Time to follow the bouncing ball–this is a tad complicated, but we’ll do our best to explain it. In 2008, Chesapeake Energy (under then-CEO Aubrey McClendon) took on a “silent” investing partner for 600,000 net acres in the Marcellus of West Virginia and southwest Pennsylvania. The non-operating partner for the acreage was Norwegian company Statoil, with a 32.5% interest in the acreage. Statoil put up buckets of money and Chessy did the drilling. Fast forward to October of this year. Chesapeake cut a deal to sell most of that acreage–some 413,000 acres with 435 drilled wells (see Chesapeake Sells Close to 25% of Marcellus/Utica Operation). The buyer is Southwestern Energy. In order for the deal to close, Statoil has to sign on. Today, Statoil announced they have cut a deal with Southwestern to reduce Statoil’s now 29% interest in the acreage down to a 23% interest, in return for a $394 million check from Southwestern…
Read More “Statoil Reduces Marcellus Holdings in $394M Deal with Southwestern”
Pushing dirt around on drill pads can get very expensive if you don’t have a signed piece of paper in your hand that says, “Mother May I?” XTO Energy, the shale-drilling subsidiary of ExxonMobil, has just learned that the hard way. The federal Environmental Protection Agency (EPA) along with the U.S. Dept. of Justice announced a settlement yesterday with XTO–fining the company $2.3 million because “fill material” (i.e. dirt and rocks) got into nearby streams and swamps in several West Virginia counties when XTO pushed that dirt and rocks around to construct roads and well pads. Oh, and XTO has to “undo” the damage, spending another $3 million or so. Total price tag of $5.3 million for violating the “Mother May I?” Clean Water Act. If XTO had had the proper paperwork, they wouldn’t have been fined. The jack boots of the feds come down again…
Read More “XTO Paying $5.3M for Violating Federal Clean Water Act in WV”
The Pennsylvania Dept. of Environmental Protection has just slapped Vantage Energy with a $1 million fine for “more than a dozen violations of environmental regulations stemming from a landslide and illegal waste disposal at their Porter Street well pad in Franklin Township, Greene County, earlier this year.” The landslide at the well pad covered over portions of two nearby creeks. Then, to add insult to injury, about six months later two truckloads of frack wastewater got dumped on the landslide area being repaired. The wastewater ended up in the streams. But wait, there’s more! Vantage constructed a new access road next to the streams adversely affected–but Vantage didn’t have a permit to construct the road. Oy vey! Did they do anything right? According to the DEP, Vantage, “to its credit,” is making improvements in their procedures to prevent a future comedy of errors…
Read More “Vantage Energy Fined $1M for Multiple Errors at Greene County Site”
Seems that the Pennsylvania Dept. of Environmental Protection (DEP) has been busy clearing up outstanding cases of violations by both drillers and pipeline companies. In addition to a stiff $1 million fine against Vantage Energy yesterday (see our companion story), the DEP fined the Tennessee Gas Pipeline (TGP) $800,000 for violations in four different counties during pipeline construction for the 300 Line Project. TGP will pay a penalty of $210,000 and will fund a $540,000 clean-up program of illegal dumpsites in Pike, Potter, Susquehanna and Wayne counties. The details…
Read More “Tenn. Gas Pipeline Fined $800K for Violations, Illegal Dump Sites”
Last week MDN posed the question, In Light of NY Frack Ban, What Happens to Signed Leases? In that article, we also began to address the topic of lawsuits based on “takings”–the fact that New York has stripped away the right of a landowner to profit and use his or her land as he or she sees fit–including fracking under it–and those landowners are owed just compensation. Today we pick up that thread. What recourse do New York landowners have at this juncture, and what actions can they take next? Would a takings lawsuit have a prayer of a chance?…
Read More “Do “Takings” Lawsuits Stand a Chance for NY Landowners?”
