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    Should Chesapeake CEO Doug Lawler Start Looking for a New Job?

    MDN has not been very complimentary of the tenure of Doug Lawler in taking over as CEO of Chesapeake Energy. Corporate raider Carl Ichan tossed Chesapeake’s co-founder and CEO for it’s entire existence (until Lawler) of Aubrey McClendon. We know, McClendon is no boy scout and certainly had his faults, but we find it sick and disgusting when an investor who holds approximately 8% of the outstanding shares in a company can eject its founder, appoint his own “tool” and embark on massive layoffs as a way of making himself money. Legal? Perhaps. Moral? Never. So we found a portion of an article on The Motley Fool interesting–an article about three CEOs in “the hot seat.” The article quotes Lawler as saying Icahn hired him to deliver on the bottom line–higher stock share price. Over the past year Chesapeake’s stock has decreased in value by 80%. Perhaps it’s time for old Doug to polish up his resume?. Doug may soon know what it feels like to get a pink slip–like the ones he’s handed out, about 2,000 times over the past couple of years…
    Read More “Should Chesapeake CEO Doug Lawler Start Looking for a New Job?”

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    Eagle Asset Mgmt Sells Gulfport Energy, Buys Rice Energy Stock

    Eagle Asset Management is a privately owned investment manager. The firm pools and invests $31 billion from high net worth individuals, investment companies, pension and profit sharing plans, pooled investment vehicles, charitable organizations, corporations, and state or municipal government entities. One of the areas that Eagle invests in is the oil and gas industry. We always find it interesting how people with big money to invest decide where to invest (essentially place bets on). According to the latest paperwork filed with the Securities and Exchange Commission, during the third quarter of 2015 Eagle Asset decreased their investment in one Marcellus/Utica driller, Gulfport Energy, while increasing their investment in another Marcellus/Utica driller, Rice Energy…
    Read More “Eagle Asset Mgmt Sells Gulfport Energy, Buys Rice Energy Stock”

  • Marcellus & Utica Shale Story Links: Mon, Jan 4, 2016

    The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: 3 new natgas pipes go online in November; Morningstar downgrades CONSOL credit rating; NY towns get foamy; green eggs and renewable scam; Latta asks for pipeline details; pipelines converge in Lebanon County; Kinder blasts MA AG; VA DEQ grants OK to Columbia pipe; and more!
    Read More “Marcellus & Utica Shale Story Links: Mon, Jan 4, 2016”

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    The 411 on New Driller Firing Up Rig in Tioga County, PA

    What's the 411Looks like there’s a new driller in the Marcellus/Utica. MDN received a tip from an industry insider to let us know that Travis Peak Resources, an Austin, TX-based exploration and production company (E&P, or “driller”), is firing up a rig to begin drilling in Tioga County, PA. Who’s Travis Peak? And are they targeting the Marcellus, or the Utica? We don’t have 100% definitive answers for you, but we do have some informed speculation…
    Read More “The 411 on New Driller Firing Up Rig in Tioga County, PA”

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    OOGA Tells Ohio to “Sit Tight” – 2016 Won’t be Pretty

    We get a rather sobering assessment of the Utica Shale industry in Ohio from Shawn Bennett, executive vice president of the Ohio Oil & Gas Association (OOGA). Shawn tosses around phrases like “survival mode” and “significant turmoil” and “perfect storm” when talking about the Utica and what’s ahead in 2016. His advice? Ohio needs to “sit tight” and wait (and pray) for energy prices to rise. Here is what Shawn recently had to say about drilling prospects in Ohio for 2016…
    Read More “OOGA Tells Ohio to “Sit Tight” – 2016 Won’t be Pretty”

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    Impact “Fee” or Impact “Tax”? It Matters in this (Court) Case

    Is the money collected from drillers in Pennsylvania for wells a fee, or a tax? Under the Act 13 law passed in 2012, it’s called an impact fee. We’ve long made the case that it’s part fee, part tax (see our story from 2012: PA’s New Tax on Drilling (er Sorry, Impact Fee)). Our definition, which we think makes eminent sense, is that a fee is money collected to reimburse the government for a service used. You drill a well in a community, you run big trucks over rural roads–those roads get damaged and it takes money to repair them. Or if there’s an accident because of the increase in traffic and fire/police are called out more frequently–there’s a cost associated. Local towns meeting to review and debate requests related to new wells? Takes precious time, and money. The impact fee, as originally intended, would compensate local municipalities for out-of-pocket expenses they incur when drilling comes to town. But then greedy politicians who like money to flow through their stick fingers got involved and in order to “sell” the impact fee in Harrisburg, compromises were made. In the end, 60% of the money collected from the impact “fee” stays local–to reimburse towns and counties for out-of-pocket expenses. The other 40% goes into the Harrisburg black hole and disappears into the fingers of local and state politicians who don’t incur any expense from drilling. So we call that 40% portion a tax–an obscene one at that. Why does it matter whether it’s considered a tax or a fee? Because of a Commonwealth Court case in which a driller maintains it’s a tax and the company doesn’t owe it if it’s considered a tax…
    Read More “Impact “Fee” or Impact “Tax”? It Matters in this (Court) Case”

