Energy Companies

Energy Companies | Gulfport Energy

Gulfport Energy 3Q15: Shuts-in 100 Mmcf/d of Production
November 9, 2015November 9, 2015

Gulfport Energy, a major Utica Shale driller, released their third quarter 2015 update last Thursday and held an analyst conference call on Friday. Among the things we learn from their public statements: in all categories (natural gas, oil, NGLs), Gulfport’s production was up dramatically from the same quarter a year ago. However, the price the company gets for those commodities is down rather dramatically. The company experienced a major paper loss for 3Q15 due to write-downs on the value of its assets (because of low prices). Gulfport announced it will “voluntarily curtail” 100 million cubic feet equivalent per day (MMcfe/d) of production beginning November 1, 2015 through early 2016, due to low prices. Better to wait and sell it later at a higher price. They’re also going to forgo a fifth drilling rig in the Utica, planned to start up in 2016. Bummer. Here’s the 3Q15 update for Gulfport…
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Anti-Drilling/Fossil Fuel | Energy Companies | Exxon Mobil | Industrywide Issues | Litigation | New York | Regulation | Statewide NY

NY AG Targets/Accuses ExxonMobil of Lying about ‘Climate Change’
November 6, 2015November 6, 2015

Eric Schneiderman, NY AG

We’ve written before about the lawless Attorney General from New York–Eric T. Schneiderman. He attacks his own constituents like landowners in the state (see NY AG Schneiderman Files to Dismiss JLCNY Lawsuit Against Cuomo), threatened the Delaware River Basin Commission that he would sue them if they allowed fracking (see NY AG Schneiderman Threatens New DRBC Lawsuit over Fracking), and he regularly bullies oil and gas companies (see NY Attorney General Schneiderman Subpoenas Shale Drillers and More on NY AG Schneiderman’s Bullying of Anadarko & EOG Resources). Schneiderman has just performed a breathtaking act of chutzpah: He’s launched an investigation and subpoenaed ExxonMobil, the largest oil company in the United States (4th largest in the world), accusing them of making false statements about so-called man-made global warming. He’s saying they contribute to global warming and they’re lying about their role in it–that they’ve made false statements to the public that contradict what their own internal research has found. That is, he is using the same strategy used against tobacco companies 20 years ago…
Read More “NY AG Targets/Accuses ExxonMobil of Lying about ‘Climate Change’”
Blue Ridge Mtn Res/Magnum Hunter | Energy Companies

Magnum Hunter Refinances Again, Dodges a Bullet…Just Barely
November 6, 2015November 6, 2015

Magnum Hunter Resources (MHR) issued an interesting press release yesterday to notify investors that they dodged a bullet–for the moment–by refinancing certain loans and getting a new $60 million loan which will let them make their $29 million bond payment on Nov. 15 (see Magnum Hunter’s Latest Woes: More Investor Unrest, $29M Payment Due). The statement also said in light of “ongoing discussions regarding its capital structure” they won’t issue a press release on third quarter financials, and they won’t hold a conference call with investors. Not a good sign. One analyst we read rhetorically asks, Does this mean they avoid bankruptcy? “The short answer is NO,” was his reply. He maintains “working on capital structure” means they are headed for a prepackaged bankruptcy. The only question is, when will it happen? Here’s the latest MHR statement in what (sadly) feels like a death watch…
Read More “Magnum Hunter Refinances Again, Dodges a Bullet…Just Barely”
Energy Companies | Rice Energy

Rice Energy 3Q15: $59M Profit, $750M LOC, Selling Gas Outside NE
November 6, 2015November 6, 2015

Rice Energy, a very young but important pure play driller in the Marcellus/Utica, released its third quarter update yesterday. Bucking the trend of other northeast drillers, Rice earned $119 million in profit before interest, taxes and all that jazz (called EBITDAX), and they earned $59 million after all that jazz. In the black. No paper loss. It’s all good. One of the secrets to Rice’s success is that they’re selling their gas for an average of $0.38 higher per Mcf than others because of deals with the REX and Texas Eastern pipelines that carry Rice’s gas to markets outside of Appalachia. Production was 609 million cubic feet equivalent per day (Mmcfe/d) in 3Q15. The company reports expanding their line of credit at the bank to $750 million and transferring ownership (called a “drop down”) of their water services business from Rice Energy the driller to Rice Midstream the subsidiary, netting Rice Energy a nifty $200 million on paper. In essence they transferred money from one pocket to another. Here’s the full update from one of our favorite Marcellus/Utica drillers…
Read More “Rice Energy 3Q15: $59M Profit, $750M LOC, Selling Gas Outside NE”
Energy Companies | Gastar Exploration

