Energy Companies

Belmont County | Energy Companies | Lease & Royalty Payments | Ohio | Rice Energy | Utica Shale

Belmont County Shopping New Deal to Lease Additional 426 Acres
April 30, 2014April 30, 2014

Belmont County, OH commissioners like the $3 million check they just got from Rice Energy for leasing 406 acres of county-owned land (see Belmont County, OH Waiting for $3M Lease Check from Rice Energy). That’s $7,500 per acre for a signing bonus! Commissioners with Belmont like that gas money so much, they’re now looking to lease another 426 acres–at an even higher price. Oy vey!

The announcement about Belmont shopping for another lease deal came at a meeting last week…
Read More “Belmont County Shopping New Deal to Lease Additional 426 Acres”
CONSOL Energy | Energy Companies

CONSOL 1Q14: Top Mgmt Changes, Change to Shale Driller Continues
April 30, 2014April 30, 2014

It’s hard to believe, but CONSOL Energy, originally a coal company, is 150 years old. The company was founded when Abe Lincoln was alive. As CONSOL’s current CEO Brett Harvey (retiring in May) says mentioning Abe and the age of CONSOL is relevant “because good assets, with the right strategy, are timeless.” CONSOL issued their first quarter operating and financial report yesterday (see it below). After experiencing a net loss last year at this time, CONSOL’s 1Q14 net income was a healthy $116 million on the black side of the ledger.

In the Marcellus Shale, CONSOL Energy and its joint venture partner drilled 35 wells, completed 23 wells, and had 11 wells turned in line. In the Utica Shale, CONSOL Energy and its joint venture partner drilled 7 wells, completed 3 wells, and had 10 wells turned in line. Below we have an overview of yesterday’s CONSOL 1Q14 report, the report itself, and a portion of an analyst call with top management…
Read More “CONSOL 1Q14: Top Mgmt Changes, Change to Shale Driller Continues”
BP | Energy Companies | Lease & Royalty Payments | Ohio | Trumbull County | Utica Shale

BP Calls it Quits in the Utica Shale – Total Write-off
April 29, 2014April 29, 2014

A sad day for landowners in Trumbull County, OH. Flashback: In March 2012 BP leased 84,000 acres in Trumbull County, OH from the Associated Landowners of the Ohio Valley (see BP’s Big Utica Shale Deal, Leases 84K Acres in Ohio). Just two years later and what started out with great fanfare is all down the toilet. BP announced today they are pulling out of the Utica Shale and writing it all off. In a very brief mention in a press release issued this morning about first quarter 2014 results, BP says: “Following on from the decision to create a separate BP business around its US lower 48 onshore oil and gas activities, and as a consequence of appraisal results, BP has decided not to proceed with development plans in the Utica shale. The Upstream result includes a write-off relating to the Utica acreage.”

Last November MDN wondered aloud whether BP would decide to move forward, or call it quits (see Decision Point: Will BP Drill Their Utica Acreage? Or Pass?). Now we know. Why leave? As we pointed out at the time, Trumbull County has proven to be mostly dry gas, and not wet gas (or natural gas liquids) which makes it a much less profitable part of the play to drill in. BP rolled the dice and bet wrong. The only other driller in Trumbull has been Halcon Resources. They pulled out too (see Halcon Resources Stops Drilling, Gives Up on the Utica Shale). Is there any hope for future Utica drilling in Trumbull County?…
Read More “BP Calls it Quits in the Utica Shale – Total Write-off”
Energy Companies | Hydraulic Fracturing | Industrywide Issues | Litigation | New York | Norse Energy | Regulation | Statewide NY

Highest Bid for Norse Energy $2.65M – Was it Sold & Who Bid?
April 28, 2014April 28, 2014

On Friday two major stories developed involving Norse Energy. You may recall Norwegian-based Norse Energy rolled the dice and placed all their bets on shale drilling in New York State, leasing some 180,000 acres, of which 130,000 acres are in the Marcellus and/or Utica Shale region. Never in their wildest dreams did Norse believe it would take six years or more for the state to allow high-volume hydraulic fracturing. Things started to go downhill for Norse when landowners sued to say Norse did not have the right to continue the leases indefinitely (beyond five years) because of New York’s tardiness in approving fracking (see New Rough Patch for Norse Energy: Force Majeure Lawsuit). Eventually the state’s ongoing moratorium on fracking led to Norse’s bankruptcy (see Lights Turned Off, Door Closed – Good Night, Norse Energy). Norse sued the state to force it to release fracking regulations so their remaining asset, the leases, could be sold for at least some value to compensate investors (see Norse Energy Sues Gov. Cuomo to Force Release of Fracking Regs).

