WellDog Launches Shale SweetSpotter After Successful Marcellus Test
WellDog (what a great name!) announced on Monday the launch of a new service called Shale SweetSpotter (another great name!). Clever marketing folks at WellDog, we’ll grant them that. Shale SweetSpotter is “the first commercial reservoir-evaluation analysis technology specific to unconventional natural gas.” In English please! “We’ve just developed a way to tell drillers where oil and gas is locked away in shale layers in the acreage they’ve leased.” Apparently it’s pretty darned good. WellDog partnered up with Shell to test their service in the Marcellus and the field trials were declared “successful”…
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It’s not all doom and gloom in the Marcellus/Utica. Seems like for the best part of a year we’ve only heard about layoffs and companies filing for bankruptcy, due to the major slowdown in drilling in our neck of the woods. But that’s not an accurate picture. Take an old steel plant in the Wheeling, WV area that had been closed for 30 years. A new business now occupies the old Wheeling-Pittsburgh Steel Corp. plant in Benwood, WV. JLE Industries has set up shop in the old plant with (so far) 25 full-time workers to inspect and repair metal tubes used in shale drilling. Chris Harris, the owner/operator, believes the company will continue to grow…
We love it when we spot a company adopting a contrarian strategy. Received wisdom and prevailing thought says that the oil and gas industry–especially in the Marcellus/Utica–is contracting. Drillers aren’t drilling, and that affects the supply chain (those companies supplying goods and services to the industry) in a big and negative way. Yep–true enough. But the received wisdom also says companies should diversity–look for business outside of the oil and gas industry. What’s contrary is to take advantage of this downturn to expand capacity–to get ready for when the downturn turns again into an upturn. That’s just what Watco Transportation Services is doing with their Kanawha River Railroad short line subsidiary. Kanawha River Railroad has just cut a deal to lease 309 miles of rail lines from Norfolk Southern in Ohio and West Virginia. One of the customers on these short haul lines will be, yep, Marcellus and Utica drillers and sand suppliers and chemical suppliers and equipment suppliers. Nope, there’s not all that much shipping right now, which makes this a step of faith. But the company believes that the future will be here soon and things will turn and the Kanawha River Railroad will be ready to take full advantage of it. We love a railroad story, and we love a contrarian story. This is both…
It’s not all gloom and doom in the Marcellus/Utica industry–but there’s no doubt we’re in a downturn. Drillers (or energy companies or producers) are having a tough enough time–but they can just stop drilling for a while and hope that the cash holds out long enough to begin again. But what about those who depend on the drillers? The companies that supply goods and services to others in the industry? What we call, the supply chain. How are they doing? And what strategies are supply chain companies using to weather the current downturn? Let’s find out…
Fairmount Santrol is a proppant manufacturer/supplier headquartered in Ohio. Proppants are things like sand and ceramic beads used to “prop open” tiny fractures created in hydraulic fracturing of shale oil and gas wells. In other words, Fairmount Santrol is a regional sand supplier for shale drillers–and a good proxy to understand what’s happening (or not happening) in our neck of the woods when it comes to drilling. If drillers aren’t drilling as much, that will show up first in the balance sheets of companies like Fairmount. And so it does. Fairmount reports in their first quarter 2016 update that revenues in 1Q16 were down 52% from 1Q15. But you can’t automatically assume that means there was half the drilling one year later. Fairmount also reports the volume of sand sold was down just 8% from 1Q15 to 1Q16. Why the discrepancy between revenue and volume? Fairmount doesn’t say, but we think we know: drillers have been putting the squeeze on supply chain companies like Fairmount, forcing them to deeply discount their prices…
Blank Rome is a big, important energy law firm. The firm went on our radar in 2013 when then-Secretary of the PA Dept. of Environmental Protection Mike Krancer resigned his post to rejoin his old law firm, Blank Rome (see 
Yesterday MDN told you the sad news that southwest PA hotel owners have hit a rough patch and some of them are putting their properties on the auction block (see 
Since 2012 MDN has had our eye on a “feel good” story–about a physician who immigrated from India to Bentleyville, PA and his son. The Gosais (doctor father and son) took to investing in hotels in western PA (they began building them in 2000). With the fracking boom, the Gosais began to cater to the Marcellus industry (see 
We have an interesting update to share with you regarding the former Ormet Aluminum Plant site located on the shoreline of the Ohio River in Monroe County, OH. The plant closed its doors as an active aluminum plant in 2014 after Ohio regulators and Gov. John “foreigner hunter” Kasich failed to get high electric rates reduced for the plant, and refused to allow Ormet to burn coal to produce their own electricity until they could begin using natural gas to create electricity from gas wells drilled on the property (see