Tuesday, November 26, 2019

Utica Rig Count Drops to 10

WEEK ENDING 11/23/19

New permits issued last week: 9 (Previous week: 1)  +8
Total horizontal permits issued: 3206 (Previous week: 3201 +5
Total horizontal wells drilled: 2734 (Previous week: 2732)  +2
Total horizontal wells producing: 2366 (Previous week: 2361)  +5
Utica rig count: 10 (Previous week: 13)  -3

CSU Study Says Shale Investment in Ohio is Up to $78 Billion Since 2011

From a JobsOhio press release:
Total investment in Ohio's resource rich shale energy sector has reached $78 billion since tracking began in 2011, according to a Cleveland State University (CSU) study. 
Prepared for JobsOhio, the report represents the most recent data available and covers shale investment through the second half of 2018. Earlier in the year, IHS Markit released estimates that by 2040, the Utica and Marcellus shale region, of which Ohio is a significant part, will supply nearly half of all U.S. natural gas production. 
The study from CSU's Energy Policy Center at the Maxine Goodman Levin College of Urban Affairs, showed drilling investments were slightly down in the second half of 2018 compared to the first half, but total upstream investments were up. Total shale-related investment in Ohio for the second half of 2018, including upstream, midstream and downstream, was around $3.82 billion. Total investment from 2011-2018 totaled about $77.7 billion.

Upstream activities, such as drilling or royalties, accounted for more than $3.5 billion of this total. According to the Ohio Department of Natural Resources Division of Oil and Gas, 117 new wells were drilled during the third and fourth quarters of 2018, 40 fewer than in the first half of the year. Yet longer laterals are resulting in higher production and increased investment per well. Data indicates that the volume of gas-equivalent shale production in the second half of 2018 was 17.7% higher than in the first half, with total upstream spending in the second half of 2018 exceeding that for the first half by around $173.4 million.
Read the whole release by clicking right here. 

Pipeline Through Hamilton County Gets Official Green Light

From WXVU:
The Ohio Power Siting Board Thursday approved Duke Energy's request for a natural gas pipeline in Hamilton County. 
The board approved the Certificate of Environmental Compatibility and Public Need for the Central Corridor Pipeline Extension's alternative plan. 
The alternative plan proposes running the nearly 13-mile, 20-inch diameter pipeline from Blue Ash to just south of Golf Manor along a route that primarily follows Reading Road, passing through Amberley Village, Cincinnati, Evendale, Reading and Sharonville as well as Blue Ash and Golf Manor. 
You can see the exact route in the diagram below.

Gulfport Energy Decides to Cut Jobs and Stop Share Buybacks, Leaving Top Investor Angry

From Reuters:
U.S. gas exploration and production company Gulfport Energy Corp (GPOR.O) on Monday confirmed that it would cut jobs, change its board and end its share buybacks, in a bid to reverse a slide in its stock price. 
Reuters had reported the news earlier in the day, citing sources. 
Gulfport shares, which fell 7.8% to $2.85 in morning trading, have lost about 67% of their market value in the last 12 months, as weak natural gas prices have eroded its profitability and forced it to slash capital investment. 
Gulfport, whose production is focused primarily in the Utica Shale in Ohio and SCOOP acreage in Oklahoma, also made a new commitment to use excess cash to pay down debt, which totaled $2.1 billion as of the end of September. 
The company said it would shed about 13% of its workforce. It also said that Chairman David Houston will not seek reelection to the company’s board when his term ends in 2020, with two other directors - Craig Groeschel and Scott Streller - stepping down from Gulfport’s board by the end of this year.
Click here to read the whole article.

And in another story from Reuters:
Firefly Value Partners on Thursday asked Gulfport Energy for a seat on its board and criticized the “half-measures” which the U.S. gas exploration and production company is taking to improve its financial performance. 
On Monday, Oklahoma City-based Gulfport announced job cuts, board changes and an end to its share buyback program to focus on debt repurchases, to help reverse a more than 65% slide in its share price over the last 12 months. 
But Monday’s proposals failed to captivate investors who pushed the stock down further. 
By Thursday, the New York-based hedge fund fired off a letter to the board in which it blamed the current directors for the company’s failures and said these people could not be entrusted to “clean up the mess they have made.” 
“That is why we are asking that the board immediately fill one of the new director vacancies with a Firefly principal as a shareholder representative,” the letter said.
Read on by clicking here. 

Wednesday, November 20, 2019

Ohio Counties Outside of Utica Drilling Look to Cash In on Shale Boom

From the Times Leader:
As drillers tap the natural gas reserves beneath Ohio’s easternmost counties, community leaders to the west hope to pump some of those profits into their own economies by developing ancillary industries.

