Energy Companies

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    OH Judge Says Filing Paperwork is Enough to Extend Lease

    Ohio landowners should be aware of an important court case just decided that says, in essence, filing paperwork is enough proof of a driller’s intent that a lease can be extended beyond the initial signing period. Several landowners in Jefferson County, OH signed a lease with Fortuna Energy in 2006 that was later sold to Chesapeake Energy (in 2010). The lease was for a 5-year period. Three days before the end of the lease Chesapeake filed a Declaration of Pooled Unit (DPU) with the Ohio Department of Natural Resources. That is, they told ODNR in essence “here’s a group of properties we intend to drill on soon” requesting permission to “pool” them together into a drilling unit. That simple act was enough proof, according to a U.S. District Court judge, to allow Chesapeake to extend the original lease beyond the original 5 years.

    And so now the landowners are stuck waiting for Chesapeake to actually do something other than file paperwork. Good luck with that…
    Read More “OH Judge Says Filing Paperwork is Enough to Extend Lease”

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    Summit Midstream Closes Deal to Buy 40% Stake in Ohio Gathering

    Last December MDN told you that Summit Midstream was buying out Gulfport Energy’s share of the Ohio Gathering pipeline and processing system (see Summit Midstream Buys Gulfport’s Interest in Ohio Gathering). As we said at the time, the deal appears complicated on paper with multiple names (like Blackhawk Midstream), but the bottom line was/is that Summit will be the 40% owner and MarkWest Energy will remain the 60% owner of the Ohio Gathering system.

    Yesterday, in an announcement by Summit that’s equally dense with details (likely written by lawyers), Summit announced they’ve closed the Ohio Gathering deal. That’s the sum total of this announcement–that the deal is now done:
    Read More “Summit Midstream Closes Deal to Buy 40% Stake in Ohio Gathering”

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    Captain Planet to the Rescue! Rice Energy’s Sense of Humor

    We just love this story. Rice Energy is one of our favorite Marcellus/Utica drillers. It was founded by Dan Rice and his boys. Dan was, for over 10 years, the single most successful mutual fund manager in the United States. After he helped found Rice Energy to take advantage of shale drilling in the northeast, his bosses at Blackrock fired him–for their own mistakes (see BlackRock’s Screw-up with Dan Rice & Rice Energy). Dan has had the last laugh, however. The company went public last week and is now valued at $2.8 billion (see Rice Energy IPO Soars, Brings in $84M More Than Expected).

    What does this have to do with Captain Planet, you ask? It seems that Dan and the boys have a healthy sense of humor (which is why we love Rice). Instead of naming their wells after the landowner, which is the usual practice, they instead name Rice wells after super heroes! Including, yes, Captain Planet–the wacky environmentalist cartoon character from the 1990s. It just brings a smile to our faces, and we thought it would to yours as well. Below is the list of Rice wells and the super heroes they’re named after…
    Read More “Captain Planet to the Rescue! Rice Energy’s Sense of Humor”

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    Another Antero Utica Well Top of the Heap: IP Rate of 40.2 Mmcf/d!

    super achieverCaution: MDN’s comments below are not completely accurate. It seems that Antero pulled a fast one on us, and unlike their previous updates, they have (starting with this update) used gas equivalents in their production reporting. The Antero Yontz well is still the highest initial production methane (natural gas only) well in the OH Utica. That’s not to take away from the incredibly productive Milligan well mentioned below–but much of Milligan’s production is NGLs and not methane. The Milligan is still a great (and profitable) well! It’s just not the top dog natgas producing well we thought it was.

    Wow, we’re speechless! (And that’s saying something.) Last August MDN told you that Antero Resources had de-throned Gulfport Energy for having the highest yielding 24-hour rate Utica Shale well (see Antero Resources Utica Well Produces Stratospheric 38.9 Mmcf/d). Antero’s amazing Yontz well is located in Monroe County, OH, south of Gulfport’s super achieving wells in Belmont and Harrison counties. South continues to be better. Yesterday Antero released an operational update, and tucked away in that update is a new reigning Utica champ. Antero reports the Milligan 2H well in Noble County produced a 24 hour initial production (IP) rate of 40.2 Mmcf/d gas equivalent (it produces lots of hydrocarbons other than methane, so the number is converted to gas for apples to apples comparisons). That is the single highest producing shale well we’ve ever heard of–anywhere. No wonder Aubrey McClendon once famously said the Utica Shale is the biggest thing to hit Ohio since the plow!