Here’s where it gets complicated. On Friday in U.S. bankruptcy court, three bids for the leases and other company assets were unsealed. The highest was for $2.65 million–which is pennies on the dollar compared to the value of the company just a year ago before NY’s action forced it into bankruptcy. The New York Post reported the company behind the winning bid was hedge fund Mason Capital. From what MDN is able to determine, that may not be correct. The highest bid was from Any Acquisition, LLC–which may or may not be backed by Mason Capital. More important, there has been no official word that the judge awarded the sale to anyone on Friday. Below we tackle a complex deal-in-the-making and sort it out with help from our friends at NGI’s Shale Daily, who did some proper, old-fashioned reporting and got the real goods…
Read More “Highest Bid for Norse Energy $2.65M – Was it Sold & Who Bid?”
Energy Companies | Hydraulic Fracturing | Industrywide Issues | Litigation | New York | Norse Energy | Regulation | Statewide NY

NY Hearing on JLCNY/Norse Lawsuit v Cuomo, Martens, Shah
April 28, 2014April 28, 2014

On Friday a lower court judge heard testimony in the “Article 78” case brought by Norse Energy and the Joint Landowners Coalition of New York (JLCNY) against Gov. Cuomo, Dept. of Environmental Conservation Commissioner Joe Martens, and State Health Commissioner Nirav Shah–to force the release of new fracking regulations. Sadly, the man who is supposed to work for the residents of New York, Attorney General Eric Schneiderman, decided instead he works for the man-child who can’t make a decision, Andy Cuomo, so he filed a motion to dismiss the Article 78 lawsuit brought by Norse and the JLCNY (see NY AG Schneiderman Files to Dismiss JLCNY Lawsuit Against Cuomo). The judge on Friday held a hearing to consider that motion. Fortunately, the motion to dismiss was not granted. Not yet anyway.

The heart of Friday’s hearing centered on the issue of, “How long is long enough?” for the state to conduct a review and release new drilling regulations. We have quotes from various sources who were there. It was obvious the judge grilled the pro-drilling side harder than the rep from the AG’s office. However, near the end (as you’ll see below), the AG rep shot herself right in the foot and perhaps tilted the chances for the lawsuit to go forward in favor of Norse/JLCNY…
Read More “NY Hearing on JLCNY/Norse Lawsuit v Cuomo, Martens, Shah”
Anti-Drilling/Fossil Fuel | Coterra Energy (Cabot O&G) | Education | Energy Companies | Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Susquehanna County

Retired J-School Prof Says Lackawanna College a Shale Prostitute
April 28, 2014April 28, 2014

A old hippie retread that fancies himself as a journalist (he’s a retired professor of mass communications) has the unmitigated gall to call Lackawanna College a “prostitute” for accepting a $2.5 million endowment from Cabot Oil & Gas (see Cabot Oil & Gas Does it Again – $2.5 Million Gift to Lackawanna College). This same retired prof–Walter M. Brasch–calls the woman who is the voice in this video a “peaceful grandmother” that Cabot tried to hush up. In other words, he’s clueless. Is it any wonder the so-called reporters we have these days are inept, when taught by people like Brasch?

Back to the good prof and his bloviating: We wonder, Prof. Brasch, the $4.4 million Cabot helped raise for a rural hospital–a project on the books for decades and going nowhere until Cabot stepped in (see Cabot Effort Raises $4.4 Million for PA Physicians Clinic)–does Cabot’s money make the hospital a prostitute too? Would it have been better to not build the new hospital? What if the Heinz Endowments, an anti-drilling non-profit backed by lib idol Teresa Heinz Kerry had given money to Lackawanna College or the hospital? Would they still be prostitutes by accepting her money? And what about NY anti-drilling crusader Helen Slottje–in wacko San Fransciso today (see our story) to receive a $150,000 award from the Goldman Foundation. She’s getting it for trying to ban fracking in NY. Does that award make her a prostitute? Why not? If the shoe fits…
Read More “Retired J-School Prof Says Lackawanna College a Shale Prostitute”
Allegheny County | CONSOL Energy | Energy Companies | Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Regulation

CONSOL to Begin Drilling at Pittsburgh Airport Next Week
April 25, 2014April 25, 2014

The last hurdle has been jumped for CONSOL Energy with their plan to begin drilling at Pittsburgh International Airport. MDN has extensively covered the plan put forward by CONSOL to drill 47 wells on airport property–a plan that will ultimately net the airport something like $1 billion in revenue (see CONSOL Energy Reveals Drilling Plan for Pittsburgh Airport). The last hurdle was zoning permit approval from Findlay Township, where the property is located. MDN pointed out more than a month ago that Findlay was holding things up (see Local Town Slows CONSOL’s Plan to Drill at Pittsburgh Airport).