Ohio Rep. Adam Holmes, R-Nashport, met recently with representatives of JobsOhio and the Appalachian Partnership for Economic Growth to discuss ways that counties adjacent to the Marcellus and Utica shale region can capitalize on the activity that is taking place there. At the Zanesville meeting, Holmes said counties such as Muskingum — which lies just west of Guernsey County and within 50 miles of many parts of Noble, Monroe, Harrison and Belmont counties where much of the drilling is taking place — are ideal locations for support services related to the industry. 
Holmes suggested that because of its central location less than an hour east of the state capital and along Interstate 70, Muskingum County is a suitable spot for trucking companies to set up maintenance and repair facilities. He said the location is also ideal for pipe yards and manufacturing and storage for pipelining companies. He pointed out that the flatter terrain of Muskingum County, as opposed to the rolling hills of the more eastern counties, means it is easier to construct large buildings and facilities there. 
He referred to his legislative District 97, which includes Guernsey and Muskingum counties, as a “downstream area” in connection with the industry.
Click here to read the whole article. 

Still No Official Decision on Belmont County Cracker Plant, But Work Continues at Proposed Site

From WTOV News:

There appears to be some movement at the site of the proposed ethane cracker plant. We took SkyView9 to the location Wednesday to get a better look. 
You can see dirt being moved and some construction work which appears to be making way for the plant in Dilles Bottom, but there is still no confirmation of the plant from PTT Global Chemical.
Click here to view the full article on WTOV's site. 

Rig Count Down to 13, Permitting Slowing Again in Utica Shale

WEEK ENDING 11/09/19

New permits issued last week: 6 (Previous week: 8)  -2
Total horizontal permits issued: 3201 (Previous week: 3192 +9
Total horizontal wells drilled: 2724 (Previous week: 2714)  +10
Total horizontal wells producing: 2358 (Previous week: 2345)  +13
Utica rig count: 13 (Previous week: 14)  -1

WEEK ENDING 11/16/19

New permits issued last week: 1 (Previous week: 6)  -5
Total horizontal permits issued: 3201 (Previous week: 3201 +-0
Total horizontal wells drilled: 2732 (Previous week: 2724)  +8
Total horizontal wells producing: 2361 (Previous week: 2358)  +3
Utica rig count: 13 (Previous week: 13)  +-0

Friday, November 8, 2019

Gulfport Energy Looking to Sell Some Utica Assets

From the Times Reporter:
Gulfport Energy is looking to sell some of its interests in the Utica Shale. 
The company announced the plan ahead of its Friday conference call with investors to discuss third-quarter earnings. 
Gulfport said proceeds from its sale of non-operated interests would offset higher-than-anticipated spending this year in the Utica. The company expected to have an agreement on the sale before the end of the year, according to a press release.

Oklahoma City-based Gulfport lost $48.8 million, or 31 cents per diluted share during the quarter. 
The company’s average production was equivalent to 1.5 billion cubic feet of natural gas per day. Utica wells accounted for 80 percent of production.
Click here to continue the article. 

EQT Looking to Sell Off its Ohio Assets

From the Pittsburgh Post-Gazette:
One of Mr. Rice’s signature promises during the proxy battle was to bring EQT’s costs down to $735 per foot. For an average well being drilled next year in southwestern Pennsylvania, at 13,000 feet long, that would translate to $9,555,000. He said EQT will be below that level by the second half of next year in this area. Its West Virginia and Ohio programs have higher cost and shorter laterals. 
But while company leaders told analysts on Thursday that “West Virginia will become a larger part of EQT’s story going forward,” the Ohio assets that Mr. Rice personally negotiated at a critical point in his former firm Rice Energy’s trajectory may be headed for a sale. 
To pay off debt, EQT is also considering selling off holdings in central Pennsylvania and southern West Virginia. 
It is also looking at selling a stake in its mineral interests, as has become more common in the industry with players like Range Resources. A deal on royalty interests could come in “a matter of months,” EQT’s leaders said and might involve a cut of current and/or future production.
Read the whole article by clicking here. 

Murray Energy Corp. Files for Bankruptcy

From the Pittsburgh Business Times:
Murray Energy, the nation’s largest privately owned coal mining company — which owns facilities in West Virginia and Ohio — filed for Chapter 11 bankruptcy protection Tuesday. 
Murray Energy, which is based in St. Clairsville, Ohio, reported between $1 billion and $10 billion in estimated liabilities and assets between $1 billion and $10 billion in the filing in the U.S. Bankruptcy Court for Southern Ohio. Its top 10 unsecured creditors have $126.9 million in claims, according to the bankruptcy filing. 
Murray Energy founder Robert Murray, one of the strongest voices in the coal industry, will move from CEO to chairman. Robert D. Moore has been named president and CEO of Murray Energy and Murray Energy Corp.
Click here to read more. 

