Energy Companies

Energy Companies | Seneca Resources

Seneca Res. 2016: Lays Down Rig, Curtails Production, Cuts Budget
February 5, 2016February 5, 2016

National Fuel Gas Company (NFG), the utility giant headquartered in Buffalo, NY and parent of Marcellus driller Seneca Resources, issued what they call their first quarter 2016 update yesterday. NFG’s first quarter is everyone else’s fourth quarter–it covers the last three calendar months of the year (October through December). The big news coming from this update is that Seneca Resources will lay down another active drilling rig in March and will then operate just a single rig for the rest of 2016 and for all of 2017. Currently they are curtailing (closing the valves) on 14.6 billion cubic feet of production they could be sending to market–because of the low price of natural gas. Seneca has also whacked its drilling budget another $50 million. Previously Seneca planned to spend $200-$250 million in fiscal year (FY) 2016. Now? It’s down to $150-$200 million. In other important news, NFG has decided to delay the in-service date of their Northern Access pipeline project by full year–from late this year to late next year…
Read More “Seneca Res. 2016: Lays Down Rig, Curtails Production, Cuts Budget”
Antero Resources | Crestwood Midstream | Energy Companies | Energy Services

Is Crestwood Exploring Sale of Marcellus Assets to Antero?
February 4, 2016February 4, 2016

The following is highly speculative and the equivalent of rumor, but sometimes it’s fun to engage in a bit of rumor-mongering. We spotted a post on the investor website Seeking Alpha that posits the following theory: Crestwood Equity Partners (i.e. Crestwood Midstream), owner of major pipelines and other facilities in the northeast and in other locales, “may” be looking to sell their Marcellus operations to Antero Resources and their Bakken Shale operations to Tesoro Logistic Partners. It must be said up front the person authoring the article owns units (i.e. shares) of Crestwood (CEQP) and is in no way objective. Articles on Seeking Alpha attempt to persuade investors to buy or sell securities. However, the rationale laid out in the article intrigues us and we think it’s worth pondering whether or not Crestwood is about to shed large parts of the company, and what that might mean for our region…
Read More “Is Crestwood Exploring Sale of Marcellus Assets to Antero?”
CNX Resources | CONSOL Energy | Energy Companies | Greene County (PA) | Industrywide Issues | Pennsylvania | Sand/Proppant

Ceramic Beads Used to Drill CONSOL’s Monster PA Utica Well
February 4, 2016February 4, 2016

On Monday MDN told you about CONSOL Energy’s newest Utica Shale well, a gusher with initial production of an eye-popping 61.9 million cubic feet per day per day (see CONSOL 4Q15: All About that Utica, ‘Bout that Utica, No Marcellus). The well, the GH 9, was drilled not in Ohio, but in Greene County, PA. Drillers always wonder what techniques and technologies were used in drilling such a well. How long are the laterals? What kind of choke is used? How much sand per foot? Etc. We have one bit of detail to share. Apparently CONSOL is cool with CARBO Ceramics telling the world that the GH 9 used CARBO ceramic beads in place of sand as the proppant. Here’s the details from CARBO for exactly what was used as the proppant in the GH 9…
Read More “Ceramic Beads Used to Drill CONSOL’s Monster PA Utica Well”
Energy Companies | Industrywide Issues | Jobs | Lycoming County | Pennsylvania | Range Resources Corp | Washington County

Range Resources Lays off 55, including 33 in PA
February 3, 2016February 3, 2016

Yesterday Range Resources, the fourth largest driller in the Marcellus, announced the company is laying off 55 people companywide, with 31 of those positions located in Washington County, PA. Another 20 positions will be eliminated in Range’s home office located in Fort Worth, TX. Two of the jobs disappearing will be in Williamsport, PA, and the final two in Oklahoma. Range CEO Ray Walker used the same identical language he’s used twice before (lazy PR department?) in saying, “Low commodity prices have created a harsh reality that everyone in our industry is facing.” Indeed. The oil and gas industry is facing the toughest market it’s had in 30 years…
Read More “Range Resources Lays off 55, including 33 in PA”
Anti-Drilling/Fossil Fuel | Coterra Energy (Cabot O&G) | Energy Companies | EQT Corp | Fayette County | Industrywide Issues | Regulation | Wastewater | West Virginia

Anti Admits Fayette County, WV Ban Aims to Shut Down All O&G Wells
February 3, 2016February 3, 2016