Gastar 3Q15: Production Up but Still Shopping Marcellus/Utica
November 6, 2015November 6, 2015

Yesterday Gastar Exploration, with active drilling programs in the Marcellus/Utica and in the Midcontinent region, issued their third quarter 2015 financial and operational update. What do we glean from it? The company lost $191.8 million for the quarter–but almost all of it was a paper loss and not actual money out the door (from writedowns). As we’ve previously noted (see Gastar Puts All Marcellus/Utica Assets (Leases/Wells) Up for Sale), Gastar continues to shop their Marcellus/Utica assets and said as much in this update. Net production in the northeast rose in 3Q15–8,000 barrels of oil equivalent per day, or Boe/d in 3Q15 vs 5,300 Boe/d in 3Q14. They didn’t drill a single new well in 3Q15 nor will they drill any in 4Q15 and for the foreseeable future. They’re trying to sell it…
Read More “Gastar 3Q15: Production Up but Still Shopping Marcellus/Utica”
Carrizo Oil & Gas | Energy Companies

Carrizo O&G 3Q15: No New Drilling in the Utica/Marcellus
November 6, 2015November 6, 2015

Carrizo Oil & Gas, a Houston-based driller, issued their third quarter 2015 financial and operational update on Wednesday. Carrizo actively drills in the Eagle Ford Shale in South Texas, the Delaware Basin in West Texas, the Utica Shale in Ohio, the Niobrara Formation in Colorado, and the Marcellus Shale in Pennsylvania. Carrizo reports losing $708.8 million in 3Q15, but like other drillers, it was a paper loss–a requirement to reevaluate and write down the value of their holdings based on low oil and gas prices. According to the update, Carrizo didn’t drill or complete any new wells in the Utica or Marcellus during 3Q15, nor do they plan to any time soon. They’re concentrating their time and effort in oil plays like the Eagle Ford. Below are select portions of yesterday’s update applicable to the Utica/Marcellus…
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Energy Companies | Energy Services | National Fuel | Seneca Resources

NFG Update: Seneca Paper Loss, Production Shut-in; New Pipes Done
November 6, 2015November 6, 2015

National Fuel Gas Company, parent of driller Seneca Resources and also an important midstream (pipeline) company, issued their quarter update yesterday. We always have to explain this. NFG counts their quarters different. Everyone else counts July through September as a calendar year third quarter. For NFG, it was their fourth quarter fiscal year. The company had a big $188 million loss for their 4Q15, vs a $57 million gain in 4Q14. However, like many others, NFG’s was a “paper loss” and not an actual money-out-the-pocket loss. The decrease is largely due to a $241 million writedown of the value of Seneca’s oil and natural gas reserves. Other news: Seneca’s production was down in 4Q15 because they decided to voluntarily shut-in 13 billion cubic feet (Bcf) of production they otherwise could have sold–due to the low price of natural gas they receive in the Marcellus. Seneca’s proved reserves (available to drill) went up 27% for fiscal year 2015. On the pipeline front, as of Nov. 1 NFG put the Westside Expansion & Modernization and Tuscarora Lateral projects into service, and they’re close to completing the Northern Access 2015 expansion project, a joint project with Tennessee Gas Pipeline’s Niagara Expansion. Here’s the full update with plenty of interesting news for the Marcellus/Utica…
Read More “NFG Update: Seneca Paper Loss, Production Shut-in; New Pipes Done”
Energy Companies | Southwestern Energy

Southwestern Energy’s Stock Sees Spike Up in Short Selling
November 6, 2015November 6, 2015

