Ohio

Energy Companies | Halcon Resources | Industrywide Issues | Lease & Royalty Payments | Ohio | Pipelines | Trumbull County

Halcon Proposes 14-Mile Pipeline from Vienna to Lordstown, OH
December 11, 2013December 11, 2013

Halcon Resources has been pretty tightfisted when it comes to spending money on leases for drilling–and now, perhaps–for pipelines as well. More than a year ago MDN told you about a landowner group that had formed in the Lordstown, OH area that hoped to negotiate new leases. The landowners were bound under 20-50 year-old leases purchased by Halcon that never envisioned shale drilling. Halcon said they wanted to work with landowners but stopped short of agreeing to renegotiate the leases (see Halcon Resources Responds to Lordstown, OH Landowners Group).

Halcon not only drills wells, they also have a midstream (pipeline) division to connect them. Halcon even stores and ships oil and gas–they’re building a $70 million storage and railroad transloading facility in Lordstown (see Halcon Resources Plans $70M Oil Terminal in Lordstown, OH). As part of the new storage facility, Halcon wants to run a 14-mile pipeline from Vienna to Lordstown. The problem, according to some communities along the route, is that Halcon doesn’t want to pay all that much to install a permanent pipeline…
Read More “Halcon Proposes 14-Mile Pipeline from Vienna to Lordstown, OH”
Energy Companies | Gulfport Energy | Ohio | Statewide OH | Utica Shale

Gulfport Energy Beefs Up Management Team for OH Utica
December 11, 2013December 11, 2013

Gulfport Energy may be based in Oklahoma City, OK, but their heart (and most of their focus) is in Ohio–in the Utica Shale. Gulfport is one of the premier Utica drillers with some of the most impressive wells drilled to date (see Gulfport’s New Record-Breaking Well in Belmont Cnty – 30.3 Mmcf/d). In keeping with their laser focus on the Utica, Gulfport announced yesterday a bunch of new hires and promotions–all of them focused on the Utica Shale.

At the top of the hit parade is a brand new Chief Operating Officer (COO) for the Utica–Ross Kirtley–who was previously a VP with Sandridge Energy. Robert Jones was appointed VP of drilling for Ohio, Mark Malone was appointed VP of operations for Ohio, and Ty Peck was appointed Managing Director of Midstream Operations. Certainly seems like a pretty major restructuring on the part of Gulfport as they prepare to do more great things in the OH Utica. Here’s the press release with details…
Read More “Gulfport Energy Beefs Up Management Team for OH Utica”
Belmont County | Lease & Royalty Payments | Ohio | Utica Shale

Utica Shale Lease May Pull OH Volunteer Fire Dept from Bankruptcy
December 10, 2013December 10, 2013

We’re not sure of the circumstances that led the Neffs (Belmont County), OH Volunteer Fire Department to go more than $1 million in the hole–but that’s where they are. The miracle that may lift them out of bankruptcy and put them back on firm financial footing is the Utica Shale. Specifically, the opportunity to lease fire department-owned land for Utica Shale drilling.

The interesting (to MDN) aspect of this story is the very generous terms Neffs VFD is getting for the lease of 56.4 acres…
Read More “Utica Shale Lease May Pull OH Volunteer Fire Dept from Bankruptcy”
Industrywide Issues | Ohio | Statewide OH | Taxation | Utica Shale

OH Repubs Offer Excuses Why This Time High Utica Taxes are OK
December 10, 2013December 10, 2013

Speaker of the Ohio House William G. Batchelder (Republican-Medina), Speaker Pro Tempore Matt Huffman (Republican-Lima), and other members of the Ohio House Republican Caucus offered their pathetic excuses on why this time it’s a-OK to steal money from Ohio landowners and drilling companies and give it to other residents of Ohio–in the form of an income tax break. Apparently there’s lack of spine to do the right thing and reduce spending in Ohio (although that particular disease is not endemic to Ohio).

