Marcellus Drilling News

Belmont County | Energy Companies | Greene County (PA) | Ohio | Pennsylvania | Rice Energy | Washington County

Rice Energy 1Q15 Earnings Call: 100% Focused on 3 Counties
May 11, 2015May 11, 2015

Last Friday MDN brought you the Rice Energy first quarter 2015 update (see Rice Energy Doubles Production 1Q15; Utica Flows; Ekes Out a Profit). On Friday, Rice’s upper management held an earnings call with analysts and as always, quite a bit more comes out in the call than in the official press release. Below is Rice Energy CEO Dan Rice’s prepared remarks on that call with some interesting details on both their Marcellus and Utica operations. Among the interesting comments: Rice is 100% focused on just three counties in the Marcellus/Utica…
Read More “Rice Energy 1Q15 Earnings Call: 100% Focused on 3 Counties”
Butler County | Carroll County | Energy Companies | Lawrence County | Ohio | Pennsylvania | Rex Energy

Rex Energy to Sell Acreage in OH & PA, Focus on 3 Counties
May 11, 2015May 11, 2015

Last week MDN brought you the first quarter 2015 update for State College, PA-based Rex Energy (see Rex Energy 1Q15: Production Up 61%, Revenue Down 33%, Gulf Coast Deal). Rex’s management held an earnings call later that day, and as is typical, a some important news was revealed on that call that was not included in the press release update. Namely, Rex is looking to sell it’s leased Utica Shale property in Belmont, Guernsey and Noble counties in Ohio. They also plan to sell leases in Westmoreland, Clearfield, and Centre counties in PA. When it’s all over and done, Rex will be concentrating on just three counties…
Read More “Rex Energy to Sell Acreage in OH & PA, Focus on 3 Counties”
American Energy Partners | Belmont County | Energy Companies | Lease & Royalty Payments | Ohio | XTO

Another Belmont County Landowner Threatened with Forced Pooling
May 11, 2015May 11, 2015

In April MDN told you about a landowner in Belmont County, OH who had questions and objections to phrasing in a proposed lease agreement from XTO Energy that talks about “nuisance oil” (see XTO Threatens Belmont County, OH Landowner with Forced Pooling). NEVER sign a lease without running it by a competent oil & gas attorney, and ALWAYS get the sometimes obscure terminology in a lease explained before you sign it. That’s our advice. We have another story along the same lines as the “nuisance oil” story–language that energy companies can’t or won’t explain to landowners. This one also comes from Belmont County, OH–perhaps the hottest of the hot places for drilling right now in the Utica Shale. A landowner from Martins Ferry, OH says XTO offered him an eye-popping $8,000 per acre signing bonus with 20% royalties, and Aubrey McClendon’s American Energy Partners offered $6,000 per acre with 20% royalties. Both have a “market enhancement clause” in the lease. The landowner didn’t like the clause, fearing it would reduce his royalties. The landowner was told by either XTO or AEP or both (we’re not sure), that they would force pool him if he didn’t sign. By force pooling him he would not get a signing bonus at all and only a 12.5% royalty. These kinds of strong-arm tactics give the industry a black eye in our opinion…
Read More “Another Belmont County Landowner Threatened with Forced Pooling”
Blue Ridge Mtn Res/Magnum Hunter | Energy Companies | Energy Services | Eureka Midstream

Magnum Hunter 1Q15: Prod. Up 66%, Financials Worse Than Expected
May 11, 2015May 11, 2015

Magnum Hunter Resources, now a pure play company focused on the Marcellus and Utica Shale region, released their first quarter 2015 update this morning. On the positive side we learn that production as up a healthy 66% in 1Q15 vs 1Q14. Production costs–how much it costs to produce the natural gas/oil/liquids, went down a big 36% year over year. And Magnum Hunter now owns ~80,000 net acres located in the Marcellus Shale and ~130,000 net acres located in the Utica Shale. Eureka Hunter, the company’s pipeline subsidiary, had new record high throughput volumes. But on the downside the company lost $0.57 per share. The “consensus” estimate was that they would lose $0.32 per share, so the performance of the company financially, if you want to think of it this way, was roughly twice as bad as Wall Street watchers thought it would be. Look for the stock price, which (before the opening) was trading at $1.86 per share–well off the typical $8 per share or so over the past year–to take a further beating…
Read More “Magnum Hunter 1Q15: Prod. Up 66%, Financials Worse Than Expected”
Energy Services | Industrywide Issues | Pennsylvania | Pipelines | Spectra Energy | Statewide PA

