New Leases Sought in Columbiana County, OH, for Oil Drilling
Leasing activity is picking up once again in the northern part of the Ohio Utica shale play. Greg Carver, a trustee with Knox Township in Columbiana County, says he was recently contacted about leasing 15 acres he owns for new oil drilling. In late February, a consortium paid $1.6 million for mineral rights for 345 acres in Knox Township. Holy smokes! That’s $4,637 per acre! It sure sounds like Utica leasing is “back” — just not where you might think it would be.
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While you wouldn’t know it from looking at the NYMEX Henry Hub futures price, the cuts in production from Marcellus/Utica producers, including Chesapeake Energy, ETQ, Antero Resources, Coterra Energy, CNX Resources, and others, IS having an effect on prices — on the spot prices of physically-traded natural gas in the M-U region. Over the past eight weeks, gas production from the Marcellus and Utica shale has fallen sharply.
The government screws up just about everything it touches — ever notice that? A perfect example is a water testing program set up by then-Attorney General Josh Shapiro in December 2022. In August 2022, Shapiro, who AG at the time, announced that he had finally bullied Energy Transfer into pleading “no contest” (meaning they don’t admit to a darned thing) in a so-called criminal case against the company for a series of accidents affecting construction for both the Revolution and Mariner East pipelines (see 
The production of ethane in the U.S. — one of several natural gas liquids (NGLs) that come out of the ground when drilling both oil and gas wells — rose 9% in 2023 to a new record high of 2.6 million barrels per day (b/d), according to the U.S. Energy Information Administration (EIA). Record ethane production was a result of the boom in natural gas production and the addition of two new ethane cracker plants coming online, one in Texas and the other in Pennsylvania.
In January, Joe Biden announced a “pause” for any approvals of new LNG export plants (currently 17 requests in the pipeline) for at least one year (see 
OTHER U.S. REGIONS: Unions push back on Chicago mayor’s plan to end natgas connections; NATIONAL: Climate alarmists’ bad science; LNG permitting pause – an essential tool, or bargaining chip?; Biden administration cancels SPR purchases; INTERNATIONAL: Iraq fails to meet OPEC+ oil target.
Mountain V Oil & Gas, headquartered in Buckhannon, WV, is a privately owned independent energy company with both conventional and shale assets in the Appalachian Basin. The company acquires and drills wells on over 300,000 leased acres, mainly focused on gas wells. Mountain V is now expanding its focus to include oil. Last fall, the company signed an agreement to buy the oil and gas assets of AXP Energy — assets located in Tennessee, Eastern Kentucky, Virginia, and the Illinois Basins — for $4 million. The AXP purchase with its oil-heavy assets closed earlier today.
A royalty case that took nearly four years and hundreds of filings by both sides was finally decided by an Ohio jury in March (see 
SLB (formerly Schlumberger) is the largest oilfield services (drilling and fracking) company in the world. It does a lot of work in the Marcellus/Utica. SLB announced yesterday a deal to buy a smaller rival, ChampionX, in an all-stock deal valued at $7.75 billion. ChampionX specializes in chemistry solutions (fracking fluids), artificial lift systems, and equipment and technologies that help companies drill for and produce oil and gas. Little did we know until we checked, but ChampionX has a major presence in the Marcellus/Utica region via supply chain vendors who sell its products and services. So this combination, which has national and international implications, also has the power to affect drilling and fracking here in the M-U.
In January, we told you the State of Maine was actively considering a new law, L.D. 2077, that would prohibit natural gas companies from charging ratepayers for the construction and expansion of gas service mains and gas service lines beginning Feb. 1, 2025 (see 
MDN is not a stock-picking service, but we spotted an interesting article appearing on the Seeking Alpha investor’s website about where to invest now so that when the price of natural gas eventually rebounds (and with it, lifts the stock price of gas producers), investors can make money. The investor/writer, who is a nuclear power engineer by training, proposes the theory that investing in the Marcellus/Utica is a better choice than investing in other gas plays because (a) our drillers have lower breakeven costs and (b) some of our drillers also produce NGLs, which fetch more money than methane.
Natural gas is, as we have often pointed out, one of the purest commodity markets in existence. The classic supply/demand curve is at work. If there’s more supply than demand, prices for gas move down. And conversely, if there’s more demand than supply, prices move higher. We have been stuck in a sucky price pattern this year, not helped by a very moderate winter. The phrase on the lips of every landowner and driller is, When will the price move higher? According to analysts from Morgan Stanley, not anytime soon.