Here’s the Republican so-called leadership’s bland, generic ~~excuses~~ statement about why it’s OK to raise taxes on drilling this time:
Read More “OH Repubs Offer Excuses Why This Time High Utica Taxes are OK”
Belmont County | Energy Companies | Lease & Royalty Payments | Ohio | Rice Energy | Utica Shale

Belmont County, OH Waiting for $3M Lease Check from Rice Energy
December 10, 2013December 10, 2013

In early October MDN told you Rice Energy had cut a deal with Belmont County to pay the county a $7,500 per acre signing bonus, more than the $5,900 per acre it promised to private landowners in the area (see Rice Pays Belmont County Higher Signing Bonus than Landowners). The lower per acre no doubt rankled some landowners–but many of them already have their money. So far, the county does not.

When will Belmont County get its $3 million check from Rice Energy? Because they really need it…
Read More “Belmont County, OH Waiting for $3M Lease Check from Rice Energy”
Economic Impact | Ethane | Industrywide Issues | Jobs | Ohio | Processing Plants | Statewide OH | Statewide WV | West Virginia | Wood County

More Details Leak About Proposed WV Ethane Cracker Plant
December 9, 2013December 9, 2013

A few weeks ago WV and Brazilian-based Odebrecht announced plans to build an ethane cracker plant near Parkersburg, WV (see WV Announces Brazilian Company to Build Ethane Cracker Complex). Wayne Dunn, the president of the commission that governs Wood County, WV where the cracker would be built, recently said some very interesting things about the cracker. One comment: he’s known about the Odebrecht cracker for more two years! Congratulations to a politician that can keep a secret that long.

Dunn also said he pegs the chances that the Odebrecht cracker will be built at somewhere between 60-80%. He says it’s far from a done deal, but the odds are better that it will be built than not. Here’s a few more interesting “insider” insights into the proposed cracker plant coming to Parkersburg, WV:
Read More “More Details Leak About Proposed WV Ethane Cracker Plant”
Ohio | Statewide OH | Utica Shale

Ohio Passes 1,000 Utica Shale Permits Issued, No End in Sight
December 6, 2013December 6, 2013

Three cheers for Ohio! Hip hip, hooray! Ohio has just flown past 1,000 Utica Shale permits issued. The number, as of last Saturday, is 1,006 to be exact. Of that number 617 wells either are or have been drilled (two-thirds!). Perhaps most fitting is that Aubrey McClendon’s new company, American Energy Utica, received it’s first five permits to drill in this latest batch issued by the Ohio Dept. of Natural Resources (ODNR). McClendon was the first to recognize the potential of the Utica Shale and moved his then-company, Chesapeake Energy, into purchasing 1 million acres of leases in the Ohio Utica.

What is truly mind-blowing is that it took only three years for Ohio to go from zero permits to 1,000+ permits for Utica wells, establishing the Utica as one of the country’s hottest shale plays. Here’s a rundown on the latest numbers from Ohio’s Utica Shale:
Read More “Ohio Passes 1,000 Utica Shale Permits Issued, No End in Sight”
Energy Services | Industrywide Issues | Marathon Petroleum | Ohio | Pipelines | Statewide OH | Utica Shale

Marathon Petroleum’s Newly Announced “Cornerstone” Utica Pipeline
December 5, 2013December 5, 2013

Another new pipeline is on the way in the Utica Shale. This one will be built by Marathon Petroleum Corporation, the largest refiner in the Utica Shale region. The Cornerstone pipeline, as they’re calling it, will stretch nearly 50 miles from the MarkWest cryogenic processing plant in Cadiz, OH northwest connecting to M3’s fractionator plant in Scio and M3’s cryogenic processing plant in Leesville along the way as it terminates and connects to Marathon’s refinery in Canton, OH (see map below). The pipeline will carry, at various times, crude oil, condensate and natural gasoline.

