Energy Companies

Energy Companies | Indiana County | Industrywide Issues | Pennsylvania | Pennsylvania General Energy | Regulation | Wastewater

PA DEP Nixes Previously Permitted Wastewater Injection Well
March 19, 2015March 19, 2015

The PA Dept. of Environmental Protection under Acting Sec. John Quigley (formerly from the anti-drilling organization PennFuture) has reversed a decision made by the DEP just last October to permit a rare/new wastewater injection well in Indiana County. Most Pennsylvania wastewater that gets injected travels out of state–to either Ohio or West Virginia–for disposal in their injection wells. It would be nice if PA handled a little more of its own wastewater. The DEP under previous Gov. Tom Corbett fully vetted a well Pennsylvania General Energy (PGE) planned to use as an injection well in Grant Township. The DEP issued a permit for the well. Now they’ve welshed on their decision and rescinded the permit they issued last October. The only thing that seems to have changed in the past five months is leadership at the top of the DEP. Ergo, Quigley didn’t want this injection well…
Read More “PA DEP Nixes Previously Permitted Wastewater Injection Well”
Cattaraugus County | Energy Companies | Industrywide Issues | New York | Pipelines | Seneca Resources

NFG Building Compressor Station in NY to Pump More PA Marcellus Gas
March 19, 2015March 19, 2015

In an effort to pump more cheap, abundant, clean-burning Marcellus Shale gas from Pennsylvania into frackless (and feckless) New York State, National Fuel Gas Company has announced they’re building a $42.5 million compressor station in Cattaraugus County, NY in the Town of Hinsdale (western part of the state). Amazingly the county wants it! And the county industrial development agency (IDA) has approved it. While construction is going on, some 100 workers will be employed earning close to $7 million…
Read More “NFG Building Compressor Station in NY to Pump More PA Marcellus Gas”
Butler County | Carroll County | Energy Companies | Ohio | Pennsylvania | Rex Energy

Rex Energy 1Q15 Update: 6 New Wells Online in Butler County
March 18, 2015March 18, 2015

The first quarter of 2015 hasn’t quite come to an end just yet (that happens on March 31)–but it’s not stopping Rex Energy from issuing a first quarter operational update. Rex, headquartered in State College, PA, is mainly focused on drilling in the Marcellus/Utica–in Butler County, PA and Carroll County, OH. According to Monday’s update, Rex placed six more wells (on two pads) in Butler County into sales during 1Q15. Because of problems with a Blue Racer compressor station, Rex reports production in Carroll County was constrained in 1Q15–but they’re quick to add those problems are over and the gas is now flowing again. Here’s yesterday’s update…
Read More “Rex Energy 1Q15 Update: 6 New Wells Online in Butler County”
Chesapeake Energy | Energy Companies | Ohio | Statewide OH | Utica Shale

Chesapeake: Next Few Years Will Separate Weak & Strong in Utica
March 18, 2015March 18, 2015

Chris Doyle is executive vice president of operations for Chesapeake Energy’s northern division. He previously held a similar position with Anadarko Petroleum. Doyle recently spoke to Columbus Business First about Chessy’s prospects, indeed everyone’s prospects, in the Ohio Utica Shale. Sounding rather Darwinian, Doyle said we’re now entering a phase in the Utica where the strong will survive, and the weak won’t. Obviously he believes Chesapeake is in the “strong” category…
Read More “Chesapeake: Next Few Years Will Separate Weak & Strong in Utica”
Chesapeake Energy | Energy Companies | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

Kathleen “Wag the Dog” Kane Says Chessy Investigation Almost Done
March 18, 2015March 18, 2015

One of the Democrats’ favorite tactics: When the spotlight is on you because of your own criminal behavior, try to turn it elsewhere. Quick, anywhere! Bill Clinton tried it when he was being dogged by the Monica Lewinsky scandal–he bombed an aspirin factory in the Sudan. It’s called Wag the Dog–as in create a new issue to distract people from the old issue you don’t want them to focus on any more. Apparently Pennsylvania’s Attorney General, Kathleen Kane, is using the same tactic. A grand jury says Kane broke the law herself in her role as AG by committing perjury (see PA Grand Jury Finds Anti-Drilling AG Kathleen Kane Lied Under Oath). Kane is fighting the charge in court by using Bill Clinton’s lawyer attack dog Lanny Davis. Apparently Lanny is now advising Kane to Wag that Dog too. So Kane is saying her investigation of Chesapeake Energy over shorting landowners out of royalties due to them is “almost wrapped up”–which of course has everyone buzzing and forgetting about her own criminal behavior…
Read More “Kathleen “Wag the Dog” Kane Says Chessy Investigation Almost Done”
Blue Ridge Mtn Res/Magnum Hunter | Energy Companies | Energy Services | Eureka Midstream | Industrywide Issues | Pipelines

