Energy Transfer Partners & Equity Merging into One Company Today

Energy Transfer is, on paper, several different companies. Energy Transfer Equity (ETE) is the mother ship–the main holding company. Energy Transfer Partners (ETP) is and has been (for us) the main company, builder of Rover Pipeline, among other projects. Nearly two years ago Sunoco Logistics Partners, a subsidiary of ETE, was merged into ETP (see ETE Merging Sunoco Logistics and Energy Transfer Partners). Sunoco, aka ETP, is building the Mariner East 2 NGL pipeline project. Although technically ETP is the builder, we still call the company doing the work Sunoco, because that’s what everyone else does. Confusing! Hopefully that confusion ends today. ETE announced yesterday that following a vote of unitholders (i.e. shareholders), as of today ETE and ETP are merged, and the new name is simply, Energy Transfer.
Continue reading

Nine Energy Buying Magnum Oil Tools for $493M

Nine Energy Service, an oilfield services company that competes with companies like Halliburton and Baker Hughes, operates in a number of shale basins, including the Marcellus/Utica. Magnum Oil Tools is a “downhole technology” company providing completions products including dissolvable frac plugs and a number of other patented inventions. Magnum also has operations in the Marcellus/Utica. Yesterday Nine announced it is buying out and merging in Magnum in a deal worth $493 million.
Continue reading

Diversified Gas & Oil Buys Core Appalachia for $183M

Diversified Gas & Oil continues its mission to buy as many non-shale (conventional) oil and gas wells as it can in the Appalachian Basin. In June, MDN brought you the exclusive news that Diversified had purchased EQT’s Huron Shale assets in Kentucky, Virginia and West Virginia for $575 million (see Diversified Gas & Oil Adds to Conventional Assets in KY, VA, WV). They’ve just done it again. This week Diversified announced a deal to buy out Core Appalachia for $183 million, which includes ~5,000 producing wells (90% of production is natgas) and 1.3 million acres in West Virginia, Kentucky and Virginia.
Continue reading

Nuverra Buys Clearwater Solutions w/Guernsey, OH Injection Wells

Nuverra Environmental Solutions (formerly Heckmann) is one of the largest companies in the United States that handles transportation and disposal of shale drilling wastewater and leftover rock and dirt from drilling. The company has major operations in the Marcellus/Utica region. Those operations are expanding. Nuverra announced last Friday it has purchased, lock, stock and barrel, ClearWater Solutions, an Ohio injection well operator. Purchase price was $41.9 million. Looks like Nuverra has fully recovered from bankruptcy just one year ago.
Continue reading

Dominion Sells 2 Gas-Fired Plants; Blue Racer Midstream For Sale

Dominion Energy has found a buyer for two of its natural gas-fired electric generating plants, one located in Pennsylvania, the other in Rhode Island. In July MDN told you that Dominion was shopping the two plants, hoping to raise $1+ billion (see Dominion Looking to Sell Gas-Fired Power Plants in PA, RI). One plant, the Fairless Power Station, is located in Bucks County, PA near Philadelphia. The other, Manchester Street Power Station, is located in the People’s Republic of Rhode Island. So why would Dominion, a company that really digs natgas, want to dump two of its natgas power generating plants situated in large, urban areas? In a word, regulation, or rather lack of it. Both of the plants Dominion wants to dump are “merchant plants”–meaning they sell electricity on the open market, at market rates. Regulated plants, on the other hand, have their prices determined by quasi-governmental agencies. Selling electric that’s regulated means the potential upside is limited, but it also means you are guaranteed a certain price and can count on receiving that price year in and year out. In the lingo of high finance, being regulated “derisks” a company–makes revenue streams predictable, which investors like. So Dominion is on a mission to (a) pay down debt by selling assets like these two merchant power plants, and (b) provide more revenue certainty for investors. And it looks like they achieved their goal, selling the two plants for $1.23 billion to Starwood Energy. In the same Dominion announcement about the Starwood sale, the company said they will continue to shop their 50% ownership stake in Blue Racer Midstream, which is the first we’ve heard that Dominion is looking to unload their share. Dominion says there is “strong interest” in buying it…
Continue reading

