EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US
Move over Exxon Mobil and Chesapeake Energy. There’s now (or soon will be, when the transaction is complete) a new #1 natural gas producer in the United States: EQT. In a deal you’ve no doubt heard about from multiple sources by now (because the news broke yesterday, just after MDN published for the day), EQT and Rice Energy announced that EQT will purchase Rice Energy, lock, stock and barrel, for $6.7 billion in cash and stock, and assume $1.5 billion in debt, for a total deal price of $8.2 billion. Along with 187,000 net acres in the PA Marcellus, and 65,000 net acres in the OH Utica Shale, EQT will get 1.3 billion cubic feet per day of Rice Energy natural gas production. When added to its own prodigious production (EQT was already one of the biggest and brightest shale companies), the combined output for the newly merged company will eclipse #2 Exxon and #3 Chesapeake Energy’s output to become the largest natural gas producing company in the country. Wow! Rice’s midstream (i.e. pipeline) assets are part of the deal. If you peg the midstream part of the deal at $1.8 billion, which some analysts say is the right number, and then calculate the per acre price of the deal, it works out to be around $9,900 per acre. Below we have the EQT/Rice announcement, the PowerPoint slide deck they used for a conference call held yesterday, and plenty of analysis about the deal–why it happened, and why now…
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As we were reading about yesterday’s big news of EQT buying Rice Energy, we came across a couple of lists (same list, different sources) listing the top 10 natural gas-producing companies in the United States. The list was reworked to show that the combination of EQT and Rice will create the #1 largest natural gas-producing company in the country. An astonishing feat. But what caught our eye in looking over the “top 10” list was just how many of the companies in that list have operations in the Marcellus/Utica. At one time or another, all 10 of the top 10 owned leases and/or drilled in the Marcellus/Utica. By our count, 8 of the top 10 still do. You already know that EQT/Rice will become the #1 producer. But who is #2, and #3? And what about the rest of the list? We have it for you below…
Whatever happened to the lawsuit filed by a Wayne County, PA landowner against the egregious overreach by the Delaware River Basin Commission (DRBC) in its ongoing stall/delay/block of any shale drilling within the Basin? In March, MDN reported that U.S. District Judge Robert Mariani ruled against the Wayne landowner in a lawsuit that challenged the right of the DRBC to stop fracking in the Delaware River Basin (see 
The TriState Infrastructure Council (TSIC) was founded in Pittsburgh in late 2016 to “serve a broad-based business community during the critical next few years by attracting and deploying investments in infrastructure projects in Ohio, Pennsylvania and West Virginia.” With infrastructure upgrades, the region will be able to realize economic growth resulting from petrochemical manufacturing and related industries in the Appalachian basin. One of the driving forces behind TSIC is a name you are likely familiar with: Kathryn Klaber. Katie Klaber founded and until a few years ago led the Marcellus Shale Coalition. She opted to focus on her consulting practice following the MSC and is now managing the TSIC. The TSIC organization was founded with a group of A-list companies located in the region. At this week’s Northeast U.S. Petrochemical Construction conference in Pittsburgh, Katie unveiled an exciting new project to map infrastructure in an 82-county region throughout the Ohio River Valley. The aim is to identify missing/key/critical infrastructure components and then work to set up public-private partnerships to get those components built. The TSIC is looking at “electric transmission and distribution, pipelines, natural gas and natural gas liquid storage capacity, reliable locks and dams, rail networks, roads and bridges, water and sewer, building sites, barge loading/unloading facilities, broadband, fiber optics, and air service, among others.” And yes, the Marcellus/Utica shale is the linchpin that holds it all together–makes it all possible–and the raison d’être for the TSIC. Here’s more on the new infrastructure database, the TSIC, and how they are giving the shale industry a big assist…