From time to time MDN notices and highlights “short selling” stories. What’s short selling? In essence, it’s when traders borrow and sell a stock so they can turn around and buy it back at a lower price, returning it to the party they “borrowed” it from, making a tidy profit. It is a trader betting that a stock’s price will go down and not up (see our explanation here: “Short Selling” – An Important Signal for Marcellus-Related Companies). On average, short selling of stocks for all companies in all industries is typically 5-6% of trading volume. Recently, oil and gas stocks, as an industry, have seen an average of 12% short selling of their stocks. When a company’s stock sees a spike in short selling, it’s a signal that “the market” believes that stock price is heading lower, which can mean trouble for the company. Southwestern Energy is the latest Marcellus/Utica driller to see a spike up in short selling of its stock. How much?…
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Anti-Drilling/Fossil Fuel | Butler County | Energy Companies | Industrywide Issues | Pennsylvania | Rex Energy

2 Anti-Drilling Dems Soundly Defeated in Mars School District Vote
November 5, 2015November 5, 2015

Two anti-drilling parents who are agitating to strip away private property rights from their neighbors in Middlesex Township, PA–Amy Nassif and Patrice Tomcik–were soundly defeated in their run for the Mars School District board of education. MDN told you back in June that three Martians tried to get on the ballot, but only two made it (see Anti-Drilling Martians Running for School Board in November). The two Democrats who made it, Nassif and Tomcik, are part of an anti-drilling cabal attempting to stop the legally permitted Rex Energy from drilling several gas wells some 3/4 of a mile from the school on the false premise that by doing so they will endanger the kiddies. The other voters in the Mars School District have said “Enough!” with a very loud voice. It’s obvious there’s overwhelming support to move ahead with drilling. Unfortunately the matter is currently tied up in court (see Landowner Lawsuit Against Martians NOT Dismissed After All). Here’s the good news story that the Martian Democrats were soundly defeated in Tuesday’s election…
Read More “2 Anti-Drilling Dems Soundly Defeated in Mars School District Vote”
Energy Companies | Shell

Shell Restructures Upstream into Conventional/Unconventional Units
November 5, 2015November 5, 2015

On Tuesday, Royal Dutch Shell held a “Management Day” event in London (another was planned for Wednesday in New York) in which Shell announced the company is restructuring its upstream (i.e. drilling) division. The newly configured upstream division will be split into an Unconventional Resources branch to oversee development of shale, tight natural gas and oil, and oilsands, and an Upstream International branch to oversee all conventional exploration. Nowhere in the presentation, a presentation which includes Shell’s strategies for midstream and downstream too, could we find a single mention of Shell’s potential ethane cracker project in Pennsylvania. There was also no mention of Shell’s Marcellus/Utica drilling program, although we found a single slide with a brief mention on it of northeast shale (see the slide below). Shell’s overall message, in essence, was this: “The ongoing low price of oil (and gas) is changing everything, and we’re making tough decisions in light of this new reality.” Below is Shell’s full Management Day announcement, which includes a description about dividing upstream so every part of it is more accountable to the bottom line, and a description of their efforts to buy BG–which consuming a lot of Shell’s energy and attention at the moment…
Read More “Shell Restructures Upstream into Conventional/Unconventional Units”
Energy Companies | Range Resources Corp | Statewide VA | Virginia

Range Sells Coal Bed Methane Wells in VA, Focusing on Marcellus
November 4, 2015November 4, 2015

Range Resources announced yesterday they are selling off 3,500 operated wells and approximately 460,000 net acres in the Nora/Haysi combined fields located in southwestern Virginia for $876 million to an unnamed buyer. The reason for the sale? Range is using the money to reduce debt and further concentrate on the “core” of their operations in the Marcellus/Utica. Range’s Nora/Haysi wells are coal bed methane wells. Drilling coal bed methane is akin to conventional drilling. All 3,500 of those wells produce an average of 109 million cubic feet per day (Mmcf/d) of natural gas. By comparison, using a very low number of 5 Mmcf/d for an average Marcellus well, it only takes 22 Marcellus wells to equal those 3,500 coal bed methane wells. Behold the power of fracking. Here’s what Range said yesterday about the sale…
Read More “Range Sells Coal Bed Methane Wells in VA, Focusing on Marcellus”
Blue Ridge Mtn Res/Magnum Hunter | Energy Companies

Magnum Hunter’s Latest Woes: More Investor Unrest, $29M Payment Due
November 4, 2015November 4, 2015

