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PA Landowners Sue XTO Energy for Shorting Them on Royalties

cha chingTwo Butler County, PA landowners with a combined 245.7 acres of land leased to XTO Energy have sued XTO claiming that XTO is breaking the lease agreement by paying royalties below 1/8 of what XTO receives in revenue for the gas. So far we’ve heard about Chesapeake Energy being the focus of these types of lawsuits for their shenanigans of inflating post-production costs from the pipeline company and then receiving a “kick back” of investments by the same pipeline company (see Chesapeake Shafting Landowners out of Royalties Mess Gets Messier). Although we don’t believe the XTO lawsuit claims the exact same thing, what it does claim is that the lease signed with the landowners does not include language that would allow XTO to deduct certain charges that they are now deducting. That’s the claim. Of course you need lawyers to sue and the lawyers in this case aren’t content with representing just two landowners. They want to turn this into a massive class action and represent hundreds of landowners (cha ching!)…
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ACLU Bullies Threaten Butler County Landowners over Martian Lawsuit

The most anti-American group on the planet that we know of, aside from ISIS/ISIL/Al-Qaeda, is the American Civil Liberties Union (ACLU). So we find it truly rich that the ACLU–always on the lookout to squash anything to do with the American way and freedom and apple pie–has now involved itself in what we loving call “the Martian controversy.” A small group of rabidly anti-drilling (and liberal) parents in the Mars School District in Middlesex Township (Butler County), PA want to prevent the legal, legitimate, and now fully permitted right of Rex Energy to drill a few Marcellus Shale wells three-fourths of a mile away from the Mars School. We’ve long chronicled this battle (see MDN’s list of Mars School stories). Four local residents used two non-profits backed by Big Green money and from the opposite side of Pennsylvania–THE Delaware Riverkeeper and the Philadelphia-based Clean Air Council–to file a lawsuit against the little town of Middlesex to stop any kind of drilling, a move that has so far cost local taxpayers over $35,000 in legal defense fees (see Dela. RiverKeeper, Clean Air Council Cost Middlesex Residents $35K+). So a group of 12 Middlesex landowners and a business launched their own lawsuit against the two Big Green groups and the four local residents claiming (rightly) that they are being economically harmed (see Shoe Now on Other Foot: Landowners Sue Martian Anti-Drillers). What do the anti-drilling, liberal, wacko parents and Big Green groups do? They go crying like little girls to the ACLU and now the Big Bully ACLU has ridden into town to tell the 12 landowners and local business they have no right to file a lawsuit! In America!!!…
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DEP Approves MarkWest Plan to Expand Bluestone Gas Processing Plant

We wouldn’t classify it as one of the major miracles, but perhaps as a minor miracle. Something comparable to a picture of the Madonna weeping real tears. The Pennsylvania Dept. of Environmental Protection (DEP), under the leadership of DEP’s PennFuture Secretary John Quigley, has signed off on a MarkWest Energy request to double the size of the Bluestone natural gas processing facility in Butler County. MarkWest plans to build two new units at the facility (200 million cubic feet per day of capacity for each, or 400 Mmcf/d total). The first of the two will, if all goes as planned, come online by the end of this year…
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Rex Energy Marcellus vs Upper Devonian – Which Produces More?

An interesting update from Rex Energy yesterday on production results for two of their wells in Butler County, PA. Rex drilled four wells on the Renick well pad–three of them in the Marcellus layer, one of them in the Upper Devonian layer. The well results reported were for one of the Marcellus wells and the Upper Devonian well. What is fascinating to MDN is that the initial production rates for the two wells–one Marcellus and one Upper Devonian are quite different. Question: Which layer do you think produced more natural gas–the Marcellus or the Upper Devonian?…
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ETP Announces $1.5B Revolution Pipeline/Plant Project in SWPA

revolutionAn important new project in the Marcellus/Utica was announced by Energy Transfer Partners (ETP) yesterday. The project, dubbed the Revolution Project, includes a new 100-mile gathering pipeline system in Butler County, PA along with a new cryogenic gas processing plant to be constructed “in western Pennsylvania.” The processing plant will be called the Revolution Plant. A pipeline (called the Revolution Pipeline) will be constructed to connect the Revolution Plant to Sunoco Logistics’ Mariner East NGL pipeline to handle NGLs coming from the plant. Another pipeline will be built to connect the plant to ETP’s Rover pipeline to handle natural gas coming from the plant. Also part of the Revolution Project will be a new fractionation facility to be built at the Marcus Hook refinery in the Philadelphia area. Total price tag for the whole shebang: $1.5 billion…
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Shoe Now on Other Foot: Landowners Sue Martian Anti-Drillers