An update on a developing story we’ve covered the past several months. In January, three Democrat county commissioners from Fayette County, WV, with the backing and help of the radical WV Mountain Party, voted to ban injection wells in the county (see WV County Officially Bans Injection Wells; Children Brainwashed). In fact, the ban is intentionally written so broadly it will also ban the operation of more than 500 vertical oil and gas wells in the county. The next day EQT sued to overturn the ban (see EQT Sues WV County that Banned Injection Wells, Seeks Injunction). Not long after, a U.S. District Court judge slapped an injunction on the county preventing them from enforcing the ban at least until a hearing scheduled for later this month (see Judge Stops WV County from Enforcing Injection Well Ban, For Now). The judge says EQT “is likely to succeed” in their lawsuit to overturn the ban.” The new news is an article where one of the chief architects of the ban, from the Mountain Party, admits the ban is intended to stop all oil and gas activity in the county. Another well operator in Fayette County, Cabot Oil & Gas, is now evaluating the ban and considering joining the lawsuit against the county. We sure hope Fayette County has a LOT of money squirreled away for legal fees and fines and penalties coming their way…
Read More “Anti Admits Fayette County, WV Ban Aims to Shut Down All O&G Wells”
Energy Companies | Gulfport Energy | Industrywide Issues | Ohio | Reserves (Proved and Unproved) | Statewide OH

Gulfport 2015 Update: Reserves Up 83%, NatGas Production Triples
February 3, 2016February 3, 2016

Gulfport Energy, a Utica Shale driller quite active in Ohio until mid-2015 when they began to pull back, released their fourth quarter and full year 2015 operational update yesterday. But not their financials–that comes later this month. There is no mention of drilling activity in 4Q15 (nor any guidance for 2016). We previously brought you the rumor that Gulfport was pushing the pause button on their drilling activities, back in November (see Rumor: Gulfport Energy Suspends Some (All?) Ohio Utica Drilling). However, data from the forthcoming Volume 3 of the 2015 Marcellus and Utica Shale Databook, which covers permit activity for from September through December 2015, shows that Gulfport received 30 permits in Ohio during that period of time. So it appears they have continued their program, albeit scaled back. The 4Q15 and full year 2015 update shows Gulfport’s oil and gas reserves have grown 83% for 2015 over 2014, and natural gas production tripled year over year. Production/operations-wise, 2015 was a very good year for Gulfport. What’s left to be seen is whether it was a good year for Gulfport financially too. Here’s the operations update…
Read More “Gulfport 2015 Update: Reserves Up 83%, NatGas Production Triples”
Energy Companies | Exxon Mobil

ExxonMobil 2015: 50% Decline in Earnings, Thank God for Downstream
February 3, 2016February 3, 2016

Yesterday ExxonMobil released its fourth quarter and full year 2015 update. Not a pretty picture. ExxonMobil is the largest oil and gas company headquartered in the U.S. It’s also the owner of XTO Energy–which is one of the major drillers in the Marcellus/Utica Shale. Everyone watches Exxon closely as a barometer for other oil “majors” as they’re called. Yesterday Exxon reported a 58% drop in quarterly profit for 4Q15 (over 4Q14), and a 50% decline in 2015 earnings over 2014 earnings. Capital and exploration spending was $31.1 billion in 2015, down 19% from 2014. Exxon anticipates more cuts in spending for 2016, with capital and exploration spending of $23.2 billion, a decrease of 25% from 2015 levels. The clear sentiment in the statement below is, “Thank God for downstream” (gas stations and chemical plants) which kept the company from falling even further…
Read More “ExxonMobil 2015: 50% Decline in Earnings, Thank God for Downstream”
Anadarko | Energy Companies | Lycoming County | Pennsylvania

Anadarko 2015: Loses $6.7B, Marcellus Drilling Almost Dried Up
February 3, 2016February 3, 2016

Anadarko Petroleum is a huge oil and gas company with drilling operations scattered all over the world–both onshore and offshore. One of those operations, teeny tiny for Anadarko, is in the Marcellus Shale in Lycoming County, PA. Some of their leases are for land in the Loyalsock State Forest where antis are attempting to stop Anadarko from drilling (see Antis Ask PA Gov Wolf to Stop New Drilling in Loyalsock Forest). Don’t worry, Anadarko can take a hint. What was once a very active drilling program in PA for Anadarko just a few years ago–with 30, 40, even 60 permits being issued for wells in any given four month period–has dried up to virtually nothing. For the last four months of 2015 Anadarko received 4 permits to drill in PA, according to the latest data from the Marcellus and Utica Shale Databook. On Monday Anadarko released their fourth quarter and full year 2015 results. The company posted a $1.25 billion loss for 4Q15 alone. The company lost $6.7 billion for the full year. Yikes! Grab the tourniquets before the company bleeds out! Anadarko announced spending for 2016 will be slashed 50% over 2015 spending levels…
Read More “Anadarko 2015: Loses $6.7B, Marcellus Drilling Almost Dried Up”
Coterra Energy (Cabot O&G) | Energy Companies | Pennsylvania | Susquehanna County

