Weekly Shale Drilling Permits for PA, OH, WV: Nov. 9-13

An interesting week for permits. Last week Pennsylvania issued just 2 new shale well drilling permits after having issued 3 the week before (lowest numbers we’ve seen). Ohio, which has not issued many permits in recent months, was on fire last week with 17 new shale permits! West Virginia issued just 1 new shale well permit.
Continue reading

Glimmer of Hope for Utica Drilling in Northeastern Ohio

Eastern OH counties

Aubrey McClendon, then-CEO of Chesapeake Energy, was the first major shale driller to recognize the promise of the Utica Shale play in Ohio (see Chesapeake Energy CEO Aubrey McClendon Talks to Jim Cramer About the Utica Shale in Eastern Ohio). He once famously said the Utica is “the biggest thing to hit Ohio since the plow.” While McClendon rightly deserves credit for launching the development of the Utica, he guessed wrong on the best places to drill in the Utica.
Continue reading

Utica Shale Academy Gets $200K Grant from State Dept. of Ed.

In August 2014 the Utica Shale Academy (USA), a new high school dedicated to training workers for the Utica Shale industry, opened its doors in Columbiana County with 24 students (see Utica Shale Academy Gets Enough Students to Open, Help from TX Co). USA is a public school, funded by the state–so it costs students and their parents nothing. Last year USA had 44 students, and this year enrollment is already at 62. The big news is that USA (and the local high school where USA shares facilities) has just received a $200,000 grant.
Continue reading

OH Town Building Reservoir to Feed NatGas-Powered Electric Plant

Advanced Power Services is building a 1,100-megawatt natural gas-fired electric generation facility in Wellsville, Columbiana County. Dominion Energy is building 5 miles of new pipeline, called the West Loop Project, from western PA into Ohio to feed the Wellsville plant (see Dominion Pipeline to Feed Western PA NatGas to OH Power Plant). The new electric plant will need a lot of water. The Buckeye Water District in Wellsville voted last Thursday to move forward with bids to construct an 18-million gallon reservoir to supply water for the electric plant.
Continue reading

FERC OKs Dominion Pipeline to Feed PA NatGas to OH Power Plant

Dominion Energy’s West Loop Project will flow natural gas from western PA into Ohio to feed a new natural gas-fired electric plant. We first noticed this small (but important) project back in June (see Dominion Pipeline to Feed Western PA NatGas to OH Power Plant). Yesterday the Federal Energy Regulatory Commission (FERC) issued a final approval for the project.
Continue reading

Ohio Landowners Sue Encino Energy for Shorting Royalties

Landowners in Carroll and Columbiana counties (Ohio) have filed a class action lawsuit against Encino Energy claiming the company underpaid oil and natural gas royalties. Last November Encino Acquisition Partners (i.e. Encino Energy) completed its purchase of all of Chesapeake Energy’s Ohio Utica Shale assets for $2 billion (see Stop Press: Chesapeake Sells ALL of its Ohio Utica Assets for $2B). The deal included all of Chesapeake’s 933,000 Ohio acres–with 320,000 net Utica acres–and 920 operated and non-operated Ohio Utica wells.
Continue reading

Construction Finally Begins on Columbiana Utica-Fired Power Plant

Advanced Power Services finally breaks ground…TODAY…on building an 1,100 megawatt Utica-fired electric plant in Columbiana County, OH (see New $1.1B Utica-Powered Electric Plant Coming to Columbiana County). The plant, big enough to power 1 million homes (!), was approved by the Ohio Power Siting Board in September 2016 (see $1.1B Utica-Powered Electric Plant in Columbiana Gets State Approval).
Continue reading

12 Landowner Lawsuits Filed Against NEXUS, Contractor in Ohio

A lawyer representing 12 Ohio landowners has filed separate lawsuits on behalf of each landowner against NEXUS Pipeline and a contractor NEXUS used to build the pipleline–Michels Corp. The lawyer says he plans to file more lawsuits in the coming weeks. According to the attorney, the lawsuits aim to hold NEXUS and Michels “accountable for specific damages they’ve caused,” and to prevent future pipeline builders from “trampling on the rights of property owners.” The charges vary, but include allegations of pumping water and silt onto farms without permission from the owners, destroying topsoil and crops (without compensation), failure to repair damaged drain tiles, and more.
Continue reading