shoe on the other footIt’s about time. Twelve (12) leaseholders and a real estate developer in Middlesex and Adams Townships, in Butler County, PA (near the Mars School District) have filed a lawsuit against local anti-drillers as well as against THE Delaware Riverkeeper and the Philadelphia-based Clean Air Council, suing them for damages because their ongoing frivolous lawsuits have keep the leaseholders from realizing profits from their leased land. And get this, the Martians and Big Green groups being sued are upset, saying their free speech rights are being infringed. Talk about nuts! It’s OK for anti-drillers to launch lawsuit after lawsuit, but as soon as someone pushes back and files a lawsuit against them, they start squealing like little piglets…
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Anti-Drilling Martians Running for School Board in November

My Favorite MartianWho knew that Martians are Democrats? Well, to be honest, we had guessed as much. A small group of Mars School parents who object to fossil fuels have formed a group to oppose Rex Energy’s plan to drill five wells on a pad about 3/4 of a mile from the Mars School in Middlesex Township (Butler County), PA. We’ve chronicled the fight over the past year or so (see our Martian stories here). Three of the parents from the anti-drilling group ran in a primary for the school board. All three, as it turns out, are Democrats. Surprised? No, neither are we. Fracking and drilling is, largely, a partisan issue. The good news is that all three were among the lowest vote-getters in the primary–and one of them flunked off and won’t be on the ballot in November. The other two will run as Dems in a district where Republicans handily outnumber them…
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Rex Energy Hires Stonehenge to Build Gathering Pipeline in PA

Rex Energy has contracted with Stonehenge Energy Resources to build a pipeline gathering system for Rex in Butler County, PA. Financial details of the deal were not disclosed, but the system–to be built this year–will provide an additional 400 million cubic feet per day of natural gas pipeline capacity, expandable in the future. The Stonehenge gathering system will deliver gas to MarkWest Energy’s Bluestone processing plant. The details…
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Rex Energy to Restart Drilling Near Mars School Following Vote

My Favorite MartianLet the drilling begin! The three members of the Middlesex Zoning Hearing Board (Butler County, PA, where the Mars School District is located) voted unanimously on Wednesday to reject challenges by anti-drillers to changes in zoning laws that allow Rex Energy to drill a series of wells on a pad about 3/4 of a mile from the Mars School. Four Martian parents have worked themselves up into a frenzy, convincing themselves that faraway drilling will harm their precious, innocent lil’ chil’ren. The Martians have enlisted the help of anti-drilling groups from the opposite side of the state–the Philadelphia area–tapping into their deep pockets to fund endless lawsuits and appeals that are costing Middlesex taxpayers big bucks to defend (see Dela. RiverKeeper, Clean Air Council Cost Middlesex Residents $35K+). (By the way, when is the IRS going to investigate THE Delaware Riverkeeper for clear violations of their 501(c)(3) tax exempt status? Riverkeeper continues to operate, politically, far outside of the Delaware River Basin. Their tax exempt status should be revoked.) The zoning board vote was good news for Rex who says they won’t waste any time in returning to the drill site to begin work. By the time the Martians are done suing, the wells will already be drilled…
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Martian Arrogance: Town MUST “Protect Us” from Drilling via Zoning

My Favorite MartianThose trouble-making Martians are at it again. Four virulently anti-fossil fuel parents from the Mars School District in Middlesex Township (Butler County), PA are being assisted–we maintain illegally–with support from THE Delaware Riverkeeper (violating its own charter of operating on the other side of the state in the Delaware River Basin) and by the Philadelphia group Clean Air Council. Riverkeeper’s interference in Butler County invalidates their tax-exempt status. Get this, using money from Riverkeeper and the Clean Air Council, the four Middlesex residents are trying to FORCE locally elected leaders in Middlesex to “protect them” from an activity that’s harmless–drilling a shale well 3/4 of a mile away from the local Mars School. It’s the same type of “sue and settle” being used at the national level, being tried locally. Seven selfish PA townships sued the state (and won) to retain the right to zone where drilling can and can’t take place. Now the Martians want to (ab)use the same Act 13 law to force the town to enact zoning that this small group of residents wants regardless of what a majority of town residents want. In other words, there is only one outcome (for them) allowed under Act 13: no drilling. It is an amazingly arrogant position and needs to be vigorously opposed legally, morally, via popular opinion–in any way possible…
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XTO Files Paperwork to Double Size of NGL Plant in W PA