Eureka Hunter Pipeline Volume Continues to Expand, now 623 Mmcf/d
March 17, 2015March 17, 2015

Every few months Eureka Hunter, the midstream subsidiary of Magnum Hunter Resources, issues a press release to update investors on their progress toward filling their WV/OH pipeline system with natural gas. Eventually they hope to flow 1 billion cubic feet per day through the system. Last September Eureka reported they were up to an average 307 million cubic feet per day (see Magnum Hunter’s Pipeline System Boosts Volumes in OH/WV). In January they were up to 400 Mmcf/d and expecting to hit 500 Mmcf/d by the end of that month (see Eureka Hunter Nears 1/2 Billion Cubic Feet per Day in WV/OH). As of last Friday, Eureka has hit north of 623 Mmcf/d on their path to a billion cubic feet…
Read More “Eureka Hunter Pipeline Volume Continues to Expand, now 623 Mmcf/d”
Belmont County | Energy Companies | Lease & Royalty Payments | Ohio | Rice Energy | Utica Shale

Rice Energy Pays St Clairsville, OH $8,700/Acre Signing Bonus
March 16, 2015March 16, 2015

In March 2014, St. Clairsville (Belmont County), OH put out a request for bids on 195 acres of city-owned land. The request for proposal (RFP) came and went with no bids (see St Clairsville RFP to Lease 195 Utica Acres Comes & Goes, No Bids). But don’t let that fool you. Drillers were keenly interested in leasing the property. The initial RFP served a legal purpose. After the period for bids closed, the real negotiations began. St. Clairsville was looking for $7,300 per acre signing bonus and 20% royalties. They got an even better deal. In January, Rice Energy handed St. Clairsville with a check for $1,479,251.84 to lease 170 out of the 195 acres–or $8,700 per acre as a signing bonus…
Read More “Rice Energy Pays St Clairsville, OH $8,700/Acre Signing Bonus”
Anti-Drilling/Fossil Fuel | Butler County | Energy Companies | Industrywide Issues | Litigation | Pennsylvania | Regulation | Rex Energy

Dela. RiverKeeper, Clean Air Council Cost Middlesex Residents $35K+
March 16, 2015March 16, 2015

THE Delaware Riverkeeper (Maya van Rossum) and the Clean Air Council, both located in the orbit of Philadelphia, have gone all the way to the opposite side of the state to meddle and cause mischief (see Martian Chronicles: Delaware River Basin Shifts to Western PA?). They’ve not only delayed legal and legitimate Marcellus drilling on the other side of the state, now they’ve cost the taxpayers in Middlesex Township (Butler County), PA over $35,000 in legal fees–and the costs keep mounting. Thank you Delaware Riverkeeper and Clean Air Council with your frivolous meddling! Those groups, in league with “four residents” are challenging the right of Middlesex to allow Rex Energy to drill several Marcellus Shale wells on a pad in a rural area that’s 3/4 of a mile away from the Mars School (see Rex Drilling Operation Near Mars School Put on Hold). Their meddling is costing real money–not only for Rex Energy, but also for the taxpayers of Middlesex who are nothing more than collateral damage for Riverkeeper and the Clean Air Council in their war on fossil fuels…
Read More “Dela. RiverKeeper, Clean Air Council Cost Middlesex Residents $35K+”
Energy Companies | EQT Corp | Hydraulic Fracturing | Industrywide Issues | Kentucky | Regulation

Kentucky Fracking One Step Closer: Commission Considers 1st Permit
March 16, 2015March 16, 2015

