Seventy Seven Energy Sells Frac Sand Subsidiary, Undisclosed Sum
Seventy Seven Energy (SSE), an oilfield services company with major operations in the northeast, is the old Chesapeake Oilfield Operating division of Chesapeake–spun off into its own company on July 1, 2014 (see Long Labor & Delivery: Seventy Seven Energy Born Yesterday). Each quarter we report on the performance of this public company, and each quarter it’s the same story: red ink (see our stories here). In May of 2015 Seventy Seven sold one of its assets, a trucking operation, in an effort to raise money (see Seventy Seven Energy Sells Trucking Subsidiary for Undisclosed Sum). Also in May the company secured a $100 million loan to stay afloat (see Seventy Seven Energy Secures $100M Loan to Keep on Drillin’). We’ve just learned that a few days before Christmas Seventy Seven sold off a Wisconsin frac sand operation. Like the trucking sale earlier this year, terms of the deal were not disclosed. In fact, Seventy Seven hasn’t said anything about the sale–it was the buyer, Emerge Energy Services, who issued a press release about it…
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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…
The price that physical natural gas is selling for–in December (winter!) no less–is enough to make grown men cry. And it does. While natgas prices for gas trading at the Henry Hub delivery point in southern Louisiana sold for an average of $1.89/Mcf yesterday, the price for gas trading at Dominion South (in the Marcellus Shale) was just 59 cents per Mcf–an historic low. Weather certainly has a lot to do with that price–but so does an overabundance of supply and lack of pipelines to carry that supply to other markets…