Energy Companies

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    Dimock Trial Update: Scott & Monica Ely’s Testimony Destroyed

    There was a ton of news coming out of the trial two Dimock families have brought against Cabot Oil & Gas in Scranton, PA yesterday. But you wouldn’t know it if you read the Democrat-controlled (and anti-drilling) Scranton Times-Tribune–the newspaper of “record” in the very place where the trial is being held. They’ve quit writing about the trial because the news is so bad for anti-drillers. Both Scott and Monica Ely testified and under cross examination their testimony was obliterated–their claims exposed as lies. Here’s the latest from FrackNation filmmaker Phelim McAleer who has been following the trial from the beginning, and from Natural Gas Now…
    Read More “Dimock Trial Update: Scott & Monica Ely’s Testimony Destroyed”

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    Range Resources 2015: $714M Loss, Sells Non-Operated Marcellus

    Range Resources released their fourth quarter and full year 2015 financial and operational update yesterday. Some interesting items of note. The company lost $714 million for the year, much of that a paper loss of impairments and depreciation. Also of note, the company sold non-operated wells and leases in the Marcellus in Bradford County, PA for $112 million. Range has reduced the 2016 drilling budget by 45% over 2015, down to just $495 million. Hey, it’s better than not spending at all. Below is the 2015 update…
    Read More “Range Resources 2015: $714M Loss, Sells Non-Operated Marcellus”

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    Southwestern Energy 2015: Record Production, Big Paper Loss

    Southwestern Energy, one of the largest drillers in the Marcellus (and Utica) issued their fourth quarter and full year 2015 update yesterday. The company reports hitting a new record in production: 976 billion cubic feet equivalent, up 27% compared to 2014. A lot of that was driven by a huge 42% increase in their northeastern Marcellus production (they purchased new acreage in NEPA from WPX last year). The new acreage they acquired in West Virginia from Chesapeake is also a big factor in the production spike. Southwestern was one of the few companies that counterintuitively increased drilling in 2015. How did it work out financially? Nnnnnot so good. On paper the company lost $4.6 billion in 2015–but like other large drillers, most of that was a paper loss (not out of pocket money loss). Here’s the update from Southwestern, with lots of details on their Marcellus/Utica operations…
    Read More “Southwestern Energy 2015: Record Production, Big Paper Loss”

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    Atlas Energy Update – 125 Layoffs Companywide

    On Tuesday, after receiving ongoing tips that layoffs had occurred at Atlas Energy (a company with assets in the Marcellus/Utica), we published a post with an unconfirmed rumor that Atlas had laid off 30 or more people in its Waynesburg, PA location (see Atlas Energy – Rumored Layoff of 30+ People in PA). We later received another tip that indicated the layoffs may have been more “surgical” than “mass” in nature. Since that time, we’ve received a fifth tip–this one from a highly place source that we trust implicitly. This new tipster could not verify the 30 layoffs in Waynesburg, but the tipster does have knowledge that recently the company laid off ~125 people companywide. Atlas has still not responded to our requests for comment. We’ll continue to update when/if we learn more.

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    Chesapeake Loses $14.9B, Suspends New Utica/Marcellus Drilling

    Hats off to Chesapeake Energy CEO (and Carl Ichan lackey) Doug Lawler for pulling a rabbit out of his hat. Everyone has thought for weeks that Chesapeake is headed for bankruptcy, given that it’s stock value has plunged nearly 90% over the past year and it faces a big debt repayment soon. But the latest quarterly (and full year) report, released yesterday, shows the company is holding its own and will live to fight another day. That good news sent CHK stock soaring, to close up 22% (if you call “soaring” going from $2.19 to $2.67 per share, when those same shares traded at ~$20/share a year ago). The big news coming from Chesapeake’s release yesterday of their fourth quarter and full year 2015 update is this: The company experienced a paper loss (not an out of pocket money loss) of $14.9 billion–a staggering number that’s hard to get your head around. The largest loss of any oil and gas company we’ve heard of–ever. But most of that “loss” was Chesapeake devaluing their assets due to low commodity prices. As we said, it wasn’t money out of pocket. The other big news (for MDN) is that Chesapeake is halting their drilling program in both the Ohio Utica and Pennsylvania Marcellus in 2016. Chessy is Ohio’s #1 driller–has been since Aubrey McClendon declared the Utica was the biggest thing to hit Ohio since the plow. Chesapeake is also Pennsylvania’s #1 driller, depending on how you measure it (they produce more natgas in PA than any other driller). Below is Chesapeake’s 4Q15 and full year 2015 update, along with other bits and bobs we found commenting on Chesapeake’s update (including a reference that Chesapeake’s stock rise of 22% yesterday is a “dead cat bounce”)…
    Read More “Chesapeake Loses $14.9B, Suspends New Utica/Marcellus Drilling”

