Marcellus Drilling News

Energy Companies | Pennsylvania | Rice Energy | Washington County

Impending Rice Energy IPO Creating a Buzz
December 11, 2013December 11, 2013

MDN has known–well, suspected–since October that Rice Energy would soon be going public and that an initial public offering of stock (IPO) would value the company as much as $2.5 billion (see Rice Energy Rumored IPO – Dan Rice Gets Last Laugh). So when we reported yesterday that Alpha Natural Resources was selling its 50% joint venture stake to Rice for $300 million ($200 million of it in Rice stock when it goes public), we didn’t think much of it (see Alpha Natural Resources Sells 50% Marcellus Stake to Rice Energy).

Apparently not everyone knew about Rice going public and the news has hit like a thunderclap. Here’s an example, along with an estimate of when shares in the IPO will be offered:
Read More “Impending Rice Energy IPO Creating a Buzz”
Bradford County | Energy Companies | Lycoming County | Pennsylvania | Southwestern Energy | Sullivan County | Susquehanna County | Tioga County (PA) | Wyoming County (PA)

Southwestern Energy’s Board Changes, Marcellus Plans for 2014
December 11, 2013December 11, 2013

Some fairly big news from one of the Marcellus Shale’s largest drillers–Southwestern Energy. In a flurry of announcements issued yesterday, we learn that Southwestern’s President & CEO, Steve Mueller, will take over as Chairman of the Board next May when current Chairman Harold Korell retires. Mueller plans to keep the title of CEO but apparently he will shed the title of President, so that begs the question, who will become Southwestern’s new president next year? Interestingly (perhaps related?) Southwestern also announced yesterday the promotion of Jeffrey Sherrick to the position of Executive Vice President for Corporate Development. Hmmm.

In addition to personnel announcements, Southwestern issued a guidance statement about their plans for capital spending in 2014. The statement indicates Marcellus production will increase by a whopping 60% next year. Southwestern’s estimated Marcellus production for 2013 is 148-149 billion cubic feet (Bcf). Next year they expect it will be 244-249 Bcf based on superb well performance in Bradford, Lycoming and Susquehanna counties. Southwestern boasts that one of their Susquehanna County wells achieved an initial production of 32 million cubic feet per day! In 2014 Southwestern plans to begin drilling in three additional northeastern PA counties…
Read More “Southwestern Energy’s Board Changes, Marcellus Plans for 2014”
Industrywide Issues | Pennsylvania | Regulation | Statewide PA

After 9 Months, Chris Abruzzo Confirmed as Sec. of PA DEP
December 11, 2013December 11, 2013

In September MDN told you that Chris Abruzzo, the “Acting” Sec. of the PA Dept. of Environmental Protection (DEP) was nominated by Gov. Tom Corbett to fill the post vacated by former Sec. Michael Krancer (see No More “Acting” for Abruzzo – Nominated as Secretary PA DEP). Last week Senate Democrats tried to rake Abruzzo over the global warming coals because Abruzzo doesn’t believe global warming is quite the big deal they do (see PA DEP Sec. Abruzzo Grilled by PA Senate on Global Warming).

We’re happy to report that Abruzzo has now been confirmed by the Senate (42-8, with partisan Democrats voting against). Finally, after holding and executing the duties of the office for nine months, E. Christopher Abruzzo is the full Sec. of the PA DEP. We congratulate him!…
Read More “After 9 Months, Chris Abruzzo Confirmed as Sec. of PA DEP”
Energy Services | Ethane | Industrywide Issues | MarkWest Energy | Pennsylvania | Pipelines | Washington County

MarkWest Extends Open Season for “Little” Ethane Pipeline
December 11, 2013December 11, 2013

MarkWest conducted an open season for their “little” 30-mile ethane pipeline that will run from Majorsville, PA to Houston, PA (in Washington County) from early November until December 9th. The MarkWest Liberty Ethane Pipeline is a pipeline to other pipelines (see MarkWest Open Season for “Little” Ethane Pipeline). Ethane arriving in Houston, PA will be able to hitch a ride out of the northeast via other pipelines to cracker plants and processing facilities in Canada and the Gulf Coast.

