Marcellus Drilling News

Anti-Drilling/Fossil Fuel | Enbridge | Energy Services | Industrywide Issues | Pipelines | Regulation

Marcellus Gas Heading North: Canadian Pipeline Gets “Green” Light
January 31, 2014January 31, 2014

Seems like today is midstream day on MDN. Many of our stories revolve around pipelines and processing plants, including our lead about MarkWest (be sure to give it a read). Here’s an interesting story about a pipeline project in Canada that has a Marcellus tie-in. Enbridge Gas Distribution wants to expand their natural gas pipeline in the Toronto area, spending upward of C$686 million to do it. The “greens” of Canada (garden variety fossil fuel-hating anti-drillers) objected. The greens’ objection #1: If we just turn our thermostats down low, we won’t need the extra gas. The Ontario Energy Board said: Nope. Not buying that one. Objection #2: This pipeline will bring in that evil, nasty, fracked Marcellus Shale gas and kill us all because it pollutes water (in the U.S.) and releases fugitive methane into the atmosphere (global warming, heeelp!). Again, the Ontario Energy board said: Nope. Not buying that one either.

Below is the full story about the pipeline. Embedded in it is the response by the calm, wise heads from the Ontario Energy Board to the greens, responding to them on the shale gas issue:
Read More “Marcellus Gas Heading North: Canadian Pipeline Gets “Green” Light”
Coterra Energy (Cabot O&G) | Energy Companies | Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Susquehanna County

Vol 2 Photojournal for Cabot Well in Susquehanna County, PA
January 31, 2014January 31, 2014

A quick note to let you know that tomorrow (Saturday, Feb. 1) you can once again download Photojournal of a Pennsylvania Natural Gas Well: Book 1: Ground Preparation. It’s a really cool book of photos (and captions) taken by a non-professional photographer, Susquehanna County resident Janice Gavern. MDN recently reported on Janice’s project to document a Cabot Oil & Gas shale well being drilled just outside of Montrose, PA, close to (yes) Dimock (see PA Resident Snaps 8,000 Pictures of Cabot Well Construction).

Jancie has been a busy beaver. She’s now posted her second volume in this multi-volume series: Photojournal of a Pennsylvania Natural Gas Well: Book 2 Site Set-up. You can grab a copy of this volume for free on Sunday, Feb. 2. Be sure to grab them while they’re free! It will save you $9.99 (or if you like, download it and pay the $9.99 to give Jan a little bit of money for her efforts).

What if you don’t own a Kindle reader? No problem. You can download and install a Kindle reader application on your computer, smartphone–just about any device you have that connects to the internet. So don’t lack of a Kindle stop you from grabbing a copy of Jan’s books.
About MDN

A Brief Word About MDN Site Technical Problems
January 31, 2014January 31, 2014

Dear MDN Readers:

Over the past several days the MDN website has, at times, slowed down significantly and in some cases was unresponsive and not loading. In addition, for some time now the site has not “remembered” logged in subscribers who revisit the site, causing them to have to log in again repeatedly each day. My profound apologies.

Last night I had the site moved to a new server and it seems to be responding well today (at least so far). I have also found and corrected the issue causing logged in subscribers to not be remembered on subsequent visits.

Please be on the look-out today and report to me any strange behavior (can’t load the site, still having to log in repeatedly). I’m doing my best to resolve these technical issues and appreciate your patience and help.

Kind regards,
Jim Willis
Editor, MDN
Best of the Rest

Marcellus & Utica Shale Story Links: Fri, Jan 31, 2014
January 31, 2014January 31, 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: Fri, Jan 31, 2014”
Anti-Drilling/Fossil Fuel | Hydraulic Fracturing | Industrywide Issues | Litigation | New York | Regulation | Statewide NY

NY DEC Com. Martens Says No NY Fracking Until 2015 Earliest
January 30, 2014January 30, 2014

In what is sure to be a bitter disappointment to New York’s landowners, Dept. of Environmental Conservation Commissioner Joe Martens said yesterday in testimony to lawmakers that he’s not going to issue any permits for shale drilling before 2015. Unless, of course, he’s forced to by a court (see Norse Energy Sues Gov. Cuomo to Force Release of Fracking Regs). Martens’ comments came as he gave testimony about the DEC’s budget for the next fiscal year, which begins on April 1st. Martens is not including anything in the DEC budget for shale drilling oversight and told lawmakers it would be “extremely unlikely” that permits would be issued before the end of March 2015, hence no need to bulk up his budget for it.

