Marcellus Drilling News

Chesapeake Energy | Energy Companies | Lease & Royalty Payments | Southwestern Energy | Statewide WV | West Virginia

Southwestern Paid Chesapeake $12K/Acre for Land Signed @ $5/Acre
December 29, 2014December 29, 2014

Last week MDN told you that Chesapeake Energy closed on a deal to sell some 413,000 Marcellus Shale acres, mostly in West Virginia (some in Pennsylvania) to Southwestern Energy (see Chesapeake Using $1B from Southwestern Deal to Buy Back Stock). The deal ended up being worth $4.975 billion, discounted from the original $5.375 billion because Southwestern agreed not to sue Chessy for “title defects” when and should that occur. As we said at the time, we’re not sure if a $400 million discount is a good deal or not in the case some of the titles to leases aren’t free and clear. But the bigger story, in our humble opinion, is this: Chesapeake picked up some of those leases that originally paid landowners as little as $5 per acre and as much as $5,000 per acre. They just turned around and sold those same leases for $12,000 an acre. That made corporate raider Carl Icahn, Geppetto pulling the strings at Chesapeake, really really happy…
Read More “Southwestern Paid Chesapeake $12K/Acre for Land Signed @ $5/Acre”
Hydraulic Fracturing | Industrywide Issues | New York | Public Opinion | Regulation | Statewide NY

Q Poll: Majority of New Yorkers Support Cuomo’s Frack Ban
December 29, 2014December 29, 2014

If we New Yorkers are ever to one day see shale drilling and fracking in the Empire State, we must face the truth squarely in the face. We must be willing to admit to ourselves what the facts are (relative to the PR war we are in) and move on from there. A Quinnipiac University poll conducted shortly after Gov. Cuomo’s ignominious decision to ban fracking throws a bucket of cold water in our collective faces and is a wake-up call for those of us who support drilling (which is the correct and righteous position on this issue). The poll, conducted statewide, shows that NY state voters approve of Cuomo’s decision to ban fracking by a margin of 55% to 25% who oppose his decision. Republicans, sadly, support his decision by 42% with 40% opposed, and Democrats are simply in lock-step mode (they don’t think for themselves anymore, too much hassle): they support the man-child’s decision by 67% to 11% against the decision. Not one single party, gender, age or regional group had a majority that disapproved of Cuomo’s decision to ban fracking. That’s the bad news. Here’s the good news…
Read More “Q Poll: Majority of New Yorkers Support Cuomo’s Frack Ban”
Eclipse Resources | Energy Companies

Eclipse Resources Gets $440M from New Stock, Trims 2015 Capex 20%
December 29, 2014December 29, 2014

Some important news today from Eclipse Resources, an exploration & production company focused solely on the Marcellus and Utica Shale region. Eclipse reports raising $440 million in cash in a “private placement” of 62.5 million shares of common stock. The purchasers are EnCap Investments and certain members of the Eclipse management team. The company is also reporting they will lop off 20% of their capital expenditure (capex) budget in 2015 from 2014 levels–with a plan to spend $640 million on new drilling and associated activities. The Eclipse drilling mix is 60% natural gas, 20% oil & condensate, and 20% natural gas liquids…
Read More “Eclipse Resources Gets $440M from New Stock, Trims 2015 Capex 20%”
Energy Companies | Ethane | Industrywide Issues | Reliance Industries

Marcellus Ethane will Head to India Aboard 6 New Japanese Ships
December 29, 2014December 29, 2014

You may recall that all of the LNG (liquefied natural gas) that will be produced at the under construction export facility in Cove Point, Maryland will be sold to two countries: Japan and India (see Dominion’s Cove Point LNG Facility Achieves Important Milestones). Japan and India are teaming up again–but this time it’s for America’s ethane instead of methane. Reliance Industries Ltd., India’s single largest company of any kind (conglomerate that includes oil and gas drilling) has ordered up 6 Very Large Ethane Carriers (VLECs) for an undisclosed sum from Japanese company Mitsui. The VLEC ships will transport some 1.5 million tons of ethane per year to India, where it will be used to feed Indian ethane cracker plants. Since RIL has two joint ventures in the Marcellus, it’s a safe bet that some of that exported ethane will be coming from the Marcellus…
Read More “Marcellus Ethane will Head to India Aboard 6 New Japanese Ships”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Ohio | Regulation | Statewide OH

Water Withdrawals from Creeks Next Point of Attack for Antis in OH?
December 29, 2014December 29, 2014

