Energy Companies

Chesapeake Energy | Energy Companies

Chesapeake Energy’s Board Changes, Archie Dunham New Chairman
June 22, 2012June 22, 2012

You certainly can’t miss the news in the mainstream media that Chesapeake Energy has appointed five new board members and has “stripped” CEO Aubrey McClendon of his chairmanship (“stripped” even though weeks ago McClendon announced he would voluntarily step down from the role of chairman when a new chairman was found, such are the vagaries of headline writers).

The new incoming board members include…

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Belmont County | Energy Companies | Guernsey County | Gulfport Energy | Harrison County | Hydraulic Fracturing | Industrywide Issues | Ohio

Gulfport Drills Longest Horizontal Utica Wells to Date
June 22, 2012June 22, 2012

Gulfport Energy reports it has just completed drilling the two longest horizontal Utica Shale wells—ever. The horizontal portion for one of the wells, located in Harrison County, Ohio, went over 1.5 miles.

Here’s the particulars:

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Chesapeake Energy | Columbiana County | Energy Companies | Lease & Royalty Payments | Ohio

Columbiana County Lease with Chesapeake, Highest Bonus Ever
June 21, 2012June 21, 2012

Columbiana County, OH has just signed a deal with DPS Penn (an agent for Chesapeake Energy) to lease 548 acres for Utica Shale drilling. And they astutely doubled their money from the original offer from DPS a year ago. The new terms of the deal, just signed, are for $5,850 per acre and a 20 percent royalty. Columbiana also negotiated the lease term down to three years. A typical lease is five years.

The deal makes Columbiana breaks the record as the highest signing bonus granted to any government body for a Utica (or Marcellus) Shale lease deal.

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Economic Impact | Energy Companies | Industrywide Issues | Jobs | Pennsylvania | Shell | Statewide PA

PA Gov. Corbett Press Conference on Shell Cracker Plant
June 21, 2012June 21, 2012

Pennsylvania Gov. Tom Corbett continues to push hard to get his package of tax incentives for a Shell ethane cracker plant passed before the state legislature goes on summer break at the end of June. Looks like it’s paid off. Word has come out the legislature will pass his proposed package.

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Energy Companies | Inflection Energy

Bregal Invests Undisclosed Amount in Inflection Energy
June 21, 2012June 21, 2012

Bregal Energy announced yesterday they have increased their investment in Inflection Energy. Inflection was founded in 2008 as a drilling company focused on the Marcellus Shale. They hold leases in both Pennsylvania and New York. Bregal is an investment company focused on the energy industry. The amount of the new investment and the terms of the deal were not disclosed in the press announcement.

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Energy Companies | Equinor/Statoil

Statoil Shifts it Focus from Marcellus to Bakken
June 21, 2012June 21, 2012

Norwegian company Statoil continues to change its focus away from the Marcellus Shale region and instead concentrate on “oily” shale areas of the country, like the Bakken Shale in North Dakota. Why? Natural gas prices continue to bump around at historically low prices, making it a challenge to be profitable.

Statoil has cut the number of drilling rigs in the Marcellus nearly in half from one year ago and the wells they’re drilling now are simply to hold acreage. That is, they drill on acreage for which leases are about to expire to hold that acreage.

According to Bill Maloney, president of Statoil North America:

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Energy Companies | Rice Energy

BlackRock’s Screw-up with Dan Rice & Rice Energy
June 20, 2012June 20, 2012

Time for a brief distraction from the troubles Chesapeake has had of late—so let’s focus on a new “problem.” That would be the public relations kerfuffle Rice Energy and its founder Dan Rice are facing in the press.

Dan has been the single most successful mutual fund manager in the United States over the past 10 years. He is co-manager of five energy-related funds for BlackRock. But not any more.

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Chesapeake Energy | Energy Companies | Ohio | Statewide OH

OH AG Mike DeWine Targets Chesapeake for Fraud
June 20, 2012June 20, 2012

Ohio’s attorney general, Mike DeWine, has Chesapeake Energy in his crosshairs. He’s investigating them for “fraud” because their stock price went down. Good luck with that.

Here’s what the Columbus Dispatch is reporting:

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Air Quality | Devon Energy | Energy Companies | Industrywide Issues | Regulation

EPA Air Pollution Rules Targeted at Senate Hearing Today
June 19, 2012June 18, 2012

Today, Devon Energy Corp.’s environmental manager Darren Smith will testify before the Senate Environment and Public Works Committee in Washington, D.C. about the Environmental Protection Agency’s badly overestimated data on the amount of so-called fugitive emissions that escape from a natural gas well when it’s drilled (a copy of his full testimony is embedded below).

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Chesapeake Energy | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Litigation | New York | Statewide NY

Victory for NY Landowners in Chesapeake Force Majeure Case
June 15, 2012June 15, 2012

In a major victory for New York landowners, Attorney General Eric Schniederman’s office reached a settlement with Chesapeake Energy to allow 4,400+ landowners with a collective 264,000 acres to renegotiate old gas drilling leases that Chesapeake was attempting to extend using the “force majeure” clause. MDN has followed this story for more than a year (see this MDN story from May 2011 for history and background).