In January, MDN told you that shale drilling/fracking may soon come to Kentucky (see Fracking on the Way in the Bluegrass State? Quite Possibly). Several weeks ago the Kentucky Oil and Gas Conservation Commission, a group that “rarely meets” (last meeting was in 2006) held a meeting to consider granting Kentucky’s very first deep horizontal natural gas drilling permit. The company applying for the permit is Horizontal Technology Energy Company, a subsidiary of Pittsburgh-based EQT. Horizontal Technology wants to drill a well in the Rogersville Shale in the eastern part of the state. No word yet on the result of that meeting…
Read More “Kentucky Fracking One Step Closer: Commission Considers 1st Permit”
Chesapeake Energy | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Litigation | Pennsylvania | Statewide PA

Chesapeake’s PA Royalty Settlement Affects Some, Not All Landowners
March 16, 2015March 16, 2015

In December MDN told you about a settlement between “several thousand” Pennsylvania landowners and Chesapeake over the royalty issue–Chessy deducting post-production payments by pipeline companies in what some call a scam that leaves landowners signed with Chesapeake receiving royalty checks that are pennies on the dollar compared to what they should receive. The new settlement for those “several thousand” would be 2/3 of $11 million, after the lawyers get their 1/3 cut (see Chesapeake & PA Landowners Settle Royalty Lawsuit…Again). However, not all PA landowners leased with Chesapeake are happy about it. Two other, separate lawsuits against Chesapeake are proceeding and, according to attorneys, the settlement will not affect these separate lawsuits which are proceeding, unless the leases have a “market enhancement” clause…
Read More “Chesapeake’s PA Royalty Settlement Affects Some, Not All Landowners”
CONSOL Energy | Energy Companies

CONSOL Trims 2015 Drilling Budget Another $80M; High-Grade?
March 16, 2015March 16, 2015

On Friday, CONSOL Energy issued a press release with lots of flowery words to say they’re whacking their drilling budget again. Instead of spending $1 billion on Marcellus/Utica drilling in 2015 (previously announced in January), they’ll spend $80 million less than that–$920 million. The language CONSOL uses is interesting: they talk about continuing their focus to “high-grade the development plan to further reduce capital in a lower commodity price environment,” whatever that means. Sounds like gobbledygook to us. They use “high-grade” as a verb. If CONSOL had spent $80M more would that have been considered low-grading the development plan? Medium-grading it? We sometimes find the language of high finance amusing as well as befuddling. Here’s the full announcement from Friday. See if you can make heads or tails of it…
Read More “CONSOL Trims 2015 Drilling Budget Another $80M; High-Grade?”
Accidents | Energy Companies | Gastar Exploration | Industrywide Issues | West Virginia | Wetzel County

Gastar Worker Injured at Injection Well in Wetzel County, WV
March 13, 2015March 13, 2015

Local media in West Virginia is reporting that early Tuesday afternoon a Gastar Exploration worker was injured in an accident at a brine injection well (owned by Gastar) in New Martinsville (Wetzel County), WV. The only thing we know is that the man’s leg was injured. We don’t know his condition or, frankly, many other details. Here’s what we’ve been able to find out so far…
Read More “Gastar Worker Injured at Injection Well in Wetzel County, WV”
Belmont County | Energy Companies | Energy Services | Greene County (PA) | Ohio | Pennsylvania | Rice Energy | Rice Midstream | Washington County

Rice Energy Turns Profitable in 2014; Strong 2015 in View
March 13, 2015March 13, 2015

Rice Energy, a “pure play” energy company focused on drilling in the Utica and Marcellus, issued their full year and fourth quarter 2014 update yesterday. Wow, what an update! Rice had a big year in 2014. The parent company, focused on drilling, went public. They also launched an IPO for their midstream (pipelines) subsidiary. Compared to 2013 which saw a loss on the books, 2014 reversed it. In 2014, Rice’s profit was $218.5 million (out of $390.9 million). That’s an increase over a 2013 loss of $35.8 million (out of $88.7 million in revenue). In 2014, Rice produced 97.7 billion cubic feet (Bcf) of natural gas, up from 23 Bcf in 2013. Aside from the company growing and hitting its stride, what was different about 2014? Last year Rice concentrated on the Utica Shale…
Read More “Rice Energy Turns Profitable in 2014; Strong 2015 in View”
Belmont County | Energy Companies | Greene County (PA) | Ohio | Pennsylvania | Rice Energy | Washington County

