Southwestern Energy Renewing Leases in WV, PA
Tick tock tick tock. Every day that passes brings landowners and drillers closer to the end of an initial five-year lease contract. In October 2014, Southwestern Energy purchased a humongous 413,000 acres of leases from Chesapeake Energy, most of that land in West Virginia (see Chesapeake Sells Close to 25% of Marcellus/Utica Operation). Southwestern paid over $5 billion for the deal. That leased acreage came with an expiration–which is happening now, at least for some (most?) of the acreage. Every lease is different. Some leases allow the driller to pay the same (or a different) renewal payment to keep the lease going for another period of time, typically another five years. The $5 billion question is, what will Southwestern do? Everyone is scaling back right now. Companies just can’t afford to do much drilling. Will Southwestern opt to renew those leases that they paid big bucks for? It seems we have an answer to that question. A WV newspaper is reporting that Southwestern has begun extending leases in Ohio and Marshall counties…
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Very early Christmas Eve morning, at 2:45 am, six CSX rail cars loaded with liquefied petroleum gas (LPG, or propane) ran off the tracks in New Martinsville (Wetzel County), West Virginia. We don’t know if the LPG in those rail cars came from the Marcellus/Utica, but there’s a decent chance it did. Increasingly NGLs like propane are being shipped in the northeast by rail. The good news about the accident: no one was injured and the rail cars didn’t leak. The accident is being investigated by federal authorities for the cause…
In a somewhat complicated scam, a former landman for XTO Energy, Steven E. Fisackerly (33 years old) defrauded XTO out of more than $1 million with fake lease deals in the West Virginia Marcellus Shale region. He cooked up bogus documents and passed them off as real, pocketing commissions. He even worked with a supposed/fake mineral rights owner to pocket kickbacks from lease payments sent to the fake rights owner. It was elaborate and convoluted–and ultimately stupid. Fisackerly plead guilty in May and will enter prison on January 4. His sentence? Pay back more than $1 million he defrauded from XTO, and serve 63 months (over 5 years) in federal prison…
It’s something straight out of the Tom Cruise movie Minority Report. The federal Environmental Protection Agency has fined the owner of five Pennsylvania natural gas processing plants and one West Virginia plant (six plants total) $50,221 for spills and leaks at the plants–that never happened. The EPA says Elkhorn Gas Processing hasn’t done enough to prevent such incidents from potentially happening, and therefore the EPA is shaking them down and making them pay for possible future violations. Perhaps it’s more like The Godfather than the Minority Report? Talk about an abuse of power! Do you need any further evidence that the Obama EPA is totally out of control?…