Marcellus Drilling News

Anadarko | Chesapeake Energy | Chevron | CONSOL Energy | Coterra Energy (Cabot O&G) | Energy Companies | EQT Corp | Exxon Mobil | Noble Energy | Range Resources Corp | Shell | Southwestern Energy | Talisman Energy

Motley Fool’s “Moguls of Marcellus”
December 20, 2012December 20, 2012

The Motley Fool investing website published a “round-up” type of article yesterday that focuses on the major players (drillers) in the Marcellus Shale, part of a series that looks at major energy plays in the U.S.

The article starts off by listing the top 11 companies by the amount of acreage they lease. They are (from highest to lowest amount of acreage):

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Economic Impact | Hydraulic Fracturing | Industrywide Issues | Jobs | Research

New Report: Fracking Creates Jobs in States with No Drilling
December 20, 2012December 20, 2012

In October, global research company IHS released the first (of three) volumes in a new study titled America’s New Energy Future: The Unconventional Oil and Gas Revolution and the Economy (see this MDN story). Yesterday they released Volume 2 of the study which focuses on the economic contributions from the Lower 48 states—from both states where there is unconventional drilling, as well as from states without unconventional drilling. Yes, jobs and economic benefits are generated in non-drilling states thanks to the borders they share with those that do have drilling.

Volume 2 of the study finds that of the states with no unconventional drilling, New York leads the pack in the number of jobs created for its residents as a result of unconventional drilling (thank you Pennsylvania!). Of those states that do have unconventional drilling (i.e. they allow high volume fracking), Texas leads the way in job creation, followed by Pennsylvania. The study also finds that by 2025 Ohio (because of the Utica Shale) will become the third most job-creating state when it comes to the oil and gas industry.

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Hydraulic Fracturing | Industrywide Issues | Regulation

Update: Which Obama Enviros are Going, Which Staying?
December 20, 2012December 20, 2012

Three federal officials (beside Obama) who have the most influence and can possibly cause the most damage to our energy independence as a county are the Secretary of Energy, Secretary of Interior and the Administrator of the Environment Protection Agency. The people who currently hold those positions are, respectively: Steven Chu, Ken Salazar and Lisa Jackson.

Immediately following the November election, the Washington rumor mill started, speculating that all three of them would not serve in a second Obama administration (see this MDN story). The latest thinking is that one of them is gone for sure, one is likely to stay, and one is on the fence. Which is which?…

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Best of the Rest

Marcellus & Utica Shale Story Links: Thu, Dec 20, 2012
December 20, 2012December 20, 2012

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:

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Coterra Energy (Cabot O&G) | Energy Companies | Pennsylvania | Susquehanna County

Cabot Boasts Highest Producing Wells in the Marcellus/Utica
December 19, 2012December 19, 2012

Cabot Oil & Gas announced yesterday that they’ve reached an important production milestone: They now produce more than one billion cubic feet of natural gas per day from the Marcellus Shale. All of Cabot’s Marcellus drilling happens in Susquehanna County, PA, so put another way, Susquehanna County is now producing more than a billion cubic feet of natural gas each and every day—and Cabot is not the only active driller in Susquehanna County! The company credits, in part, the rapid build out of pipeline infrastructure by Williams for the huge increase in production.

Buried in the same press release is what MDN considers major news. Two of Cabot’s recently drilled wells (on a single well pad) have a combined production rate exceeding 66 million cubic feet of natural gas per day (doing the math, each well averages 33 Mmcf/d). Compare that to Gulfport’s top-producing Utica Shale well, which produces 28.5 Mmcf/d (see this MDN story). Of course, there is one major difference between the Marcellus wells in northeast PA and the Utica wells in eastern OH…

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Energy Companies | Equinor/Statoil | Harrison County | Lease & Royalty Payments | Monroe County | Ohio | Tyler County | West Virginia | Wetzel County

Statoil Pays $590M for 70K “Wet Gas” Marcellus Acres
December 19, 2012December 19, 2012

In August, MDN told you that Statoil (a Norwegian company) was in the hunt for more U.S. shale acreage (see this MDN story). Statoil previously purchased a 32.5% interest in Chesapeake Energy’s Marcellus Shale acreage in 2008, securing 600,000 net acres for the company (but not as the “operator” for that acreage). They’ve been in the hunt for more, specifically to become an operator, and today they announced they’ve done a deal for an additional 70,000 Marcellus Shale acres—in the wet gas area of the play.

Statoil officially closed on the deal yesterday with Grenadier Energy Partners LLC, Protege Energy II LLC and PetroEdge Resources II LLC, paying $590 million for 70,000 acres in both West Virginia and eastern Ohio. The purchase price works out to be $8,429 per acre.

Here’s the Statoil press release announcing the deal, along with a slide presentation and map of the newly acquired acreage:

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Energy Services | Industrywide Issues | Inergy | Pennsylvania | Pipelines | Statewide PA | UGI Energy Services | WGL Holdings

Commonwealth Pipeline for Marcellus Region on Hold
December 19, 2012December 19, 2012

A 120-mile**, large (30-inch) Marcellus Shale pipeline from Lycoming County, in northeastern Pennsylvania, all the way to Rockland, Maryland was announced in March of this year. The three companies planning it—Inergy, UGI and WGL Holdings—dubbed it the Commonwealth Pipeline and said it will cost $1 billion to build it (see this MDN story for the original announcement). The three companies offered a non-binding “open season” (period of time when other companies commit to using capacity in the pipeline) and in June announced the open season went better than expected (see this MDN story).

However, the Commonwealth Pipeline is now on hold and work has stopped. What happened?

