Antero Takes Southwestern to Cleaners in Deal for 55K Marc. Acres
Antero Resources announced yesterday that the company has just cut a deal with Southwestern Energy to purchase 55,000 net acres located in Wetzel, Tyler and Doddridge Counties in West Virginia for $450 million. Antero says the acreage is in the “core” of the Marcellus and some 75% of the acreage also includes Utica Shale rights. The acreage Southwestern is selling is acreage they themselves bought in 2014 from Chesapeake Energy. Chessy originally signed the acreage with landowners for $5 per acre (peanuts). Southwestern paid Chesapeake $12,000 per acre (see Southwestern Paid Chesapeake $12K/Acre for Land Signed @ $5/Acre). Antero picked up the acreage for $8181 per acre–about $4K/acre (one-third) less than what Southwestern paid for it. Oops. No wonder Antero is crowing about the deal! Here’s the lowdown, with announcements from both Antero and Southwestern…
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As we report today, Antero Resources is buying 55,000 acres of leases in the Marcellus (and Utica) Shale from Southwestern Energy (see 
Gentlemen, start your engines! Your economic engines, that is. The news earlier this week that Shell has made the commitment to move ahead and build an ethane cracker plant in Monaca, PA has, as we knew it would, set the region buzzing (see 
A group of business and government leaders from Ohio and West Virginia in what is called the Mid-Ohio Valley have banded together to form an economic development group called Shale Crescent USA. The group has been some two years in the making and officially launched yesterday at a public event in Washington County, OH. The aim of the group is to attract manufacturers (particularly petrochemical manufacturers) to set up shop in the region. Leaders of the new organization point out the unique location, with the mighty Ohio River to barge materials and products in and out, and the location right on top of the most abundant supplies of cheap natural gas in the entire world. In addition to yesterday’s event, the group launched a website: 
It’s been a while since we’ve checked in on the proposed 549 megawatt, $615 million electrical generating plant to be built near Moundsville (Marshall County), WV. At last check almost a year ago, Moundsville Power was on schedule for an opening in 2018 (see 
Each year the Ben Franklin Shale Gas Innovation and Commercialization Center (SGICC) hosts an annual Shale Gas Innovation Contest. Last week the SGICC hosted their fifth annual contest and announced four winners that split an $80,000 prize purse. The four winners this year include: Aridea Solutions, valve manufacturer; Compass Natural Gas, a CNG (compressed natural gas) station supplier; Epiphany Water Solutions, a wastewater recycler; and someone we personally know and like a great deal–Donny Beaver with HalenHardy, who won for yet another superb product (from an ingenious and serial entrepreneur). Donny’s new product is called SPILLTRATION™–a product engineered to absorb and contain oil-based leaks and spills while allowing clean water to be filter through. Read on for a description of the products/services that won. A huge congrats to our friend Donny!…
Forget about a cracker plant in West Virginia. Well, not really–just put it on the back burner for the moment. A researcher from West Virginia University says what the Mountain State and indeed all of Appalachia really needs is ethane storage. Specifically, an ethane storage hub. According to Brian Anderson, director of West Virginia University’s Energy Institute, without ethane storage (and pipelines) the Marcellus/Utica region risks seeing its abundant ethane leave the area, mostly heading to the Gulf Coast. Why is that bad? Because if we can keep ethane in the area, we will attract manufacturers to the region who want to use the results of that ethane–ethylene, the raw material in plastics. Our region can realize a bonanza in manufacturing jobs and investments–if we can store and use the ethane here, at home…
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…
States often send trade delegations to foreign countries looking for investors to set up shop in their states–a sad but necessary activity that’s been going on for years. Just look at the ethane cracker plants announced for the Marcellus/Utica: Shell (headquartered in the Netherlands) wants to build a plant in PA; PTT Global Chemical (Thailand) wants to build a plant in OH; and Odebrecht (Brazil) once wanted to build a plant in WV, a plan that seems to now be dead. Speaking of WV, a new trade delegation is heading back to Japan, seeking more investment in the Mountain State. Among those going is Pat Ford, representing the Northern Panhandle area. One of Ford’s main reasons for going is “discussions on West Virginia’s energy growth, in particular ongoing development of the Marcellus and Utica shale plays for the natural gas industry.” Hmmm. That’s interesting. Makes us wonder if Gov. Earl Ray Tomblin is looking for another cracker investor–this time from the Land of the Rising Sun…
It’s good to know that “research” can still be purchased at the once-great Duke University. For years now the radical Park Park Foundation has been buying its research from a few select professors at a few select universities. One of the scientists for sale is Avner Vengosh, professor of geochemistry and water quality at Duke University’s Nicholas School of the Environment (see 
EQT, a major Marcellus (and Utica) driller based in Pittsburgh, announced yesterday it has cut a deal to purchase all of Norwegian Statoil’s Marcellus assets in West Virginia. The deal will give EQT another 62,500 net acres and 50 million cubic feet per day (50 Mcf/d) of natgas production for $407 million. The acreage is located in Wetzel, Tyler and Harrison counties in WV. The deal includes 31 Marcellus wells and ~500 drilling locations. It bumps up EQT’s available drilling locations by a big 29% and shows the company’s continued commitment to the mighty Marcellus Shale. How will they finance it? EQT released another announcement yesterday that says they are floating 10.5 million shares of new stock, hoping to get $67 per share for a total of $700 million for this deal and for “other potential acquisitions and for general corporate purposes.” Statoil is retaining ownership of its shale assets in Ohio and (for now) it’s non-operated Marcellus assets–i.e. joint venture deals where Statoil owns a portion of the lease but doesn’t do the drilling…
A circuit court judge recently ruled on a case in West Virginia with implications for unitization or pooling. No, NOT forced pooling–or forcing landowners who haven’t signed a lease into a drilling unit, forcing drilling under their land. That’s not what this case was about. This case was about landowners with an already-signed lease for vertical wells now being used to allow that land to be pooled with other land and a horizontal well allowed to be drilled under it. The landowners, who wanted a new lease for horizontal drilling (and more money, which is reasonable in our opinion) said because the lease was silent on the matter of pooling or unitizing, it should not be allowed. The judge disagreed and found in favor of the energy company, in this case American Energy…