More Marcellus Gas for Philly: Texas Eastern Pipeline Expansion
May 11, 2015May 11, 2015

A new pipeline expansion project that will bring more cheap, abundant and wholesomely fracked Marcellus Shale gas to the Philadelphia, PA area was announced late last year by Spectra Energy–and somehow it escaped our notice! The Greater Philadelphia Expansion Project will not involve building any new greenfield pipeline but rather will expand (using larger diameter pipes and looping new pipes next to existing pipes) for the Texas Eastern pipeline that already serves the Philly area. Currently, the Texas Eastern pipeline delivers 550,000 dekatherms per day (Dth/d) of natural gas into the greater Philadelphia region (roughly 550 million cubic feet per day). The expansion will add an additional 475,000 Dth/d (or 475 Mmcf/d)–nearly doubling capacity. The open season–the time when customers can officially sign contracts to reserve capacity–ended last Friday. No word yet on how that went. According to Spectra Energy, this is very early days yet in the life of this proposed project. Below we have more details about the project along with a map…
Read More “More Marcellus Gas for Philly: Texas Eastern Pipeline Expansion”
Energy Companies | Energy Corporation of America | Energy Services | WGL Holdings

Washington Gas $126M Deal to Bring Marcellus Gas to DC Suburbs
May 11, 2015May 11, 2015

Washington Gas, a natural gas utility serving customers in Washington, DC, Maryland and Virginia, announced a deal last week to purchase Marcellus Shale natural gas directly from 22 producing wells in Pennsylvania to be used to sell to Washington Gas’ customers in Virginia. Yes, some of that cheap, abundant and wholesomely fracked Marcellus Shale gas will be going to the Washington, DC suburbs. The deal is with Energy Corporation of America (ECA) for $126 million and runs for 20 years. It is the first such deal under a new 2014 Virginia law that allows such investments. Here’s the details…
Read More “Washington Gas $126M Deal to Bring Marcellus Gas to DC Suburbs”
Beaver County | Energy Companies | Ethane | Industrywide Issues | Pennsylvania | Processing Plants | Shell

Shell to Close on PA Cracker Plant Property in “Next Few Months”
May 11, 2015May 11, 2015

Last week we told you a positive sign that the proposed $2-$3 billion ethane cracker plant to be built by Shell in Monaca (Beaver County), PA was the joint information session recently held by the Dept. of Environmental Protection and Shell to discuss an air quality permit the DEP will issue for the project (see Progress: DEP & Shell Hold Info Session on PA Cracker Plant). Here’s yet another very encouraging sign: Horsehead Corporation, which still owns the site Shell would use to build the plant, said in their first quarter update that they expect to close on a sale of the property to Shell “within the next few months”…
Read More “Shell to Close on PA Cracker Plant Property in “Next Few Months””
Hydraulic Fracturing | Industrywide Issues | Regulation | Statewide VA | Virginia

Virginia AG Says Localities Can “Regulate” & “Prohibit” Fracking
May 11, 2015

Apparently Virginia’s Attorney General, Mark Herring, believes every county and town in the Old Dominion is populated with oil and gas experts. How else could he issue an advisory opinion that, in his opinion, every municipality in the state has the authority to regulate and/or prohibit fracking within its jurisdiction? Every other oil and gas producing state, save a bad decision made by New York’s highest court, says oil and gas regulation is solely under the purview of the state–and for good reason. The state employs oil and gas experts who know what they’re doing–what’s safe and what isn’t. How the process works. What pollutes and what doesn’t pollute. But AG Herring has thrown that out the window in Virginia…
Read More “Virginia AG Says Localities Can “Regulate” & “Prohibit” Fracking”
Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | PennEast Pipeline | Pennsylvania | Pipelines | Statewide PA