Tuesday, November 5, 2019

GOP Effort to Block Nationwide Fracking Ban Gets Stopped by House Democrats

From the Washington Times:
House Democrats blocked Tuesday consideration of a resolution in support of hydraulic fracturing as Republicans sought to protect the U.S. energy boom from Democratic presidential candidates seeking to ban fracking nationwide 
The resolution, sponsored by Rep. Rob Bishop, Utah Republican, affirmed that states should “maintain primacy for the regulation of hydraulic fracturing for oil and natural gas production on State and private lands,” and that no president should impose a moratorium without congressional approval. 
“In recent weeks, many of the Democratic candidates for president have pledged to ban hydraulic fracturing in the United States, a campaign promise straight out of the keep-it-in-the-ground playbook,” said Rep. Debbie Lesko, Arizona Republican, in a floor speech. 
Sens. Kamala Harris, Bernard Sanders and Elizabeth Warren, all 2020 Democratic presidential hopfeuls, have called for a nationwide ban on fracking, an extraction process used in the vast majority of U.S. natural gas production.
Read the whole article by clicking right here. 

Analysts Try to Quantify Effects of Fracking Ban Promised by Democratic Presidential Candidates

From Forbes:
A number of Democratic candidates have endorsed a fracking ban, recently including Elizabeth Warren, and as Bob McNally said, this would “vaporize the oil and gas boom in the United States.” In this piece, I will try to quantify the impact of a fracking ban on the U.S. natural gas supply, and the concomitant economic effects. 
Of course, there is some skepticism that she would actually do that if elected, and suspicion that the suggestion is nothing more than an attempt to appeal to the more liberal Democratic primary voters. Given that Democrats from Barack Obama to Jerry Brown have not opposed (regulated) fracking, and the pertinent fact that politicians often make promises they don’t intend to keep, (shocking I know), I would lean towards that myself. 
My belief is strengthened by the nature of the arguments in favor of a fracking ban. Yes, it’s done by big oil (I mean BIG OIL), except many of the companies are much smaller. Yes, it’s a novel method, except it’s been done for about a century in various forms. And yes, there is evidence of pollutants like benzene near fracking sites, but mainly because there’s benzene nearly everywhere. One would like to think that the public would recognize that argument resembles fears of radiation from nuclear power plants—which are trivial when compared to natural radiation levels.
Click here to read the rest of the article. 

AEP Sells Thousands of Acres to Ohio, Retains Subsurface Rights

From The Columbus Dispatch:
Thousands of acres of land the state of Ohio has agreed to purchase from American Electric Power for recreation and conservation does not include the subsurface rights. AEP is holding onto those rights for potential future drilling for oil and natural gas. 
The state’s planned $47 million purchase of more than 31,000 acres of land in eastern Ohio for recreation and conservation does not include the subsurface rights, and some of it likely will be the site of fracking activities, The Dispatch has learned. 
Ohio Gov. Mike DeWine — flanked by outdoorsmen and members of the General Assembly — announced the land purchase in eastern Ohio from American Electric Power a few weeks ago. The move was applauded by conservationists because the land, formerly used by the utility for strip mining, would be used by the Ohio Department of Natural Resources for recreation and conservation and designated as a state park. 
However, a draft of the purchase agreement obtained by The Dispatch shows AEP will retain the subsurface rights to the land for potential oil and gas drilling. 
The draft states that AEP retains the “right to construct, install, and maintain well site locations, access roads, production equipment, pipeline systems, and utilities and to conduct seismic and geological surveys and the right to drill and extract from new water wells and reasonable use of non-domestic surface water for such purposes.”
You can continue this article by clicking here. 

President Trump Praises Shale Drilling During PA Rally

From Kallanish Energy:
President Trump Wednesday celebrated a love-in in the Appalachian Basin. 
The president delivered a 64-minute salute to shale drilling and the U.S. energy industry at the 9th annual Shale Insight conference in Pittsburgh. Kallanish Energy was in attendance. 
“You are the No. 1 producer of oil and natural gas on the planet Earth, No. 1 by far,” he said. “America is a winner, a winner, a winner, a winner. We’re not being laughed at anymore.” 
Shale drilling has reshaped the American economy and Americans are benefitting from lower heating bills and more jobs, Trump said. 
‘I like energy people’ 
“I like energy people,” he said. He addressed an audience of roughly 5,200 persons at the David Lawrence Convention Center, including nearly 1,480 conference attendees and those involved in staging the conference. 
The conference was staged by the Marcellus Shale Coalition, the Ohio Oil and Gas Association and the West Virginia Oil and Natural Gas Association.
Click here to read the whole article. 