In 2013 XTO Energy began operation at its very own natural gas liquids (NGL) cryogenic processing facility in Butler County, PA (see XTO’s New NGL Recovery Plant in Butler County, PA Now Online). Life is good in the midstream. According to the Pittsburgh Business Times, XTO has just filed paperwork with the state to build a new plant at the site, doubling capacity at the facility…
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Rex Energy to Sell Acreage in OH & PA, Focus on 3 Counties

Last week MDN brought you the first quarter 2015 update for State College, PA-based Rex Energy (see Rex Energy 1Q15: Production Up 61%, Revenue Down 33%, Gulf Coast Deal). Rex’s management held an earnings call later that day, and as is typical, a some important news was revealed on that call that was not included in the press release update. Namely, Rex is looking to sell it’s leased Utica Shale property in Belmont, Guernsey and Noble counties in Ohio. They also plan to sell leases in Westmoreland, Clearfield, and Centre counties in PA. When it’s all over and done, Rex will be concentrating on just three counties…
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Martian Sighting in Harrisburg – Keep Wells Away from Schools

My Favorite MartianWhere’s HG Wells when you need him? We’ve had another Martian sighting! At yesterday’s PA Dept. of Environmental Protection Oil & Gas Technical Advisory Board (TAB) meeting, Amy Nassif, representing some of the parents from the Mars School district in Butler County, PA, addressed TAB members imploring them to “keep oil and gas well pads away from schools.” Aaah, Ms. Nassif–what about well pads that already exist ON SCHOOL PROPERTY? Like the well pad at the Elk Lake School in Susquehanna County (see Rural NE PA School Nets $1.7M in Royalties from 2 Marcellus Wells). Should they rip out their two wells–wells that haven’t harmed a single student and have brought in millions of dollars for the school?…
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Why < 9% PA Towns Haven't Passed O&G Zoning Regs: Anti-Drillers

There’s a reason that less than 9% of communities in the 33 Pennsylvania counties with shale drilling have passed ordinances specifically aimed at the drilling industry. They look at the grief experienced in places like Middlesex Township (Butler County) where Martians–a few parents from the local Mars School District–are agitating to prevent a shale well from being drilled 3/4 of a mile from the school (see Rex Drilling Operation Near Mars School Put on Hold). Those towns see how so-called non-profits like the Delaware Riverkeeper are operating outside of their jurisdictional (we would argue outside of their legal) parameters, costing communities like Middlesex big bucks (see Dela. RiverKeeper, Clean Air Council Cost Middlesex Residents $35K+). Other towns look at that festering mess and say, “no thanks,” which is kind of ironic since the towns themselves sued to overturn portions of the Act 13 law, giving them the right to enact their own oil and gas zoning regulations…
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Struggling Rex Energy Gets JV Partner, Slashes Budget Again

Rex Energy, our little energy company that could (and does) continue to drill in the Marcellus/Utica, is struggling. Rex has, like all companies, been hit with low commodity prices for natural gas, a shortage of pipelines to get the gas to markets, and consequently has scaled back on plans for 2015. Although Rex had a great 2014 with production up some 66% over 2013, in December the company announced they would trim the 2015 budget by 44% over 2014 (see Rex Energy Reduces 2015 Marcellus/Utica Drilling Budget by 44%). In February Rex was included in a list of 19 companies on one analyst’s “death list”–meaning they owe a lot more money than they bring in–in Rex’s case they owe 5 times as much as they bring in annually (see 19 Oil/Gas Companies on “Death List” – 8 are in Marcellus/Utica). Shortly after that, Rex put 28K PA acres up for sale in their non-core area, to raise cash (see Rex Energy Looks to Sell 28,300 Marcellus Acres in Bid to Raise $). And that brings us to yesterday, when Rex announced they are slashing their drilling budget again, by another 30%, and they’ve taken on a joint venture partner for some of their acreage in a bid to keep drilling…
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Rex Energy 1Q15 Update: 6 New Wells Online in Butler County

The first quarter of 2015 hasn’t quite come to an end just yet (that happens on March 31)–but it’s not stopping Rex Energy from issuing a first quarter operational update. Rex, headquartered in State College, PA, is mainly focused on drilling in the Marcellus/Utica–in Butler County, PA and Carroll County, OH. According to Monday’s update, Rex placed six more wells (on two pads) in Butler County into sales during 1Q15. Because of problems with a Blue Racer compressor station, Rex reports production in Carroll County was constrained in 1Q15–but they’re quick to add those problems are over and the gas is now flowing again. Here’s yesterday’s update…
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