A press release issued yesterday by Chesapeake Energy caught our interest. Chessy announced the closing of the deal we first announced back in October–a deal to sell some 413,000 Marcellus/Utica acres plus 435 already-drilled wells on that acreage to Southwestern Energy for $5.375 billion (see Chesapeake Sells Close to 25% of Marcellus/Utica Operation). Yesterday’s announcement says the deal is now done (see our related story today about Southwestern and Statoil), and that Chessy will use some of that money to buy back $1 billion worth of common stock, an effort to boost the company’s stock price. What’s interesting to us, aside from trying to make Carl Icahn’s stocks worth more, is how the details of the deal with Southwestern changed from October to now…
Read More “Chesapeake Using $1B from Southwestern Deal to Buy Back Stock”
A very small independent oil and gas company headquartered in Denver, CO, Hinto Energy (market cap of $5.4 million), issued a press release today to say they’ve drilled a shallow, conventional oil well in the Berea Sandstone of Ohio. A conventional driller targeting shallow rock layers is typically not something that catches our attention. The thing that does catch our attention is that Hinto is also eyeing other rock layers for the leases they own in Ohio–including the Utica Shale. Hinto has not previously drilled any horizontal shale wells, from what we can tell. It appears they didn’t even drill this conventional Ohio Berea well as their announcement states they will maintain a “75% non-operated interest” (i.e. ownership) in the well. Non-operated means they didn’t do the drilling. While this isn’t big news by any stretch, it is notable that yet another E&P is sniffing around the Ohio Utica…
Read More “Potential New OH Utica Driller First Drills Conventional Oil Well”
Another new pipeline on the way from Pennsylvania utility company UGI. This one will run from Lycoming County in north-central PA to Snyder County in central PA and bring abundant, cheap, clean-burning Marcellus Shale gas from NEPA to a site where a company is converting a former coal-burning electric generating plant into a natural gas electric plant, near the Shamokin Dam in Snyder County. UGI has submitted a pre-filing request to the Federal Energy Regulatory Commission (FERC) for the 35-mile pipeline–a project that will cost $150 million to build. Starting next month UGI will conduct an open season to sign up more customers for cheap Marcellus Shale gas. Here’s the details…
Read More “UGI Pre-Files with FERC for New Marcellus Pipeline in Central PA”
How could two liberal, eastern states review the science of fracking and make opposite decisions about whether or not to proceed? That question has been rolling around our heads since last week. MDN even mentioned it in passing–that just a few weeks ago outgoing liberal Democrat Gov. Martin O’Malley (Maryland) has given fracking the green light in his state (see Maryland Gets Ready to Frack! Gov O’Malley Files New Regulations). But last week, liberal Democrat Gov. Andrew Cuomo (New York) put the brakes on fracking in his state (see After 6+ Years, Andrew Cuomo Bans Fracking in New York). Two different states, same “science” reviewed–why the difference? A (surprisingly) well-written article in the Washington Post tackles and answers that question…
Read More “Why Did Maryland Decide to Allow Fracking but New York Didn’t?”
Some anti-drilling, anti-pipeline folks who live in Lancaster County, PA complained to their Congressman, U.S. Rep. Joe Pitts, about the proposed Williams pipeline project Atlantic Sunrise that will come through their area. Following the November election in which Pitts was re-elected, a Pitts staffer responded to several of them, calling them up to discuss the project and tell them why they ought to allow Williams to survey their property. NEVER talk common sense to an anti-driller. So the anti-drillers conscripted the local newspaper to turn the story around and make it seem like the Pitts staffer is engaged in illegal lobbying for Williams…
Read More “Lancaster Congressional Staffer Calls Anti-Pipeliners – Big Mistake”
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: Tue, Dec 23, 2014”
More evidence to support what MDN has been telling you: That nutjob anti-fossil fuelers are using the New York decision to ban fracking in an attempt to bully other states (see Anti-Drillers Seek Domino Effect in More States After NY Frack Ban). Three odious groups are behind much of this bullying: Food & Water Watch, Earthjustice and the National Resources Defense Council. Notice which “network” they run to for rebroadcast of their pap–the anti-American, terrorist-loving Al Jazeera. Also notice that before the NY ban these same people said there isn’t all that much of an economic benefit for fracking in NY. No reason to frack in NY, no one would make any money on it. Now that the ban is in place? They say fracking in NY would have been “a financial boon for the state” which makes Cuomo’s decision “momentous.” It’s called talking out of both sides of a lying mouth…
Read More “Anti-Drillers Continue to Use NY Decision to Bully Other States”
There is ongoing fallout from New York Gov. Andrew Cuomo’s political decision to disallow fracking during his tenure as governor (an act that disqualifies him from running for national office). Farmers in the Southern Tier of NY are weighing in on Cuomo’s political decision, and they’re none too happy:
Read More “NY Farmers to Cuomo on Frack Ban–You Gave us the Shaft”
The most compelling “let the science decide” reason for banning fracking in NY given by Gov. Andrew Cuomo? Because his hand-picked Commissioner of the Dept. of Health, Howard Zucker, said he wouldn’t let his own kids play outside near a fracking site. If you actually read the biased report filed by Zucker, you find the following: a) Zucker says there are no scientific conclusions, as of yet, that fracking harms “public health”–he clearly admits it, and b) he laundry lists a bunch of “studies” and reports that are not peer reviewed, not published, and funded by anti-drilling groups to disparage fracking. He overlooked and left out published, peer reviewed studies that say fracking doesn’t harm people. That is, Zucker stacked the deck, he loaded the dice–whatever metaphor you want to use. The outcome was predetermined (a political decision by Cuomo) and Zucker prostituted himself and has permanently damaged his own reputation by being the “fall guy” for Cuomo’s decision. We expect it’s a quid pro quo–Zucker finds against fracking in return for moving from “Acting” Commissioner to full Commissioner at the DOH–a job he’s clearly not qualified for. Keep an eye out for Zucker’s permanent appointment in the near future. When you see it, you’ll know the fix was in…
Read More “NY Health Dept Fracking Report Based on Anti-Drilling “Research””
New York state representatives and local town leaders from upstate NY are almost universally critical of New York Gov. Andrew Cuomo’s political decision to ban fracking. According to elected leaders, Cuomo has just screwed upstate in a big way. They also point out the complete reversal in Cuomo’s position from just one year ago when he embraced using fracked natural gas in western NY…
Read More “Upstate NY Politicians Criticize Cuomo over Frack Ban”
We sincerely wish our readers a Merry Christmas! Thank you for your support (moral and financial). We will take the next two days off and be right back on Monday, Dec. 29 to catch you up on all of the latest Marcellus and Utica Shale news. Now go have some eggnog!