Marcellus Drilling News

Industrywide Issues | Ohio | Statewide OH | Taxation | Utica Shale

Ohio Republicans About to Go Goose Hunting with Severance Tax?
March 26, 2014March 26, 2014

It seems MDN is not alone in encouraging the weak-kneed Republican politicians in Ohio to not screw up the economic miracle happening in their state by imposing an overzealous severance tax on Utica Shale drilling.

The editorial writers at the Wheeling News-Register think Gov. John Kasich and the House Republicans should tread lightly and make double-dog sure whatever new taxes they vote for, they don’t kill the goose laying the golden eggs in Ohio…
Read More “Ohio Republicans About to Go Goose Hunting with Severance Tax?”
Energy Companies | Hydraulic Fracturing | Industrywide Issues | Litigation | New York | Norse Energy | Regulation | Statewide NY

NY Update: Norse/JLCNY Lawsuit Hearing Date Set for April 25
March 26, 2014March 26, 2014

Sadly, politics in New York State have become so corrupt that even the State Attorney General, Eric Schneiderman, actively works against the interests of the people he’s sworn to protect–the citizens of New York State. Late last year Norse Energy sued Gov. Andrew Cuomo, DEC Commissioner Joe Martens and State Health Commissioner Nirav Shah over their collusion to stop shale drilling in the state (see Norse Energy Sues Gov. Cuomo to Force Release of Fracking Regs). Later, the 70,000-member Joint Landowners Coalition of New York joined that lawsuit (see D-Day: JLCNY Files Lawsuit Today Against Cuomo, Martens, Shah).

How has AG Schneiderman reacted? By filing to dismiss the lawsuits and delay (see NY Attorney General Files to Dismiss Norse Lawsuit, More Delays). It’s utterly shameful. The lawsuit was scheduled for a hearing first in January, then moved to February, then March, and now April. It appears Norse and the JLCNY, whose cases are now tied together, will finally get a hearing at the end of April–on the 25th…
Read More “NY Update: Norse/JLCNY Lawsuit Hearing Date Set for April 25”
Antero Resources | Belmont County | Energy Companies | Guernsey County | Harrison County | Lease & Royalty Payments | Ohio | Utica Shale

MWCD Close to Signing Utica Lease for Piedmont Lake, OH Property
March 26, 2014March 26, 2014

In early January MDN brought you the delicious news that the Muskigum Watershed Conservancy District (MWCD) is planning to lease a large tract of District-owned land in and around Piedmont Lake (in Belmont, Guernsey and Harrison counties) for Utica Shale drilling (see MWCD Open House on Leasing Piedmont Lake Property for Drilling). The original 6,600 acres has now turned into 6,700 acres and the lessor will be Antero Resources, according to an announcement issued by the MWCD last Friday.

According to the MWCD board, they will likely vote on the lease at their next meeting scheduled for April 18. An update on the Piedmont Lake lease from the MWCD is below, along with the draft copy of the lease from Antero. Noticeably missing from the draft lease are the terms…
Read More “MWCD Close to Signing Utica Lease for Piedmont Lake, OH Property”
Beaver County | Economic Impact | Energy Companies | Ethane | Industrywide Issues | Jobs | Pennsylvania | Processing Plants | Shell

Cracker Plant Talk Spurs Economic Growth in Beaver County, PA
March 26, 2014March 26, 2014

Over the past couple of years the prospects for an ethane cracker plant in Beaver County, PA have swung from wild optimism to wild pessimism and everything in between. Most recently the pendulum has once again tilted negative (see Shell’s Shale Pessimism Signals Worry for Some re PA Cracker). But don’t talk negative to the businesses setting up shop and expanding in Beaver County. The mere talk that it’s possible Shell will build the $2-$3 billion ethane cracker in Monaca has caused a significant uptick in the local economy. One Realtor has said for businesses looking to get a piece of the coming economic pie–you’re already late! Many have already grabbed up space and it’s increasingly difficult to find commercial real estate in the county.

Here is the story of the economic boom already under way in Beaver County just from talk–talk that Shell may build a cracker plant there…
Read More “Cracker Plant Talk Spurs Economic Growth in Beaver County, PA”
Boardwalk Pipeline Partners | Energy Services | Industrywide Issues | Litigation | Pipelines | Regulation | Williams

Judge Rules Bluegrass Pipeline Cannot Use Eminent Domain in KY
March 26, 2014March 26, 2014

On Monday MDN brought you the news that the Kentucky House had voted to strip the right to use eminent domain from natural gas liquids pipelines (see Kentucky House Votes to End Eminent Domain for Bluegrass Pipeline). An alert MDN reader predicted the measure wouldn’t get signed into law because the KY Senate president said with only 10 days left in this session, it’s not likely to come up for a vote in the Senate (see Bluegrass Pipeline bill passes House).