The Cornerstone pipeline is slated to be built and in operation in 2016, according to Marathon officials. Here’s what Garry Peiffer, President of Marathon’s Master Limited Partnership MPLX GP said about the Cornerstone project on an analyst call yesterday:
Read More “Marathon Petroleum’s Newly Announced “Cornerstone” Utica Pipeline”
Industrywide Issues | Ohio | Statewide OH | Taxation

OOGA Caves, Endorses New Higher Tax on OH Utica Shale
December 5, 2013December 5, 2013

It looks like taxes on the Utica Shale in Ohio will go up. Yesterday OH Rep. Matt Huffman and Speaker William Batchelder (both Republicans) introduced House Bill 375 which would raise taxes on Utica Shale drilling. Efforts have been under way for the past two years by OH Gov. John “foreigner-hunter” Kasich. He’s into socialism these days–raise taxes on one set of people and give it to another. He’s had some assistance from his fellow Republicans in this regard–but the efforts have (thankfully) gone nowhere.

But now it’s different. This time the Ohio Oil & Gas Association (OOGA), long opposed to raising the Utica Shale tax, has endorsed the latest proposal, which means it’s probably not as much as Kasich wanted, but it’s certainly more that what it is now. Sadly, OOGA has also (for political expediency) endorsed the concept of giving “the extra money” raised by new taxes to voters (i.e. vote buying) in the form of a state income tax cut…
Read More “OOGA Caves, Endorses New Higher Tax on OH Utica Shale”
Ohio | Statewide OH | Utica Shale

OH Utica Shale Status Report – Red Hot & Growing
December 3, 2013December 2, 2013

The Utica Shale is being developed faster than other shale plays–it is perhaps the fastest ramp-up in the short history of U.S. shale plays: 0 to almost 1,000 shale wells permitted (609 of them drilled) in the last 3 years. Some of the lessons being learned in the Utica are being carried to other, more “mature” plays like the Marcellus and the Bakken. So what’s going on in the red hot Utica?

A status report on the Utica Shale, courtesy the Youngstown Business Journal and the recent DUG East conference in Pittsburgh…
Read More “OH Utica Shale Status Report – Red Hot & Growing”
Economic Impact | Industrywide Issues | Ohio | Pennsylvania | Statewide OH | Statewide PA | Statewide WV | West Virginia

List of U.S. Shale Plays Ranked by Profitability (IRR)
December 3, 2013December 2, 2013

Thanks to our ever-helpful second set of eyes, Chris Acker, MDN was alerted to a Seeking Alpha article with a table showing the Internal Rate of Return (IRR) for commercially developed U.S. shale plays. It is a way of ranking shale plays (specific regions within plays) that shows the profitability of the plays. The higher the IRR percentage, the better/more profitable that play is. A dollar of investment goes further with a higher IRR.

And what did we spot in scanning the chart? The top spot–the most profitable shale play in America–is the “Marcellus Super Rich” area located in southwest PA and the northern panhandle of WV. The second most profitable play, virtually tied with the Marcellus? The “Utica Liquids Rich” region in eastern OH. It’s a fascinating table. Have a look…
Read More “List of U.S. Shale Plays Ranked by Profitability (IRR)”
Industrywide Issues | Jobs | Ohio | Statewide OH | Utica Shale

The Real Employment Numbers in Ohio’s Utica Shale
December 3, 2013December 2, 2013

There’s a lot of trash talking about how many jobs shale drilling “actually” creates–by those desperate to stop drilling. In classic disinformation style they throw out wildly inflated numbers, say those of us on the pro-drilling side made those claims, and then knock down the “straw man” they created when employment numbers don’t measure up. “See! The drilling industry lied to you about how many jobs they would create.” That’s the tact they use to try and discredit this jobs-creating industry.