Nova Scotia Goldboro LNG Buys Driller, Getting Gas from Canada

For years we’ve had a Canadian LNG export project on our radar, bringing you news about the project, hoping that prodigious amounts of Marcellus/Utica gas would be used at the plant. The project is called the Goldboro LNG project, planned by Pieridae Energy for the coast of Nova Scotia. Two weeks ago we told you that $3 billion of German money will be used to propel the $10 billion project to begin (see With $3B from Germany, Canadian Goldboro LNG Looks Like Done Deal). While it looks like the project will happen, alas, it will happen without liquefying Marcellus/Utica molecules. Last Friday Pieridae announced it is purchasing Canadian driller Ikkuma Resources Corp. Ikkuma has major acreage and producing wells (both conventional and shale) in Western Canada, mostly Alberta. With TransCanada Pipeline’s new lowball shipping charges (see TransCanada Pipe Begins Lowball Shipping to Compete with Marc/Utica), Pieridae will be able to ship its own gas to Nova Scotia, liquefy it, and sell it. We’re disappointed, but we certainly understand. You can’t build a multi-billion dollar LNG plant on the *hope* that US politicians in New York and New England will suddenly get their heads right and allow pipelines to flow cheap Marcellus gas north into Nova Scotia. We get it. It’s just a shame–because our gas is more than thousand miles closer to the Goldboro plant, cheaper to ship–IF the pipelines were in place to do so. Because of anti-fossil fuel freaks in New England, that’s not the case. Pieridae wants to get going and can’t wait forever. They’ve purchased their own reliable supplies, and with TransCanada’s low-ball shipping from west-to-east, Pieridae is pulling the trigger. The FID will happen soon, and Pieridae will be totally self-sufficient. Good for them. Bad for us…
Continue reading

Rex Energy Sells Itself to PennEnergy Resources for $600M

Rex Energy, one of our favorite small drillers, has finally found a buyer for its Marcellus/Utica assets. And it’s a good home. After scheduling and rescheduling a bankruptcy auction four times in a single week, Rex canceled the auction and said it has cut a deal with PennEnergy Resources to buy the company–for $600.5 million. You may recall that Rex, heading into bankruptcy in May, owed nearly $1 billion to several creditors (see Rex Energy Owes Nearly $1B – Who They Owe & How Much). If the deal is for $600.5 million, somebody’s not going to get paid everything they’re owed. But then, that’s the nature of bankruptcy court–to decide who gets what and how much. The deal Rex/PennEnergy is subject to approval by the bankruptcy court, but we expect it will get approved. Part of the deal calls for PennEnergy to pay $1 million to Rex landowners who had sued the company claiming Rex didn’t pay them royalties. We think PennEnergy will be a good home for the Rex assets. PennEnergy launched in 2011, founded by two former Atlas Energy executives–Rich Weber and Greg Muse. The company is backed by EnCap Investments and now has 70 employees. No word on how many of Rex’s employees will come along with the deal. Rex’s acreage sits close to PennEnergy’s, hence the interest. Below the details as we have them, including Rex’s SEC filing outlining the deal…
Continue reading

Eclipse’s Top Brass Not Sticking Around After Blue Ridge Merger

MDN brought you the big news yesterday that Eclipse Resources is merging with Blue Ridge Mountain Resources (see Eclipse Resources Merging with Former Magnum Hunter). We noted that nowhere in the announcement and paperwork we read that Eclipse co-founder and CEO Ben Hulburt would be staying with the newly merged company. We now have confirmation that Hulburt is leaving when the deal closes. We also have confirmation that pretty much all of Eclipse’s top brass is leaving–except for Oleg Tolmachev, who will become the senior vice president and COO of the newly merged company. In addition to Hulburt’s departure, Eclipse executive VP/general counsel Christopher Hulburt is leaving, and executive VP/CFO Matthew DeNezza will also exit stage right. All three are being paid more than $1 million (Ben Hulburt more than $3 million) to leave…
Continue reading

Eclipse Resources Merging with Former Magnum Hunter

Blue Ridge/Eclipse combined acreage location – click for larger version

Some big news breaking from yesterday: After months of teasing by Eclipse Resources that it’s working on selling itself–it finally has. The buyer is Blue Ridge Mountain Resources, the renamed remnant of Magnum Hunter Resources. Magnum Hunter filed for bankruptcy in December 2015, emerging from bankruptcy in May 2016 minus CEO Gary Evans (see Magnum Hunter Emerges from Bankruptcy with CEO Gary Evans Gone). Looking to shed the image of the past, the company renamed itself as Blue Ridge in January 2017 (see Magnum Hunter Changes Its Name, Leaves the Bankrupt Past Behind). Blue Ridge, headquartered in Texas, has 99,000 acres of leases (mostly undeveloped) in the Marcellus and Utica Shale plays. Eclipse, on the other hand, is headquartered in State College, PA and has 128,000 acres–focused 100% on the Marcellus/Utica. Eclipse is renown for having drilled the world’s longest onshore lateral wells. Why do we say Blue Ridge is buying Eclipse when the announcement talks about a merger and on paper Blue Ridge will become a subsidiary of Eclipse? Because Eclipse is doing a 15 to 1 reverse stock split (combining shares to boost the per share value) and Eclipse CEO Ben Hulburt is nowhere to be found in the management structure of the newly combined company. Blue Ridge President and CEO John Reinhart will become President and CEO of the newly combined company. Eclipse’s top engineer Oleg Tolmachev–the guy who figures out how to drill those super-long laterals–will become Executive Vice President and COO of the combined company. No word yet on which name (or new name) they will use for the newly merged company…
Continue reading