MDN has recounted numerous Magnum Hunter Resources (MHR) woes, including a threat to de-list their stock on the New York Stock Exchange (see Magnum Hunter Stock Avg Falls Below $1, Receives NYSE Warning), the threat of a takeover by a plucky young investor who owns 5% of the company (see Activist Investor Threatens Magnum Hunter with Takeover Unless…), and rumors the company may be preparing to file for bankruptcy protection (see Magnum Hunter: Preparing to Sell, or Filing for Bankruptcy?). A few new woes to add to the list: Another investor is threatening to form a coalition to “protect our interests” (i.e. force MHR to sell), and MHR needs to make a $29 million interest payment on bonds, due Nov. 15. The bondholders have hired lawyers in anticipation they may not get paid…
Read More “Magnum Hunter’s Latest Woes: More Investor Unrest, $29M Payment Due”
CONSOL Energy | Energy Companies | Industrywide Issues | Noble Energy | Pennsylvania | Pipelines | Regulation | Statewide PA | Wastewater

PA Allows Wastewater Pipelines to be Buried – With No Regulations
November 4, 2015November 4, 2015

A last minute change made to proposed new drilling regulations in Pennsylvania will mean (if adopted) that drillers can bury wastewater pipelines instead of being required to run them on top of the ground. Companies typically use pipelines in areas where it would be disruptive to have multiple truck trips in and out of an area. They’re also used to lower the cost of transporting wastewater (cheaper through a pipeline than by tanker truck). The change came after a letter-writing campaign launched by CONSOL Energy and their joint venture partner Noble Energy. But there’s a bit of controversy over the new standard that permits lines to be buried: the buried wastewater lines aren’t regulated. Not yet anyway…
Read More “PA Allows Wastewater Pipelines to be Buried – With No Regulations”
CONSOL Energy | Energy Companies

CONSOL Board Member Snaps Up $70K of Company Stock
November 4, 2015November 4, 2015

From time to time we highlight “insider buying” and “insider selling”–when top management either buys or sells their own company’s stock. Here’s one we’ve not seen before: A member of the board of directors for CONSOL Energy, Alvin R. Carpenter, has just bought himself 10,000 shares of CONSOL stock for $70,400. What does Carpenter know about CONSOL that we don’t? That’s the question that always runs through our heads when we read about these transactions. Here’s the low-down on Mr. Carpenter…
Read More “CONSOL Board Member Snaps Up $70K of Company Stock”
Energy Companies | Marshall County | Noble Energy | Utica Shale | West Virginia

Noble Energy 3Q15: Marcellus Prod. Up 50%, 1st Utica Well Drilled
November 3, 2015November 3, 2015

Noble Energy is a global driller involved in a number of shale plays in the U.S. including the DJ Basin, Eagle Ford Shale, Delaware Basin and Marcellus Shale. Noble idled the last remaining drilling rig they were operating in the Marcellus in September (see Noble Energy to Idle Remaining Marcellus Rig Next Month). Even so, they had a banner third quarter in the Marcellus. Noble issued their third quarter update yesterday and although the section on their Marcellus operations is brief (read it all below), it packs a punch. Even with reducing rigs to zero, Noble completed and brought online their first Utica Shale well (in Marshall County, WV). Noble’s production volumes in the Marcellus in 3Q15 rocketed to 493 million cubic feet of natural gas equivalent per day (MMcfe/d), more than a 50% increase over 3Q14 numbers. But wait, there’s more!…
Read More “Noble Energy 3Q15: Marcellus Prod. Up 50%, 1st Utica Well Drilled”
Energy Companies | Statewide WV | Stone Energy | West Virginia

Stone Energy 3Q15: Shut Down 110 Mmcfe/d of Marcellus Production
November 3, 2015November 3, 2015

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. Earlier this year the company released the one active Marcellus rig they were running and said they would not resume drilling in the northeast until receiving a hybrid rig in late 2015/early 2016 that can drill both Marcellus and Utica wells (see Stone Energy 1Q15: No New Marcellus Drilling, But More Production). In September Stone said they were shutting in most of their production in the Marcellus/Utica (see Stone Energy Shuts in Most of their WV NatGas Production). And indeed they did. Yesterday Stone released their third quarter 2015 update and it shows the company turned off the spigots in their northeast operations, cutting out all 100-110 million cubic feet equivalent per day (Mmcfe/d) of production in what they call their Mary field. The company continued to produce 20-25 Mmcfe/d from their Heather and Buddy fields (in the Marcellus). Here’s the latest update from Stone Energy…
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