Cabot O&G 2015 Update; Cutting 2016 Drilling Budget 58%
February 2, 2016February 2, 2016

Cabot Oil & Gas, one of the premier drillers in the Marcellus Shale (operates totally within Susquehanna County, PA) released their fourth quarter and full year 2015 operational update this morning. The highlights: Cabot ended up spending $774 million on capital expenditures (mostly drilling) in 2015, down a bit from the previous estimate of $850 million. It’s down because they scaled back activity during 4Q15. They also had to write down the value for some of their non-core holdings by $73 million–what’s called an impairment charge. Looking ahead, Cabot plans to spend $615 million on capital expenditures (i.e. drilling) in 2016, which is down 58% from 2015. They will drill approximately 30 new wells, 25 of them in the Marcellus and 5 in the Texas Eagle Ford Shale. Here’s the update…
Read More “Cabot O&G 2015 Update; Cutting 2016 Drilling Budget 58%”
Energy Companies | Warren Resources

Warren Resources Misses $7.5M Debt Payment, 30-Day Clock Ticking
February 2, 2016February 2, 2016

Warren Resources, a small, independent exploration and production company with an ongoing drilling programs in California, Wyoming, and in the northeast Pennsylvania Marcellus Shale, announced yesterday they won’t (for now) make a $7.5 million in payments due on IOUs (i.e. notes) that are due to be made this month. Even though they claim to have enough money in the bank. Big red flag. Instead, Warren has hired investment bank Jeffries LLC to help the company with “potential restructuring of its balance sheet” and the company has “initiated restructuring discussions with representatives of the creditors under its first and second lien credit facilities.” Restructuring is a cheaper and (if you can swing it) better alternative than bankruptcy. The question is, will Warren’s restructuring be enough to keep the company out of bankruptcy proceedings? The terms of missing the payment allow a 30-day grace period before bad stuff begins to happen. The clock is ticking…
Read More “Warren Resources Misses $7.5M Debt Payment, 30-Day Clock Ticking”
Antero Resources | Doddridge County | Energy Companies | Industrywide Issues | Kanawha County | Litigation | Statewide WV | West Virginia

More People Pile on Antero, Seek to Join Mass “Nuisance” Lawsuit
February 2, 2016February 2, 2016

Last September MDN told you about the troubling news that more than 200 residents in WV (likely those who don’t own the mineral rights under their land) began filing “scores” of “nuisance” lawsuits over the past couple of years against Antero Resources and Hall Drilling, in places like Doddridge County (see Scores of “Nuisance” Lawsuits Against WV Drillers Combined). The lawsuits claim excessive traffic, odors and noise from nearby drilling make it “impossible” for them to enjoy their homes. The troubling development was that all of these lawsuits (dozens? hundreds?) had been rolled up into one mega lawsuit that sits before the WV Mass Litigation Panel. In other words a class action lawsuit. Since then we’d not heard anything, until we read about two more such lawsuits filed in Kanawha County. The lawyers want to add the two to the existing mass litigation case…
Read More “More People Pile on Antero, Seek to Join Mass “Nuisance” Lawsuit”
Energy Companies | Energy Services | Equinor/Statoil | GE Oil & Gas | Hydraulic Fracturing | Industrywide Issues

4 People Win GE/Statoil Contest to Reduce Water Used in Shale
February 2, 2016February 2, 2016

GE and Norwegian oil giant Statoil today announced four winners of their Open Innovation Challenge, a contest designed to use crowd sourcing to find solutions that reduce fresh water use in shale oil and gas production. There of the winners are in the United States, and one is from Australia. Each winner gets a cash prize of $25,000 with the promise of future funding for their technology. Here’s the cool new technologies that won this year’s contest…
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Columbia Pipeline Group | Energy Companies | Energy Services | Gastar Exploration

Gastar’s Mike McCown Retires; Peg Heeg Joins Columbia Pipeline Bd
February 2, 2016February 2, 2016