A total of 31 anti-drilling, leftist (almost all Democrat) mayors, council members and county freeholders (not freeloaders, but freeholders) from a dozen New Jersey townships begged and pleaded with the NJ Department of Environmental Protection to kill the PennEast Pipeline project. The antis sent a letter to DEP Commissioner Robert Martin claiming PennEast will have “unacceptable” impacts in their towns if it gets built. We wonder, will they find it “unacceptable” to have their gas and electric turned off, because of lack of natural gas coming in via pipeline? It is yet another list of, frankly, nobodies who are desperately attempting to grab a headline from a sympathetic anti reporter (which they did, NJ.com), to try and create the impression that masses of people are against the project. Fortunately, it will fail…
Kudos to West Virginia and its Attorney General, Patrick Morrisey, for leading the charge (along with 10 other states) to stop the Environmental Protection Agency’s implementation of the Obama methane rule. Earlier this month the Trump EPA filed paperwork to stop implementation of the egregious and illegal rule (see 
We suppose it had to happen eventually. The Trump White House is backing a Washington insider, a swamp dweller, to become Deputy Administrator (#2 person) at the Environmental Protection Agency. Jeff Holmstead, a former top EPA official under President George W. Bush, is as inside Washington as inside gets. He’s a Washington lobbyist and a lawyer (already two strikes against him). His appointment is not yet official, but the rumor mill is working overtime. We find it disappointing that Scott Pruitt, the consummate outsider, is promoting Holmstead, the consummate insider, for the position…
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: NY Supreme Court justice to AG Schneiderman: “You are wasting my time”; Rover pipeline fine will be used for work at Ashland County Courthouse; Bailout of 2 Ohio nuclear plants stalls in Statehouse; Shell project manager says cracker plant ‘will change forever Pittsburgh’; Trillium CNG opens CNG station in York, Pa.; Need for natural gas supply growing in New England; Haynesville slowdown highlights bearish natural gas outlook; Exxon’s shale drilling unit XTO shifting 1,600 jobs to Houston; Are Russia and the Saudis planning a natural gas cartel?; U.S. drillers are hammering OPEC’s plans; and more!
Eclipse can’t help it–they keep setting new world records for the longest lateral (horizontal) wells drilled–in the entire world! It began last year when Eclipse drilled what they call their first “super lateral” Utica well in Guernsey County, OH–the Purple Hayes, at 18,500 feet long (see 
Rover Pipeline (i.e. Energy Transfer) has settled an ongoing dispute with the Ohio State Historic Preservation Office (a PRIVATE organization) to pay them $1.5 million in what MDN views as shakedown money. Which is far less than the “asking” price of $1.5 million PER YEAR over the next five years ($7.5 million total). The payment comes after Rover paid the same organization $2.3 million for knocking down a dilapidated old house that was under consideration to be added to the National Register of Historic Places. In addition to the $2.3 million paid for This Old House, the Ohio State Historic Preservation Office said they had worked out a deal with Rover to pay the organization $1.5 million as compensation for something they haven’t even done yet but presumably will do–disturbing other “historic sites” as the pipeline cuts across the state. Apparently the history buffs felt the agreement was for $1.5 million per year over the next five years. Rover said (in so many words), “in your dreams.” No way. So the matter was referred to the Federal Energy Regulatory Commission (FERC) for dispute resolution. Before FERC could render a decision, the history buffs settled with Rover for a one-time additional payment of $1.5 million (a $1.5M bird in the hand is worth more than a $7.5M bird in the bush). Here’s the background for this shakedown, and a copy of the signed agreement stipulating a one-time payment of $1.5 million to the PRIVATE Ohio State Historic Preservation Office…
Marcellus Shale gas is now powering a Panda Power Funds electric generation plant supplying electricity for 778,000 homes in the Washington, DC metro area. Panda announced that its 778-megawatt “Stonewall” generating station in Loudoun County, Virginia is now online producing electricity for Northern Virginia/District of Columbia customers. MDN first had its eye on this project in November 2014 when we brought you the news that South Jersey Gas had won the contract to provide Marcellus Shale gas to the plant when built (see 
In May, MDN conveyed the news that it appears Mountaineer NGL Storage, which wants to build a new underground NGL storage facility in Monroe County, Ohio, near Clarington, along the Ohio River (see