As a brief background, a number of New York landowners—many of them in the Southern Tier area of New York—signed gas drilling leases in 2000 with small drilling companies. The leases had a 10-year term. Most of the landowners got $3 per acre as a signing bonus. Those leases, along with leases signed prior to 2000, were bought by Chesapeake in the mid-2000s. In 2009, Chesapeake sent letters to New York landowners invoking the force majeure clause, which is legalese for “we’re extending the contract term due to extenuating circumstances, which we believe is our right to do.” The extenuating circumstance? The moratorium on high volume hydraulic fracturing that was implemented by then-Gov. David Paterson in 2008.

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Economic Impact | Energy Companies | Industrywide Issues | Jobs | Pennsylvania | Processing Plants | Shell | Statewide PA

Gov. Corbett’s PR Campaign for $1.7B Cracker Plant Tax Break
June 15, 2012June 15, 2012

Pennsylvania Gov. Tom Corbett officially launched his public relations effort yesterday to get the PA legislature to pass a package of tax credits for Shell to build an ethane cracker plant in the state. The package of tax credits will amount to $1.7 billion over a 25-year period (up to $66 million per year) and will not begin until 2017 at the earliest.

Three of Corbett’s cabinet secretaries held a forum at the Beaver County community college yesterday, near the location of the proposed plant (in Beaver County), to push for the tax credits. When the new plant is built, it will result in 20,000 new jobs throughout the region.

Corbett is making a push to get the legislature to adopt the package by the end of June, before legislators adjourn for summer recess. But many legislators complain they don’t know enough about the plan (yet) to cast a vote either way. This effort by Corbett and his administration is an attempt to bridge that gap.

Read More “Gov. Corbett’s PR Campaign for $1.7B Cracker Plant Tax Break”
Energy Companies | Industrywide Issues | Litigation | New York | Norse Energy | Statewide NY

Norse Says NY Force Majeure Settlement Doesn’t Apply to Them
June 15, 2012June 15, 2012

MDN reported today that New York Attorney General Eric Schneiderman’s office struck a deal with Chesapeake Energy over the issue of extending landowner leases in New York using the “force majeure” clause in the contract (see this MDN story). Norse Energy issued a press release saying essentially that the deal does not apply to them, and their force majeure claims are still in place until overturned by a court.

Here’s the Norse press release:

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Energy Companies | Energy Services | Industrywide Issues | Lycoming County | National Fuel | Pennsylvania | Pipelines | Seneca Resources

Trout Run Pipeline Goes Operational, Seneca Wells Connect
June 15, 2012June 15, 2012

National Fuel Gas Midstream’s new Trout Run Gathering System (Lycoming County, PA) came online May 30 and is now delivering natural gas to the Transcontinental Gas Pipe Line (Transco). Because the new pipeline is now operational, Seneca Resources has brought online four new wells. As of a few days ago, the wells were producing a combined 45 million cubic feet of gas per day.

National Fuel Gas’ press release:

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Energy Companies | New York | Norse Energy | Statewide NY

Norse Energy: The Little Driller that Could
June 14, 2012June 14, 2012

You have to admire Norse Energy Corp. (subsidiary of the larger Norwegian company of the same name). They rolled the dice by leasing most of their acreage for shale gas drilling in New York State, thinking there was no way it would take this long (now four years) for New York to begin high volume hydraulic fracturing. But it has taken this long, and Norse has tried to stay alive by selling off various assets, reducing staff, restructuring debt and in general doing whatever it takes to “hang in there.”

Just a few weeks ago Norse announced they were shuttering their Buffalo office and heading back to Houston (see this MDN story).

But the plucky Norse, not ready to throw in the towel quite yet, found encouragement in yesterday’s leaked trial balloon announcement that Gov. Andrew Cuomo may begin to allow very limited fracking soon (see this MDN story).

Read More “Norse Energy: The Little Driller that Could”
Chesapeake Energy | Energy Companies

Chesapeake CEO Losing Chairman Title, But Keeping Powers
June 14, 2012June 14, 2012

Although Chesapeake Energy CEO Aubrey McClendon is about to lose his title as Chairman of the Board, it seems that’s about the only thing he’s losing—the title. The power of the position—the ability to call board meetings and the power to call special shareholder meetings—he’s going to keep. The existing board of directors made a change to its bylaws last Friday to grant McClendon the right to call meetings.

Those critical of Chesapeake’s management take it to mean that nothing is really changing with respect to board oversight of McClendon.

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Brooke County | Chesapeake Energy | Energy Companies | Equinor/Statoil | Industrywide Issues | Lease & Royalty Payments | Litigation | Range Resources Corp | West Virginia

WV Couple Challenges Chesapeake Lease Renewal
June 13, 2012June 13, 2012

A husband and wife in Brooke County, West Virginia are suing to have their 5 year-old lease, which is now expired and up for renewal, nullified so Chesapeake (now the owner of the lease) cannot automatically renew it as they are attempting to do.

Increasingly landowners who signed leases that are now expiring after a customary 5 year period face the same issue—and drillers are trying to lock them in under the terms of lease for a new period of time.

Here’s the story of Ramon and Lois Bowen:

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