The Fight to Build the PennEast Pipeline: Arguments For & Against
May 11, 2015May 11, 2015

About a month ago MDN editor Jim Willis granted an interview with Kevin Mooney, on assignment writing for The Daily Signal, a publication of arguably the top conservative think tank in the country–the Heritage Foundation. Kevin wanted to talk about the PennEast Pipeline and the controversy surrounding what should be a straightforward and non-controversial project. These days anything to do with fossil fuels is being opposed by the likes of the Sierra Club and (in the case of the PennEast), regional anti-drilling groups like THE Delaware Riverkeeper–a group now being investigated by pro-drillers for possible violations of ethics laws in their dealings with the Delaware River Basin Commission. Kevin not only talked with MDN, he also spoke to Tom Shepstone of the always excellent Natural Gas Now, and Nicole Jacobs from the excellent Energy in Depth–both good friends of MDN’s Jim Willis. Kevin got the other side of the story too–from none other than Maya van Rossum, who is THE Delaware Riverkeeper herself (see Delaware Riverkeeper Gets a French Kiss from Phila. Inquirer). Kevin turns in a well-balanced and useful overview of the fight to build the PennEast. What are the arguments for it, and against it? We bring you Kevin’s article here…
Read More “The Fight to Build the PennEast Pipeline: Arguments For & Against”
Anti-Drilling/Fossil Fuel | Athens County | Columbia Pipeline Group | Energy Services | Industrywide Issues | Ohio | Pipelines

Ohio Univ to Get New Natgas Pipeline from Columbia Gas This Year
May 11, 2015May 11, 2015

Here’s a fact: So-called “sustainable” forms of energy like solar, wind and geothermal cannot, by themselves, provide all of the electric needs for a huge university like Ohio University, situated on an 1,850 acre campus in Athens, OH. Right now OU uses coal to meet its electric generating needs. They want to replace it with natural gas. But get this, ninny nanny “environmentalists” don’t like that idea. They’d rather have OU continue to burn dirty coal rather than build a pipeline to the campus and have the campus change over to natural gas. Which perfectly illustrates another fact: “environmentalist” opposition to natural gas springs from a twisted ideology and irrational hatred of fossil fuels, rather than concern for the environment or concern for the air people breathe…
Read More “Ohio Univ to Get New Natgas Pipeline from Columbia Gas This Year”
About MDN | Calendar

Calendar of Events for May 11 – Aug 10 (90 Days)
May 11, 2015May 11, 2015

Below are upcoming events for the next three months (90 days). To see the full list of future events, visit this page: //marcellusdrilling.com/calendar/.

NOTE: To have an item included, please email it to: calendar@marcellusdrilling.com.
Read More “Calendar of Events for May 11 – Aug 10 (90 Days)”
Best of the Rest

Marcellus & Utica Shale Story Links: Mon, May 11, 2015
May 11, 2015May 11, 2015

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:
Read More “Marcellus & Utica Shale Story Links: Mon, May 11, 2015”
CNG/LNG | Dominion Energy | Energy Services | Exporting | Industrywide Issues | Litigation | Maryland | Regulation | Statewide MD

DOE Grants Cove Point LNG Final Approval, Earthjustice Sues
May 8, 2015May 8, 2015