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    PA Supreme Court Gives EQT “Procedural Victory” in $4.5M Fine Case

    Over a year ago the Pennsylvania Dept. of Environmental Protection (DEP) fined PA driller EQT $4.53 million for a leaky wastewater impoundment in Tioga County, PA (see PA DEP Levies Biggest Fine Ever, $4.5M Against EQT). While EQT is not saying there wasn’t a problem with leaks at the site, they are saying the way the DEP is calculating the fine is unreasonable and arbitrary. In fact, EQT says the DEP levied the fine and took EQT to court because a few weeks prior EQT has sued the DEP. Seems to be a tit for tat thing going on. There is, more than a year later, a development in the case. EQT appealed the fine and the case to PA Supreme Court and the high court has just handed EQT a “procedural victory” by saying EQT has a point about the manner in which the DEP is calculating the fine. The Supreme Court has sent the case back to a lower court for follow up work…
    Read More “PA Supreme Court Gives EQT “Procedural Victory” in $4.5M Fine Case”

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    Court Approves Magnum Hunter’s “First Day” Bankruptcy Motions

    Two weeks ago MDN brought you the sad news that Marcellus/Utica driller Magnum Hunter Resources (MHR) has filed for Chapter 11 bankruptcy protection (see Sad Day: Magnum Hunter Files for Chapter 11 Bankruptcy). A few days after filing, MHR reported (see below) that the courts have already approved all “first day” motions related to the bankruptcy. The upshot is this: the courts have approved MHR’s plans that allow the company to continue to make payroll, pay royalty payments to landowners, and continue to work on getting a $200 million bridge loan to keep it all going. Here’s the details…
    Read More “Court Approves Magnum Hunter’s “First Day” Bankruptcy Motions”

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    Morningstar Outlook/Predictions for Oil & Gas in 2016 & Beyond

    Morningstar, Inc. is one of, if not THE leading providers of independent investment research in North America, Europe, Australia, and Asia. Morningstar’s analysts keep a close eye on many different sectors, including the energy sector. Yesterday Morningstar published its Quarter-End Insights for the oil and gas sector, which include not only a look back at what happened, but predicts what they see coming in 2016 and beyond. Among Morningstar’s predictions: “Long-term” prices for oil will hit $70 per barrel for Brent crude and $64 per barrel for WTI. Near-term oil prices? They “could be ugly.” Morningstar recommends three specific E&Ps in which to invest. Two of them operate in the Marcellus…
    Read More “Morningstar Outlook/Predictions for Oil & Gas in 2016 & Beyond”

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    Chesapeake Energy Races to Exchange Notes Before the Ball Drops

    The news for Chesapeake Energy continues to be downright dismal. And no, we’re not happy to say as much. We believe Carl Icahn deserves to lose every penny (and more) that he invested in the company in return for the mass firings he instigated through his chosen tool Doug Lawler. However, there are still a lot of good people who work at Chessy–and a lot of landowners who depend on Chesapeake drilling on and under their property (that is, when they pay fair royalties). It is in no one’s best interests to see Chesapeake file for bankruptcy. Yet increasingly, that’s the scenario being whispered (see Chesapeake Energy Faces Bankruptcy if Noteholders Don’t Cooperate). Chesapeake faces a deadline tomorrow with noteholders. If they don’t successfully seal the deal and get a majority of those noteholders to exchange their existing notes for new notes–let’s just say the alternative is not pretty…
    Read More “Chesapeake Energy Races to Exchange Notes Before the Ball Drops”

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    Cabot O&G Attorney Sells $97K of Company Stock

    From time to time MDN brings you news of a company’s top management either buying (preferred, from our perspective) or selling (not so preferred) shares of company stock. We figure it’s a good sign when the people who run the company believe in it enough that they plunk down their own coin to buy shares of it. We should hasten to add selling company stock is not necessarily a bad sign or indicator of a lack of confidence. People have lives and need money: kids to put through college, renovations to the house, Christmas debt to pay off, etc. This latest buying/selling incident is one in which a top officer is *selling* stock. Cabot Oil & Gas’ General Counsel, George Cunningham, sold 5,670 shares of company stock on Monday for a total price of $97,297.20…
    Read More “Cabot O&G Attorney Sells $97K of Company Stock”

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    DOE Study: More LNG Exports Don’t Mean Higher Prices at Home

