Energy Companies

Chesapeake Energy | Energy Companies | Industrywide Issues | M&A

Rumor Mill: Indian Oil Co Wants to Buy Chesapeake Energy
January 21, 2015January 21, 2015

Carl Ichan, corporate raider and puppet master at Chesapeake Energy, must be rubbing his hands together in glee. The rumor mill is buzzing that Oil & Natural Gas Corporation Limited (ONGC), the state-run national oil company of India, is “aggressively” pursuing Chesapeake–to buy it. It appears ONGC wants to buy the whole company, although we don’t know that for sure. The ONGC/Chessy buzz has Chessy’s stock trading higher, which delights Mr. Ichan. Here’s what we’re able to find about this latest rumor…
Read More “Rumor Mill: Indian Oil Co Wants to Buy Chesapeake Energy”
Energy Companies | Lease & Royalty Payments | Marshall County | Noble Energy | West Virginia

WV Leases Another 1,400 Acres Under Ohio River for Drilling
January 21, 2015January 21, 2015

More drilling under the Ohio River is about to become reality. Last October, MDN told you about the deal to lease a 232-acre tract of land around and under the Ohio River in Marshall County, WV. The state leased the land for drilling to Gastar Exploration for $3,500 per acre plus a 20% royalty (see Gastar Wins Lease to Drill Under Ohio River in WV). That deal netted WV a tidy signing bonus check for $812,000, to say nothing of the royalties they’ll get once the gas starts to flow. WV liked that deal and decided to put more land under the river on the market (see WV Looks to Lease More Ohio River, Other State Land for Drilling). Yesterday the state confirmed they are close to finalizing a deal with Noble Energy to lease another 1,400 acres of state-owned land around and under the Ohio River–also in Marshall County. This new deal also nets the state $3,500 per acre, or $4.9 million, as a signing bonus…
Read More “WV Leases Another 1,400 Acres Under Ohio River for Drilling”
Butler County | Energy Companies | Pennsylvania | Rex Energy

Rex Energy: Production Up 66% in 2014, New Drilling Area in 2015
January 21, 2015January 21, 2015

Rex Energy, the little energy company that could (and does) successfully drill in the Marcellus and Utica Shale, announced in December that they would reduce their drilling budget in the Marcellus by 44% in 2015 (see Rex Energy Reduces 2015 Marcellus/Utica Drilling Budget by 44%). Yesterday the company released an operational update for 2014 that shows production was up 66% in 2014 over 2013 numbers. Fourth quarter production numbers were up 15% over third quarter. In addition, Rex has begun drilling a series of Marcellus wells in a new area of Butler County, what they call the Moraine East Area. They plan to drill drill 10 to 16 wells in the Moraine East Area and complete 4 to 10 wells in 2015. Here’s the rundown from Rex for what happened in 2014, and what they intend to do in 2015…
Read More “Rex Energy: Production Up 66% in 2014, New Drilling Area in 2015”
Chesapeake Energy | Energy Companies | Ohio | Statewide OH | Total | Utica Shale

Total Scales Back Investment in Utica Shale, Blames Low Oil Price
January 21, 2015January 21, 2015

Total (pronounced “toe-tail”), is a French multinational integrated oil and gas company and one of the six “supermajor” oil companies in the world. Yesterday the relatively new CEO of Total, Patrick Pouyanne, announced that he’s scaling back in the North Sea fields and in U.S. shale plays. In 2012, Total plowed more than $2 billion into the Utica Shale, partnering with Chesapeake Energy (see Chesapeake Sells More of its Utica Leases to Total). In September 2014, Total sold off a smallish investment they had in Cardinal Midstream, a Utica midstream company, to South Korean investors for $400 million (see Total, EVEP Sell Interest in Cardinal Midstream to S Koreans for $612M). Patrick Pouyanne became CEO of Total last October after a freak runway accident killed Total’s colorful and long-time CEO Christophe de Margerie (see French Supermajor Total CEO Killed in Freak Runway Accident). Pouyanne is now making his mark on the company. He blames the plunge in oil prices for his action. Here’s what Pouyanne said at a conference in Davos, Switzerland earlier this morning…
Read More “Total Scales Back Investment in Utica Shale, Blames Low Oil Price”
Belmont County | Energy Companies | Gulfport Energy | Lease & Royalty Payments | Ohio

Coal Company Leases 6K Acres for Natgas Drilling in Belmont, OH
January 20, 2015January 20, 2015

Murray Energy Corp. is a coal mining company headquartered in St. Clairsville (Belmont County) in eastern Ohio. In 2013, Murray’s CEO and founder, Robert Murray, sued Aubrey McClendon when McClendon named his new company American Energy Partners. Murray, you see, operates a subsidiary coal mining company called American Energy Corp. (see McClendon Gets Sued in OH Over New Company’s Name). We haven’t heard anything since that time, so presumably it’s all blown over by now. What’s interesting is that Murray, whom we assumed has a grudge against natural gas, has just leased 2,076 acres of his coal mining property owned by American Energy Corp., along with 3,849 acres from another Murray subsidiary mining operation, The Ohio Valley Coal Co., to Gulfport Energy so Gulfport can drill for natural gas under the coal mines…
Read More “Coal Company Leases 6K Acres for Natgas Drilling in Belmont, OH”
Accidents | Energy Companies | Industrywide Issues | Monroe County | Ohio | Triad Hunter