Looks like it won’t matter what the KY legislature does. Last December a lawsuit was filed by a group calling itself KURE (Kentuckians United to Restrain Eminent Domain), to prevent the Bluegrass Pipeline from using eminent domain in the Bluegrass state (see Bluegrass NGL Pipeline’s Eminent Domain Challenged in KY Court). Yesterday Franklin Circuit Judge Phillip J. Shepherd ruled in KURE’s favor and said the Bluegrass cannot use eminent domain to force landowners to allow the pipeline to be buried under their property…
Read More “Judge Rules Bluegrass Pipeline Cannot Use Eminent Domain in KY”
Industrywide Issues | Ohio | Pennsylvania | Statewide OH | Statewide PA | Statewide WV | Taxation | West Virginia

Best Way to Kill Drilling in PA/OH/WV: “Uniform” Severance Tax
March 26, 2014March 26, 2014

A few weeks ago MDN said the plan floated by lefties and libs to create a so-called uniform severance tax across PA, OH and WV is one of the dumbest things we’ve heard in a long time (see Stupid Idea of the Year: Create Uniform Severance Tax in PA-OH-WV). The plan as proposed means all three states hold hands and jump off the economic cliff together. Apparently it’s more fun to die together (economically) than alone.

MDN is not the only voice to point out the lunacy of this plan. The head of the PA Chamber of Business and Industry also says the proposed mega-tax is nuts. As Gene Barr highlights in the following letter to the editor, it’s apparent the people proposing such a plan–including the Pennsylvania Budget and Policy Center–are ignorant of how taxes in PA and other places actually work. You would think an organization with a name that includes the word “budget” would employ at least one economist or accountant. Apparently they don’t. They are economic illiterates who don’t realize what they are proposing is anything but fair–especially to Pennsylvanians…
Read More “Best Way to Kill Drilling in PA/OH/WV: “Uniform” Severance Tax”
Belmont County | Carroll County | Columbiana County | Guernsey County | Harrison County | Lease & Royalty Payments | Monroe County | Noble County | Ohio | Utica Shale | Washington County (OH)

Company Targets OH Landowners – Buy Future Royalties for Cash Now
March 26, 2014March 26, 2014

Gateway Royalty is back and has $58.5 million on the bank they can’t wait to give landowners in the Ohio Utica Shale in return for future royalty payments. MDN told you about Gateway last summer. They were the company that the town of Carrollton, OH sold 1/4 of their royalty rights to (see OH Town Votes to Give Up 1/4 Royalties for Cash Payment Now). The way it works, in brief: Gateway pays landowners a lump sum now in return for the right to receive that landowner’s future royalty payments for years to come. You (the landowner) get your money now, they (Gateway) get the money you would have gotten dribbled out over time. Of course the money you receive now is discounted and in all likelihood far less than you would have gotten if you had waited just a few years (the bulk of royalty payments come in the first four years). It’s a bit of a gamble by both parties because no one really knows how much a well will produce.

Still, there are reasons why someone may want to get cash up front–pay off debt, ill health, etc. So in that vein, we bring you the latest press release from Gateway announcing they are ready, willing and waiting to give Ohio Utica Shale landowners money now. Specifically they are targeting landowners in Washington, Noble, Guernsey, Monroe, Belmont, Harrison, Carroll and Columbiana counties…
Read More “Company Targets OH Landowners – Buy Future Royalties for Cash Now”
Accidents | Anti-Drilling/Fossil Fuel | Industrywide Issues | Pennsylvania | Statewide PA

Anti-Drillers Attack Crude-by-Rail Traveling Through PA
March 26, 2014March 26, 2014

The leftist anti-drillers at the Pennsylvania news organization called PublicSource, backed by the likes of Teresa Heinz Kerry, is taking aim at shale-produced crude oil that travels by railroad. In a hit piece in which they begin by doing a bait-and-switch, starting with a derailment of ethanol (nothing at all to do with oil or gas), they then parry and say derailments of oil in Pennsylvania are an imminent threat and danger to PA residents. The hue and cry has gone up: Either have the feds regulate shale oil on railroads out of existence, or preferably just stop shipping crude by rail. Who wants all that nasty crude from North Dakota anyway? Funny how the answer is always the same no matter the question: just stop extracting fossil fuels.