Wednesday night, Findlay supervisors voted 2-1 to approve CONSOL’s permits to drill at the airport. But not without 23 “conditions” attached to their approval, including limits on noise, working hours, creation of a public complaint hotline and air monitoring throughout drilling operations. Still, CONSOL was happy with the end result and says they’re ready to begin, as early as next week, a drilling program that will be “a model for the entire nation”…
Read More “CONSOL to Begin Drilling at Pittsburgh Airport Next Week”
Energy Companies | EQT Corp | Guernsey County | Ohio | Utica Shale

EQT Leaving the Utica? Maybe. Guernsey County Wells Disappoint
April 25, 2014April 25, 2014

On a quarterly earnings call yesterday with analysts, EQT said they have drilled 8 wells in the Utica Shale, along the western side of the Utica, with 3 of those wells online. And they are not happy with the results. Therefore, effective immediately, their planned program to drill 21 Utica wells this year has gone to 0 while they “evaluate” the wells they’re completing and bringing online. Meanwhile, EQT is moving the money they would have spent to drill the 21 Utica wells (all of them in Guernsey County, OH) into drilling an additional 8 Marcellus and 13 Upper Devonian wells this year.

Antero Resource recently reported some less-than-stellar results in the same general area, along the western edge of the Utica…
Read More “EQT Leaving the Utica? Maybe. Guernsey County Wells Disappoint”
Energy Companies | EQT Corp | Utica Shale

EQT 1Q14: Marcellus Doing Great, Utica Not So Much
April 25, 2014April 25, 2014

Yesterday EQT released their first quarter 2014 results, along with conducting an analyst call. One of the bigger pieces of news is that EQT is not happy with their Utica Shale well results (see our companion story today). However, the rest of the news was very positive. Production was 30% higher than a year ago, expenses were 17% lower, and EQT’s midstream division is humming right along too.

EQT drilled 64 gross wells in 1Q14: 46 wells targeting the Marcellus, 14 wells targeting the Huron, and 4 wells targeting the Upper Devonian Shale. In 2014, EQT will complete and evaluate 5 Utica wells drilled in 2013 but will not drill any more wells on its Ohio Utica acreage–at least until after this year. Instead, EQT now expects to drill 8 additional Marcellus wells and 13 additional Upper Devonian wells for a total of 194 Marcellus wells and 43 Upper Devonian wells in 2014. The change does not result in any additional capital outlay. Below is a portion of the update released by EQT yesterday, and the full transcript of the analyst call (lots of really interesting stuff)…
Read More “EQT 1Q14: Marcellus Doing Great, Utica Not So Much”
Coterra Energy (Cabot O&G) | Energy Companies

Cabot 1Q14: Marcellus Continues to Soar for Cabot
April 25, 2014April 25, 2014

Cabot Oil & Gas published their first quarter 2014 update yesterday, and the news continues to be spectacular. On more than one occasion MDN has noted how Cabot continues to spin gold from hay–making money hand over fist in the dry gas Marcellus of Susquehanna County, PA, even in a low commodity price environment. This latest update continues that trend. Cabot’s production is up 34% from the same time last year. Net income is up 102% over last year. And costs are down 19%.

Here’s the Cabot 1Q14 update:
Read More “Cabot 1Q14: Marcellus Continues to Soar for Cabot”
Energy Companies | Noble Energy

Noble Energy 1Q14: Marcellus Experiments Paying Off
April 25, 2014April 25, 2014

Noble Energy is a big driller involved in a number of resource plays–both onshore and offshore. One of their offshore operations–off the coast of Israel–has transformed Israel from energy dependent to becoming almost completely energy independent. Yesterday in the parade of quarterly earnings updates, Noble released their update for first quarter 2014. Noble is a big driller in the Marcellus Shale and their northeast program, which is what interests us, continues to perform very well for the company.

Of particular interest to MDN is a brief paragraph about Noble’s Marcellus program and the experimentation they’ve been doing–and the impressive results they’ve been getting from those experiments…
Read More “Noble Energy 1Q14: Marcellus Experiments Paying Off”
Allegheny County | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Olympus/Huntley & Huntley | Pennsylvania | Range Resources Corp | Regulation

Republicans (!) Seek to Slow Approval of Deer Lakes Park Lease?
April 25, 2014April 25, 2014

To us, a somewhat strange case in the ongoing effort for Allegheny County, PA to lease land under Deer Lakes Park for drilling. Allegheny County Executive Rich Fitzgerald squeezed Range Resources hard and negotiated a deal to allow Range to drill under (not on) Deer Lakes Park for a $4.7 million in signing bonus and 18% royalties, which will net the county something over $70 million over the next 20-30 years (see Allegheny Co Exec Bests Range on Deer Lakes Park Lease Deal). It’s a sweet deal. The only thing that remains is for the 15-member county council to approve it.

