Proxy Advisor ISS Gives Lukewarm Approval of Cimarex/Cabot Merger
Earlier this week MDN told you that a major national proxy advisor, Glass Lewis, is recommending shareholders from both Cimarex Energy (Permian oil driller) and Cabot Oil & Gas (Marcellus gas driller) approve a proposed merger on September 29 when they vote (see Proxy Advisor Glass Lewis in Favor of Cimarex/Cabot Merger). Another (THE other) major national proxy advisor, Institutional Shareholder Services (ISS), has now weighed in with its approval on the deal too–although ISS’s approval is decidedly lukewarm and not a full-throated endorsement of the deal.
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Because of the soaring price of natural gas (see our companion post today), and because gas drillers have shown remarkable restraint and a real effort to scale back capital spending in an effort to generate free cash flow, investors have taken note and like what they’ve seen. The share price in most pure-play shale gas producers (mainly those in the M-U) posted double-digit gains in value over the past month.
In May MDN told you about one of the oddest combinations in recent memory–the merger of Permian driller Cimarex Energy with Marcellus driller Cabot Oil & Gas (see 
Last week Pennsylvania issued 18 permits for new shale well drilling scattered across the state. Ohio (for the eighth week in a row) did not issue any new shale permits. Are we missing something with Ohio? Are they late in updating their online database? West Virginia issued 2 permits for new shale well drilling last week.
EnergyNet is an online marketplace for buying and selling oil and gas working interests (operated and non-operated), overrides, royalties, mineral interests, leaseholds, and other contracts. From time to time we spot auctions on EnergyNet from Marcellus/Utica drillers. EnerVest Energy is currently auctioning a package of 146,053 acres of leases for non-operated and overriding royalty interests (ORRI) in the Utica Shale scattered across Ohio and Pennsylvania. The EnerVest auction ends Oct 7. We have the details below.
Another great company succumbs to the siren call of ESG (environmental, social, governance). A week ago we told you that Seneca Resources, the drilling arm of utility giant National Fuel Gas Company (NFG), had signed up with Project Canary to certify its natural gas as responsibly sourced (see 
Southwestern Energy, which is one of the biggest Marcellus/Utica drillers, previously applied for a conditional use permit from the City of Weirton, WV that would allow them to build a well pad and drill several wells on it all within the city limits of Weirton. The request came before the Weirton Zoning Board of Appeals in August but the board delayed a decision until this month, September. Following almost three hours of comments and testimony yesterday, the Zoning Board of Appeals unanimously voted down Southwestern’s request–a decidedly unfriendly gesture by the normally gas-friendly municipalities in WV.
ExxonMobil is the latest big driller to sign on to a certification program called MiQ which aims to prove the natural gas it produces is “responsible.” We guess all the gas it’s produced for decades until now has been irresponsible, right? Anyway, Exxon plans to initially use the MiQ standard to certify some of the gas coming from its Permian Basin facilities at Poker Lake, New Mexico. Depending on how that goes, Exxon plans to expand the MiQ certification to other plays, including the Marcellus/Utica.
Early last week MDN told you about a new/third well pad planned by Olympus Energy in Upper Burrell Township in Westmoreland County, PA (see 
Whether we think it’s a good idea or not (we don’t), there is no denying that the Marcellus/Utica industry has collectively jumped off the RSG/ESG cliff. RSG stands for “responsibly sourced gas” and ESG is “environmental, social, governance.” Responding to pressure from investors and customers, most M-U drillers are now making moves to prove the natural gas they produce has been produced using practices that protect the environment. We say the gas has always been produced responsibly and we have nothing further to prove, but hey, who are we? The latest to join the crowd is Seneca Resources. The company announced yesterday will use Project Canary to certify its natural gas.
In early August MDN told you about privately-owned Penn Production Group, LLC, which concentrates on exploration and production for oil and gas in western Pennsylvania. Penn Production closed on the purchase of certain assets owned by Greylock Energy in Clearfield County, PA (see 
In early June Southwestern Energy Company announced it would no longer be a pureplay Marcellus/Utica driller. Southwestern said it was buying Indigo Natural Resources, which drills for natural gas in the Louisana Haynesville Shale, for $2.7 billion (see 
Olympus Energy, the renamed Huntley & Huntley Energy Exploration (HHEX), continues to make progress in Upper Burrell Township in Westmoreland County, PA. The company currently has two well pads (Zeus and Calliope) with multiple wells drilled in Upper Burrell. Now comes word of plans for a third well pad, named the Selene Well Pad by the company. Olympus will present plans for the new pad at a hearing on Wednesday.