    Aside from the Milligan 2H, there’s a lot of other news in the Antero update, including a very active Marcellus Shale drilling program (they currently have 15 rigs in the Marcellus), and the first of three compressor stations to help get their gas to market has come online in the Utica (two others are behind schedule). Here’s the full Antero update for 4Q13, with a bit of forward looking to 2014…
    Read More “Another Antero Utica Well Top of the Heap: IP Rate of 40.2 Mmcf/d!”

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    Rice Energy IPO Soars, Brings in $84M More Than Expected

    Last Friday Rice Energy, a company devoted to drilling in the Marcellus and Utica Shale, floated their initial public offering (IPO). In plain language, they started to trade shares of stock on the New York Stock Exchange. So how did they do? Not bad, especially since the Dow Jones Industrial Average dropped like a rock on Friday–down 318 points (2%). The Rice Energy stock was priced by the underwriters at $21 per share. By the closing bell it was trading at $21.90, a 4% jump. It’s certainly not as impressive as the recent Antero Resources IPO (see Antero’s Stock Climbs 18% on First Day of Trading). However, Rice is a much smaller company, so it’s not really fair to compare. The Rice IPO infused the company with $924 million in new revenue (selling 44 million shares). That’s 10% more than the $840 million they were hoping for–so we would term their IPO a huge success (see Rice Energy Launches IPO, Hopes to Raise $840M). The company now has a market capitalization (value) of $2.8 billion. Nicely done!

    Some reaction and analysis of Rice’s stock debut last Friday by energy investment advisory firm Renaissance Capital:
    Read More “Rice Energy IPO Soars, Brings in $84M More Than Expected”

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    CONSOL Energy 4Q13 Update: Marcellus Production Up 56%

    CONSOL Energy, the Pittsburgh-based coal mining company that’s transforming itself into a natural gas exploration company, issued an operational update this morning. According to the update, CONSOL’s fourth quarter Marcellus Shale gas production was up 56% over the same period a year ago. For all of 2013, CONSOL drilled 55 horizontal shale wells: 46 Marcellus Shale and nine Utica Shale wells. They completed 59 Marcellus Shale wells and 10 Utica Shale wells last year, and turned in line (switched on) 52 Marcellus Shale and two Utica Shale wells. And it’s full speed ahead for 2014.

    Here’s the full update with details of where CONSOL is drilling and how they’re doing:
    Read More “CONSOL Energy 4Q13 Update: Marcellus Production Up 56%”

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    Rice Energy’s Debutante Ball Happens Today – More Yummy IPO Info

    Today is IPO day for Rice Energy. MDN doesn’t keep mentioning the Rice IPO because we have any kind of financial interest–we don’t invest in any energy stocks, to avoid even the appearance of a conflict of interest. We keep mentioning the Rice IPO because we keep spotting really good information and articles about Rice–things we believe you would be interested in.

    Yesterday we brought you an article from Seeking Alpha with good Rice info (see Rice Energy IPO Launches Tomorrow, Fri Jan 24). Today, we spotted an even better article about Rice on Seeking Alpha from a different author. This one tells us precisely where in the Marcellus and Utica Rice holds their acreage, how many rigs they’re currently running, how many wells they’ve drilled, and yes, who the biggest Rice stockholders are. All helpful information for landowners considering a lease with Rice, potential supply chain partners considering selling things to Rice, and other drillers sizing up a potential new (strong) competitor…
    Read More “Rice Energy’s Debutante Ball Happens Today – More Yummy IPO Info”

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    Hess Goes All in for Shale Drilling in 2014, $550M on Utica Shale

    Over the past couple of years, Hess Corporation–the company whose name you recognize because you probably have filled up your car at one of their gas stations–has been transforming itself from petroleum products marketer (like retail gas stations) to oil and gas driller. Hess still owns some of those gas stations–but not for long. They’re in the process of spinning off retail gas stations into their own company so they can sell it (see Hess Continues Transformation With Plans for Retail Spinoff). Early last year Hess’ plans to become an E&P company was challenged by one of their stockholders (see Corporate Raider Paul Singer Tries to Force Hess Out of Shale). He was obviously unsuccessful in trying to bully Hess into doing his bidding. (Note to Chesapeake: you should have followed Hess’ example.)