ODNR Still Investigating Triad Hunter Well Blowout in Ohio
January 20, 2015January 20, 2015

On December 13, 2014, Triad Hunter’s Stalder 3UH well in Monroe County, OH experienced a blowout (see Triad Hunter Well Blowout in Monroe County, OH – No One Injured). Some 50 residents in 28 homes were displaced–too dangerous to be close to a well venting methane that might explode if an ignition source is close by. Those residents were out of their homes for 10 days but finally returned on Dec. 23 (see Triad Hunter Well Blowout in Ohio Fixed, Residents Go Home). It’s now been five weeks since the blowout. What do we know about the cause? According to the Ohio Dept. of Natural Resources, the “accident” that caused the plugged well to start flowing uncontrollably is still not known…
Read More “ODNR Still Investigating Triad Hunter Well Blowout in Ohio”
Energy Companies | Southwestern Energy

Feed the Beast: Southwestern Seeks $2.34B from New Stock Offering
January 20, 2015January 20, 2015

As MDN previously pointed out, Southwestern Energy has racked up a lot of expenses lately. They picked up 413,000 acres and 1,500 wells from Chesapeake Energy, and another 46,700 acres and 63 Marcellus wells from WPX in 2014 (see Southwestern Energy on a Tear – Doubles Marcellus Budget for 2015). Southwestern has to pay for that rapid expansion somehow. Early last week they announced they would float 20 million new shares of stock (see Southwestern Energy Floats 20M New Shares of Stock). Later last week the number of shares was increased and we found out how much money they hope to raise: $2.34 billion. What will they do with the money?…
Read More “Feed the Beast: Southwestern Seeks $2.34B from New Stock Offering”
Energy Companies | Gulfport Energy | Marshall County | Ohio County | Utica Shale | West Virginia

Gulfport Energy Enters WV Utica, Leases in Ohio/Marshall Counties
January 19, 2015January 19, 2015

Looks like Gulfport Energy, with 184,000 acres of leases and an active driller in eastern Ohio’s Utica Shale, is making moves into the West Virginia Utica Shale. We spotted an article that says Gulfport has purchased an 87.5% stake in “hundreds of lease agreements” in Ohio and Marshall counties in WV. We don’t know how many acres are involved (yet). But we do know who they’ve purchased the leases from…
Read More “Gulfport Energy Enters WV Utica, Leases in Ohio/Marshall Counties”
Energy Companies | Industrywide Issues | Pennsylvania | Range Resources Corp | Regulation | Statewide PA | Washington County

Strange: DEP Fines Range Resouces $1.75M for Water Withdrawals
January 19, 2015January 19, 2015

A strange announcement from the Pennsylvania Dept. of Environmental Protection (DEP) on Friday says that Range Resources has agreed to pay $1.75 million to the state for failure to keep track of water withdrawals made by the company (takes a lot of water to frack, much of which comes from creeks and rivers), and for exceeding the amount of water withdrawn according to the plan they have on file with the DEP. What’s strange about the announcement is that a) you can’t find it on the DEP website itself, b) Range was making withdrawals and not recording/tracking the withdrawals from 2009 to 2014–five years–but apparently the DEP didn’t notice or didn’t care, and c) $950,000 of the $1.75 million “fine” (more than half) will go to fix up and operate the Hamilton Abandoned Mine Treatment System in Findlay Township, Allegheny County…
Read More “Strange: DEP Fines Range Resouces $1.75M for Water Withdrawals”
Energy Companies | Energy Services | Industrywide Issues | NGLs | Pipelines | Range Resources Corp | Sunoco Logistics

Range Cuts 2015 Drilling Budget 33%; Mariner East Up & Running!
January 16, 2015January 16, 2015

In addition to release good news yesterday about record high proved reserves (see today’s companion story), Range Resources issued a second press release yesterday to say they’re scaling back the drilling budget (capital expenditures, or capex) for 2015. Originally they set out to spend $1.3 billion on drilling projects in 2015. They’ve just trimmed it back by 33% to $870 million. They’re scaling back because of the low commodity price of natural gas, plain and simple. That’s the bad news. The good news is that 95% of that money will be spent in the Marcellus Shale. The further good news (why the deuce do we always have to hear these things from Range instead of Sunoco Logistics?!) is that the Mariner East pipeline is now up and running, flowing propane from western PA to storage caverns currently–not all the way to Philadelphia just yet…
Read More “Range Cuts 2015 Drilling Budget 33%; Mariner East Up & Running!”
Antero Resources | Energy Companies | Lease & Royalty Payments | Monroe County | Ohio | Utica Shale

Antero Resources 4Q14: Just Paid $20K/Acre for More Utica Leases
January 16, 2015January 16, 2015

