Energy Companies

Energy Companies | Southwestern Energy

Southwestern Energy – Full Speed Ahead in Marcellus for 2014
March 3, 2014March 3, 2014

Southwestern Energy is a large Marcellus Shale driller. According to NGI’s Shale Play Factbook, Southwestern leases 337,300 acres in the Marcellus. In 2013 Southwestern invested $872 million into their Marcellus drilling operations, drilling 108 wells. Their proved reserves in the Marcellus grew by 141% in 2013 to 1.9 trillion cubic feet. More interesting facts from Southwestern: their average completed Marcellus well cost was $7.0 million per well; the average horizontal lateral length was 4,982 feet and they used an average of 18 fracture stimulation stages per well in 2013.

Below is Southwestern’s fourth quarter and full year 2013 financial and operational update. Below the update is a portion of a recent analyst call with Southwestern’s top management. The call transcript, unsurprisingly, mentions the Marcellus Shale–a lot…
Read More “Southwestern Energy – Full Speed Ahead in Marcellus for 2014”
Chesapeake Energy | Energy Companies | Guest Post

Guest Viewpoint – Solar Guy Knocks Chesapeake Energy
March 3, 2014March 3, 2014

Last week MDN was contacted by Robert Magyar, Managing Director at Navitus Strategies, to offer a guest viewpoint to run on MDN. We occasionally post guest articles and agreed to post Bob’s article (below). His article takes a look at Chesapeake Energy and offers the view that although Chesapeake has laid off more than a thousand people and sold off (and continues to sell off) key assets, the company is still financially unhealthy. Bob offers his reasons why (mostly from hedging agreements). He also highlights the recent and ongoing problems Chessy has with royalty payments in Pennsylvania.

In our email correspondence Bob says, “we need natural gas” and that he is not anti-drilling by any stretch. However, we would note for the record that his company, Navitus, works on alternative energy projects–primarily solar–and so it seems in his own best interests to knock the shale industry (and one of it’s most prominent players) around just a bit. With that as a preface, here is Bob’s article on Chessy “continuing to grind down,” which first appeared on the freelance article website Examiner.com:
Read More “Guest Viewpoint – Solar Guy Knocks Chesapeake Energy”
Energy Companies | Industrywide Issues | Pennsylvania | Range Resources Corp | Regulation | Washington County

Mt Pleasant Twp Shenanigans re Range Request for Water Ponds
February 28, 2014February 28, 2014

This is what happens when local townships create their own oil and gas zoning laws: chaos and confusion. Like that in Mt. Pleasant (Washington County), PA over water impoundments (ponds) that Range Resources wants to use for drilling in nearby townships. Mt. Pleasant was one of seven infamous anti-drilling townships that sued the state (and eventually won) to overturn the Act 13 law, a law that provided for expert, even-handed and uniform zoning practices throughout the state with regard to oil and gas drilling (see Happy Story Ends Badly Because of 7 PA Towns). What’s left in the wake of overturning Act 13 is petty squabbling by town boards ill-equipped to handle complex oil and gas oversight–i.e., Mt. Pleasant.

We’ve chronicled the long history of Range’s ongoing disagreement with Mt. Pleasant over water impoundments (see previous MDN stories on Range & Mt. Pleasant). The latest Mt. Pleasant town board shenanigan is to impose yet another delay:
Read More “Mt Pleasant Twp Shenanigans re Range Request for Water Ponds”
Antero Resources | Energy Companies

Antero Resources Keeps up the Pace in the Marcellus/Utica
February 28, 2014February 28, 2014

Antero Resources, a very big driller in both the Marcellus and Utica Shale, and owner of the (so far) best initial performing well in the Utica (see Antero Resources Utica Well Produces Stratospheric 38.9 Mmcf/d), released their fourth quarter and full year 2013 financial and operational update yesterday. It’s long, and full of information. Below is the operations portion of the update. Antero is operating 15 drilling rigs in the Marcellus and 5 rigs in the Utica. They currently have 85 wells either being drilled, or waiting to be completed. They are a seriously big Marcellus/Utica driller that should be on your radar if you have an interest in northeastern shale drilling.

Here’s a small part of the Antero update for 2013:
Read More “Antero Resources Keeps up the Pace in the Marcellus/Utica”
Crosstex Energy | Devon Energy | Energy Companies | Energy Services | EnLink Midstream | Industrywide Issues | M&A

Crosstex, Devon Name Names of Board & Leaders for New EnLink
February 28, 2014February 28, 2014

MDN has chronicled the marriage of Crosstex Energy (a midstream company) and Devon Energy’s midstream division (see Crosstex Energy Gets a Name Change, Merger with Devon Proceeds). The new entity will take on the name EnLink Midstream and will continue to have major operations in the Marcellus/Utica region. Not every t has been crossed and i dotted, yet. The two are close to tying the knot–the shareholders of both companies need to approve the deal. But it’s a foregone conclusion that the deal is happening and will happen very soon.

