Board Members, Management Snap Up Shares in Shale Companies

We always take it as a good sign when board members and upper management decide to buy up shares of the companies they operate. One might colloquially say they “eat their own dog food.” That’s what’s happening with at least some shale oil companies. Board members and upper management are buying shares of company stock because those shares are currently at super low prices, given the Saudi-Russia oil war and COVID-19 coronavirus pandemic scare. These people know that sooner or later the economy will straighten out and their company’s share prices will zoom skyward again–making them wealthy.
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Range Resources Puts Louisiana, Some PA Assets Up for Sale

Range Resources turned in its fourth-quarter and full-year 2019 update on Friday. The company lost $1.72 billion last year, after losing $1.74 billion the year before. Ouch. The company is actively shopping its northern Louisiana shale assets hoping a sale will help reduce debt. You may recall Range bought out Memorial Resource Development Corp. (MRD) in a stock swap/debt assumption deal worth $4.4 billion back in 2016 (see Range Resources Buys Louisiana Driller in Deal Worth $4.4B).
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Marcellus/Utica Drillers’ Stock Prices Near/At Historic Lows

The value of a company’s stock price is important, for a variety of reasons. The stock price reflects investor confidence in whether the company can earn its keep and grow profits in the future. A higher stock price wards off takeovers. Upper management gets a raise. And the company can borrow money when it needs to at reasonable interest rates. All sorts of reasons why the stock price is important. Unfortunately for top drillers in the Marcellus/Utica, their stock prices have tanked. As a group, and individually, the stock price is either near or even at the lowest it’s *ever been.* Let that sink in.
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S&P Downgrades Credit Rating for Six Big Marcellus/Utica Drillers

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Large Marcellus/Utica drillers continue to take it on the chin in the financial markets. The stock prices for almost all M-U drillers have tanked, and now (at least for some of them), their credit ratings have been downgraded too. Standard & Poor’s Global Ratings recently downgraded the credit rating for six of the biggest M-U drillers…
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Range Fights DEP Order to Fix Methane Problem They Didn’t Cause

A longtime dispute between the Pennsylvania Dept. of Environmental Protection (DEP) and Range Resources reemerged in January when the DEP ordered Range to fix a well in Lycoming County the DEP alleges is leaking methane into the surrounding ground and water supplies. The DEP says faulty cement casing allows methane to leak. Range maintains the methane was already in the ground/water supply long before it drilled the well. Range is appealing the DEP’s order to “fix it” to a special environmental court.
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Range Resources Converts to Electric Fracking with US Well Serv.

Last November MDN told you that Range Resources was testing an all-electric fracking fleet at the Ziolkowski Pad in Allegheny County (see Range Resources Fracking Program – Meticulous & Thirsty). The results are in and Range likes what it sees. The company has signed on with U.S. Well Services to continue using “electric fracking.”
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Range Recycles ALL its Wastewater + Water from 14 Other Drillers

A number of Marcellus/Utica drillers recycle most, if not all of, the flowback and produced water from the wells they drill. Produced water (from the depths) continues to pour out of wells for years after they’re drilled. Produced water is super salty, filled with minerals. If a driller can’t reuse the water, they must dispose of it–typically via an injection well (in Ohio). Range Resources not only recycles all of its own produced water but also accepts and reuses produced water from 14 other drillers!
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PA Landowner Says Range Well Didn’t Cause Methane Problem in Water

Range Resources’ Harman Lewis Unit 1H well in Moreland Township, Lycoming County.

Two days ago MDN told you that the Pennsylvania Dept. of Environmental Protection has once again climbed up on its high horse and is now ordering Range Resources to “fix” a well they claim is leaking methane into the ground, causing nearby water wells and the ground itself to be contaminated (see PA DEP Orders Range to Fix Leaking Gas Well in Lycoming County). Range says the well is not at fault. The landowner whose land where the well is located also says the Range well is not at fault.
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PA DEP Orders Range to Fix Leaking Gas Well in Lycoming County

A long-simmering dispute between the Pennsylvania Dept. of Environmental Protection (DEP) and Range Resources has once again erupted into the public over allegations that a Range well drilled in Lycoming County, PA back in 2011 is leaking methane into the surrounding ground and water supplies. The DEP has, for years, maintained faulty cement casing allows methane to leak, and Range maintains methane was already in the ground/water supply before it drilled the well. Who’s right?
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Range Refinancing $500M in Debt, Writing Down Value of LA Shale

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Yesterday Range Resources issued a couple of press releases detailing a plan to buy back $500 million of outstanding notes (i.e. IOUs) issued in years gone by and due payable in 2021/2022, by generating a new pot of $500 million by issuing new notes payable in 2026. The company also filed an SEC Form 8-K that mentions they will write down the value of their Louisiana shale assets. However, the company says it will not write down the value for their Marcellus/Utica assets.
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IEEFA Report Says Marcellus/Utica Drillers in Financial Trouble

Masquerading as a nonpartisan, independent nonprofit, the Institute for Energy Economics and Financial Analysis (IEEFA) reportedly “conducts research and analyses on financial and economic issues related to energy and the environment.” The Institute’s stated mission is “to accelerate the transition to a diverse, sustainable and profitable energy economy.” In other words, they’re anti-fossil fuels. We spotted an article appearing on OilPrice.com that quotes a new “study” issued by IEEFA. The article opens by saying, “drillers in Appalachia are in particularly bad shape.” Is it true? Is the end near? Is it a shalepocalypse?
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PA AG Continues NatGas Witch Hunt – 2 Dozen DEP Workers Testify

Last week Pennsylvania Attorney General Josh Shapiro sat down to talk with the editorial board/reporters of the Washington (PA) Observer-Reporter. He refused to confirm or deny he’s actively conducting a witch hunt of the PA Marcellus Shale industry, including trotting dozens of people before a grand jury–even though the media has been reporting on his grand jury fishing expedition since February (see PA AG Continues Marcellus Witch Hunt, Impanels Grand Jury). No worries. None other than the Deputy Secretary of the PA Dept. of Environmental Protection (head of the DEP’s Office of Oil and Gas Management) has confirmed he appeared before Shapiro’s witch hunt grand jury.
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Range Resources 3Q – Production Up Slightly, Spending Down

Spending went down, but natural gas production went up slightly (3%) at the very first Marcellus driller, Range Resources, in 3Q19. The company previously forecast it would spend $756 million in 3Q but spent $736 million instead. The savings came “as a result of continued efficiency gains, water savings, and service cost improvements.” The company connected 22 new wells in the Marcellus to production in 3Q19, the same number they connected in 3Q18. Our takeaway: the company is doing more, producing more, with less resources. Getting more efficient.
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Range Sells Another 0.5% Royalty Interest for $150M

In July MDN brought you the news that Range Resources had sold a 2% overriding royalty interest on 350,000 acres “in southwest Appalachia” for $600 million (see Range Resources Sells 2% Royalty Interest + 20K Acres for $634M). Range’s announcement did not identify who, exactly, was the company doing the purchasing. Lime Rock Resources later self-identified as the buyer (see Mystery Solved: Lime Rock Buyer of 2% Royalty Interest in Range). Range has just done it again–sold off another 0.5% (one-half of one percent) of an overriding royalty interest for another $150 million.
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