Antero Resources, one of the biggest Marcellus/Utica Shale drillers, issued their fourth quarter operations and hedging report on Wednesday. The report includes a lot of 2014 summary information. It’s an important update with a lot of juicy information contained in it. Perhaps the juiciest is buried near the end: Antero closed on a deal to pick up another 12,000 Utica acres, most of it located in Monroe County, OH, from an undisclosed third party. Antero paid an eye-popping $240 million–or $20,000 per acre! The land does have five producing shale wells and an 8-mile pipeline. Figure the wells are worth $8M each (the cost to drill them) and the pipeline is worth $1M per mile, another $8M (this is very rough, back of the envelope stuff). Deducting that from the price you still get $16,000 per acre for the undeveloped land. Yikes. Here’s the other things that caught our eye about the update…
Read More “Antero Resources 4Q14: Just Paid $20K/Acre for More Utica Leases”
Energy Companies | Industrywide Issues | Range Resources Corp | Reserves (Proved and Unproved)

Range Hits Record High 10.3 Tcfe Proved Reserves in 2014
January 16, 2015January 16, 2015

A high level report wrapping up stellar results for 2014 was issued by Range Resources yesterday. Among the things Range is justifiably crowing about: Their proved reserves have increased by 26% to 10.3 trillion cubic feet equivalent (Tcfe). In 2014, it cost Range an average of $0.64 per million cubic feet (Mcf) to find and develop their Marcellus Shale acreage–get it ready to drill. And in 2014, it cost them an average $0.55/Mcf to drill and develop their acreage. That’s a combined $1.19 per Mcf cost to Range to find, drill and product, so you can see they’re still making money on dry gas that sells for less than $3/Mcf (plus they’ve hedged, meaning they get even more for their gas than the going spot price). There’s plenty of other goodies in yesterday’s announcement…
Read More “Range Hits Record High 10.3 Tcfe Proved Reserves in 2014”
American Energy Partners | Energy Companies

Trusted McClendon Lt. Takes Reigns as CEO of Northeast Drilling
January 14, 2015January 14, 2015

Aubrey McClendon has just entrusted the main part of his fledgling new company, American Energy Partners LP (AELP), to a trusted lieutenant. MDN told you last week that AEP was combining their Utica and Marcellus shale operations–on paper separate entities–into one larger subsidiary of AEP called American Energy Appalachia Holdings, or AEA as they now call it (see McClendon Utica/Marcellus Subsidiaries Combine & Form New Company). The man who was/is running AEA is Jeffrey A. Fisher. Until now, Fisher was Chief Operating Officer of the American Energy Partners mothership AELP. Now he’s the CEO of AEA. That is, he’s the CEO over roughly 90% of Aubrey’s newly amassed empire…
Read More “Trusted McClendon Lt. Takes Reigns as CEO of Northeast Drilling”
Allegheny County | Energy Companies | Laurel Mountain Energy | Pennsylvania | Statewide PA

“New” Pittsburgh Company Forms to Target Marcellus/Utica in W PA
January 12, 2015January 12, 2015

A brand new baby is born! Or is it? Using money from private equity firm TPH Partners, the father-son team of Clark and David Nicklas have just given birth to a new “upstream” (exploration and production) company called Laurel Mountain Energy which will be headquartered in Pittsburgh and target the Marcellus, Upper Devonian and Utica layers in western PA. Dad Clark founded Vista Resources in 1987 and since that time the company has drilled over 1,000 wells in the northeast. This is Houston, TX-based TPH’s first investment in the Marcellus, and they couldn’t be happier…
Read More ““New” Pittsburgh Company Forms to Target Marcellus/Utica in W PA”
Energy Companies | Halcon Resources | Ohio | Statewide OH | Utica Shale

Halcon Resources: Slashes Drilling Budget 50%, No Utica for 2015
January 12, 2015January 12, 2015

As MDN chronicled in March 2014, Halcon Resources, with some 140,000 net acres in the Ohio Utica Shale, quit drilling in the Utica, at least for the balance of 2014 (see Halcon Resources Stops Drilling, Gives Up on the Utica Shale). That now holds true for 2015 as well. In a statement about their drilling program released late last week, Halcon indicated they have revised their drilling budget down by nearly 50%–from the previous $750-$800 million to $375-$425 million. They’re also reducing the number of drilling rigs from 11 rigs to 3–and none of them will be operating in the Utica Shale…
Read More “Halcon Resources: Slashes Drilling Budget 50%, No Utica for 2015”
Energy Companies | Southwestern Energy

Southwestern Energy Floats 20M New Shares of Stock
January 12, 2015January 12, 2015

As we’ve previously noted, Southwestern Energy has been on a tear, snapping up Marcellus and Utica Shale acreage (see Southwestern Energy on a Tear – Doubles Marcellus Budget for 2015). All of that new acreage and plans to drill means the company needs more money. Today, Southwestern announced they will float an additional 20 million shares of stock in an effort to raise more cashola to drill baby drill…
Read More “Southwestern Energy Floats 20M New Shares of Stock”