Construction to Begin “Immediately” on Columbiana Utica-Fired Plant

In October 2015, Advanced Power Services announced it would build an 1,100 megawatt Utica-fired electric plant in Columbiana County, OH (see New $1.1B Utica-Powered Electric Plant Coming to Columbiana County). The plant, big enough to power 1 million homes (!), was approved by the Ohio Power Siting Board in September 2016 (see $1.1B Utica-Powered Electric Plant in Columbiana Gets State Approval). At the time of the approval, construction was supposed to begin in January 2017 and take some 550 workers about three years to build. Construction never began. A few things have changed along the way. The plant will now cost $1.3 billion to build and will take 1,000 people to build it. How do we know? Because global engineering firm Bechtel has just announced it has been selected to build the plant–and to start building it NOW, as in “immediately.” Yes, it will still take three years to build. The new target in-service date is second quarter 2021. In addition to the plant itself, a new 20-inch pipeline will be built to feed the plant, connecting to the nearby Dominion Transmission pipeline. Here’s the great news that Ohio’s latest Utica-fired electric plant is now under construction…
Continue reading

“Strong” Well Results in Northern Utica During 1Q18

As MDN reports in today’s lead story, Ohio has just achieved a new milestone by producing more natural gas than the state has ever produced during the first three months of this year (see Top 25 Producing Gas & Oil Wells in Ohio Utica for 1Q18). The best performing individual wells are located in the southern part of the Utica play–in Belmont, Jefferson, Monroe, and Guernsey counties. However, don’t overlook the wells and overall performance of counties in the northern part of the play–places like Columbiana, Mahoning and Trumbull counties. Particularly Columbiana County. The Youngstown Business Journal does a deep dive into the numbers for the northern tier counties and finds that wells drilled by Hilcorp in Columbiana produced “strong results” in 1Q18. Here’s a closer look at the northern Utica counties and the drillers who work there…
Continue reading

OH Landowners with Early Utica Leases Still Get Good Royalties

Some 10 years ago in the “early days” of the Ohio Utica Shale, landowners signed leases not knowing about the Utica and the bonanza it would soon bring. A group of 24 landowners in Columbiana County signed a lease in 2008 with Anshutz–for a few bucks an acre and 12.5% royalties. Seemed like a good deal then. But five years later leases were going for $5,000-$6,000/acre in signing bonuses and 20% royalties. It didn’t seem like such a good deal then. Chesapeake Energy later bought the Anshutz leases. We all know about the shenanigans Chesapeake plays with royalty payments. But these wells produce mainly oil instead of gas. In the early days, a 12.5% royalty, even on properties where post-production deductions “generously” taken, yielded a lot of money. Then the price of oil bottomed out and royalty checks shriveled up. With the price of oil back up, royalty checks, while not as much as they were 4-5 years ago, are still much higher than they were a few years ago. All of which is to say: When the price of oil (or gas) goes up, it covers a multitude of post-production deduction sins. But when the price is down, landowners get the shaft. At least, some landowners. Here’s the story of some of those Ohio landowners who signed early. As we read the story, our impression was this: Yes there’s been some bad (even lawsuits), but there’s been a lot of good too. And in the end, these landowners (like others we’ve spoken to in person at various events), would say if they had to do it all over again, they would. That is, shale drilling is worth it, even with the bad, and the ugly…
Continue reading

FERC Authorizes Tetco TEAL Phase II – Connecting to NEXUS Pipe

Here’s a project we’ve mentioned in passing as part of other posts, but until now, have not specifically focused on. In August 2017, Enbridge received approval (a certificate) from the Federal Energy Regulatory Commission (FERC) to construct and operate the Texas Eastern Appalachian Lease Project (“TEAL Project”). TEAL boosts the capacity along the Texas Eastern Transmission Company (Tetco) pipeline and connects it to the NEXUS pipeline. NEXUS has been under construction since last October (see NEXUS Pipeline Begins Construction in OH, MI). TEAL will bump up volumes of Utica/Marcellus gas along Tetco by an extra 950 million cubic feet per day–nearly 1 billion cubic feet! The markets for the gas are the Midwest and Canada. The justification for the project, when it was filed two years ago, was “offsetting the impact of the decline in traditional western Canadian supplies available to serve these markets.” That was before TransCanada lowered the tolls along its pipeline to bring more western Canadian gas to eastern Canada. Oops. What’s done is done. On December 19, 2017, Texas Eastern received approval to proceed with construction of the Phase I TEAL Project facilities. Last week Texas Eastern requested permission to begin Phase II in Columbiana and Belmont counties (in Ohio), and yesterday FERC said yes…
Continue reading