The truth is, shale drilling has created thousands of new, direct jobs in the oil and gas industry–in Pennsylvania, West Virginia and Ohio. It’s also created thousands more jobs in related industries, like environmental consulting, trucking, etc. So let’s, for a change, talk about real numbers, shall we? The Ohio Dept. of Job and Family Services, official tallying agency for employment numbers in Ohio, says Ohio’s natural gas and shale employment numbers have gone up 30% over the past two years…
Read More “The Real Employment Numbers in Ohio’s Utica Shale”
Carroll County | Economic Impact | Harrison County | Industrywide Issues | Ohio | Statewide OH | Utica Shale

Meet Ohio’s New Utica Millionaires – Hundreds of Them
December 2, 2013December 2, 2013

As part of a story about the Morgan County (OH) Landowner Group, or MCLG (see our companion story today), near the end of the story we get this short mention which, although an “off-hand” comment, comes as a startling thunderclap to MDN about the sheer number of millionaires created by the Utica Shale (i.e. “shaleonaires”):
Read More “Meet Ohio’s New Utica Millionaires – Hundreds of Them”
Energy Companies | Landowner Coalition News | Morgan County | Ohio | PDC Energy | Utica Shale

Morgan County, OH Looks to Join the Utica Shale Well Club
December 2, 2013December 2, 2013

So far Morgan County, OH (south of Muskingum County, west of Noble County) has been quiet with respect to Utica Shale drilling. We’ve heard nothing. However, in November, Petroleum Development Corporation (PDC) obtained three Utica Shale permits in Center Township, Morgan County. Depending on the results of those three wells, more may be on the way.

In addition to the first three Utica wells to be drilled in Morgan by PDC, another surprise (to MDN): There’s a landowner group in Morgan County we were not aware of–the Morgan County Landowner Group (MCLG)–which incorporated as a non-profit in 2012 and already has 60,000+ acres…
Read More “Morgan County, OH Looks to Join the Utica Shale Well Club”
Energy Services | Industrywide Issues | Litigation | Ohio | Patriot Water Treatment | Regulation | Trumbull County | Wastewater

OH Court Tells ODNR: Turn Over Emails in Patriot Water Lawsuit
November 27, 2013November 27, 2013

Patriot Water Treatment of Warren, OH has had a long-running feud with the Ohio EPA and Ohio Dept. of Natural Resources (ODNR)–a feud that goes all the way back to 2011 (see MDN’s string of Patriot Water stories here). Patriot processes frack wastewater at it’s Warren plant and then disposes of the wastewater by using the local Warren municipal sewage treatment plant. That is, Patriot strips out all of the really nasty stuff, and then the sewage plant finishes off the process and the water is then released into the Mahoning River, near Youngstown.

The OH EPA and ODNR pulled Patriot’s permits to operate for a four-month period in 2012, but Patriot sued and won the right to continue operating (and sending their wastewater to the sewage plant). In relation to the shut-down, Patriot is suing for damages and the ODNR has not been altogether forthcoming with emails and paperwork requested by Patriot as part of the lawsuit. So the OH District Court of Appeals told the ODNR yesterday to comply, or else…
Read More “OH Court Tells ODNR: Turn Over Emails in Patriot Water Lawsuit”
Belmont County | Lease & Royalty Payments | Monroe County | Noble County | Ohio | Utica Shale

OH’s Largest School District Gets $1M+ from Lease Bonuses
November 27, 2013November 27, 2013

Ohio’s largest school district (geographically speaking), the Switzerland of Ohio Local Schools in eastern Ohio, has raked in over $1 million so far from Marcellus/Utica Shale drilling deals. It’s located in some of the best drilling spots in the Ohio Utica (Monroe/Belmont/Noble counties). Even so, the school is headed for “devastating cuts” according to the school treasurer, due to a collapse in enrollment over the last 20 years.

The money received so far from shale deals is from lease payments, not royalties. Will the school district go on over the fiscal cliff? Or will shale royalties come along in time to save the day? School officials are not sure…
Read More “OH’s Largest School District Gets $1M+ from Lease Bonuses”