From time to time we mention people coming and going at various drilling and midstream companies. The reason we mention it is because when there are changes at the top of an organization, it has the potential to affect the future actions of that organization. We have two such moves to report. The first is that Mike McCown, senior vice president and chief operating officer for driller Gastar is retiring. We’ve quoted Mike a number of times over the years–he’s an important cog in the Gastar wheel. The second bit of news is that Peggy Heeg has joined the board of directors at midstream giant Columbia Pipeline. Peggy is an attorney and former general counsel at El Paso Corporation…
Read More “Gastar’s Mike McCown Retires; Peg Heeg Joins Columbia Pipeline Bd”
CNX Resources | CONSOL Energy | Energy Companies | Utica Shale

CONSOL 4Q15: All About that Utica, ‘Bout that Utica, No Marcellus
February 1, 2016February 1, 2016

Last Friday CONSOL Energy released their fourth quarter 2015 update and we couldn’t stop the Meghan Trainor song “All About That Bass” from going through our heads, changing the word “bass” to Utica and “treble” to Marcellus. CONSOL was positively effusive about their Utica program and what it means for the future of the company. And well they should be (pun intended). In 4Q15 CONSOL drilled and brought online it’s most initially productive-ever Utica well, the GH 9 in Greene County, PA. The well’s initial flow was 61.9 million cubic feet per day per day (MMcf/d). That’s not as high as EQT’s record-breaker of 72.9 MMcf/d, also in Greene County (see EQT’s 1st Utica Well Shatters Record – 72.9 MMcf/d IP Rate!), but still, it’s amazing output for the CONSOL well. That amazing second well comes on the heels of CONSOL’s first PA Utica well, drilled in Westmoreland County in 3Q15, with an initial flow rate of 61.4 MMcf/d (see CONSOL 3Q15: Natgas Production Up 33%, Natgas Revenue Down $56M). Here’s what really caught our eye about Friday’s update and accompanying analyst conference call: In the Ohio Utica, the first well CONSOL drilled took 84 days and the drilling phase cost them $9 million. By the fifth well, the cost had gone down to $5 million. And they now believe they can get the cost of drilling a Utica well down to $4 million and do it in 23 days. Astonishing! (Note: that number is not the “all in” cost, which still is still more than $15 million per well.) So what about CONSOL’s Marcellus program?…
Read More “CONSOL 4Q15: All About that Utica, ‘Bout that Utica, No Marcellus”
Chevron | Energy Companies

Chevron 4Q15: First Quarterly Loss in 13 Years, Scaling Back 2016
February 1, 2016February 1, 2016

Chevron, one of the country’s largest oil and gas companies (with a sizable drilling operation in the Marcellus/Utica) issued its fourth quarter and full year 2015 update last Friday. It was not good news. Chevron lost money in 4Q15–their first quarterly loss in 13 years. The reason? Upstream (or drilling) got “crushed” due to low commodity prices for oil and gas. The news has created jitters on Wall Street. This week three more majors are due to release their updates: ExxonMobil, BP and Shell. Investors are worried they may show losses too. In their Upstream division, Chevron lost $1.9 billion in 4Q15 over 4Q14, and they lost $4 billion for the entire year, after making $3.3 billion in 2014. Chevron is a BIG company, so don’t fret. They still made money company-wide. Although Chevron lost $588 million in 4Q15 (company-wide), they made $4.6 billion of net income for full year 2015…
Read More “Chevron 4Q15: First Quarterly Loss in 13 Years, Scaling Back 2016”
Commodity Price | Energy Companies | Industrywide Issues | Stone Energy

IHS Says Hedging Woes Ahead for E&Ps in 2016 & 2017
February 1, 2016February 1, 2016

A new study from oil and gas powerhouse research firm IHS says there’s problems ahead for U.S. drillers because of hedging. Hedging is a complicated trading activity that reduces risk. In plain English, drillers lock in prices for the gas they will sell in the future–several months or even years in advance–today. On the up-side they get a lot more money for their gas. One of the masters of hedging in the Marcellus/Utica is Antero Resources (see Antero Resources 4Q15 Update: NatGas Sales Averaged $4.40/Mcf). On the down side, you’re not able to lock in prices that earn you a profit. That’s the situation facing drillers as hedges in 2016 and 2017 “roll off” and companies are negotiating new contracts that just aren’t all that great. According to IHS’ “Comparative Peer Group Analysis of North American E&Ps” (unfortunately we don’t have a full copy) in 2016 will see a decline in hedging, and 2017 will be even worse…
Read More “IHS Says Hedging Woes Ahead for E&Ps in 2016 & 2017”