NEXUS Pipeline Tax Bonanza: $33M in Tax Rev for Single OH County

Columbiana County, OH

How often have you read that pipelines are “private companies” and solely created for “corporate greed”–not benefiting landowners all that much, and certainly not benefiting the communities through which they pass. All take, no give. We read those kinds of nonsense statements in so-called mainstream media all the time. False allegations. Fake news. Here’s some real news: One pipeline–the planned NEXUS Pipeline, a $2 billion, 255-mile interstate pipeline that will run from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada–will generate ~$33 million in tax revenue over five years for a single county along its route–Columbiana County, OH. That’s tax money going to a local school district, multiple townships and other local government entities. How’s that for “this pipeline doesn’t benefit anyone but the company that owns it”? This story rips the facade off anti arguments that pipelines don’t benefit anyone but corporate greedsters…
Continue reading

New Marcellus/Utica Driller Snaps Up Assets in OH, PA

It’s not often these days we get to announce a new driller in the Marcellus/Utica. Today is one of those days. Actually, this company has been around since early 2015, but we’re only now becoming aware of them. Pin Oak Energy Partners, headquartered in Akron, OH, is an exploration and production company engaged in both conventional and unconventional oil and natural gas wells and the operation of associated assets (like pipelines). Pin Oak currently operates 363 wells producing nearly 5.7 MMcfe/d (32% liquids) across more than 32,000 acres in the Marcellus/Utica region. The company is also involved in midstream, field services and operations through its affiliate companies. Pin Oak is on an aggressive acquisition binge of shale AND midstream assets, as well as leasing new acreage. Who is Pin Oak? According to CEO Chris Halvorson, Pin Oak is comprised of folks who were formerly with AB Resources. You may recall that AB Resources built a position in the southwestern “core” of the Marcellus and sold out to Chevron several years ago. Pin Oak is “what’s next” for for the former AB folks. Their target: the Appalachian basin. In July, Pin Oak bought 9,300 acres of leases and 8 Utica wells from EQT in Guernsey, Muskingum, and Columbiana counties (Ohio). Earlier this week Pin Oak announced they’ve purchased another 7,700 acres of leases and 10 Utica wells from an undisclosed seller in Trumbull, Tuscarawas and Mahoning counties (in Ohio) and Mercer, Crawford and Venango counties (in Pennsylvania). Below are two recent announcements. Pin Oak can be summed up in one word: aggressive. Keep a close eye on this company in the coming months and years…
Continue reading

Hilcorp Files for Permits to Drill 3 Wells in Columbiana County, OH

Hilcorp has woken up and come alive in the Ohio Utica Shale–for the first time this year. The company recently filed for permits to drill three new Utica wells in Columbiana County. Which is interesting. Hilcorp zigs when everyone zags. Most drilling in the Ohio Utica currently happens in southeastern Ohio–in counties like Belmont, Monroe and Guernsey. When the play first became active for shale drilling, much of the early action happened in Carroll County, and Columbiana. But lately (over the past 2-3 years) most drilling moved south. But Hilcorp, with acreage in the northern Utica in both Ohio and Pennsylvania, continues to make money staying north. In fact, Hilcorp has been called the “dominant active prospector” in the northern tier area of the Utica Shale–an area including Columbiana, Mahoning and Trumbull counties in OH and Lawrence and Mercer counties in PA. Hilcorp is strong and steady. They make money when they drill. So we take this as a good sign that drilling is heating up in the northern Utica…Continue reading

Gas Leases Expiring “Daily” in Columbiana County, OH

Click for larger version

An attorney who actively represents leaseholders in Columbiana County, OH says “lease expirations are happening daily” in the county. Leases that were signed five years ago (or longer) are coming due in Columbiana, one of the first counties to be targeted in the Utica Shale. Some of those leases are getting renewed–typically leases with Chesapeake Energy. Others, especially in the northern part of the county, are not getting renewed. Here is a rundown on what is happening with lease renewals in Columbiana…
Continue reading