Here’s how the latest PublicSource hit piece begins…
Read More “Anti-Drillers Attack Crude-by-Rail Traveling Through PA”
Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Statewide PA

Birthplace of Fracking (NE USA) Once Again Leads O&G Innovation
March 26, 2014March 26, 2014

Fracking as a concept has been around for a long time. Would you believe us if we said the first rudimentary forms of fracking date back to the 1860s–around the time of the American Civil War? That’s when liquids were first used to fracture “shallow, hard rock wells” in places like PA, NY and WV. Somewhere along the way oil and gas drilling drifted to places like Texas and Louisiana and Oklahoma. In the modern era, fracking started to be widely used commercially in 1947. Oil and gas drilling “grew up” in, and innovations came from, drilling in the southwestern part of the U.S.

Shale drilling is a more recent development–the combination of fracking and horizontal drilling. Shale drilling has been around commercially for 15-20 years, and yes, it was first pioneered and developed by George Mitchell in the Barnett Shale of Texas. However, drillers in Texas and other locations are now learning from innovations coming from the Marcellus and Utica Shale. The country and indeed the world now looks to how companies like Cabot Oil & Gas are able to economically drill for gas in a low-price environment. The innovation that started in the northeast “once upon a time” some 150 years ago has finally returned to its birthplace in the northeast, and the northeast is showing the world how to do it better, faster, and safer than ever before…
Read More “Birthplace of Fracking (NE USA) Once Again Leads O&G Innovation”
Best of the Rest

Marcellus & Utica Shale Story Links: Wed, Mar 26, 2014
March 26, 2014March 26, 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: Wed, Mar 26, 2014”
About MDN | MDN Sponsor | Meetings

Oil & Gas Awards – List of Winners, Bang-up Time!
March 25, 2014March 25, 2014

Last week MDN editor Jim Willis (that’s me) had the pleasure of participating in the Northeast Oil & Gas Awards, including the “Conference for Excellence,” in Pittsburgh. Below is the list of winners for the 25 categories of competition. Many of the names you will recognize, some you may not. I will list the winners in due course. But first, a bit about my personal journey in participating in this star-studded and impressive event.

The CEO for the Oil & Gas Awards, Daniel Creasey, contacted me four months ago to see if MDN would consider becoming a media partner for the Northeast event. For those outside of the publishing world, such deals typically include a barter arrangement where a publication promotes an event in return for publicity as a media sponsor–listings in conference materials and on the conference website. The first thing I noticed was, Daniel and the Oil & Gas Awards company are British! Which is a plus for me, because I have worked for and with Brits most of my adult career (I am a confirmed Anglophile). Daniel and I “hit it off” and we both decided perhaps more than the usual media partner deal would be beneficial…
Read More “Oil & Gas Awards – List of Winners, Bang-up Time!”
Crime | Industrywide Issues | Litigation | Mahoning County | Ohio | Wastewater

Ben Lupo Admits Guilt in OH Frack Wastewater Dumping, Prison Next?
March 25, 2014March 25, 2014

Last week MDN speculated that Ben Lupo, the business owner of a trucking company who instructed an employee to repeatedly dump frack wastewater down a drain that emptied into the Mahoning River near Youngstown, OH, would change his plea from not guilty to guilty (see Youngstown Wastewater Dumping Case Nears End, Lupo to Plead Guilty?).

Indeed, Lupo did change his plea yesterday in a federal court in Cleveland…
Read More “Ben Lupo Admits Guilt in OH Frack Wastewater Dumping, Prison Next?”
Energy Companies | Halcon Resources | Ohio | Statewide OH | Utica Shale

Utica Driller Halcon Resources Up for Sale According to CEO
March 25, 2014March 25, 2014

MDN recently reported that Halcon Resources has stopped drilling on their leased land in the Utica Shale (see Halcon Resources Stops Drilling, Gives Up on the Utica Shale). Halcon’s blunt-talking CEO, Floyd Wilson, famously said he didn’t want to drill any more underperforming (he used more colorful language) wells in the Ohio’s northern Utica and instead seemed to say the company’s focus would be further south. Then the company said nyet–no more wells drilled in 2014 in the Utica. From Wilson’s remarks yesterday at the Howard Weil energy conference in New Orleans, it appears that Halcon may not drill any more wells in the Ohio Utica…ever.