Apparently the open season didn’t garner as much business as MarkWest had hoped, because yesterday they announced “ya got a few more days to sign up.” The new deadline for the open season is this Friday, December 13th at 5:00 pm Eastern. So hurry and sign up, while you still can! Here’s the MarkWest announcement from yesterday extending the open season for the Liberty Ethane Pipeline:
Read More “MarkWest Extends Open Season for “Little” Ethane Pipeline”
Energy Companies | Halcon Resources | Industrywide Issues | Lease & Royalty Payments | Ohio | Pipelines | Trumbull County

Halcon Proposes 14-Mile Pipeline from Vienna to Lordstown, OH
December 11, 2013December 11, 2013

Halcon Resources has been pretty tightfisted when it comes to spending money on leases for drilling–and now, perhaps–for pipelines as well. More than a year ago MDN told you about a landowner group that had formed in the Lordstown, OH area that hoped to negotiate new leases. The landowners were bound under 20-50 year-old leases purchased by Halcon that never envisioned shale drilling. Halcon said they wanted to work with landowners but stopped short of agreeing to renegotiate the leases (see Halcon Resources Responds to Lordstown, OH Landowners Group).

Halcon not only drills wells, they also have a midstream (pipeline) division to connect them. Halcon even stores and ships oil and gas–they’re building a $70 million storage and railroad transloading facility in Lordstown (see Halcon Resources Plans $70M Oil Terminal in Lordstown, OH). As part of the new storage facility, Halcon wants to run a 14-mile pipeline from Vienna to Lordstown. The problem, according to some communities along the route, is that Halcon doesn’t want to pay all that much to install a permanent pipeline…
Read More “Halcon Proposes 14-Mile Pipeline from Vienna to Lordstown, OH”
Energy Companies | Gulfport Energy | Ohio | Statewide OH | Utica Shale

Gulfport Energy Beefs Up Management Team for OH Utica
December 11, 2013December 11, 2013

Gulfport Energy may be based in Oklahoma City, OK, but their heart (and most of their focus) is in Ohio–in the Utica Shale. Gulfport is one of the premier Utica drillers with some of the most impressive wells drilled to date (see Gulfport’s New Record-Breaking Well in Belmont Cnty – 30.3 Mmcf/d). In keeping with their laser focus on the Utica, Gulfport announced yesterday a bunch of new hires and promotions–all of them focused on the Utica Shale.

At the top of the hit parade is a brand new Chief Operating Officer (COO) for the Utica–Ross Kirtley–who was previously a VP with Sandridge Energy. Robert Jones was appointed VP of drilling for Ohio, Mark Malone was appointed VP of operations for Ohio, and Ty Peck was appointed Managing Director of Midstream Operations. Certainly seems like a pretty major restructuring on the part of Gulfport as they prepare to do more great things in the OH Utica. Here’s the press release with details…
Read More “Gulfport Energy Beefs Up Management Team for OH Utica”
Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | Pennsylvania | Pipelines | Statewide PA | Sunoco Logistics

Handful Protest Mariner East Pipeline at Sunoco HQ in Philly
December 11, 2013December 11, 2013

Something like two dozen paid, professional protesters showed up at Sunoco Logistics headquarters yesterday in downtown Philadelphia to preen before (a few) media cameras and make outrageously false statements about the Mariner East pipeline. These are people with nothing better to do with their time than to desperately try to grab 15 minutes of fame.

Here’s an example of the bilge that flowed from the groups financing the protest:
Read More “Handful Protest Mariner East Pipeline at Sunoco HQ in Philly”
Lease & Royalty Payments | Pennsylvania | Statewide PA | Statewide WV | West Virginia

Clear Fork Royalty Now Buying Royalty Rights in PA & WV
December 11, 2013December 11, 2013

There are companies that will purchase landowners’ royalty payments–giving them a lump sum payment in return for signing over all future royalty payments to the company (or individual) buying them. It’s not unlike companies that approach and pay lottery winners who receive payouts over a long period (for life, or for a period of years), the winners selling their future payments for a single lump sum now. Of course by selling future royalty payments for money now, the landowner will typically accept far less than they otherwise would have received by continuing to get the royalty checks over time. But there are certain circumstances (terminal illness, for example) when the landowner would rather have as much of their money as they can get–right now. And so royalty-purchasing companies exist to oblige.

