Marcellus Drilling News

Energy Companies | Gulfport Energy | Utica Shale

Gulfport Energy Releases Other Half of 2Q15 Update – the Bad News
August 7, 2015August 7, 2015

Last week Gulfport Energy, with some 243,000 acres of Utica Shale leases, released half of their second quarter update (see Gulfport Releases Half of 2Q15 Update – The Good News Part). This week they released the full update, the other half dealing with the financial aspects of the company. Like other drillers across the country, Gulfport’s net income (after expenses, accounting this and that, taxes) took a big hit. They lost $31.3 million in 2Q15 vs making $47.9 million in 2Q14. The good news is that Gulfport remains active in the Utica–they plan to have drilled between 49-55 new Utica wells by the end of 2015…
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Carrizo Oil & Gas | Energy Companies

Carrizo O&G 2Q15: No New Utica Drilling, but Production Goes Up
August 7, 2015August 7, 2015

Carrizo Oil & Gas released their second quarter update yesterday. Carrizo has operations in both the Marcellus and Utica–although the Utica seems to be where they are concentrating their efforts in the northeast. At the beginning of the year Carrizo said they would not do any new drilling in the northeast, instead concentrating on the Eagle Ford Shale in Texas (see Carrizo Cuts Budget 35%, No Drilling Planned in Utica/Marcellus in 2015). The latest update shows the company to be following that strategy. Although there has been no new drilling, Carrizo did bring several previously drilled Utica wells online for sales, boosting their production in the Utica. Carrizo’s Marcellus production was roughly flat with 1Q15 production with nothing new planned for the Marcellus. Below are the relevant portions of the update dealing with the Utica/Marcellus…
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Energy Companies | Gastar Exploration

Gastar 2Q15: No New Marcellus/Utica Wells, Production Increased Anyway
August 7, 2015August 7, 2015

Gastar Exploration, with a small but meaningful drilling program in both the Marcellus and Utica Shale (~46,700 net acres leased) filed their second quarter update yesterday. As we reported after their 1Q15 update, Gastar isn’t drilling any new Marcellus wells for the balance of 2015, instead concentrating new drilling on the Midcontinent drilling program (see Gastar 1Q15: NE Production Up 5%, No New Marcellus Wells in 2015). Even though Gastar didn’t drill anything new in the northeast over the past three months, production from the Marcellus for Gastar continued to climb because of previously drilled and completed wells. Gastar, like almost all other North American drillers, took a huge net loss on income during 2Q15 largely due to assets being devalued due to the price collapse. In other words, it wasn’t actual money they lost, but money on paper. Below is the brief update from the 2Q15 update on Gastar’s Marcellus program, along with their most recent investor presentation. MDN has hacked apart the long PowerPoint to show you only those bits related to the Marcellus/Utica (and there are some good slides in there)…
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Energy Companies | Seneca Resources

National Fuel Gas/Seneca Res. 3Q15: Marcellus Production Down 12%
August 7, 2015August 7, 2015

National Fuel Gas Company, a large Buffalo-based utility with subsidiaries active in drilling and midstream, released their third quarter (everybody else’s second quarter) financial and operating results yesterday. National Fuel Gas is the parent of Marcellus driller Seneca Resources and midstream company Empire Pipeline. Sounding like a broken record, Seneca Resources, like just about every other driller in North America, had a horrible quarterly net income statement because of write-downs in the value of their assets–i.e. a paper loss (not an actual cash loss). Unlike many other drillers, Seneca’s Marcellus production was down year over year by 12%–presumably from lack of drilling and completing new wells. Below we have the scoop on National Fuel’s drilling/upstream operations (Seneca Resources), and on their pipeline/midstream operations (Empire Pipeline & National Fuel Gas Midstream), along with a snapshot of their production numbers, broken out by oil/gas and by region…
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Energy Services | Summit Midstream

Volume Steady in Mountaineer Midstream’s WV Pipeline @ 547 MMcf/d
August 7, 2015August 7, 2015

Summit Midstream has a small but growing presence in the Marcellus/Utica region largely through purchasing pipeline systems from other companies (see our list of Summit stories here). Yesterday the company issued its second quarter 2015 financial results. Below is a financial update for Mountaineer Midstream, Summit’s Marcellus-area pipeline system in Doddridge County, WV. Of note, volumes of gas flowing through Mountaineer were down 0.9% from 1Q15. In essence, volumes are steady through the pipeline at 547 million cubic feet per day (MMcf/d) on average…
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Best of the Rest

Marcellus & Utica Shale Story Links: Fri, Aug 7, 2015
August 7, 2015August 7, 2015

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:
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Accidents | Energy Services | Energy Transfer Partners | Industrywide Issues | Pennsylvania | Pipelines | Tioga County (PA)

