Eclipse Resources Loses $73M in 2Q16, Resumes Utica Drilling
In July Eclipse Resources, a Marcellus/Utica pure play driller headquartered in State College, PA that drills mostly in Ohio, released their operational update but not their financial update (see Eclipse Resources 2Q16: Drilling Resumes, 2 New Utica Wells). Yesterday we got “the rest of the story”–Eclipse’s financial results from 2Q16, as well as an updated operational report. The numbers show Eclipse lost $73 million in 2Q16 (versus losing $42 million in 2Q15). Production, as noted in July, was up and operating expenses were down. During 2Q16 Eclipse resumed drilling with one rig, allocated a drilling budget of $196 million, and began completing previously drilled but uncompleted (DUC) wells in their portfolio. Here’s the full update from Eclipse–including finances and operations…
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Norwegian oil giant Statoil, which is 67% owned by the country of Norway, was an early and big mover in leasing Marcellus and Utica Shale acreage, amassing a huge 665,000 acres. Over the past few years Statoil has been equally aggressive in divesting itself of its non-operated acreage (Statoil doesn’t do the drilling) in the northeast–in particular in West Virginia. This is about to get complicated, but we’ll try to make it understandable. A lot of Statoil’s acreage is in joint venture deals. In December 2014, Statoil sold some of its “working interest” in the Marcellus acreage it owns in WV and PA to Southwestern Energy for $394 million (see 
Cabot Oil & Gas, one of our favorite large independent drillers in the Marcellus, issued their second quarter 2016 update last Friday. There was plenty of good news, but we’ll start with the bad news first. Cabot lost $63 million during 2Q16 versus losing $27.5 million in 2Q15. Compared to some oil and gas companies with losses in the billions per quarter, Cabot’s loss is inconsequential. We’d call it treading water, financially. The good news is that they are planning to drill and complete more wells than originally planned for 2016. That is, the market is picking up again. Cabot announced they recently added back a second completions crew in Susquehanna County, PA, the only county where they drill in PA. They still operate just a single rig, but that rig is accomplishing a lot for the company. At the beginning of 2016 Cabot planned to drill 25 Marcellus wells (see 
Last week Halcon Resources, a Utica Shale driller that “guessed wrong” by leasing 140,000 Utica Shale acres in the northern part of the play (in Ohio) and currently doesn’t drill on any of that acreage, filed for bankruptcy (see 
As you have no doubt noticed, we are in the midst of quarterly reports season. Public companies (those with stocks) must file quarterly financial reports with the Securities and Exchange Commission. Along with those filings comes a version of the same news constructed for consumption by investors and the general public. The overall “feel” of reports coming from most Marcellus/Utica drillers has been upbeat. The obvious trend is that the big drillers–EQT, Cabot, Southwestern, others–plan to drill more wells in 2Q16 than originally forecast. However, given the recent severe downturn, most drillers are sounding notes of caution as a balance to the good news that more drilling is on the way. Perhaps “cautiously optimistic” is the best way to put it…
EQT, one of the big Marcellus/Utica drillers, with its headquarters in Pittsburgh, released an interesting second quarter 2016 update yesterday. Along with the update came a quarterly conference call with analysts. You may recall that the Utica Shale play previously turned the head of EQT (see 
Canadian driller and midstream company Epsilon Energy had a shareholder rebellion in 2013 and threw out the sitting board of directors (see 
National Fuel Gas (NFG), the Buffalo-based utility giant with both a drilling subsidiary (Seneca Resources) and a midstream/pipeline subsidiary (Empire Pipeline) filed an application with the Federal Energy Regulatory Commission (FERC) in March 2015 for a pipeline project they call Northern Access 2016 (later renamed to simply Northern Access Project, dropping the “2016” part). The $455 million project includes building 97 miles of new pipeline along a power line corridor from northwestern Pennsylvania up to Erie County, NY. The project also calls for 3 miles of new pipeline further up, in Niagara County, along with a new compressor station in the Town of Pendleton (see 
Range Resources, one of the largest (and the very first) Marcellus Shale drillers, issued their second quarter 2016 update yesterday. While there was plenty of good news Range highlighted at the beginning of the release–Marcellus production was up 16% year over year at 1.379 billion cubic feet per day, costs were down 8%, total debt as low as it’s been since 2012–there was no getting over the 800-pound gorilla in the room: Range lost $225 million for the quarter in 2Q16, versus losing $119 million in 2Q15. One of the things Range seems most jazzed about is buying Memorial Resource Development Corp. and drilling in Louisiana instead of the Marcellus (see 
The parade of quarterly updates continues. Yesterday CONSOL Energy, once one of the largest coal companies in the U.S., now one of the largest independent drillers in the Marcellus and Utica Shale, issued their update. And in interesting one it is. After having idled its rigs, CONSOL reports they will begin a “modest” drilling program once again in August. However, the strategy is shifting. CONSOL plans to drill eight new Utica wells (in Monroe County, OH) and only two new Marcellus wells (in Washington County, PA). CONSOL will own 100% of the Utica wells but only has a 50% working interest in the Marcellus wells–which may be the biggest reason why they are focusing on the Utica for now. Also in the update: CONSOL’s natgas production jumped 32% in 2Q16 over 2Q15. The big financial news is that CONSOL lost $470 million in 2Q16, but that’s an improvement over 2Q15 when the company lost $603 million. Revenue dropped almost in half–from $545 million in 2Q15 to $286 million in 2Q16. Yesterday’s comprehensive update contains breakdowns of production by shale play, details on a 10-well “plugless” completion, and much more. We’ve also tracked down and embedded CONSOL’s latest PowerPoint presentation…
The lawless Attorney General in New York, Eric Schneiderman, and his philosophical twin in Massachusetts, AG Maura Healey, are refusing to obey a subpoena issued by Congress for copies of their communication records that would show the two (along with other AGs) have been unethically (perhaps illegally) colluding with Big Green groups in targeting Exxon Mobil over the issue of so-called global warming. As MDN previously reported, Schneiderman, Healey and several other far-left radicals made fantastical claims that Exxon “knew” that burning their evil, filthy, nasty oil and natural gas is causing Mom Earth to warm up, so the AGs served subpoenas to Exxon to turn over every piece of communication the company has ever had. Why? So the AGs could try to build a case against Exxon’s expression of free speech (see 
Just last week MDN predicted that Atlas Resource Partners (ARP), a publicly-traded exploration and production master limited partnership (“MLP”) with operations in basins across the United States including the Marcellus and Utica Shale plays, was heading for a bankruptcy (see 
Today’s lead story on MDN is about Atlas Resource Partners’ plan to file a pre-packaged bankruptcy turning some $900 million of debt into ownership equity (see Atlas Resource Partners Filing for Bankruptcy Tomorrow). Another Marcellus/Utica company is doing something similar, but without filing for bankruptcy. In April MDN told you about Rex Energy’s plan to convert some outstanding debt into shares of stock (see 
Stone Energy, an independent oil and natural gas exploration and production company (E&P) headquartered in Lafayette, Louisiana drills mainly in the Gulf of Mexico but also has a presence in the Marcellus/Utica Shale with 75,000 acres of leases. Last year Stone quit drilling in the northeast and actually shut-in part of their production due to low prices (see