Rice Energy CEO Dan Rice Says 5 Utica Wells Producing 80Mmcf/Day
March 13, 2015March 13, 2015

CORRECTION: In the original version of this story MDN incorrectly stated Rice’s 5 Utica wells were producing $80 million per day instead of 80 million cubic feet of natural gas. A dumb mistake. We relied on an inaccurate transcription of what was said (see it below). The transcription lists the quantities as dollars–the person transcribing got it wrong. We should have known! Our apologies. The 5 wells are still awesome in producing 80 Mmcf/d–but not as awesome as $80 million per day! 🙂

In addition to releasing their fourth quarter and full year 2014 update yesterday, Rice Energy also held an analyst phone call to share the results. Rice’s top management was on the call and shared some fascinating insights. Among them: In 2014 and early 2015 Rice brought five Utica Shale wells online–Bigfoot 9H, Blue Thunder 10H and 12H, and Gold Digger 1H and 3H. (Just an aside, we love how Rice names their wells. Their newest well pad just completed in Belmont County, OH is the “Son-Uva-Digger” pad. Love it!) Anywho, the five Utica wells completed in 2014 and early 2015 collectively are producing, according to CEO Dan Rice, 80 million cubic feet of gas PER DAY. Truly astonishing. In addition to the Utica in Belmont County, Rice is eyeing the Utica underneath their Marcellus assets in southwestern PA–in Washington and Greene counties. This company is smart and focused and one to keep an eye on. Below is a transcript of the comments from yesterday’s analyst call. We’ve added our yellow highlighter to point out some items that caught our attention…
Read More “Rice Energy CEO Dan Rice Says 5 Utica Wells Producing 80Mmcf/Day”
Energy Companies | Gastar Exploration

Gastar’s Marcellus/Utica Production Goes DOWN in 2014 – Why?
March 13, 2015March 13, 2015

Gastar Exploration is an independent oil and gas driller with active drilling programs in the Hunton Limestone horizontal play, the Woodford Shale and the Meramec Shale–all three of which occupy roughly the same acreage in the Mid-Continent area. Of interest to MDN is Gastar’s program in West Virginia and Pennsylvania, where they drill in both the Marcellus and now the Utica Shale layers. At last check-in Gastar owns 58,900 acres of leases in the northeast. As we reported in February, Gastar plans to spend a minimal amount drilling in the northeast in 2015–essentially just completing a few wells already drilled (see Gastar Finishing 5 Wells, Then Idling Rigs in Marcellus/Utica). In their 2014 year-in-review, Gastar reports year over year production in the Marcellus/Utica went down–a story we don’t often see. Usually production goes up. Why down for Gastar? They drilled and brought fewer wells online in the Marcellus/Utica in 2014 than in previous years. Here’s the Appalachin Basin section from Gastar’s 2014 update…
Read More “Gastar’s Marcellus/Utica Production Goes DOWN in 2014 – Why?”
Energy Companies | Energy Services | EQT Corp | Equitrans/EQT Midstream

EQT Midstream Swims Against the Tide, Issues Units Instead of Notes
March 13, 2015March 13, 2015

As we’ve commented a number of times, we don’t pretend to understand all of this high finance stuff when it comes to oil and gas companies and how they decide to fund future development. Sometimes they sell shares of stock. Sometimes they sell “units”–which are the equivalent of shares of stock for companies organized as a master limited partnership (or MLP). Sometimes they borrow money in a revolving loan (line of credit). And sometimes they float notes, what we tongue-in-cheek call IOUs. Lately there have been a rash of companies, many of them midstream (pipelines and processing plants) floating notes to get more cash through the door. We spotted one that’s different (different always stands out). EQT Midstream, a subsidiary of driller EQT but a company (on paper) that’s independent, just announced they’re issuing 8.25 million new units (i.e. like shares of stock), with an option of issuing an additional 1.2 million units. Issuing units (or shares of stock) is equity financing–selling ownership in the company, whereas notes and lines of credit is debt financing. Which is better? Ask a CFO. We have a built-in bias to avoid debt, but that’s just us…
Read More “EQT Midstream Swims Against the Tide, Issues Units Instead of Notes”