Southwestern Sells More Assets from 2014 Chesapeake Deal

southwestern energyAs we report today, Antero Resources is buying 55,000 acres of leases in the Marcellus (and Utica) Shale from Southwestern Energy (see Antero Takes Southwestern to Cleaners in Deal for 55K Marc. Acres). The acreage that Southwestern is selling comes from the massive $5.375 billion deal Southwestern made with Chesapeake in 2014 (see Chesapeake Using $1B from Southwestern Deal to Buy Back Stock). The interesting thing is that selling land is not the only recent deal Southwestern has brokered to dump assets from the Chesapeake deal. Southwestern cut a deal (in May) to sell 135 vertical (conventional) and 37 horizontal (shale) wells in West Virginia to HG Energy. Earlier this week Southwestern got approval from the Federal Energy Regulatory Commission (FERC) to sell pipeline contracts to HG Energy too. Which begs the question: How many more Chesapeake deal assets is Southwestern going to sell off?…
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Sierra Club Pressures WV County to Oppose Atlantic Coast Pipeline

The Virginia Chapter of the Big Green (and very radical) Sierra Club is pressuring county commissioners in Upshur County, WV to support their effort to block the Atlantic Coast Pipeline. Atlantic Coast is a $5 billion, 564-mile natural gas pipeline from West Virginia through Virginia and into North Carolina. Dominion is the company building it. The strategy being employed by the radicals at the Sierra Club (and at other Big Green groups that should lose their non-profit status because the engage in political activities) is to try and force the Federal Energy Regulatory Commission to combine all of the pipelines being proposed into one, massive environmental impact review–hoping that by combining separate projects together it will trigger a decision to deny all of them. The problem is by law FERC cannot combine separate projects together. Not all of those projects will get built. And they run in different geographies. FERC’s mandate, under U.S. law, is to evaluate each project individually. But silly things like obeying the law never stops Big Green groups–they just keep right on community agitating…
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XTO Paying $5.3M for Violating Federal Clean Water Act in WV

Mother May IPushing dirt around on drill pads can get very expensive if you don’t have a signed piece of paper in your hand that says, “Mother May I?” XTO Energy, the shale-drilling subsidiary of ExxonMobil, has just learned that the hard way. The federal Environmental Protection Agency (EPA) along with the U.S. Dept. of Justice announced a settlement yesterday with XTO–fining the company $2.3 million because “fill material” (i.e. dirt and rocks) got into nearby streams and swamps in several West Virginia counties when XTO pushed that dirt and rocks around to construct roads and well pads. Oh, and XTO has to “undo” the damage, spending another $3 million or so. Total price tag of $5.3 million for violating the “Mother May I?” Clean Water Act. If XTO had had the proper paperwork, they wouldn’t have been fined. The jack boots of the feds come down again…
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“Listen” Up: WV College Offers New NatGas Geophysics Major

West Virginia Wesleyan College, a private college in Buckhannon (Upshur County), WV, sits in the midst of Marcellus drilling country. So it only makes sense for the school to want to tap into the industry and offer a degree related to the booming shale industry. But instead of offering a “me too” degree in petroleum engineering, Wesleyan has decided to focus its degree on the fascinating area of geophysics–or more properly seismic readings and determining “what’s down there” by bouncing sound waves through the rock. All of the new degree programs being offered by schools in the northeast are needed–along with good jobs training programs offered by community colleges (in areas like welding). However, we applaud Wesleyan, a smaller school of some 1,400 students, for staking out a different path to assist the industry. Kids, “listen” up! Geophysics is a great field.

Here’s the Wesleyan announcement about their new program, set to begin this August…
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Aveda Transportation Opening WV Branch Office to Move Utica Rigs

Aveda Transportation and Energy Services Inc., a Canadian oilfield hauling services and equipment rental company, released their second quarter financials yesterday. Aveda currently operates a branch office in Williamsport, PA to service Marcellus drillers.

An interesting little announcement was tucked in yesterday’s release. Aveda is opening another branch office in the northeast–this one in West Virginia–to service the rapidly growing number of rigs in the Utica Shale. According to CEO Kevin Roycraft, he’s counting on the new WV office to contribute to the company’s bottom line by fourth quarter of this year…
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New Pipeline, Wells Coming to Upshur & Barbour Counties in WV

Drilling for natural gas in the largely dry gas West Virginia counties of Upshur and Barbour is about to pick up–a lot. How do we know? CONE Gathering, the midstream part of a joint venture between CONSOL Energy and Noble Energy, is constructing a new 24-inch, 37-mile gathering pipeline through the heart of both counties. When that pipeline is done, it will start to connect a flurry of new wells drilled by CONSOL and Noble.

Construction on the new pipeline is set to start in six to nine months and will be completed another six to nine months after that. So the new pipeline may be online as early as a year from now…
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Tangible Evidence of the Change from Dry to Wet Gas Drilling

For some time there have been rumblings of how drilling activity is moving from “dry gas” (methane only) to “wet gas” (methane plus natural gas liquids like ethane, pentane and butane) areas. It seemed you couldn’t read a quarterly financial update from an energy company that didn’t mention such a move. And while slowdowns were apparent in some isolated areas, frankly, the actions just didn’t seem to match the words.

Here’s a bit of news that provides tangible evidence of the change from dry to wet gas drilling. Great Plains Oilfield Rentals, a company that employs 120 people in and around Buckhannon in Upshur County, WV (center of the state), is moving—to the upper panhandle area of West Virginia. Why? Wet gas drilling.

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