Are we surprised? Not really. The decision of whether or not to allow fracking in New York has been a political and not a scientific one for a long time now–we’d say for years. Gov. Andrew Cuomo continues to push off the decision–not Health Commissioner Nirav Shah, not Joe Martens, but Cuomo. Shah and Martens are just foot soldiers that do their master’s bidding. This latest revelation of no fracking until 2015 further validates landowners’ resolve in pushing forward with lawsuits on various aspects of the drilling issue at various levels of the court system. It’s now obvious we will have to litigate for our freedoms–or loose them forever…
Read More “NY DEC Com. Martens Says No NY Fracking Until 2015 Earliest”
American Energy Partners | American Energy Utica | Energy Companies | Hess | Ohio | Statewide OH | Utica Shale

Hess Sells 74,000 OH Utica Shale Dry Gas Acres to Mystery Buyer
January 30, 2014February 4, 2014

Looks like the end of 2014 came in January of 2014 for Hess. On Oct 30, 2013 Hess’ Executive VP and President of Worldwide Exploration & Production, Greg Hill, said that Hess was working on figuring out their Utica Shale acreage and where the wet gas area is located so they could make decisions about where they will and won’t drill. Hill said they would make their final decision “at the end of 2014 once we finish delineation” (see Hess Officials Talk About the Utica on 3Q13 Earnings Call). Yesterday Hess announced they have struck a deal to sell to sell 74,000 Utica Shale dry gas acres to an unnamed buyer for $924 million. End of 2014 (and Christmas) came early for Hess. Why sell now? And, who was the buyer? MDN thinks we know (we speculate below).

Hess owns a 100% interest in 95,000 Utica Shale acres, and a 50% interest (in a joint venture deal with CONSOL Energy) for another 65,000 Utica acres. In consulting the Hess map of their Utica acreage below (from a November 2013 investor presentation), you can get a pretty good idea of where the acreage they’ve sold is probably located. Much of Hess’ 100%-owned acreage is in the “dry gas” area on the map–our money is that most of that acreage is what got sold. No doubt landowners will soon receive notifications if they are among those being traded to another drilling team. Below is the Hess announcement (which is brief), the map we located which helps shed light on the brief announcement, and our speculation on why they sold now, and who purchased…
Read More “Hess Sells 74,000 OH Utica Shale Dry Gas Acres to Mystery Buyer”
American Energy Partners | American Energy Utica | Energy Companies | Ohio | Statewide OH | Utica Shale

McClendon’s New Company Gets Another Half Billion $ for Utica
January 30, 2014January 30, 2014

Former Chesapeake Energy CEO Aubrey McClendon’s new company, American Energy Partners, keeps the money rollin’ in. Last fall AEP lined up a big pile of cash to be used to purchase leases in the Utica Shale (see McClendon Gets a Little Help ($1.7B) from His Friends in OH Utica). In December, Aubrey floated 100 million “units” (i.e. stock) in an effort to raise up to $2 billion more (see McClendon Plan to Raise Additional $2B in “Unit” Offering). No word on how that effort is going.

In the meantime, time’s a wastin’, so Aubrey has raised another $500 million in private equity to help fund Utica Shale ventures (see the story below). MDN wonders, is it just coincidence that AEP’s brief announcement was issued yesterday, on the same day that Hess announced their sale of 74,000 Utica Shale acres to a mystery buyer? Interesting, no?…
Read More “McClendon’s New Company Gets Another Half Billion $ for Utica”
Antero Resources | Energy Companies

Antero Resources Will Spend $2B+ in Marcellus/Utica in 2014
January 30, 2014January 30, 2014

Antero Resources continues to be in the news. Over the past couple of days MDN has reported on Antero’s recently released production results for their Utica Shale wells (see Another Antero Utica Well Top of the Heap: IP Rate of 40.2 Mmcf/d! and More on Antero’s Record Shattering Utica Shale Wells). On the heels of their 4Q13 update from a couple of days ago, Antero yesterday released their 2014 capital expenditure budget. The company plans to spend $2.6 billion in 2014. Of that, they will spend $1.8 billion for drilling and completion, $600 million for expanding midstream facilities and $200 million for core leasehold acreage acquisitions.