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    Dimock Resident Scott Ely Takes the Stand in Lawsuit Against Cabot

    Yesterday the lead Dimock plantiff in the lawsuit against Cabot Oil & Gas, Scott Ely, was on the witness stand to talk about how Cabot destroyed his water supply. Except when you read even biased news sources like PBS’ StateImpact Pennsylvania, it appears Ely didn’t do a lot of talking about his water but about his own tenure in working for Cabot. Ely attempted to smear Cabot’s reputation by making wild claims about the reckless nature of their operations. Of course Ely’s attorney hopes the jury will infer that if Cabot was reckless in other activities, they were likely reckless when they drilled near Ely’s home and caused his water to become contaminated with methane–a problem that is fixable (although Ely wouldn’t allow Cabot to fix it). In addition to Ely’s testimony, his attorney asked the judge, yet again, to allow 300 new pieces of “evidence” that she tried to slip in at the last minute, an ambush of Cabot’s attorneys. And once again the judge said “no” to her request…
    Read More “Dimock Resident Scott Ely Takes the Stand in Lawsuit Against Cabot”

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    Guest Post: 7 Important Points to Know About Dimock Trial

    By Phelim McAleer

    The Ely and Hubert families of Dimock, Pennsylvania are suing Cabot Oil & Gas for allegedly polluting their water. The case is hugely significant because Dimock has been characterized as “Ground Zero” for water allegedly contaminated by fracking. It was featured in the documentaries Gasland 1 & 2 and has been the subject of national and international news reports. Countless celebrities have also pushed the lie that Dimock’s water was contaminated with fracking fluid. But the case has thrown serious doubts on the narrative being spun by activists. The plaintiffs’ case is looking very shaky, indeed. Here are seven key points that have emerged as the case enters its second day.
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    Guest Post: Dimock Plaintiff Exposed Under Cross Examination

    By Phelim McAleer

    The Ely family in Dimock, Pennsylvania is suing an oil and gas company alleging they contaminated their water well through fracking. Dimock has become a focal point for anti-fracking activists with many calling it “Ground zero” for pollution. Dimock and the Ely’s have been featured in national and international news reports and documentaries. Celebrities such as Mark Ruffalo, Yoko Ono, and Susan Sarandon have visited the tiny community to sympathize. But yesterday in the first day of the trial, facts started to emerge that show the truth is much different from the previously reported stories. Questioned under oath, Scott Ely’s claims look a lot less certain and he looks a lot less credible. Below are five facts that emerged during the first day that expose serious problems with Ely’s claims that his water was contaminated by fracking.
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    Antero Resources Stands Above the Rest – Nets $941M in 2015

    There’s at least one driller that’s figured out how to continue making money in one of the worst down markets in two generations: Antero Resources. Antero released their “good news” operational update back in January (see Antero Resources 4Q15 Update: NatGas Sales Averaged $4.40/Mcf). Earlier this month the company issued an update for 2016 that they will cut back spending by 23% (far less than others) with plans to drill 110 wells this year in the Marcellus/Utica (see Antero Resources 2016: Spending 23% Less, Drilling 110 Wells). We thought for sure when they finally got around to sharing their financial numbers it would be red as far as the eye can see. Nope! Yesterday Antero, one of the biggest and best drillers in the Marcellus/Utica, released their fourth quarter and full year 2015 financial update. And guess what? They made more money last year than the year before! Three years ago Antero lost $18.9 million. Two years ago, after expenses, Antero made $674 million. Last year, in 2015, Antero made, after expenses, $941 million. That’s nearly $1 billion in profit! Other drillers need to study Antero closely to see what they’re doing right…
    Read More “Antero Resources Stands Above the Rest – Nets $941M in 2015”