November 2019 Well Activity Maps Posted by ODNR

Rig Count Back to 14 in Utica Shale

WEEK ENDING 10/26/19

New permits issued last week: 8 (Previous week: 10)  -2
Total horizontal permits issued: 3192 (Previous week: 3187 +5
Total horizontal wells drilled: 2714 (Previous week: 2708)  +6
Total horizontal wells producing: 2345 (Previous week: 2340)  +5
Utica rig count: 14 (Previous week: 13)  +1

WEEK ENDING 11/02/19

New permits issued last week: 6 (Previous week: 8)  -2
Total horizontal permits issued: 3198 (Previous week: 3192 +6
Total horizontal wells drilled: 2719 (Previous week: 2714)  +5
Total horizontal wells producing: 2355 (Previous week: 2345)  +10
Utica rig count: 14 (Previous week: 14)  +-0

Monday, November 4, 2019

FirstEnergy Will Try Anything to Avoid Reversal on Nuclear Bailout

From Cleveland.com:
A federal judge has rejected a last-ditch plea by opponents of Ohio’s new nuclear bailout law to be granted 38 additional days to collect petition signatures for a referendum overturning it. 
Instead, U.S. District Court Judge Edmund A. Sargus asked the Ohio Supreme Court for its opinion on whether to grant more time, on the grounds that the legal questions involved the Ohio Constitution, not the U.S. Constitution. 
“The court has jurisdiction to decide cases and controversies arising only under federal law,” the judge wrote in an opinion issued Wednesday night. “As the parties agree, this court does not have jurisdiction over any claim that the secretary of state or the Ohio General Assembly has violated the referendum provisions of the Ohio Constitution.” 
Sargus sent four “certified questions” to the state Supreme Court, including whether anti-HB6 activists should be credited with more time to collect signatures. 
Under state law, referendum seekers have 90 days to collect and submit at least 265,774 valid signatures to qualify for the ballot. 
But the group Ohioans Against Corporate Bailouts sought a preliminary injunction for an extra 38 days, because that is how long it took them to get approval from Attorney General Dave Yost and Secretary of State Frank LaRose to start collecting signatures.
Read the whole article by clicking here.

Another article from Cleveland.com:
Police have charged a now-former worker for the campaign defending Ohio’s House Bill 6, the recently passed nuclear bailout law, as a result of her confrontation in suburban Columbus with a worker for the campaign trying to repeal the law. 
Dublin police said Friday they have charged Stinner Wimberly Shine of Columbus with a misdemeanor count of criminal damaging. She was charged after police say she broke a cell phone belonging to Harold Chung, a Las Vegas man working for the pro-repeal campaign. 
Chung was collecting signatures Tuesday outside a Dublin library when he tried to take a picture of Wimberly Shine, who had been hired by the pro-HB6 campaign to try to disrupt the signature gathering process. 
The charge is a second-degree misdemeanor with a maximum penalty of 90 days in jail and a $750 fine. 
Cleveland.com obtained surveillance footage of the incident from the Columbus Metropolitan Library system via a public records request.
Click here to continue reading and view the video.

And with more details on how dirty the fight over this issue has become, this is from the Dayton Daily News:
Opposing House Bill 6 and favoring a referendum: Ohioans Against Corporate Bailouts, a coalition of business, consumer and environmental groups, opposes the new law and is seeking to put it up for a referendum in November 2020, the same day as the presidential election. 
Favoring House Bill 6 and opposing a referendum: Akron-based FirstEnergy Solutions, Generation Now, Ohioans for Energy Security and owners of the Ohio Valley Electric Corp. plants. 
At stake is more than $1 billion slated to go to FirstEnergy Solutions and OVEC if the new law is preserved. 
An expensive campaign 
Supporters of HB6 have spent $16.56 million so far on advertising to get the bill passed and stop the referendum, according to Medium Buying, a firm that tracks ad buys. 
Opponents of HB6 have spent $4.46 million so far, according to the firm.

Those figures do not include money spent on lobbyists, political strategists or petition circulators. 
Political insiders who run ballot issue campaigns say the spending and the hardball tactics are jaw dropping. 
“Ohio has never ever seen this level of decline-to-sign petition campaign,” said Ian James, who ran the 2015 ballot campaign to legalize marijuana in Ohio. “And I doubt, if the petition falls short on signatures, that Ohioans will ever truly know the level of funding that was spent for and against the petition HB6 effort.”
Read more by clicking here.