Are water withdrawals the next point of attack for anti-drillers in Ohio? Perhaps. We noticed an interesting story where a pair of elected Democrats (one from the Ohio House, one from the Ohio Senate) are making noise about the drilling industry’s unrestricted right to withdraw water from creeks as long as they report it to the Ohio Dept. of Natural Resources (ODNR). The Dem politicians seem to be saying they would like to slap a new law in place to limit (or disallow) water withdrawals…
Read More “Water Withdrawals from Creeks Next Point of Attack for Antis in OH?”
Hydraulic Fracturing | Industrywide Issues | New York | Regulation | Statewide NY

WashPo: NY Gov Cuomo “Ignoble”; Wrong on Frack Ban
December 29, 2014December 29, 2014

The Washington Post, one of the more liberal newspapers in the country and self-appointed arbiter of national news, released an editorial (penned by their very own reporters/editors) that floored us. The Post editorial says fracking is OK when done right, and New York Gov. Andrew Cuomo screwed up with his decision to ban fracking. Duck down! Was that a flock of pigs flying by?…
Read More “WashPo: NY Gov Cuomo “Ignoble”; Wrong on Frack Ban”
Industrywide Issues | Lease & Royalty Payments | Pennsylvania | Research | Statewide PA

Online Tool Tracks PA Production by Well, Calculates Royalties
December 29, 2014December 29, 2014

Several times in the past, MDN has touted what we consider to be the best online database for Pennsylvania landowners interested in tracking the production of gas wells in the Keystone State. It’s called MarcellusGas.org and for $20 a year you can all the data you can handle with regard to how much a given Marcellus well is producing–based on the semi-annual reports filed with the state Dept. of Environmental Protection. MarcellusGas.org sports not only data on historical production, but a royalty calculator that projects out what a well may produce based on the production of other wells in the area that have produced longer. And according to landowners who have compared the projections with their royalty checks, they say it’s pretty darned accurate…
Read More “Online Tool Tracks PA Production by Well, Calculates Royalties”
Energy Services | FirstEnergy | Statewide WV | West Virginia

FirstEnergy Investing $100M in Electric Projects for WV Marcellus
December 29, 2014December 29, 2014

FirstEnergy, headquartered in Akron, Ohio, is the parent of Mon Power, an electric utility serving 385,000 customers in 34 West Virginia counties. FirstEnergy announced last week they’re investing $100 million in new electric transmission projects to service the growing Marcellus and Utica Shale industry in WV. The projects include new high voltage power transmission lines and substations to serve natural gas processing plants (and other gas operations) in the region. As a consequence, not only will the Marcellus industry benefit, so too will local electric customers in WV…
Read More “FirstEnergy Investing $100M in Electric Projects for WV Marcellus”
Ethane | Industrywide Issues

Louisiana Ethane Cracker for Marcellus Gas Built with Intl Money
December 29, 2014December 29, 2014

In June 2014, MDN told you about a Range Resources deal to sell some of their ethane to a cracker plant, yet to be built, in Lake Charles, Louisiana (see Range Announces Multiple Agreements to Sell Natgas & Ethane). The Lake Charles cracker plant is part of a huge $8.9 billion petrochemical complex that will be built by energy/chemical company Sasol. In a press release last week, Sasol announced they’ve secured $4 billion in a “credit facility” (i.e. loans) for the project, although they don’t mention when construction will actually get under way. Aside from the fact that Marcellus ethane, in part, will feed the plant, what struck us as interesting is the international nature of the project. Some 18 international banks and investment firms are involved in the $4 billion credit deal. Sasol itself is a South African company; the Bank of Tokyo is the administrative agent for the deal; Bank of America is the account bank; HSBC (Hongkong and Shanghai Banking Corporation) is the “security trustee” for the $4B loan; and the Bank of Scotland is financial adviser. It’s a real panoply of international involvement!…
Read More “Louisiana Ethane Cracker for Marcellus Gas Built with Intl Money”
Best of the Rest

Marcellus & Utica Shale Story Links: Mon, Dec 29, 2014
December 29, 2014December 29, 2014

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, Dec 29, 2014”
Broome County | Hydraulic Fracturing | Industrywide Issues | New York | Regulation | Statewide NY

NY Landowners Fight Back Against Cuomo Frack Ban, Rally on Jan 5
December 24, 2014December 24, 2014

Two important bits of news for New York landowners–a group not broken and not cowed by the likes of Andrew Cuomo. First, the Joint Landowners Coalition of New York (JLCNY) is hosting an important radio show on Sunday, Dec. 28 with special guest Dr. Gilbert Ross from the American Council on Science and Health (ACSH). Dr. Ross will debunk the sorry, lame excuses offered by NY State Health Commissioner Howard Zucker and his so-called report on fracking. Second, the JLCNY has put the word out that they will hold a rally at the Holiday Inn Arena in Binghamton, NY on Monday, Jan. 5 at 4 pm. The JLCNY needs every pro-driller and family member who can, to attend. Details below on both…
Read More “NY Landowners Fight Back Against Cuomo Frack Ban, Rally on Jan 5”
Energy Companies | Industrywide Issues | Pipelines | Rice Energy

