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Ohio Court of Appeals Upholds Depth Severance Clause in Shale Lease
The Ohio Court of Appeals recently issued a decision in a case involving lease language about a “depth severance clause” that is very important for both landowners and drillers to know about. In Tera LLC v. Rice Drilling D LLC, et al., a landowner in Belmont County, OH, signed a lease with language that leases both the Marcellus and Utica shale layers, but all other formations were “reserved to the lessor” (i.e. the landowner). However, the driller, Rice (now EQT), drilled into and produced hydrocarbons from the Point Pleasant layer that sits immediately below the Utica. According to the lease (and the decision by the court), that was a no-no.
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Last April, MDN introduced readers to the developing issue of landowners being approached to lease “pore space” rights (see 
It’s brutal out there–with respect to the price of the NYMEX Henry Hub futures price. Yesterday the HH dropped below, and stayed below, $3/MMBtu. The price “settled” at $2.94, down 12 cents (4%) for the day. That is the lowest settlement price for the HH in 20 months–since May 2021. Not even the good news that Freeport LNG received permission from FERC to begin some restart operations (see our companion story today) was enough to lift the price. So why did the price crash further yesterday?
What a difference 20 years can make. In 2001, natural gas was used to produce 2% of the electricity produced in Pennsylvania, and coal produced 57% of the state’s electricity. Then the Marcellus Shale miracle happened–the first Marcellus well was drilled in PA in 2004. By 2021, 52% of PA’s electricity was produced by natural gas, and 12% was produced by coal. A complete reversal. Most of that change came over just eight years–from 2008 to 2016. There are multiple reasons for the change, including regulations (against coal), low cost (for newfound supplies of gas), and emissions (more for coal, less for gas).
Is the coal industry and natural gas industry in West Virginia friends? Or enemies? Or perhaps “frenemies”? We suppose it depends on the issue. In our book, the coal industry has largely been an enemy of the natural gas industry in WV because natgas-fired power plants threaten to displace coal-fired plants (see 
Last week the Municipality of Murrysville, PA (in Westmoreland County, near Pittsburgh) voted to allow Olympus Energy to build a well pad on a property straddling the border with Plum Township. The well pad will eventually host eight shale wells. Olympus wants to begin drilling the wells either late this year or early next year. This is good news indeed!
In late December, the New Jersey Board of Public Utilities (BPU) voted to grant permission to New Jersey Natural Gas (NJNG) to build a pipeline regulator station in Holmdel, NJ. What does a regulator station do? It reduces pressure on the underground natural gas pipelines that already exist in the area, running underneath the ground in Holmdel Township and throughout Monmouth County. Ultimately, a regulator station will ensure the reliability of the pipelines and gas that flows in the area. The new station will replace a currently-operating temporary regulator station. Yet the “leaders” of Holmdel have voted to appeal the BPU decision to court, allocating up to $20,000 (of taxpayer money) for legal fees in what is sure to be a fruitless attempt at overturning the BPU decision.
Sempra Infrastructure, a subsidiary of Sempra, announced yesterday it had signed its final customer to buy LNG from the Port Arthur (Texas) LNG facility. All of the LNG that can be produced from Phase 1 of the Port Arthur facility is now spoken for, meaning Sempra anticipates moving forward with a final investment decision (FID) to build the plant and begin actual construction sometime by the end of March this year. Although located along the Texas Gulf Coast, this is good news for the Marcellus/Utica.
After the shocking news that U.S. Senator Joe Manchin had sold out his state and the entire country by agreeing to support the misnamed Inflation Reduction Act (IRA) bill last summer, the details began to come out about just how bad this bill really is for the oil and gas industry. First and foremost, it slaps a new tax on natural gas production (see 
Today it’s fashionable to go along with the crowd and bash fossil fuels and fossil energy. If you’re a politician and you actually stick up for fossil energy, you don’t get invited to parties with all the cool kids. The thing is, those who bash fossil energy depend on fossil energy for about 90% of the things they use every single day. Do they know? Do they care? If we were to eliminate all fossil energy in the next 5-10 years (a metaphysical impossibility), it would instantly transport these dopes back into the Stone Age.
From time to time, we’ve brought you news about some of the more radical (and violent) people who irrationally hate fossil fuels–members of groups like Extinction Rebellion and its spinoff, Just Stop Oil. Some of their members are the kids who recently tried to deface a Vincent van Gogh painting in London (see 
The Long Ridge Energy Terminal, host to a Utica shale gas-fired power plant that went online in November 2021, scheduled brief downtime for routine maintenance during the fourth quarter of 2022. But when the techs started to analyze the equipment, they discovered a problem, turning a couple of weeks of downtime into more than a month.
The clown judges who occupy the U.S. Court of Appeals for the Fourth Circuit (4th Circus) appear ready to reject a water permit granted by the Virginia State Water Control Board to help finish up the 94% complete Mountain Valley Pipeline (MVP). Three judges from the 4th Circus were appointed back in 2017 to hear appeals by Big Green groups against the project. All three judges are profoundly bigoted and prejudiced against natural gas pipeline projects. Yesterday, the three clowns heard oral arguments from the foreign-backed Sierra Club (and its cronies) arguing the Control Board’s approval of a permit to cross streams and wetlands violates the federal Clean Water Act.
A Marcellus gas-fired power plant in Nicetown (a neighborhood in North Philadelphia) received a permit to build in 2017 (see 