Despite Earnings Decline in 3Q for O&G, M-U Drillers Still Profited
In Q3 2025, U.S. E&Ps (drillers) successfully leveraged rigorous cost-cutting and capital discipline to maintain stable earnings despite commodity price volatility. With lifting costs down 16% since mid-2022, producers offset revenue pressures through efficiency and consolidation. RBN Energy reports that performance diverged by sector in 3Q: oil-weighted producers saw earnings rise 19% on stabilized crude prices and reduced impairments, while gas-weighted peers suffered a 27% earnings slump due to lower realizations. Total production increased 4.7%, mainly driven by oil majors. Looking ahead to Q4, the outlook shifts; oil producers face headwinds as prices dip toward $60/bbl, while natural gas producers anticipate a strong finish fueled by winter demand and rising Henry Hub prices. Read More “Despite Earnings Decline in 3Q for O&G, M-U Drillers Still Profited”
It’s time to revisit a topic we’ve covered many times before — philanthropy in the Marcellus/Utica region. Drillers and pipeline companies in the M-U region already contribute to the region through the generous lease bonuses and royalties paid to landowners. In addition to the billions that flow to landowners, M-U companies cumulatively donate millions of dollars to local communities and nonprofit organizations. Here’s the latest example of that in action: The Marcellus Shale Coalition (MSC) says its members (and their employees) have embraced this Thanksgiving season by giving back through food drives, volunteering at local charities, and supporting community initiatives. 
You knew the number of new permits issued in the M-U would come back down to earth sooner or later. Last week it happened. After three consecutive weeks with numbers of 37, 39, and 37, the number of new permits issued fell to 24 last week. Still respectable, but not in the coveted 30s. Pennsylvania issued 16 new permits last week, up from 13 the prior week. Ohio issued 6 new permits, down from 8 the prior week. West Virginia was shut out, issuing no new permits last week, which was the main reason why the number fell precipitously. 
Range Resources issued its third quarter 2025 update on Wednesday. Range’s production averaged 2.23 Bcfe/d in 3Q, approximately 69% natural gas. Range used two rigs and drilled ~262,000 lateral feet across 16 wells, while turning to sales ~228,000 lateral feet across 15 wells. 3Q25 drilling and completion expenditures were $165 million. In addition to D&C spending, Range spent approximately $16 million on acreage and $9 million on infrastructure, pneumatic devices, and other investments. CEO Dennis Degner stated during the earnings call that the company remains encouraged by the early activity in Pennsylvania, particularly with gas-fired power generation for data center projects. Degner said he’s convinced more than ever that data centers will create another 2.5 Bcf/d (billion cubic feet per day) of demand for Marcellus/Utica drillers like Range. 
Following three years of negotiations, Lycoming County Commissioners celebrated closing a deal with Range Resources to lease 1,350 acres in Jackson Township for shale drilling. The county is receiving a $5.4 million signing bonus, which works out to $4,000 per acre. Sweet. However, the county will receive just a 2% royalty for any oil/gas produced from the property. You read that right (not a typo)—just 2%, which has to be the lowest royalty rate we’ve ever seen negotiated, either with a private landowner or a municipality. 
EY, previously known as Ernst & Young, is a multinational professional services network (i.e., consulting firm) based in London. EY is also one of the “big four” largest accounting firms in the world. EY published a new study last week titled “US Oil and Gas Reserves, Production and ESG Benchmarking Study” (full copy below). The study found that due to mergers and acquisitions in 2024, the largest publicly traded oil and gas companies in the U.S. went from 50 down to 40, and that those 40 companies produced a staggering 41% of all O&G production in this country. It’s probably no surprise that many in the list produce natural gas (and oil) in the Marcellus/Utica. 
According to an article on the Fortune magazine website, “AI’s endless thirst for power is driving a natural gas boom in Appalachia—and industry stocks are booming along with it.” It looks like the roles are reversing. For all of oil and gas history, oil has been the belle of the ball, the more sought-after hydrocarbon. A change is happening, at least in places like the Marcellus/Utica, where natural gas is the more sought-after commodity. And because of that, the stock price for companies that focus on gas drilling is soaring. The market capitalization (stock value times the number of outstanding shares) for M-U companies has soared 25% to 75% over the past 12 months. Wow!