It comes as no surprise that the two companies have today announced who will be on the board of directors for the new EnLink operation, and who will lead it as executive management. Here is the announcement that names names for the coming EnLink when the merger is finalized:
Read More “Crosstex, Devon Name Names of Board & Leaders for New EnLink”
Energy Companies | Gulfport Energy | Ohio | Statewide OH | Utica Shale

Gulfport Production & Profits Jump in 2013 Thanks to Utica Shale
February 27, 2014February 27, 2014

Gulfport Energy is one of the leading drillers in the Utica Shale, so when they issue press releases and updates, as they did yesterday, it’s news for MDN. Gulfport issued their fourth quarter and full year 2013 financial and operational update yesterday. We’re including the full thing below, which contains a fair bit of mind-numbing financial numbers (meaningful to investors and traders, not so much for the rest of us). However, sometimes you spot a few gems in all those numbers and in the narrative that accompanies them. We believe we have in this most recent update…
Read More “Gulfport Production & Profits Jump in 2013 Thanks to Utica Shale”
Energy Companies | Gulfport Energy | Ohio | Rhino Resource Partners | Statewide OH | Utica Shale

Rhino Dumps the Rest of its Utica Assets in Deal with Gulfport
February 27, 2014February 27, 2014

Oil and gas deals are sometimes complicated–more complicated than we can get our brains around. That’s our disclaimer for this bit of news. In 2012 Rhino Resource Partners, a coal company, decided to get in on some of the shale action in the Utica by investing in a joint venture with Gulfport Energy and Wexford Capital (see Rhino Resource Ups Investment in Utica Shale JV). Rhino doesn’t do any of the exploration, drilling or production. It’s just a partnership granting them a piece of the revenue action in return for investing in the operation. Somewhere along the way Rhino either got cold feet, or (more likely) the company hit a rough patch and needed money, because they sold 20% of their royalty interests in the jv (see Rhino Flips 20% of Utica Investment to Undisclosed 3rd Party). Further supporting our theory the company is cash-strapped, in September last year the company tried to sell 1.1 million of “common units” (equivalent of stock) to generate money to pay back loans (see Rhino Resources Issues 1.1M Common Units to Repay Debt).

Yesterday, as part of Gulfport’s update and also in a separate announcement from Rhino, comes word that Rhino has cut a deal with Gulfport to dump the rest of its interest in the Utica jv to Gulfport for $185 million, raising what appears to be much-needed cash for Rhino. Here’s the twin announcements:
Read More “Rhino Dumps the Rest of its Utica Assets in Deal with Gulfport”
Chesapeake Energy | Energy Companies | Ohio | Pennsylvania | Statewide OH | Statewide PA | Statewide WV | Utica Shale | West Virginia

Chesapeake 2013 & Beyond: Lack of Pipelines Still a Big Problem
February 27, 2014February 27, 2014

Yesterday Chesapeake Energy issued their fourth quarter and full year 2013 operational and financial results. Chessy’s CEO, Doug “the ax” Lawler is all proud of himself for having fired over 1,200 employees, saving the company all that money (money that goes into Carl Icahn’s bank account). Whatever. For all of our disgust with what Chesapeake has become because of Icahn and his corporate raiding practices, it’s still a very important driller in the Marcellus and Utica (as well as other plays), and will continue to be so. When they issue an update, we need to pay attention, because as Chessy goes, so goes the Marcellus and Utica, in some senses.

What does yesterday’s update show? Chessy has drilled a lot of wells in the Utica–425 so far, more than half of the 747 Utica wells drilled to date in Ohio. Of those 425, 230 are online and producing, but a huge 195 wells are still waiting to be hooked up to pipelines. Lack of infrastructure is still a big issue in the Utica and in the Marcellus. In the northern Marcellus area (northeast PA) Chesapeake has 112 wells waiting to be connected to pipelines. They’ve scaled back their drilling in NEPA somewhat over the past year. In the southern Marcellus (SWPA and WV) Chesapeake has 47 wells waiting to be connected to pipelines or otherwise completed. Here’s the operations update for both the Utica and Marcellus from Chessy’s announcement yesterday:
Read More “Chesapeake 2013 & Beyond: Lack of Pipelines Still a Big Problem”
American Energy Partners | Energy Companies | Ohio | Statewide OH | Utica Shale

Aubrey McClendon’s Wandering Eye: Now Loves a Second Shale Play
February 26, 2014February 26, 2014

Does Aubrey McClendon have a wandering eye? Is he a shale play philanderer? It seems to us that since Aubrey was shown to the door of his own company (Chesapeake Energy) last year by corporate raider Carl Ichan, the only word to come out of Aubrey’s mouth has been “Utica.” It’s been Utica this and Utica that. He’s now raised more than $2.9 billion (!) for Utica Shale land acquisition and drilling (see McClendon Hauls in Another $1.2B, Utica Shopping Spree Continues).

