesting (kind of funny) thing to MDN was an off-the-cuff statement by Hess President & COO Greg Hill on the call. Hill said that Hess will continue to concentrate their Utica drilling in Harrison County, OH. Why? Not because that’s where most of their remaining Utica acreage is located–oh no. But because Harrison County is, according to Hill, “truly the sweet spot of the play” and “the wettest part of the play.” There you have it. Forget about Belmont, Monroe, Noble and Guernsey counties. Harrison is where it’s at…
Continue reading

Newsweek Names Hess #1 “Green” Big Oil Company

Perhaps this is anti-“green” day on MDN (see our story on the G7 today). We have nothing against people and companies who pretend to be better than the rest of us by saving the planet (“go green”), or saving the whales/polar bears/snail darters/whatever. Knock yourself out if supporting some “cause” makes you feel better/worthy/superior. What we do take exception to are people who want to force the rest of us to participate in your cause. We don’t see anti-fossil fuelers ever showing us how it’s done–how to stop using fossil fuels in their day to day lives. Their come back is that we all have to engage in this lunacy together for it to work. We say–you go first. You show us how it’s done. You show us the “superior” way to save the planet. When it comes to using the “green” banner, what’s really funny to us is when fossil fuel energy companies pretend to be “green” and “sustainable”. We think that’s laugh out loud funny. Here’s the latest example, courtesy of Hess, one of the planet’s biggest fossil fuel companies (and a driller in the Ohio Utica Shale), proud of being ranked #1 among energy companies for being “green” in a ranking by a magazine nobody reads anymore–Newsweek
Continue reading

Hess Named #1 O&G Company on 100 Best Corporate Citizens List

Number1.jpgWhen MDN editor Jim Willis attends industry conferences, more often than not there is at least one, sometimes more than one, session on CSR, or Corporate Social Responsibility. CSR means oil and gas companies ensure they are in compliance not only with the letter, but the spirit of the laws and regulations under which they operate. It also means going beyond the minimum and being good neighbors and participating in the communities in which they operate. Our industry takes the CSR role seriously. So when we noticed that Hess was named the No. 1 oil and gas company on Corporate Responsibility magazine’s prestigious list of 100 Best Corporate Citizens for 2015, we thought it worth mentioning and giving them a shout-out for a job well done…
Continue reading

Hess Cuts Utica Drilling Budget 42% for 2015

Hess Corporation, with some 90,000 leased acres in the Ohio Utica Shale, announced yesterday they are whacking their Utica budget, reducing it by 42% for 2015. Last year Hess spent $500 million in the Utica. This year they plan to spend $290 million and drill 20-25 wells (around $11-$12 million per well). Hess will continue their joint venture with CONSOL Energy in the Ohio Utica. Here’s the announcement from yesterday:
Continue reading

Hess Talks Utica at Investor Day – Predicts 40,000 Boe/d by 2020

Earlier this week Hess hosted an analyst/investor day to discuss the company’s plans and strategies now that it has shed its retail and transportation operations (Hess doesn’t own those green Hess gas stations any more, see Marathon Petroleum Buys the Hess Truck! What Will We Do for Xmas?). Two weeks ago we noted with interest that Hess said almost nothing about the Utica in its third quarter update (see Hess 3Q14: Says Almost Nothing About Utica Operations). That changed earlier this week. During the analyst/investor soirée, Hess had quite a bit to say about the Utica…
Continue reading

Hess 3Q14: Says Almost Nothing About Utica Operations

Not long ago Hess sold off its retail (gas stations) and transportation operations, completing its transformation into an E&P-only company (see Marathon Petroleum Buys the Hess Truck! What Will We Do for Xmas?). One of the operational areas for Hess is the Utica Shale in Ohio. In May of this year, the company said it was in the process of drilling 35 Utica wells this year (see Hess Likes Early OH Utica Results, Drilling 35 Utica Wells in ’14). However, when we look at the latest quarterly update from the company, published yesterday, we find the following very brief references to the Utica…
Continue reading