    What would happen if the U.S. increased LNG (liquefied natural gas) exports from 12 billion cubic feet per day (Bcf/d) to 20 Bcf/d? A new report just published by the Dept. of Energy and researched by Rice University and Oxford Economics, titled “The Macroeconomic Impact of Increasing U.S. LNG Exports” (full copy below) finds that although prices for U.S. consumers may go up a little, what would happen is that the production pie would grow and most of the delta (the difference between 12 and 20 Bcf/d) would come from new production. In other words, it’s a win/win. More jobs, more money flowing into the U.S., while at the same time very little rise in gas prices here at home–even if we ratchet up exports significantly…
    Read More “DOE Study: More LNG Exports Don’t Mean Higher Prices at Home”

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    Duke U Study: Property Values Drop When Marcellus Drilling Begins

    Once or twice a year anti-fossil fuel “researchers” at Duke University issue another “publish or perish” term paper that takes aim at the Marcellus/Utica and call it a study. A few weeks ago the latest in a string of such biased reports was issued by Duke–this one claiming that property values go down when Marcellus Shale drilling comes to a community. Three researchers wrote the report. One of the researchers is from the Environmental Defense Fund (EDF). The EDF is as anti-drilling as any of the far-left enviro-Nazi groups like the Sierra Club, Food & Water Watch, various Riverkeepers, et al. But the EDF usually tries to work with the industry, which often ostracizes them from the kooks on their left. It’s disappointing to see the EDF piling on in this latest sham study. The study is titled, “The Housing Market Impacts of Shale Gas Development” (full copy below). The problem for this study is that there are numerous other studies that look at property values and conclude the opposite–that property values go UP when drilling comes to an area. When you dig in to the the Duke study you’ll find that in some cases they did find property values increased, and other cases values decreased. We bring you this study to prepare you for the onslaught of sycophantic mainstream media stories that will mention it a time or two and then move on–typical “drive by” misinformation from the media where truth is the casualty…
    Read More “Duke U Study: Property Values Drop When Marcellus Drilling Begins”

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    Scranton Newspaper Supports Stealing Gas Money for Philly

    It shouldn’t surprise anyone that the Democrat-controlled Scranton Times-Tribune doesn’t like the fair impact fee collected on Marcellus drilling in the state and instead prefers an unfair severance tax. It certainly doesn’t surprise us that they they think in such a twisted way. After all, 60% of the impact fee stays local and out of the hands of Harrisburg politicians. That’s just not “right” in Democrat-land. The other 40% that does go through the sticky fingers of Harrisburg politicians isn’t “enough” for good Lib Dems like those who control the Times-Tribune. So in their latest editorial, the Times-Tribune fans the flame of PA Democrat Auditor General Eugene DePasquale’s investigation into the industry in tracking down the “missing” $30 million of impact fee money (see PA Auditor General to Investigate “Lost” $30M Marcellus Impact Fee). True to Lib Dem form, the Times-Tribune wants DePasquale to go far beyond a simple investigation. They want DePasquale to somehow override the will of the legislature, and the residents of Pennsylvania, and extra-Constitutionally change the tax structure–throwing out the impact fee and instead slapping a nose bleed severance tax on the industry. That’s their preferred outcome. It will produce more money (so they reason) for them to play with and hand out to welfare slugs in “struggling urban areas” who keep voting for them…
    Read More “Scranton Newspaper Supports Stealing Gas Money for Philly”

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    Art Berman’s Peak Oil Theories, Again

    Art Berman seems to have learned an important lesson from Barack Hussein Obama. When somebody points out the flaws in your policies and theories, just double and triple down and keep repeating said theories all the more. That’s what Art Berman does with his discredited “peak oil” theory. You know, the theory that the world is about to run out of oil and that oil will continue to get more and more expensive (and scarce) until it is either too expensive to use or just plain gone. Nightmarish stuff. Keeps little boys and girls who watch Captain Planet up at night. And then the shale energy revolution hit and all of Art’s theories went out the door. Except he’s still pedaling his debunked theories, twisting and turning them–even recanting them (“Peak oil is not about running out of oil”)…
    Read More “Art Berman’s Peak Oil Theories, Again”

  • Happy New Year! MDN Off Until Jan. 4; Our 2016 Prayer 4U

    happy new year 2016MDN will not publish on Dec. 31 or Jan. 1. We will be back on Monday, Jan. 4. MDN’s prayer for you in 2016 is this:

    May all of your land get leased (for obscenely high signing bonuses and royalty rates); may all of your drilling units get drilled on; may drilling rigs pop up like spring crocuses, providing jobs and new royalty income; may new pipelines pop up like summer dandelions, connecting hundreds and thousands of new wells; may all of those pipelines be filled to capacity; may the price of natural gas double in the New Year; may at least one ethane cracker plant receive a Final Investment Decision; and may 2016 be the safest year ever–with no fatalities in the oil & gas patch. Amen.