But what’s this? Another shale play–closer to home (in Oklahoma)–seems to have caught Aubrey’s fancy and he’s now engaging in a dalliance back home. He’s already raised a cool $680 million for his new shale mistress…
Read More “Aubrey McClendon’s Wandering Eye: Now Loves a Second Shale Play”
Accidents | Chevron | Energy Companies | Greene County (PA) | Industrywide Issues | Pennsylvania

Chevron Well Fire Update: 2nd Well Capped, Work on 7 Wells Stopped
February 26, 2014February 26, 2014

We’ve been monitoring the tragic well fire in Greene County, PA that claimed the life of one contract worker. On Sunday afternoon Chevron reports the original well to explode and catch fire, the Lanco 7H, was capped (see Greene County Chevron Well Fire: 7H Well Capped, 6H in Few Days). Chevron now reports the second well to catch fire from the first, the Lanco 6H, is also capped as of yesterday afternoon (see the announcement below). What we somehow missed in the coverage was the fallout from the fire. Last week the PA Dept. of Environmental Protection asked Chevron to suspend drilling operations at other wells in the area pending a review. Chevron responded they had already stopped drilling operations at 7 nearby wells.

Here’s the latest official announcement from Chevron (that does not mention shutting down operations on other wells), along with a story from last week about the DEP’s tete-a-tete with Chevron:
Read More “Chevron Well Fire Update: 2nd Well Capped, Work on 7 Wells Stopped”
Energy Companies | Range Resources Corp

Range Resources’ Laser Focus on the Marcellus Continues into 2014
February 26, 2014February 26, 2014

Range Resources, the first and one of the largest drillers in the Marcellus Shale, issued their fourth quarter 2013 and full year 2013 financial and operational update yesterday. Range has a lot of good news to report. They averaged 940 million cubic feet equivalent of natural gas production per day during the year, but as MDN noted in December last year, they have now exceeded 1 billion cubic feet per day average (see Range Resources Inducted into the Marcellus “1 Bcf/d Club”). Proved reserves were up for Range by 26%, to 8.2 trillion cubic feet. Cash flow was up 25%, to $943 million. Perhaps the only “bad news” was that profits in the fourth quarter were down by 47%, to $28.2 million, mainly because of the low commodity price of natural gas. Everything else appears to going quite well for this Marcellus powerhouse.

In 2014 Range plans to spend $1.52 billion on capital expenditures (drilling and associated costs). The vast majority of that–87%–will be spent in the Marcellus. They expect to boost production another 20-25% in 2014. The company is on a tear! Below are details of how many wells Range drilled in the Marcellus in 2013, and how many they plan to drill in 2014, along with loads of other details about their drilling operations…
Read More “Range Resources’ Laser Focus on the Marcellus Continues into 2014”
Carrizo Oil & Gas | Energy Companies

Carrizo CEO Says Transition to Focus on Oil “Now Completed”
February 26, 2014February 26, 2014

Last November MDN told you that Carrizo was de-emphasizing the Marcellus and instead focusing on more oily and wet gas plays, like the Utica (see Carrizo Down on Marcellus, Up on Utica and Other Wet/Oil Plays). In releasing their 2013 fourth quarter and full year results yesterday, Carrizo’s CEO Chip Johnson said, “We began our shift from gas to oil back in 2010, and I’m pleased to say that we’ve now completed the transition. Crude oil now accounts for more than 60% of our proved reserves, and even though we sold almost 45% of our 2012 U.S. reserve base through our Barnett Shale and other non-core divestitures, we were still able to increase our PV-10 by 44% in 2013. Oil also now accounts for the majority of our production, as we expect it to be approximately 60% of 2014 volumes.”

