Federal Judge Rules for EQT in Ohio Lease Dispute – Ramifications
An important decision was recently made in a lease case in Ohio–a case which has implications for both drillers and landowners with Marcellus/Utica leases. Driller EQT signed a lease with Jefferson County, OH landowner Alex Cooper on Oct. 6, 2008. The initial term of the lease was for five years, with a five year extension IF EQT makes an extension payment. The lease also stipulates that EQT MUST drill a well on or before Oct 6, 2013–the end of the first term of the lease. EQT opted to extend the lease, making (or rather attempting to make) a payment to Cooper–but EQT did not drill a well by Oct 6, 2013. Cooper claimed since EQT hadn’t drilled, the lease expired on Oct 6, 2013 and he is free to lease again. The case ended up in Federal District Court for the Southern District of Ohio and U.S. District Judge Algenon Marbley decided in favor of EQT, even though the language in the lease stipulates a well MUST be drilled during the first term of the lease. How and why did Judge Marbley decide the case as he did? Below is a recap of the case, followed by a copy of the full decision from Judge Marbley…
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A couple of bits of news from Gulfport Energy, a driller focused primarily on the Utica Shale in eastern Ohio. In April, MDN reported that Gulfport had inked a deal with Paloma Partners III, a small energy & exploration company headquartered in Houston, to purchase 24,000 acres in Belmont and Jefferson counties (Ohio) for $12,500 per acre (see 
We have major news coming from Aubrey McClendon’s American Energy Partners (AEP). A lot of news. So buckle in. First we’ll tell you the news, then we’ll give you our take on that news–what it means. In brief, the news coming from AEP HQ in Oklahoma City is this: (1) AEP’s Marcellus/Utica AEP subsidiary, American Energy Appalachia Holdings, has been spun out into a 100% standalone company and has changed its name to Ascent Resources; (2) the CEO of Ascent is the same guy who was the CEO of American Energy Appalachia Holdings–trusted McClendon lieutenant Jeffrey A. Fisher; (3) Ascent has cut a deal with Gulfport Energy to sell 35,000 prime Utica Shale acres for $407 million; and (4) Ascent has just sold shares in the company and taken out new loans for $977 million, giving them $700 million in cash after they pay off certain other loans. Whew! Here’s the details, along with a little news of our own about AEP…
Sometimes the CURE is worse than the disease. Such is the case with the anti-drilling Communities United for Responsible Energy (CURE) in eastern OH. The group agitated and squawked and carried on with such histrionics that they’ve gotten the Ohio Dept. of Natural Resources (ODNR) to order an oilfield services company to shut down a satellite location in Jefferson County, OH. The offense? Depends on who you ask. The company, Anchor Drilling Fluids, says it didn’t have a permit to store excess drilling mud–the stuff used by drillers to keep a drill bit cool and lubricated and free of bacteria. The ODNR says Anchor was recycling at that site and lacked a proper waste recycling permit. Question: If you mix drilling mud at a well site but don’t use all of it, and you then truck it back to HQ to store it for a few days or weeks before taking it somewhere else, is that “recycling”? Apparently it is for the ODNR…
A mechanical malfunction at a producing American Energy Partners Utica Shale well in Jefferson County, OH caused the evacuation of about 400 area homes from Tuesday night into early Wednesday morning, according to the Ohio Dept. of Natural Resources (ODNR). The well, near the Mingo Sportsmen’s Club, was successfully shut down by Boots & Coots International Well Control Inc. Although area residents interviewed said they didn’t feel in danger, it’s still disconcerting (and a hardship) when something like this happens. Here’s an ear-witness account…