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    Rice Energy 2015: Lost $291M, Production Up 101%

    Rice Energy issued their fourth quarter and full year 2015 financial and operational update yesterday. The company stumbled in 4Q15, losing $281 million, which made last year’s total year loss $291 million (i.e. most of the loss came in 4Q15). That’s the bad news. The good news is that production was up 57% in 4Q15 over 4Q14 and production for the entire year was up 101% over 2014, an average of 552 million cubic feet equivalent per day (Mmcfe/d). Also good for Rice is the price they’ve been getting for their gas. They averaged $3.39/Mcf in 4Q15 and $3.19 for all of 2015. Proved reserves are up 30%. The company also released details for 2016 yesterday. Rice, which is a pure play driller focusing on the Marcellus and Utica Shale region, will spend 14% less this year than they did last year–which is far less of a cut than most drillers. Below are both the 2015 update and the 2016 forecast, with lots of details about their Marcellus and Utica programs…
    Read More “Rice Energy 2015: Lost $291M, Production Up 101%”

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    Marcellus Ethane Export Sets Sail “Within a Week” from Philly

    We’ve been predicting for some time, but the day is almost here when the first export shipment of Marcellus and Utica ethane will leave the Marcus Hook terminal in Philadelphia and head to Norway. Genscape, which monitors pipelines and trucks and ships and uses really cool technology to alert them of when these things are about to happen says the first ethane export from Philly will happen “within a week”…
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    Dimock Lawyers Admit Frack Fluid Didn’t Contaminate Well Water

    court-gavel.jpgYesterday saw opening arguments in the case of two Dimock, PA families who are suing Cabot Oil & Gas with a claim that Cabot’s drilling “contaminated” their well water supplies (see Dimock Trial Starts Today – 2 Families Try to Shake Down Cabot). MDN friend and top film documentary maker Phelim McAleer–creator of the excellent FrackNation documentary–noticed a very important admission by the attorneys for the plaintiffs. In their opening arguments, the attorneys for the landowners admit that there is “no scientific proof” that fracking fluid ever reached or contaminated the plaintiffs’ water wells. We’ve known that and have trumpeted that for years. This case has always been about methane (natural gas itself) “migrating” through the ground into the water wells as a result of Cabot’s drilling program. That’s what is at issue: Did Cabot’s drilling cause methane migration? But the general public, because of propaganda films like Gasland and Gasland II, believe fracking chemicals had somehow seeped into the water wells in Dimock. Not true–and now it’s on the record for all, including Josh Fox, to see. The stunning admission by the landowners’ own lawyers that fracking fluid did not contaminate the wells in Dimock totally refutes false claims by Fox and Hollywood stars like Mark Ruffalo who have tried to use Dimock as a rallying cry…
    Read More “Dimock Lawyers Admit Frack Fluid Didn’t Contaminate Well Water”

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    Chesapeake Trades Future Royalties on 8,500 Wells for Lump Sum Now

    Haymaker Resources has just signed a deal with Chesapeake Energy to give Chessy $128 million in return for ownership of mineral and royalty interests in 8,500+ wells across 24 states and 324 counties, including wells in the Marcellus/Utica. The mineral/royalty interests Chesapeake is selling are considered “non-core” for the company. These are wells in which Chessy owns an interest, but they didn’t drill it and don’t manage it. They’re a partner in the well. What this deal means is that any royalties generated from those wells will now go to Haymaker instead of Chesapeake. Sort of like those deals we’ve highlighted in the past where a company pays a landowner a lump sum now and then receives all future royalty payments (see Company Targets OH Landowners – Buy Future Royalties for Cash Now). Think of it this way: You win the lottery, $1,000 a week for life. You’re 50 years old and think you’ll live another 30 years, at least. That would be $1.56 million total, IF you live that long. A company comes along and offers you $750,000, right now, in return for taking over the annuity of $1,000 per week (such companies do exist). That’s how we think of this deal. Chesapeake needs money now, to keep from going bankrupt, and they have these assets that bring in money, but in dribs and drabs and it’s not at the center of what they do. So they cash it in and get a chunk of money now instead of waiting for it later. Here’s the Haymaker announcement…
    Read More “Chesapeake Trades Future Royalties on 8,500 Wells for Lump Sum Now”