Wilson said yesterday at the investor’s conference that it is his end-game to sell Halcon to a bigger fish. Wilson started Halcon 2011. In order to sell the company, he’s working to make it more attractive to investors. Wilson knows a thing or two about building energy companies and selling them–he built up and sold Petrohawk Energy to BHP Billiton Plc in 2011 for $12.1 billion. Apparently he’s hoping to do something similar with Halcon, except this time around it’s more of a challenge. Below is a report on Wilson’s “Halcon is up for sale” remarks yesterday in New Orleans…
Read More “Utica Driller Halcon Resources Up for Sale According to CEO”
Cameron County | Elk County | Energy Companies | Lycoming County | Pennsylvania | Seneca Resources | Upper Devonian Shale

Seneca Drills First Upper Devonian Well with Impressive Results
March 25, 2014March 25, 2014

Seneca Resources, a wholly-owned subsidiary of Buffalo-based National Fuel Gas Company, reports drilling their very first Upper Devonian shale well in Lycoming County, PA. The results are impressive: a peak 24-hour production rate of 14.1 million cubic feet (MMcf) per day, and an average 8.6 MMcf per day during its first 30 days. The Upper Devonian (UD) is a number of shale layers lumped together under one umbrella name. The specific layer targeted by Seneca for their first UD well is the Geneseo rock layer.

Word of Seneca’s success in the UD comes as part of an operational update issued by National Fuel Gas yesterday. Another gem in the update: Seneca has just completed drilling a 9-well pad and is almost finished drilling a 6-well pad. Here’s the full update from Seneca with the exciting UD news…
Read More “Seneca Drills First Upper Devonian Well with Impressive Results”
Anti-Drilling/Fossil Fuel | Coterra Energy (Cabot O&G) | Energy Companies | Industrywide Issues | Litigation | Pennsylvania | Susquehanna County

PA Anti-Drilling Activist Asks Court to Lift Cabot Restraining Order
March 25, 2014March 25, 2014

Vera Scroggins, a local and outside NEPA a little-known anti-driller in Susquehanna County with a potty mouth (see this video of her harassing filmmaker Phelim McAleer), had her day in a Montrose, PA court yesterday in which she and her commie-lib ACLU lawyers tried to get a restraining order lifted. Vera, according to Cabot Oil & Gas, repeatedly violated no trespassing requests from the company. She would show up at Cabot drill sites playing tour guide to obtuse politicians from New York City and on occasion even Hollywood celebrities (like Susan Sarandon), pretending the drill sites and compressor plants she showed them are somehow harming the environment. Cabot repeatedly told Vera to please stop entering roadways and drill sites as a safety precaution. She wouldn’t listen, so Cabot was forced to turn to the local Susquehanna County Court for help (see NE PA Anti-Driller Slapped with Trespassing Injunction)…
Read More “PA Anti-Drilling Activist Asks Court to Lift Cabot Restraining Order”
Chesapeake Energy | Energy Companies

Chesapeake’s 2014 Laser Focus: Liquids and Continued Fire Sales
March 25, 2014March 25, 2014

Chesapeake Energy is presenting at the 42nd Annual Howard Weil Energy Conference this week in New Orleans. As part of their presentation they released a new PowerPoint slide deck (copy embedded below). What does it show? Liquids liquids liquids. Chesapeake has its sights set on producing more liquids as it’s ticket to financial health. The presentation also reveals they will continue to shed “noncore assets and noncore affiliates.” That is, “Watch out below–more ballast coming over the side!” as Chessy will continue to dump divisions and subsidiaries in an effort to prop up the stock price and make bossman corporate raider Carl Icahn happy.

The slide deck is quite revealing and loaded with good information. We learn, for example, that Chessy is spending less than half in capital expenditures on drilling this year than they did just two years ago. First we’ll give you some of our insights and point out our favorite slides and what they reveal, then we’ll share SNL Financial’s take on the presentation. Finally, we’ve embedded the presentation itself so you can peruse it for yourself. The flavor and tone of the presentation is that Chessy is (now) fiscally disciplined and on track to turn the company around and make it profitable. Not mentioned anywhere in the presentation is the 800-pound gorilla: the lawsuits filed and investigations launched into Chesapeake’s alleged screwing of landowners out of royalty payments, which (if found true) will quickly derail all of their best-laid plans to make Icahn even more rich…
Read More “Chesapeake’s 2014 Laser Focus: Liquids and Continued Fire Sales”