The strange part is a bid by a pair of Republicans to enlist outside legal counsel to review the lease–when council already has its own attorney for that purpose. Normally it’s the Republicans who are pro-drilling. The effort to get outside counsel, which failed in committee along a party-line vote of 5-2, is nothing more than a “stall tactic” according to Rich Fitzgerald. That’s the strange part–why would the Republicans want to delay this lease? Council will meet next Wednesday to take up the Deer Lakes Park lease again–hopefully to approve it…
Read More “Republicans (!) Seek to Slow Approval of Deer Lakes Park Lease?”
Energy Companies | EQT Corp | Hydraulic Fracturing | Industrywide Issues | Lease & Royalty Payments | Litigation | Pennsylvania | Statewide PA

Was PA Court Decision Really an OK for Forced Pooling?
April 24, 2014April 24, 2014

Sometimes language is a funny thing. Terms come into use and and thrown around–but in different contexts they mean different things. MDN recently noticed that earlier this month EQT won a lawsuit against landowners in Allengheny County, PA. The landowners had leased their land with EQT, but we’re guessing they were old leases, done some number of years ago, because the landowners said EQT could not drill under their properties collectively–in a drilling unit. Apparently the landowners wanted EQT to drill on each individual property–or perhaps (more likely) renegotiate the old leases for better money to allow horizontal shale drilling. Bear in mind EQT and the landowners–all of them–already have contractual leases.

EQT sued (EQT Production Co. v. Opatkiewicz et al.) to “force” the landowners to allow them to do their job–drill horizontally under several properties as part of a drilling unit. The court ruled in favor of EQT (copy of the decision is embedded below) saying the landowners can’t stipulate how EQT gets the gas from leased contiguous properties. That is our essential understanding of the case. However, it’s widely being reported that the court “supported forced pooling”…
Read More “Was PA Court Decision Really an OK for Forced Pooling?”
Energy Companies | Gulfport Energy

New Top Management at Utica Driller Gulfport Energy
April 24, 2014April 24, 2014

At the end of January Gulfport Energy announced, rather suddenly, that it’s CEO James Palm would retire in two weeks time (see Gulfport’s James Palm to Retire in 2 Weeks, Search on for New CEO). Gulfport is an important player in the Utica Shale, drilling some of the most prolific producing wells in the play, so when top management experiences a shake-up, it’s unsettling.

The search is over and Gulfport has a new CEO, a new COO, and a new member for the board. Interim CEO (and formerly the CFO) Michael Moore, a numbers guy, has been promoted to the top spot as CEO. Ross Kirtley, formerly COO for Ohio operations, is now COO for the entire company. Finally, both Mr. Moore and Michael Reddin, CEO of Davis Petroleum, have joined the board of directors. Here’s yesterday’s Gulfport announcement…
Read More “New Top Management at Utica Driller Gulfport Energy”
Accidents | Air Quality | Chevron | Energy Companies | Greene County (PA) | Industrywide Issues | Pennsylvania

DEP Says Residents Not Exposed to Pollutants in Chevron Well Fire
April 24, 2014April 24, 2014

You may recall the Chevron well fire in Greene County, PA that resulted in the death of one contract worker on February 11th (see Chevron Well Fire Update: 2nd Well Capped, Work on 7 Wells Stopped). Soon after the fire began, the Pennsylvania Dept. of Environmental Protection (DEP started measuring and testing in the area–to ensure nearby residents and first responders were not being exposed to unsafe pollutants. They sampled both upwind and downwind for 57 different toxic air pollutants. The DEP did find elevated levels for some pollutants, but (thankfully) nothing that would threaten the health of those in the area.

Below are the results of the testing along with the DEP announcement in releasing the results.
Read More “DEP Says Residents Not Exposed to Pollutants in Chevron Well Fire”
Blue Ridge Mtn Res/Magnum Hunter | Energy Companies

Magnum Hunter Sells Canadian Assets to Focus on Marcellus/Utica
April 23, 2014April 23, 2014

Magnum Hunter announced yesterday they are selling their Canadian assets–52,520 acres of leases and 84 producing wells in Saskatchewan, Canada for $67.5 million. Why? So they can further focus on the Marcellus and Utica Shale in West Virginia and Ohio. The buyer is an unnamed private company, according to the MH press release…
Read More “Magnum Hunter Sells Canadian Assets to Focus on Marcellus/Utica”