    Yesterday Hess released their 2014 capital and exploration budget, and it shows Hess has gone “all in” for shale drilling. The Hess capex budget calls for a whopping $5.8 billion in spending–of that $2.85 billion (49%) will be spent on shale drilling. The lion’s share of Hess’ shale budget will go to drilling for oil in North Dakota’s Bakken Shale. However, they have allocated $550 million for drilling in the Utica Shale this year, with plans to sink 35 new Utica wells. Here’s the full Hess budget released yesterday…
    Read More “Hess Goes All in for Shale Drilling in 2014, $550M on Utica Shale”

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    Rice Energy IPO Launches Tomorrow, Fri Jan 24

    MDN previously told you that Rice Energy, a northeast-only driller with operations and acreage in both the Marcellus and Utica Shale, would soon go public with an IPO (see Rice Energy Launches IPO, Hopes to Raise $840M). The date for the IPO–the initial public stock offering–is now fixed: Friday, Jan. 24. Tomorrow. Rice hopes to raise $840 million in new investment to help with their planned $1 billion of drilling investment in the Marcellus/Utica for this year. Will they get it? That’s the million, or rather billion dollar question. We hope so!

    MDN has covered various parts of the Rice story previously (see our Rice Energy category listing for all past MDN stories). However, an article published yesterday on the Seeking Alpha website does a good job of corralling all of the details into a single, easy-to-read article. While the article is aimed at those considering an investment in Rice, we found the information helpful for landowners, supply chain businesses and others with an interest in Rice. Forthwith:
    Read More “Rice Energy IPO Launches Tomorrow, Fri Jan 24”

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    Trans Energy’s WV Focus Paying Off – IP Numbers for 8 Wells

    Trans Energy is a smaller, “pure play” driller in the WV Marcellus Shale. MDN told you last October that Trans Energy had sold off it’s holdings in Tyler County, WV in order to focus on drilling in Marshall, Wetzel and Marion counties (see Trans Energy Sells Off Holdings in Tyler County, WV – Who Bought?).

    Looks like focusing is paying off for Trans Energy. Tuesday the company provided an update on production for 8 of their wells in Marion and Marshall counties. The IP (initial production) numbers look pretty darned good to us…
    Read More “Trans Energy’s WV Focus Paying Off – IP Numbers for 8 Wells”

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    Chief O&G Adds Field Office/Jobs in Bradford County, PA

    Chief Oil & Gas is expanding–in Wyalusing, PA. Where the heck is Wyalusing (population 564)? Smack in the middle of Bradford County, not far from Towanda, PA. Bradford is one of (perhaps the most) drilled Marcellus Shale counties in the state. It certainly makes sense for Chief to set up shop there–especially since Chief owns 210,000 acres of leases and operates 100 wells in the area!

    The new field office in Wylausing consists of three trailers and 12 employees–at least for now…
    Read More “Chief O&G Adds Field Office/Jobs in Bradford County, PA”

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    CONSOL Update: Spending $1.5B in 2014, Production Target 235 Bcfe

    CONSOL Energy continues its rapid transformation from coal producer to natural gas producer. Yesterday the company issued an update reiterating their intention to hike natural gas production by 30% this year. To do it, they plan to spend up to $1.5 billion on drilling and capital investments. That’s a whole lotta dough. Most of that will be spent in the Marcellus and Utica Shale (CONSOL is headquartered in Pittsburgh).

    Below is CONSOL’s announcement in which they tell us where, and how, they plan to dramatically increase natural gas production in 2014:
    Read More “CONSOL Update: Spending $1.5B in 2014, Production Target 235 Bcfe”

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    New CNX Gas COO Tim Dugan – Marcellus & Utica Experience

    Back in November, MDN told you that the top dog guy who runs the exploration and production (E&P) division of CONSOL Energy, Randy Albert, is retiring (see CNX Gas Chief Randy Albert Retiring, Search On for Successor). We were truly sorry to see him go. We’ve met Randy and liked him.