One of those companies is Texas-based Clear Fork Royalty, who (by press release) has announced they’ve now hung their shingle in the Marcellus/Utica region–in PA and WV. If you’re a royalty owner, Clear Fork may come knocking on your door…
Read More “Clear Fork Royalty Now Buying Royalty Rights in PA & WV”
Hydraulic Fracturing | Industrywide Issues | Marion County | West Virginia

WV Well Pad Liner Company Gets Shot of Investment Money to Grow
December 11, 2013December 11, 2013

Extreme Plastics Plus (EPP) has been manufacturing and installing well pad liners since 2007. Pad liners protect the ground from accidental spills of frack wastewater and chemicals used during the drilling process. Located in Fairmont, WV, EPP’s customers are in the Marcellus and Utica Shale region. In order to expand, EPP has just accepted an undisclosed amount of investment money from Hastings Equity Partners. According to EPP CEO Bennie Wharry, the money, and Hastings’ expertise, will help EPP grow “to the next level.”

The Hastings/EPP announcement:
Read More “WV Well Pad Liner Company Gets Shot of Investment Money to Grow”
Hydraulic Fracturing | Industrywide Issues | New York | Regulation | Statewide NY

Can Towns Ban Fracking in NY? Webinar Today Tackles Question
December 11, 2013December 11, 2013

Can localities ban oil and gas development in New York State? That is the question New York’s highest court (Court of Appeals) will answer when it hears arguments by attorneys representing Norse Energy and a dairy farmer versus the towns of Dryden and Middlefield. The decisions in these two important cases could have a huge impact on the future of shale development in New York. If the court decides that municipalities can ban drilling town- or citywide, MDN believe’s it lights out on serious shale drilling in New York–forever. Happily, we don’t think the court will decide that way.

A webinar is being offered today, Wednesday, Dec. 11 at 1 pm that will address that issue. Greg Sovas, President and owner of XRM, LLC and former Director of the Division of Mineral Resources at the NYS DEC will review the history of the supersession clause and its importance, implementation over the past thirty years and what has changed, the arguments being made on both sides in the court case, and how a decision either way could affect the future of oil and gas development in New York State. A Q&A at the end.

MDN encourages you to attend this 30-minute presentation. Sign up here: https://www1.gotomeeting.com/register/694678240.
Best of the Rest

Marcellus & Utica Shale Story Links: Wed, Dec 11, 2013
December 11, 2013December 11, 2013

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, Dec 11, 2013”
Coterra Energy (Cabot O&G) | Energy Companies | Pennsylvania | Susquehanna County

Cabot Oil & Gas & The Marcellus – An “Unstoppable” Combination
December 10, 2013

Cabot Oil & Gas continues to exceed expectations and, well, impress just about everybody! Yesterday Cabot issued an operations update. Among the highlights: They’ve just completed a 10-well pad in Susquehanna County (dry gas portion of the Marcellus). Calling it, “the new standard for operational efficiencies and technological advancement,” Cabot said the 10-well pad was completed with 170 frac stages and had a combined peak production rate of a huge 201 million cubic feet (Mmcf) per day. That’s an average of 20.1 Mmcf/d per well for all 10 wells! This is exciting stuff folks.