Does that mean Carrizo is exiting the Marcellus completely? Not according to the update. Carrizo drilled 6 Marcellus wells in 4Q13. They complain that midstream (pipeline) delays continue to “impact” their operations in the Marcellus, along with really low commodity prices. So for now they’ve pulled back. For 2014 they plan to complete the wells they’ve already drilled–24 in all, and finish up drilling 3 wells already begun. According to our trusty NGI’s Shale Play Factbook, Carrizo owns leases on 49,200 acres in the Marcellus (and 21,700 acres in the Utica). Here’s yesterday’s update which clearly details the oil/wet gas direction of the company…
Read More “Carrizo CEO Says Transition to Focus on Oil “Now Completed””
eCORP International | eCORP Stimulation Technologies | Energy Companies | Energy Services | Hydraulic Fracturing | Industrywide Issues

Checking in on ecorpStim’s 100% Waterless Fracking, New Video
February 25, 2014February 25, 2014

ecorpStim has poked their heads up again to try and catch a bit of attention for their innovative waterless fracking solution. A press release issued yesterday by the company (full copy below) touts a new short video about their technology and promises that their “non-flammable propane stimulation” solution, developed in “2013,” will roll out in field demonstrations by “the end of this year.” We gave the video a watch a liked it (see it below).

MDN has had our eye on eCORP, ecorpStim’s parent company, since 2012 when they attempted but ultimately failed to cut a deal with landowners in Tioga County, NY to lease a large swath of land and potentially use a waterless fracking technology (from Canadian GASFRAC) to avoid New York’s ongoing moratorium (see Tioga County, NY Lease Deal with eCORP Falls Apart). It was after the wheels came off that deal that ecorpStim changed gears to develop their own waterless fracking solution.
Read More “Checking in on ecorpStim’s 100% Waterless Fracking, New Video”
Chesapeake Energy | Energy Companies

Chesapeake Energy Looks to Dump Oilfield Services Division
February 25, 2014February 25, 2014

Doug “the ax” Lawler, CEO of Chesapeake, continues to swing his ax to get rid of assets the company worked so hard to create. The latest asset Lawler (and his boss corporate raider Carl Icahn) want the company to get rid of is Chesapeake Oilfield Services, or COS. Chessy issued a press release yesterday stating they want to either spin COS off into it’s own company, or sell it outright. Not in the cards: keeping it and expanding it.

Here’s the latest from “the ax”…
Read More “Chesapeake Energy Looks to Dump Oilfield Services Division”
Blue Ridge Mtn Res/Magnum Hunter | Energy Companies

Magnum Hunter’s 4Q13 Update: 2 Wells, 2 Formations, Same Pad
February 25, 2014February 25, 2014

Magnum Hunter (MH) issued their fourth quarter 2013 and full year 2013 financial and operational update yesterday. Below we’ve selected out the operations portion leaving the financial discussion behind. What does it show? MH sold off their Eagle Ford assets in 2013 for $401 and has invested that money in the two remaining regions in which the focus–the Marcellus/Utica and the Bakken Shale (or Williston Basin). MH is currently operating 6 drilling rigs–3 in the Marcellus/Utica and 3 in the Bakken. They drilled 8 new wells in the northeast in 4Q13 and 15 new wells in the Bakken (so you see where their attention is going–to the more oily play).

Of interest, buried in the narrative, is mention of the recent Stadler 3UH Utica Shale well recently brought online in Monroe County with a peak rate of 32.5 MMcf/d (see Magnum Hunter’s Prolific (& Dry) Utica Well in Monroe County, OH). Here’s the interesting part: MH is also right now completing the Stalder 2MH well on the same pad–except the 2MH is a Marcellus (not Utica) well. So MH is targeting two different formations on the same pad. It will be fascinating to compare the production from the two wells. Here’s select portions of yesterday’s update:
Read More “Magnum Hunter’s 4Q13 Update: 2 Wells, 2 Formations, Same Pad”
CONSOL Energy | Energy Companies | Ethane | Exporting | Industrywide Issues | Pipelines | Statewide WV | West Virginia

CONSOL Feeling Heat over Ethane Exports to Europe, CEO Defends
February 24, 2014February 24, 2014

CONSOL Energy’s CEO Brett Harvey must be getting some heat over the company’s recent announcement that they have signed an agreement to export ethane from the Marcellus to Europe (see CONSOL to Begin Ethane Shipments Next Year–to Europe?!). Why would we say CONSOL is getting blowback? Because Harvey penned an op-ed that appears in The Intelligencer/Wheeling News-Register giving a spirited defense of their decision. The gist of Harvey’s points, if we might summarize, is this: CONSOL has deep roots and is committed to WV; there’s plenty of ethane to go around, including for exports (and exports bring money into WV); CONSOL is also going to sell ethane to the Odebrecht ethane cracker when/if it gets built; in the meantime, selling ethane to Europe means CONSOL will have more money to invest in WV.

Here’s Harvey’s “it’s OK” op-ed:
Read More “CONSOL Feeling Heat over Ethane Exports to Europe, CEO Defends”