Williams Finally, After Years, Buys Out Williams Partners Subsidiary

Williams, after years of saying it would so, finally bought out and merged in its Williams Partners MLP subsidiary. The on-paper $10.5 billion merger happened last Friday. Williams originally planned to do this in May 2015 in a deal worth $13.8 billion (see Williams is Buying Out Williams Partners Subsidiary for $13.8B). Shortly after Williams’ announcement, Kelsy Warren and his Energy Transfer Equity company pursued Williams, wanting to merge Williams into its own operation. The ETE distraction caused Williams to put a merger with Williams Partners on hold. Williams initially fought ETE, but in the end cut a deal (see Williams Accepts ETE’s “Indecent Proposal” – Price Went Down $10B). Without recounting the all the sordid details, ETE got cold feet and left Williams at the alter, and Williams sued (see Merger Turns Sour: Williams Sues ETE/CEO Kelcy Warren). The merger never happened, and near as we can tell, the lawsuits over the aborted attempt to merge still are not fully resolved. In the end, Williams remained a standalone company. Williams CEO Alan Armstrong not only survived the botched ETE attempt to take it over, he also survived an attempted board of directors coup against him not long after the merger went bust (see Half of Williams Board, Including 2 Corporate Raiders, Quit). Armstrong is a survivor and Williams is now doing great. Last Friday’s merger of the MLP Williams Partners into the Williams C Corporation is proof of that. In the end, the deal cost Williams (C Corp) stockholders $10. 5 billion (see FERC Tax Decision Forces Williams to Restructure – No More MLP). Here’s the news that Williams is now, finally, all under one umbrella…
Continue reading

Texas Crane Company Buying Marcellus/Utica Crane Company

TNT Crane & Rigging, headquartered in Houston, TX, has just purchased itself a major presence in the crane/rigging market in the Marcellus/Utica. TNT announced on Tuesday it is “merging with” (i.e. buying out and merging in) Allison Crane & Rigging, located in Williamsport, PA. When you read these kinds of announcements you’re never quite sure who is buying whom. But it became clear in this announcement. TNT, which is a “portfolio company” of (i.e. majority owned by) First Reserve, a BIG private equity investment firm, owns and operates 700 cranes in 44 different branch offices across North America. Allison operates 30 cranes. That’s how we know who bought whom. Here’s the news that TNT and Allison figure they’re better together…
Continue reading

Quebec’s Junex Says Utica Offer “Not Superior” – Merger in Doubt

MDN told you in June that Canada’s Quebec Province announced it will commit fracking suicide by implementing a permanent frack ban (see Quebec to Ban Utica Shale Drilling, Most Other Drilling Too). Quebec’s announcement is a virtual death sentence for oil and gas companies in the province. The shale fracking ban is coupled with new drilling standards so tight that even conventional drillers will have a difficult, almost impossible time. The result was immediate. Junex, a driller headquartered in Quebec with 1 million leased acres in the St. Lawrence lowlands (where there is Utica Shale), announced it would sell out to/merge with Cuda Energy, headquartered in Calgary, Alberta. Except now the merger is in doubt. It seems the merger was Cuda’s idea and was “unsolicited.” But hey, what’s a oil/gas driller going to do if they can’t horizontally drill and frack? Junex looked the offer over in detail and says it “does not constitute a ‘Superior Proposal’.” Oh oh. Is this a negotiating tactic for a higher price/better terms? What’s Plan B for Junex if they don’t sell out to Cuda? Here’s the latest on the Cuda/Junex potential merger…
Continue reading

Chesapeake’s $2B Exit from Ohio Utica “Is a Good Thing”

Last week MDN shared the blockbuster news that Chesapeake Energy is exiting the Ohio Utica, selling all of its Ohio assets for $2 billion (see Stop Press: Chesapeake Sells ALL of its Ohio Utica Assets for $2B). The buyer is Encino Acquisition Partners, a joint venture between Encino Energy and the Canada Pension Plan Investment Board. At the time we speculated this may be good news for Ohio’s landowners signed with Chesapeake–that perhaps landowners now stand a better chance of seeing new drilling. That was just speculation/hope on our part. Looks like we’re not the only ones thinking that way. A couple of industry experts are saying the same thing. One of them said Chesapeake’s sale and exit “is a good thing” because it means Encino will sink money into new drilling programs in a way that Chesapeake, larded up with debt, could not…
Continue reading