Get this: All of the $1.8 billion drilling budget will be spent on drilling in the northeast–75% of it in the Marcellus, and 25% of it in the Utica. And the $200 million for new leases will be spent in both the Marcellus and Utica as well. It’s a massive amount of money flowing into the northeast ($2 billion or more)–all from a single driller. Here’s the Antero budget update issued yesterday:
Read More “Antero Resources Will Spend $2B+ in Marcellus/Utica in 2014”
Energy Companies | Gulfport Energy | Ohio | Statewide OH | Utica Shale

Gulfport’s James Palm to Retire in 2 Weeks, Search on for New CEO
January 30, 2014January 30, 2014

Gulfport Energy announced yesterday that CEO James Palm will retire as of February 15 (just two weeks from now). Gulfport is one of the most important (and increasingly prolific) drillers in the Utica Shale. In 2013 Gulfport stole many headlines with their southeastern Ohio Utica shale wells breaking records left and right (see Gulfport’s New Record-Breaking Well in Belmont Cnty – 30.3 Mmcf/d).

Palm has been CEO of Gulfport for the past eight years. Was he pushed? No indications of that. It appears he’s simply exiting while Gulfport, under his expert guidance, is at a high point. No doubt he leaves the company as a very wealthy man. Here’s the brief Palm retirement announcement from Gulfport:
Read More “Gulfport’s James Palm to Retire in 2 Weeks, Search on for New CEO”
Economic Impact | Energy Services | Industrywide Issues | Pipelines | Transco | Williams

Williams CEO: Transco Pipeline will Double Capacity by 2017
January 30, 2014January 30, 2014

Williams President & CEO, Alan Armstrong, addressed the Hart Energy’s annual Marcellus-Utica Midstream Conference & Exhibition at the David L. Lawrence Convention Center in downtown Pittsburgh yesterday. He said several interesting things, but the one that caught our attention was this: Williams is going to spend $5 billion expand their Transco methane pipeline. Transco runs from the Gulf Coast to New York. Armstrong said they will be adding more mainline to the Transco–making it longer, by about 9%. Which doesn’t seem like much, but it will nearly double the capacity of the entire pipeline. That’s a big hairy deal with lots of implications: More gas can get to market for consumers (bringing down prices for consumers), more gas can be shipped from drillers (more revenue for drillers), and more Marcellus gas will make it’s way into northeastern markets (great for drillers and landowners).

A summary of Armstrong’s speech:
Read More “Williams CEO: Transco Pipeline will Double Capacity by 2017”
Hydraulic Fracturing | Industrywide Issues

Former Mainstream Reporter Sees the Fracking Light
January 30, 2014January 30, 2014

Is there any hope that mainstream media reporters will ever tell the truth about the miracle of fracking? You may despair, but every now and again there’s hope. We spotted a column written in the more-or-less conservative Washington Times by a former reporter for the Associated Press, someone who also has worked for Newsweek, ABC News and “20/20”. That’s mainstream media cred if we’ve ever heard it! Not only that, but this reporter was once funded (in a professorship) by the rabidly anti-drilling Park Foundation. Fait accompli–a dyed in the wool mainstream media guy.