Rice Midstream IPO Falls Short of Goal by Approx. $134M
December 24, 2014December 24, 2014

Earlier in December Rice Energy, a Marcellus and Utica Shale exploration and production company, launched an Initial Public Offering (IPO) for their midstream division–spinning it off into it’s own company (see Rice Energy Launches Midstream IPO – MDN Nails the Price). Rice had hoped to get between $19 and $21 per share. The IPO is now done and dusted–and Rice only got $16.50 per share. So instead of the hoped for $546-$604 million in new cash (call it $575 million), they got $441.6 million. Still very respectable, but certainly short of the mark…
Read More “Rice Midstream IPO Falls Short of Goal by Approx. $134M”
Energy Companies | Rex Energy

Rex Energy Reduces 2015 Marcellus/Utica Drilling Budget by 44%
December 24, 2014December 24, 2014

Rex Energy, the little energy company that could (and does) successfully drill in the Marcellus and Utica Shale, earlier this week released their 2015 operational budget. Rex is reducing spending on drilling in the Marcellus and Utica in 2015 by 44% over what they spent in 2014. Rex will spend between $180-$220 million on new drilling, broken down as $115-$140 million in the Marcellus and $45-$60 million in the Utica. According to Tom Stabley, Rex’s CEO, the company is taking a breather in this low commodity price environment. Production will actually increase next year, even though drilling will decrease. That allows the company to perform better financially, for investors, according to Stabley…
Read More “Rex Energy Reduces 2015 Marcellus/Utica Drilling Budget by 44%”
Accidents | Blue Ridge Mtn Res/Magnum Hunter | Energy Companies | Industrywide Issues | Monroe County | Ohio | Triad Hunter

Triad Hunter Well Blowout in Ohio Fixed, Residents Go Home
December 24, 2014December 24, 2014

On Monday we noted that it had been 10 days since a well blowout at a Triad Hunter Utica Shale well pad in Monroe County, OH with some 50 area residents still displaced from their homes (see Residents Near Leaking Triad Hunter Well in OH Still Displaced). Good news: residents near the well pad will be home for Christmas. Magnum Hunter (parent of Triad Hunter) reports as of yesterday Wild Well Control has successfully replaced the well head and temporarily capped the well. Residents are now home, just in time for the holidays. We sense a new Hallmark Christmas movie coming…
Read More “Triad Hunter Well Blowout in Ohio Fixed, Residents Go Home”
Economic Impact | Energy Services | Ethane | Housing | Industrialization | Industrywide Issues | Jobs | Odebrecht | Ohio | Processing Plants | Washington County (OH) | West Virginia | Wood County

WV/OH Officials Going on Field Trip to Prepare for Cracker Plant
December 24, 2014December 24, 2014

The Odebrecht ethane cracker plant planned for the Parkersburg, WV area continues to walk/smell/act/behave like it’s the real deal. The latest evidence: Odebrecht has told area officials around Parkersburg, you need to be prepared for when the 100% official announcement comes, cause at that point, things will happen fast. So area officials are boning up now to be prepared for an influx of people and jobs–both a good thing, and a challenge. Area officials from Wood County, WV and neighboring Washington County, OH will head to the bitter-cold north country–Minot, North Dakota–in January (!) to see how that community has dealt with a rapidly expanding population and influx of new jobs due to the Bakken Shale…
Read More “WV/OH Officials Going on Field Trip to Prepare for Cracker Plant”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Ohio | Regulation | Statewide OH | Wastewater

OH Anti Group Wants EPA to Suspend ODNR Injection Well Oversight
December 24, 2014December 24, 2014

Whenever anti-drillers in a given state don’t like how the state environmental authority is doing its job, they run to the federal government like a petulant child clinging to its mother’s skirt. “Mommy, mommy! Johnny hurt my feelings!” Such is the case with Ohio Citizen Action (OCA), an anti-drilling group that is accusing the Ohio Dept. of Natural Resources (ODNR) of falling down on the job when it comes to regulating injection wells–wells used to dispose of frack wastewater. OCA’s demand? That the federal EPA suspend ODNR’s oversight of the injection well program in Ohio and that the feds move in and take over. OCA used 16 untrained volunteers (activists), gave them mountains of official paperwork from the ODNR archive, and armed each of them with yellow highlighters. The 16 untrained volunteer activists found every reference they could of what they say is incompetence and malfeasance by the ODNR, stitched it all together in a “report” (full copy below), and are now calling on Mommy EPA to “do something” about it…
Read More “OH Anti Group Wants EPA to Suspend ODNR Injection Well Oversight”