We have two big pieces of news to share with you today about the Cove Point, Maryland LNG export facility being built by Dominion. The first is that yesterday, after a years-long process, the Obama Dept. of Energy finally gave Dominion their final stamp of approval to build the facility. Last month we pointed out this last piece of the puzzle still had not fallen into place (see Cove Point LNG Plant STILL Waiting for Final DOE Approval?!). It now has. There is nothing else in the way to stop the project. Except, possibly, a lawsuit–which is the second big piece of news. On Wednesday we told you that the Federal Energy Regulatory Commission had finally, this week, responded to a request for a re-hearing on the facility demanded by anti-drilling groups. FERC declined (see FERC Says “No” to Anti’s Request for Cove Point LNG Re-hearing). As we explained on Wednesday, the groups needed an official response from FERC on a re-hearing before they could launch yet another frivolous lawsuit. As we predicted on Wednesday, they’ve now filed a frivolous lawsuit in another last-gasp attempt to stop the Cove Point export facility from becoming reality…
Read More “DOE Grants Cove Point LNG Final Approval, Earthjustice Sues”
Anti-Drilling/Fossil Fuel | Crestwood Midstream | Energy Services | Industrywide Issues | New York | Regulation | Schuyler County | Statewide NY

NY DEC Signals Support for Seneca Lake Propane Storage Project
May 8, 2015May 8, 2015

A little good news coming from New York State for a change. The state’s Dept. of Environmental Conservation (DEC) has “quietly” given its support to the Crestwood Midstream plan to use a depleted salt cavern along the shores of Seneca Lake to be used as a propane storage facility. We’ve written about this before–about the very safe plan to use it in this manner, and about protesters like Sandra Steingraber who seem to enjoy trips to the county jail for blocking the facility, repeatedly (see Steingraber, 2 Others Sent to Jail for Refusing to Pay Fine). In February an “issues conference” was held before an administrative law judge where testimony was given by both sides–Crestwood Midstream and anti-drillers. The anti-drilling side is being funded by the odious Earthjustice and National Resources Defense Council (NRDC). The DEC has sent a brief (full copy below) saying, in essence, (a) those against the project haven’t proven this facility would bring about environmental Armageddon, as they say it would, (b) some of the loonies opposing it don’t even have standing to oppose it, and (c) no more hearings are required. The only continuing reservation we have, and the reason we’re not celebrating just yet, is that the person who will make the ultimate decision is the head of the DEC, the anti-drilling Joe Martens, a man deeply in the pocket of Big Green…
Read More “NY DEC Signals Support for Seneca Lake Propane Storage Project”
Chesapeake Energy | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Litigation | Marshall County | Ohio County | West Virginia

Wheeling Non-Profits Sue Chesapeake for Taking O&G with No Lease
May 8, 2015May 8, 2015

A group of non-profit organizations in the Wheeling, WV area is suing Chesapeake Energy claiming the company illegally stole oil and natural gas from underneath their property without a valid lease. The Parks System Trust Fund of Wheeling, Ohio Valley Medical Center, Elmhurst House of Friendship, Vance Memorial Presbyterian Church, the Children’s Home of Wheeling and the YWCA are all joint owners of 224 acres bequeathed to them in 1957. The groups say Chesapeake illegally pooled their acreage with others in a local drilling unit and proceeded to extract oil and gas without paying them…
Read More “Wheeling Non-Profits Sue Chesapeake for Taking O&G with No Lease”
Energy Companies | Energy Services | Rice Energy | Rice Midstream

Rice Energy Doubles Production 1Q15; Utica Flows; Ekes Out a Profit
May 8, 2015May 8, 2015

Rice Energy, a driller focused on the Marcellus and Utica Shale region, released their first quarter 2015 update yesterday. Counter to most others, Rice was actually able to eke out a gain of $152,000 for 1Q15 (most others, in fact we think all others, experienced a loss in 1Q15). Of course that’s down radically from 1Q14 when the company made $129.5 million! But still, they ended up on the positive side of the balance sheet. The big news was that Rice more than doubled their production in 1Q15 from a year ago–to an average 440 million cubic feet equivalent per day (Mmcfe/d). Unlike last year, this year 15% of Rice’s production came from the Utica Shale (last year it was 0%). Rice’s midstream division continues to experience strong growth as well–by volumes shipped and by revenue. Below we have Rice’s update yesterday, links to several stories analyzing Rice’s results, and a copy of the newest PowerPoint slide deck, used by Rice management on their earnings call with analysts…
Read More “Rice Energy Doubles Production 1Q15; Utica Flows; Ekes Out a Profit”