And yet, this mainstream media guy was able to see through the lies of the anti-drillers and come to the conclusion that yes, fracking is indeed a miracle and does not destroy the environment. Hallelujah! A mainstreamer who saw the light. Maybe there is hope?…
Read More “Former Mainstream Reporter Sees the Fracking Light”
Economic Impact | Electrical Generation | Industrywide Issues | Ohio | Statewide OH

New SW Ohio Electric Generating Plant to be Powered by Natgas
January 30, 2014January 30, 2014

Middletown, OH, located on the border of Butler and Warren counties in southwestern Ohio, is about to get a new $500 million natural gas-fired electric generating plant. That is, they will if NTE Energy’s plan is approved. The new plant will generate enough electricity to supply 400,000 homes. Although the story we found about the plant doesn’t say where the gas will come from, you can bet your bottom dollar it will be fueled by Utica and Marcellus Shale gas…
Read More “New SW Ohio Electric Generating Plant to be Powered by Natgas”
Best of the Rest

Marcellus & Utica Shale Story Links: Thu, Jan 30, 2014
January 30, 2014January 30, 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: Thu, Jan 30, 2014”
Antero Resources | Energy Companies | Ohio | Statewide OH | Utica Shale

More on Antero’s Record Shattering Utica Shale Wells
January 29, 2014January 29, 2014

Yesterday MDN brought you the news that Antero had turned in some of the highest producing wells–ever–in the Utica Shale (see Another Antero Utica Well Top of the Heap: IP Rate of 40.2 Mmcf/d!). We got the context of their announcement slightly wrong, and admitted it at the top of that article. We believed one of those wells to be the #1 overall producing well in the Utica–but such is not the case. As we explained, Antero is now converting the production output from their wells into “gas equivalent” because many of these wells produce a lot of natural gas liquids, including ethane, butane and propane. Even though we got it slightly wrong, the wells are still awesomely impressive for the their record-breaking output.

MDN thanks our friend and intrepid reporter Bob Downing at the Akron Beacon Journal for pointing out the change-up in how Antero reports its numbers (he gave us a courtesy call). Bob went on to research the Antero announcement and found that three of their recently announced wells are ranked in the Utica “top 10” most productive wells overall. Although the Antero wells may not be #1 in producing the most methane (“dry gas”), they produce an enormous amount of NGLs, which are a lot more profitable than plain methane! Here’s a pair of reports from Bob from yesterday:
Read More “More on Antero’s Record Shattering Utica Shale Wells”
Chesapeake Energy | Energy Companies | Industrywide Issues | Jefferson County (OH) | Lease & Royalty Payments | Litigation | Ohio

OH Judge Says Filing Paperwork is Enough to Extend Lease
January 29, 2014January 29, 2014

Ohio landowners should be aware of an important court case just decided that says, in essence, filing paperwork is enough proof of a driller’s intent that a lease can be extended beyond the initial signing period. Several landowners in Jefferson County, OH signed a lease with Fortuna Energy in 2006 that was later sold to Chesapeake Energy (in 2010). The lease was for a 5-year period. Three days before the end of the lease Chesapeake filed a Declaration of Pooled Unit (DPU) with the Ohio Department of Natural Resources. That is, they told ODNR in essence “here’s a group of properties we intend to drill on soon” requesting permission to “pool” them together into a drilling unit. That simple act was enough proof, according to a U.S. District Court judge, to allow Chesapeake to extend the original lease beyond the original 5 years.

And so now the landowners are stuck waiting for Chesapeake to actually do something other than file paperwork. Good luck with that…
Read More “OH Judge Says Filing Paperwork is Enough to Extend Lease”
Industrywide Issues | Jobs | Ohio | Statewide OH

Utica Shale Transient Workers in Ohio Crosshairs
January 29, 2014January 29, 2014

Calling OH Gov. John “foreigner hunter” Kasich: Ohio is being invaded by foreigners! Time for a dragnet to kick them out!! We refer, tongue-in-cheek, to Kasich’s disdain for non-Ohioans moving to Ohio to work in the Utica Shale drilling industry–doing nasty, hard jobs that often require someone who’s skilled at doing them–like pipefitting and welding, and man-handling equipment at rig sites (called a roustabout). Ohioans can certainly be trained, but often it takes people who have done it to show them how.

The Columbus Dispatch has taken a decidedly anti-drilling stance recently with a flurry of articles that attack the Utica Shale industry. Their latest article takes aim at “transient” workers–people Kasich calls foreigners. It’s jingoistic and repugnant–but then prejudice and ignorance always are. Here’s the Dispatch waxing eloquent on “transients”…
Read More “Utica Shale Transient Workers in Ohio Crosshairs”