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    Former Devon Energy CEO Buys Himself a Place in Rubio Campaign

    With Jeb Bush out of the Republican presidential primary, the old-line Republican establishment has closed ranks behind Florida Senator Marco Rubio. Which is why we find him disgusting. We no longer vote for politicians that promise one thing and do another (ex: Bob Dole, John McCain, Mitt Romney, Mitch McConnell, Paul Ryan, Jeb Bush, John Kasich, Marco Rubio). That’s the definition of establishment. They view themselves as the ruling class–something we left behind 240 years ago when we formed this country to rid ourselves of such people. Those in the energy industry are not immune to the siren call of serving the establishment. The co-founder and former CEO of Devon Energy, Larry Nichols, has just become Rubio’s energy advisor in return for “hosting a fundraiser” for the Senator (translation: giving him big piles of money). We call that purchasing a seat at the table. Before you get too outraged, please know that this goes on ALL THE TIME in both parties. And has for years. MDN editor Jim Willis used to work in the Ronald Reagan White House, and we saw it there too. Big monied people donate, and when the candidate wins, those same people either get top posts in the administration, like Secretary of Energy, or they get cushy postings as an ambassador to some country like France, or Belize (in the tropics). We find it disheartening and distressing. But it is the way things are. Unless we change it. Below is the news about Nichols buying himself a place at the Rubio table…
    Read More “Former Devon Energy CEO Buys Himself a Place in Rubio Campaign”

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    Carrizo O&G 2015: Loses $1.2B, Stops Drilling in Northeast

    Carrizo Oil & Gas, a Houston-based driller, issued their fourth quarter and full year 2015 financial and operational update on Monday. Carrizo actively drills in the Eagle Ford Shale in South Texas, the Delaware Basin in West Texas, the Niobrara Formation in Colorado, and until mid-year in 2015, they did have an active drilling program in the Ohio Utica and Pennsylvania Marcellus. No more. They haven’t drilled in Appalachia since 3Q15, and according to Monday’s update, they won’t be drilling here in 2016. Not only that, they have curtained (shut-in) some of their Marcellus/Utica production, and they may shut-in even more in the coming months, if prices don’t recover. According to Carrizo’s financials, the company made $226 million in 2014. But in 2015 the company lost $1.2 billion. Here’s a portion of Monday’s update, which says they plan to focus on the Eagle Ford for the time being…
    Read More “Carrizo O&G 2015: Loses $1.2B, Stops Drilling in Northeast”

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    PDC Energy 2015: $68M Loss, Production Up 65% Y/Y

    PDC Energy, a driller in the Wattenberg Field in Colorado and the Utica in Ohio, paused their Utica drilling program in 2015 (see PDC Energy Pushes Pause Button on OH Utica Drilling for 2015). In December the company announced they would restart Utica drilling in 2016 with plans to drill five wells (see PDC Energy to Restart OH Drilling in 2016, Drilling 5 Utica Wells). On Monday PDC released their fourth quarter and full year 2015 financial and operating results. PDC grew production in 2015, substantially, over 2014 (up 65%). Although the company lost money in 2015, as most drillers did, it wasn’t all that much compared to others. In 2014 PDC made $155 million in profit. In 2015, they lost $68 million. With others losing over $1 billion, $68 million is a comparative drop in the bucket. We spot no mention of when they will restart Utica drilling. Here’s the update from PDC…
    Read More “PDC Energy 2015: $68M Loss, Production Up 65% Y/Y”