    Today, we’re happy to report a new COO for the E&P division–someone who’s been around the Marcellus/Utica block a few times and knows the ropes well: Tim Dugan. Here’s the CONSOL announcement about Tim taking the reigns at CNX Gas…
    Read More “New CNX Gas COO Tim Dugan – Marcellus & Utica Experience”

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    Center for Sustainable Shale Comes Roaring Back (to Life)

    roaring backFinally, signs of life from the Center for Sustainable Shale Development (CSSD), a new independent certification organization for Marcellus Shale drillers launched with much fanfare in March of last year. Both drillers and environmentalist organizations, along with non-profits like the mostly anti-drilling Heinz Endowments, cooperated to develop a set of 15 standards drillers should meet to receive the CSSD’s official stamp of approval (see Important: Drillers & Enviros Form New Group, Launch Cert Program for MDN’s mixed feelings about the organization and its standards). Heinz Endowments president Bobby Vagt lost his job for promoting the CSSD (see Bobby Vagt Out as Pres of Heinz Endowments – Fracking Connection?).

    Since launching, aside from the Vagt/Heinz flap, all has been quiet with the CSSD. However, the CSSD was busy working behind the scenes. From the beginning, Andrew Place, corporate director of energy and environmental policy for EQT has served as interim director of the CSSD. News reports are now coming fast and furious. First, environmentalist lawyer Susan LeGros from Philadelphia has been named the director of the CSSD. She’ll be making a move to Pittsburgh where CSSD HQ is located. Second, Bureau Veritas (BV) has been selected as the company to audit/evaluate companies that want to spend the $30-$100K required to become certified. After they evaluate, a 3-member panel will decide on whether they get the stamp of approval. Two of those three people are Christy Todd Whitman, former governor of NJ and former EPA chief, and former Treasury Secretary Paul O’Neill. Third, it appears to MDN that no one else has joined the CSSD beyond the initial handful of signups (Shell, EQT, Chevron, CONSOL Energy), and that no one has sought certification–although that may change now that the cert process is up and running…
    Read More “Center for Sustainable Shale Comes Roaring Back (to Life)”

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    PA Resident Snaps 8,000 Pictures of Cabot Well Construction

    Photojournal of a PA NatGas WellMDN editor Jim Willis received an excited phone call from Susquehanna County, PA resident Janice Gavern after being pointed in our direction by Cabot Oil & Gas. Janice, who runs a goat farm with her daughter near Montrose, PA (and a cancer survivor) started a project a few years back to document the drilling of a shale well on her friend’s property. As Janice says, after she visited the site, just to “keep an eye on things” and snapped her first picture, she was hooked. And the rest, including some 8,000 pictures taken with Janice’s little digital camera, is history. At least that’s what Janice hopes.

    Janice’s aim in doing a photo documentary of the drilling process is to preserve an important bit of Susquehanna County history, for future generations. Janice has selected 650 of the 8,000 pictures and compiled them into an e-book on Amazon–the first e-book of a series she’s planning. The first batch cover site preparation and building the well pad–up to the point when the drill arrives. She’s done a fabulous job, and we’re happy to help her make it known to the world. In fact, although the e-book normally retails for $9.99, you can order it FREE today and then again on Feb. 1. We recommend you head on over and download it right now. Here’s a bit more of Janice’s story as told by the Scranton Times-Tribune…
    Read More “PA Resident Snaps 8,000 Pictures of Cabot Well Construction”

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    School in Belmont County, OH Gets $7,250/Acre from Gulfport

    Some 10 miles “as the crow flies” from Gulfport Energy’s super well, the Irons 1-4H (pumping out 30 million cubic feet of natural gas per day) sits the small community of Shadyside and the Shadyside Local School District. The school has just leased 20 acres to Gulfport for drilling under (not on), which may seem like not much. However, when you’re getting $7,250 per acre as a signing bonus, and 20% royalties on anything produced, the school’s 20 acres is way more than “not much.”

    Shadyside School’s lease with Gulfport will net them an initial check for $145,000–just for the signing bonus. Gulfport is signing up the neighbors around Shadyside too. Will the school’s property be drilled under this year? Maybe! Gulfport is spending $630 million to drill 95 new Utica wells–many of them in Belmont County, OH where Shadyside is located and where Gulfport has had huge success already…
    Read More “School in Belmont County, OH Gets $7,250/Acre from Gulfport”