Sad Day: Pipeline Worker Killed in Tioga County, PA Accident
August 6, 2015August 6, 2015

It’s always a sad day when MDN has to report on the death of a worker related to the Marcellus/Utica Shale. On Tuesday, Ricky Dettman was operating a bulldozer on a steep grade in Tioga County, PA working on installing a pipeline for Energy Transfer Partners when the bulldozer rolled over, several times, killing Ricky. We’re not sure exactly which pipeline project it is Ricky was working on, but its a 36-inch pipeline (a big pipeline) that will flow Marcellus and Utica Shale gas, according to the PR agency working for ETP. Below are four news accounts of the accident. They all have slightly different accounts, including a discrepancy on Ricky’s age–he was either 54 or 55 years-old. Ricky hailed from Nebraska…
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Energy Services | Industrywide Issues | Pipelines | Spectra Energy

Spectra Energy Provides Important Update for NE Pipeline Projects
August 6, 2015August 6, 2015

Spectra Energy, a major pipeline company with major operations existing and planned for the northeast, issued its second quarter 2015 update yesterday. For this review we’re leaving behind the financial talk. The thing that caught our eye is an update on Spectra’s pipeline projects in the Marcellus/Utica. In the update they tell us about the Uniontown to Gas City project, the OPEN project, the AIM project in New England, the NEXUS project, the Lebanon Extension project, the $3 billion Access Northeast project and several others. Across all of their pipeline projects, both in the northeast and elsewhere, Spectra Energy has an astounding $20 billion worth of projects currently in the works. By the end of this decade (by 2020) they will have spent an eye-popping $35 billion on new pipeline projects. Let’s get right into the good stuff–updates on important northeast pipeline projects in the Spectra portfolio…
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Energy Services | Industrywide Issues | Litigation | NEXUS Pipeline | Ohio | Summit County

NEXUS Pipeline Files Lawsuits for Survey Access in Summit County
August 6, 2015August 6, 2015

Yesterday MDN told you about the City of Green in Summit County, OH and their leaders’ opposition to (and lies about) the NEXUS pipeline (see NEXUS Pipeline Sends Armed Guards with Surveyors to Protect Them). NEXUS is sending out armed security guards with surveyors because they’ve been threatened. Apparently a number of landowners in Green are refusing to allow surveyors access to their property, so NEXUS is, today, filing lawsuits in Summit County to force landowners to allow surveyors on their property to make a simple survey for potential pipeline routes…
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Energy Services | Patterson-UTI

Patterson-UTI Active Rigs Finally Hits Bottom in July? Maybe
August 6, 2015August 6, 2015

Since March MDN has been watching the active number of rigs operated by Patterson-UTI Energy as a proxy for whether or not we’ve “turned the corner” on falling rig counts in the Marcellus/Utica. Patterson is a major drilling contractor with operations in the Marcellus/Utica region. In March, Patterson ran an average of 142 U.S. rigs and 4 Canadian rigs. In April, they ran an average of 131 U.S. rigs and 2 Canadian rigs. In May, Patterson ran an average of 122 U.S. rigs and 1 Canadian rig. In June, Patterson ran an average of 112 drilling rigs in the U.S. and one rig in Canada. What about July? The number in the U.S. slide by one, to 111 drilling rigs. But the number in Canada increased–back up to 4 active rigs operating. Have we finally hit rock bottom on the lay down of drilling rigs?…
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Energy Services | Industrywide Issues | NGLs | Pipelines | Sunoco Logistics

Sunoco Logistics has Best Quarter Ever, Thanks to Marcellus NGLs
August 6, 2015August 6, 2015

In contrast to the bad news we read in quarterly report after quarterly report for exploration and production (E&P) companies, i.e. “drillers”, it’s a starkly different story for some pipeline companies. Take Sunoco Logistics Partners, for example. Sunoco LP’s second quarter 2015 update boasts record earnings for 2Q15. That is, Sunoco LP made and distributed more profit to shareholders in 2Q15 than ever before. What was the “key contributor” to their growth, according to Sunoco LP’s CEO? The company’s three NGL (natural gas liquids) pipelines: Mariner West, Mariner South and Mariner East 1. Both the Mariner West & East pipelines are located in the Marcellus/Utica region. In addition to the rosy financial picture, we learn in the 2Q15 update that Sunoco LP has decided that the Mariner East II project will be two pipelines. We previously told you of Sunoco’s “tentative” plans to build two Mariner 2 pipelines (see Mariner East 2 Giving Birth to Twin Pipelines). Judging from the language in the Q215 update, tentative is sounding a lot more like definite…
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Energy Companies | Stone Energy