FERC Approves Dominion Energy/SCANA Merger – Deal Still Alive

In January Dominion Energy announced a deal to buy out and merge in South Carolina-based SCANA Corporation (see Dominion Buys SCANA, Mulls Atlantic Coast Pipe Expansion into SC). SCANA is an energy-based holding company principally engaged, through subsidiaries, in electric and natural gas utility operations and other energy-related businesses. In other words, the local electric and gas company for much of South Carolina. Dominion is a big company with many operations–they are a pipeline company, an electric generating company, and a utility company (like SCANA). The merger makes sense. Dominion gets to grow and add more customers to its utility business, especially if they expand their now-under-construction Atlantic Coast Pipeline–flowing Marcellus/Utica gas–into South Carolina (see Atlantic Coast Pipeline’s Future Plans: Expand in NC & SC). But there was recently a big bump in the road. SCANA had started, and later abandoned, building a nuclear plant, costing ratepayers boatloads of money. In June, the SC legislature passed a bill (vetoed by the governor but overridden) lowering SCANA’s electric rates by 15%. Dominion threatened to cancel the merger (see Dominion Bid to Buy SCANA in Trouble Following Passage of SC Bill). But then the sun came out. Last week the Federal Energy Regulatory Commission officially blessed the merger plan, and in announcing FERC’s approval, Dominion didn’t say a word about the 15% reduction or pulling out of the deal. All of that seems to now be forgotten. In fact, Dominion’s CEO told SC Gov. Henry McMaster that Dominion is not canceling buyout/merger plans, even with the bill…
Continue reading

Blue Wolf Goes Hunting – Extreme Plastics Merging with Mustang

Extreme Plastics Plus (EPP) has been manufacturing and installing well pad liners since 2007. Pad liners protect the ground from accidental spills of frack wastewater and chemicals used during the drilling process. Located in Fairmont, WV, EPP’s customers are in the Marcellus and Utica Shale region. In order to expand, EPP raised an undisclosed amount of investment money from Hastings Equity Partners in 2013 (see WV Well Pad Liner Company Gets Shot of Investment Money to Grow). However, a few years later the market turned down and EPP fell on hard times, eventually filing for bankruptcy (see WV Oilfield Services Co. Extreme Plastics Files for Bankruptcy). In late 2016, MDN told you that Blue Wolf Capital Partners was on the hunt for bargains and had offered a “stalking horse” bid to purchase EPP out of bankruptcy. Blue Wolf landed its prey, buying the company’s assets out of bankruptcy in December 2016 (see Blue Wolf Stalks and Rescues Extreme Plastics from Bankruptcy). According to Blue Wolf, EPP would exit bankruptcy with a debt-free balance sheet and in the pole position for an eventual oil and gas market recovery. Blue Wolf has gone hunting again and this time found Mustang Energy Services, another pad liner company. Blue Wolf announced earlier this week it has orchestrated a merger between EPP and Mustang. The combined companies (no word yet on which name, if either, they will use), have customers in eight states and counting. Here’s what happens when Blue Wolf goes hunting…
Continue reading

Dominion Bid to Buy SCANA in Trouble Following Passage of SC Bill

In January Dominion Energy announced a deal to buy out and merge in South Carolina-based SCANA Corporation (see Dominion Buys SCANA, Mulls Atlantic Coast Pipe Expansion into SC). SCANA is an energy-based holding company principally engaged, through subsidiaries, in electric and natural gas utility operations and other energy-related businesses. In other words, the local electric and gas company for much of South Carolina. Dominion is a big company with many operations–they are a pipeline company, an electric generating company, and a utility company (like SCANA). The merger makes sense. Dominion gets to grow and add more customers to its utility business. We didn’t think there was any tie-in with the Marcellus/Utica, but turns out there is. We brought you news in early December that Dominion and their partner in the Atlantic Coast Pipeline (ACP) project, Duke Energy, are considering expanding the original ACP to more locations in North Carolina, AND expanding the pipeline into South Carolina (see Atlantic Coast Pipeline’s Future Plans: Expand in NC & SC). Dominion openly says that the SCANA purchase makes it more likely they will push to expand ACP into SC–meaning even more Marcellus/Utica gas could be flowing to Dixie. But now there’s a big, fat wrinkle. SCANA is in trouble because they began to build, and later abandoned, a nuclear plant project–costing ratepayers millions of dollars. SC politicians want to rebate some of the money that was paid for the project back to ratepayers. They passed a bill on Wednesday (now on the governor’s desk) that will slash rates for customers by 15%. Dominion reacted strongly, implying they may pull out of the deal if the bill is signed by the governor…
Continue reading