In addition to the excellent Marcellus news, Cabot announced they’ve sold more of their mid-continent “non-core” assets, bringing the total to $325 million worth of non-core assets this year. A good share of that money is being invested in the Marcellus. Below we have the full Cabot press release, the Cabot investor slide deck (with some great charts and maps), and energy analyst Robert Zeit’s key takeaways from yesterday’s update…
Read More “Cabot Oil & Gas & The Marcellus – An “Unstoppable” Combination”
Broome County | Energy Services | Industrywide Issues | Laser Northeast Gathering | New York | Pipelines | Williams

Williams Files to Expand Marcellus Pipeline in Broome County, NY
December 10, 2013December 10, 2013

Two years ago the newly completed Laser Northeast Gathering pipeline, a 33-mile pipeline stretching from Susquehanna County, PA across the border into Broome County, NY where it connects to the Millennium Pipeline, was sold by Delphi Midstream Partners to Williams Partners (see Laser Northeast Pipeline Selling to Williams for $750M). There is “new news” to share about the formerly named Laser, now named the “New York Mainline,” courtesy of MDN friend Andy Leahy, writing on his excellent NY Shale Gas Now! blog.

Sifting through a pile of digital paperwork, Andy found that in early December Williams filed a request to expand the Laser/NY Mainline by adding an additional 16″ pipeline loop–right here in the good old Town of Windsor, NY (where MDN is written!). The new pipeline loop will expand the capacity of Marcellus Shale gas flowing out of northeast PA and into the Millennium pipeline. Here’s Andy’s report…
Read More “Williams Files to Expand Marcellus Pipeline in Broome County, NY”
Anti-Drilling/Fossil Fuel | Chautauqua County | Electrical Generation | Industrywide Issues | New York | Regulation | Tompkins County

Anti-Drillers Oppose Converting 2 NY Electric Plants to NatGas
December 10, 2013December 10, 2013

This is the tale of two electrical generating power plants. Both are located in New York State–on opposite sides of the state. One is in Tompkins County (near Ithaca, NY), the other in Chautauqua County (Dunkirk, near Buffalo, NY). Both are powered by coal and both will either need to convert to natural gas or close down.

Something else both have in common: anti-drilling nutters want them closed rather than converted from burning coal to burning natural gas–even though closure means school and property taxes in both areas will go through the roof–higher than the nosebleed rates they already are. In both cases the power plants are the single largest taxpayer in their respective municipalities. Makes no difference to the nutters because most of them don’t live there and could care less. An update for both the Cayuga Power Plant and the Dunkirk Power Plant…
Read More “Anti-Drillers Oppose Converting 2 NY Electric Plants to NatGas”
Hydraulic Fracturing | Industrywide Issues | Research

EIA’s Dec DPR: Marcellus Now Provides 18% of US NatGas
December 10, 2013December 10, 2013

Our new favorite monthly report from the ace analysts at the U.S. Energy Information Administration (EIA) was issued yesterday–the latest and third installment of the Drilling Productivity Report (DPR). We’ve embedded a full copy of the report below for your viewing pleasure (love the charts they use). The monthly DPR provides key information about how quickly wells decline in production–it’s one report you want to keep a close eye on.

In addition to the latest DPR below, we’ve also included screenshots for two tables with the raw numbers EIA uses to generate the reports (tables we wish they would include in the monthly DPR). Below the DPR we’re including a bit of analysis work done by the EIA based on the DPR. The EIA analysts say their research shows the mighty Marcellus, as of this month, is producing 18% of all natural gas produced in the U.S. A single play! Truly astonishing. It shows the incredible importance of the Marcellus to our country’s energy infrastructure…
Read More “EIA’s Dec DPR: Marcellus Now Provides 18% of US NatGas”
Belmont County | Lease & Royalty Payments | Ohio | Utica Shale

Utica Shale Lease May Pull OH Volunteer Fire Dept from Bankruptcy
December 10, 2013December 10, 2013

We’re not sure of the circumstances that led the Neffs (Belmont County), OH Volunteer Fire Department to go more than $1 million in the hole–but that’s where they are. The miracle that may lift them out of bankruptcy and put them back on firm financial footing is the Utica Shale. Specifically, the opportunity to lease fire department-owned land for Utica Shale drilling.

The interesting (to MDN) aspect of this story is the very generous terms Neffs VFD is getting for the lease of 56.4 acres…
Read More “Utica Shale Lease May Pull OH Volunteer Fire Dept from Bankruptcy”