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Anti-Drilling/Fossil Fuel | Health Impacts | Hydraulic Fracturing | Industrywide Issues | New York | Regulation | Statewide NY

Anti-Drilling Groups Demand Copy of DEC Health Study
December 19, 2012December 19, 2012

Just a few days in to a 30-day public comment period in New York State for revised fracking rules, a collection of the same old anti-drilling groups with the same old agenda (delay indefinitely in hopes of a ban) sent a letter to State Health Commissioner Nirav Shah and Environmental Conservation Commissioner Joseph Martens demanding an advance copy of the “health review study” being reviewed by three outside health experts.

The letter (full copy embedded below) says in part:

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Energy Companies | Gastar Exploration | Marshall County | West Virginia

Gastar Issues Report on Marcellus Drilling Results/Strategy
December 19, 2012December 19, 2012

Gastar Exploration Ltd. provided an update this morning on the results of its 2012 drilling operating operations in the Marcellus Shale. Gasstar says they currently operate 34 gross Marcellus Shale wells (in Marshall County, WV) and will up that number to 38 wells by the end of the year. They also discuss their Marcellus drilling strategy in the near-term, over the next several months:

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Energy Companies | Southwestern Energy

Southwestern Energy’s 2013 Plan: Double Marcellus Production
December 19, 2012December 19, 2012

Southwestern Energy yesterday issued their 2013 spending plan and best estimates for the production/results they believe they will achieve in 2013. Of interest to MDN is their plans for the Marcellus. Southwestern says they will more than double natural gas production in the Marcellus—from 63-65 billion cubic feet this year to 160-165 Bcf next year. They’re also increasing their budget for Marcellus drilling by $165 million—to $705 million.

Here’s the entire announcement from Southwestern, which includes all of their operational areas (not just the Marcellus):

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Hydraulic Fracturing | Industrywide Issues

Esquire Magazine: Thank You for Fracking
December 19, 2012December 19, 2012

A surprisingly balanced human interest article written about the issue of hydraulic fracturing has just appeared in Esquire magazine (yes, that Esquire). The story takes a look at Curt Coccodrilli, who used to work for Bonnie Raitt before she fired him because he supports fracking. Must be she didn’t want to give them something to talk about. (Yeah, you saw that groaner coming!)

The article begins this way:

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Best of the Rest

Marcellus & Utica Shale Story Links: Wed, Dec 19, 2012
December 19, 2012December 19, 2012

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:

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Energy Companies | Gulfport Energy | Lease & Royalty Payments | Ohio | Rhino Resource Partners | Statewide OH

Gulfport Adds Another 30K Utica Net Acres, Pays $10K/Acre
December 18, 2012December 18, 2012

Gulfport Energy announced yesterday they have purchased another 30,000 Utica Shale acres in eastern Ohio for $300 million—or $10,000 per acre. That brings Gulfport’s grand total to 137,000 gross Utica Shale acres (99,000 net acres). Gulfport bought the acreage from its Utica Shale joint venture partner Wexford Capital. Perhaps a better way of phrasing it: Gulfport increased its ownership interest in acreage in which they’ve already invested.

Gulfport and Wexford, along with Rhino Resources, have previously invested in both two and three-way Utica Shale jv’s together (see this MDN story). So far, Gulfport has drilled the top producing wells in Ohio (see this MDN story for the secret to their success).

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BP | Energy Companies | Industrywide Issues | Ohio | Pipelines | Processing Plants | Trumbull County | Utica Shale

BP: Trumbull County Needs More Pipelines, Processing Plants
December 18, 2012December 18, 2012

Yesterday at a press conference in Youngstown, OH, BP announced plans to move into a new office and warehouse space in the Youngstown Commerce Park (see this MDN story). At the same event, BP officials spoke about their concerns that pipeline and processing plant infrastructure in Trumbull and surrounding counties may be quickly overwhelmed once BP’s drilling program is in full swing.

What do BP’s public comments mean? More pipelines and processing plants are likely on the way in Trumbull County:

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BP | Economic Impact | Energy Companies | Industrywide Issues | Mahoning County | Ohio | Trumbull County | Utica Shale

BP Moves into New Utica Shale Digs, Drilling Starts January
December 18, 2012December 18, 2012

Important Update: BP will not start drilling test wells until April 2013, not January as indicated in the headline (and as quoted in the story below). The news source quoted by MDN was inaccurate! Many thanks (and a hat tip) to MDN friend Andrea Wood, Publisher of the Youngstown Business Journal, for taking the time to notify us of the error.

BP announced yesterday they have begun moving into the company’s new “Utica Operations Center,” a 5,000 square foot office space with 38,000 sq ft of warehouse/storage space located in the Youngstown Commerce Park in North Jackson (Mahoning County), Ohio. BP aggressively leased Ohio Utica Shale acreage during 2012—signing up some 100,000 acres of leases this year. Of the Ohio acreage leased by BP, the vast majority (84,000 acres) is in Trumbull County, close to the new office space.

Ohio landowners who signed with BP, and businesses interested in supplying BP with products and services, will be interested to know BP plans to start drilling their first Utica Shale test wells in January 2013 (more details below).

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Energy Companies | EV Energy Partners | Lease & Royalty Payments | Utica Shale

EV Energy Partners About to Shed Utica Acreage
December 18, 2012December 18, 2012

Landowners in the Utica Shale who signed with EV Energy Partners, take note: Your lease may soon be reassigned.

An article on the Seeking Alpha website takes a close look at EV Energy Partners (EVEP) and their large Utica Shale investments. EVEP is structured as a “master limited partnership” or MLP. The focus for an MLP is distributing (via quarterly payments called distributions) most of the profit made by the company to its partners/shareholders. Because of its MLP structure, long-term development of “speculative” plays like the Utica is not in line with the company’s mission, so EVEP is looking to shed most of it’s Utica Shale leases—and they’re doing it soon…

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