Stone Energy 2Q15: Increased % Ownership in Marcellus JV Wells
August 6, 2015August 6, 2015

Stone Energy, an independent oil and natural gas exploration and production company (E&P) headquartered in Lafayette, Louisiana drills mainly in the Gulf of Mexico but also has a presence in the Marcellus/Utica Shale. Earlier this year the company released the one active Marcellus rig they were running and said they would not resume drilling in the northeast until receiving a hybrid rig in late 2015/early 2016 that can drill both Marcellus and Utica wells (see Stone Energy 1Q15: No New Marcellus Drilling, But More Production). Stone issued their second quarter 2015 results yesterday. Interestingly, some of Stone’s joint venture partners elected not to exercise rights to own more of the wells drilled by Stone, leaving Stone with a higher percentage ownership for a number of Marcellus wells. Stone said they expect production in the Marcellus region (currently 144 MMcfe per day) to tapper off over the rest of the year because they aren’t drilling or completing any new wells. Even so, they expect 2015 production to exceed 2014 production in the northeast. Despite cost-cutting measures, Stone’s net income (which includes expenses), like that of so many other drillers across the country, took a dive in 2Q15–going from $4.4 million net income in 2Q14 to minus $152.9 million in 2Q15…
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Energy Services | Marathon Petroleum | MarkWest Energy

MarkWest Energy 2Q15: Operating Inc. Up 26%, Net Inc. Down 562%
August 6, 2015August 6, 2015

MarkWest Energy, the premier midstream (pipelines and processing plants) company in the Marcellus/Utica, issued their second quarter 2015 update yesterday. MarkWest, you may recall, is in the process of selling itself to Marathon Petroleum (see Midstream Bombshell: MarkWest Sells Itself to Marathon Petroleum). MarkWest shows a slight decrease of 11% in revenue from 2Q14 to 2Q15. But after expenses, income from operations actually went up 26% on record volumes flowing through their pipes and processing plants. But after you add in all of the accounting machinations including things like “loss on redemption of debt”, MarkWest had a net income loss of $86.4 million for the quarter (down 562% from 2Q14). However, that’s not what really interests us. What interests us is an operations update for the Marcellus and Utica regions and what this midstream giant has been up to…
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Crestwood Midstream | Energy Services

Crestwood Midstream 2Q15: Slight Net Loss; MARC II Still Alive
August 6, 2015August 6, 2015

Crestwood Midstream Partners issued their second quarter 2015 update yesterday. Unlike Sunoco Logistics Partners which generated and distributed the most money ever in a single quarter (see today’s Sunoco LP story), Crestwood experienced a net loss of $42 million over the same quarter last year. But when you dig deeper you find that $40 million of that was a devaluation of its assets on paper. In other words they only lost around $2 million of cash in operations. Compared to the deep hole drillers are in, Crestwood’s shortfall is nothing. Crestwood has operations in the Marcellus as well as several other major shale plays. One bit of news we noticed from this update: Crestwood “continues to move forward with customer discussions and preliminary design work for the 1.0 Bcf/d MARC II pipeline project to interconnect with the announced Penn East Pipeline project in 2017.” We first told you about the MARC II in October 2014 (see Crestwood Announces Successful Open Season for MARC II PA Pipeline). No mention in the 2Q15 update about the Seneca Lake propane storage project that is still, inexplicably, not approved by the NY Dept. of Environmental Conservation now going on six years…
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CONE Midstream | Energy Services

CONE Midstream 2Q15: Revenue & Net Inc. Almost Double
August 6, 2015August 6, 2015

CONE Midstream, the pipeline joint venture between CONSOL Energy and Noble Energy, is a small but growing company. Yesterday’s second quarter 2015 update shows both revenue and net income for the company just about doubled year over year between 2Q14 and 2Q15. Below is the good news update from CONE, with details about their expansion projects in southwestern PA and the northern panhandle of WV…
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Anti-Drilling/Fossil Fuel | Industrywide Issues | Regulation

The Hill: Obama’s “Love Affair” with Natural Gas is Over
August 6, 2015August 6, 2015

Further analysis of President Obama’s draconian new EPA Clean Power Plan rule that, if allowed to stand, will gut natural-gas fired electric generating plants in this country. The analysis comes from the left-leaning DC newspaper The Hill, which characterizes it this way: “President Obama’s love affair with natural gas is over.” They also note that the natural gas industry is “furious” at Obama’s betrayal. We have to ask: Were you really that dumb? Did you really believe Obama’s lying words when he said he (somewhat) supported natural gas like it was “the other white meat”? We never believed it–not for a minute. Here’s a cold splash of reality for those who still have a hard time believing that yes, Obama has just thrown natural gas under the bus…
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