Showing posts from December, 2018

Rice Brothers Challenging EQT Leadership

EQT headquarters in Pittsburgh From Reuters: EQT Corp’s board of directors will ask to meet Toby and Derek Rice for talks, people familiar with the matter said on Sunday, after the two brothers threatened the largest producer of natural gas in the United States with a board challenge.  The Rice family sold its company Rice Energy Inc to EQT for $6.7 billion in cash and stock last year. It now owns about 2.75 percent of EQT, and Toby and Derek Rice wrote a letter last week to EQT’s board asking for a “course correction”.  The brothers have also warned EQT that they will nominate their own directors to its board at its next annual shareholder meeting in 2019 if a “mutually agreeable outcome” is not reached.  EQT Chairman Jim Rohr and Chief Executive Rob McNally plan to write to the Rice brothers to ask them to discuss their plans for the company in more detail with the board, the sources said, asking not to be identified because the matter is confidential. Click here to cont

BLM Auctions Off More Wayne National Forest Land

Wayne National Forest From NGI: Nearly half of the roughly 2,456 acres in Ohio, Michigan and Mississippi auctioned for oil and gas development last week by the Bureau of Land Management's (BLM) Eastern States Office received no bids.  Instead, about 1,313 acres in all three states were leased by Texas-based R & R Royalty Ltd. The rest of the acreage in Muskegon County, MI, and George County, MS, attracted no bids. The sale generated only about $ 22,636, but the bulk of those profits came from just 75 acres in Ohio's Wayne National Forest (WNF).  The parcels, in the Utica Shale hotspot of Monroe County, earned about $ 200 / acre and took in nearly $ 16,000, including bonus payments and other fees.  BLM said in 2015 it was considering leasing land in the WNF's Marietta Unit, which spans 40,000 acres in Ohio's Monroe, Washington and Noble counties, which were nominated by the industry for unconventional development. The Eastern States Office began auctioni

Digging Deep Into the 3rd Quarter 2018 Utica Shale Production Figures

The Ohio Department of Natural Resources has now released the production data from the Utica shale for the third quarter of 2018. As always, we are going to give you a look at how the numbers compare to past quarters, past years, and how they break down among the various drillers who are active in Ohio and the counties where they are drilling. We'll look at where the production numbers would end up for 2018 if they continue at the same pace as they have had through the first three quarters. We also have the top 10 oil and gas wells detailed below. PRODUCTION RATE COMPARISONS First up, let's take a look at how the quarterly data compares from the first quarter of 2014 (which is when the ODNR began reporting quarterly data rather than one yearly report) through the third quarter of 2018. As a reminder, all oil figures are 42-gallon barrels, and all gas production is measured in MCF: Oil production continues its rebound in the third quarter.  The total output is the mo

ODNR Releases 2018 Third Quarter Utica Shale Production Data

From the Ohio Department of Natural Resources: During the third quarter of 2018, Ohio’s horizontal shale wells produced 5,545,536 barrels of oil and 605,716,125 Mcf (605 billion cubic feet) of natural gas, according to figures released today by the Ohio Department of Natural Resources (ODNR).   Natural gas production from the third quarter of 2018 showed a 31.44% increase over the third quarter of 2017, while oil production increased 31.79% for the same period.                                   2017 Quarter 3 (Shale) 2018 Quarter 3 (Shale)     % Change Barrels of Oil                  4,207,674 bbl                  5,545,536 bbl                       31.79% Mcf of Natural Gas 460,844,826 Mcf             605,716,125 Mcf                31.44%   The ODNR quarterly report lists 2,242 horizontal shale wells, 2,198 of which reported oil and natural gas production during the quarter. Of the wells reporting oil and natural gas results:    The average amount

Rig Count Jumps by Two on Latest ODNR Utica Shale Report

New permits issued last week:   9  (Previous week:  13 )   -4 Total horizontal permits issued:  2953  (Previous week:  2948 )   +5 Total horizontal wells drilled:  2469  (Previous week:  2467 )   +2 Total horizontal wells producing:  2092  (Previous week:  2088 )   +4 Utica rig count:  19  (Previous week:  17 )   +2

Landowners Advised to Hold Out on Cabot Lease Offers

From Farm and Dairy: As landowners in the Ashland-Holmes-Wayne County area await official production results from exploratory wells drilled by Cabot Oil and Gas, attorneys for the landowners say it also makes sense to wait before signing any new lease agreements.  A group of approximately 50 area farmers and landowners, many whom are part of the Mohican Basin Landowners Association, met in the basement of a church Dec. 13 for an update on drilling and leasing activity.  Houston-based Cabot Oil and Gas has drilled two test wells in the area, with plans for several more, through a sublease agreement with TransCanada, the company that owns many of the old Columbia Gas leases in the area.  Seeking signatures  Over the past couple years, Cabot has had representatives in the area, seeking signatures from landowners that would amend and ratify existing leases, allowing Cabot to perform horizontal fracturing of wells that go beneath the Utica Shale formation. Read more of this artic

Ohio Supreme Court Offers Clarification of Ohio Marketable Title Act

From Vorys: On December 13, 2018, the Supreme Court of Ohio clarified the preservation of interests under the Ohio Marketable Title Act (OMTA). See Blackstone v. Moore, Slip Opinion No. 2018-Ohio-4959. In its decision, the Court held that under the OMTA, a deed reference to a previously reserved royalty interest is sufficiently-specific to preserve that royalty interest where the reference identifies the type of interest created and the person to whom the interest was granted.  You can read the decision here .  BACKGROUND   The Kuhns conveyed real property to the Browns in 1915, reserving a one-half interest in oil and gas royalties. In 1969, the Browns’ successor-in-interest conveyed the same property to David Blackstone by a deed that referenced the Kuhns’ royalty interest as follows:  Excepting the one-half interest in oil and gas royalty previously excepted by Nick Kuhn, their [sic] heirs and assigns in the above described sixty acres. Click here to read more. 

Shale Industry Has Come a Long Way Since 2014

From Bloomberg: U.S. shale’s response to OPEC’s decision to cut supply and boost prices: We’ll take it, but we don’t need it. In 2014, the U.S. oil industry’s fate seemed to rest in the hands of OPEC ministers who were flooding the market with cheap oil in a push to obliterate them. Now, the cartel is in full retreat, agreeing to cut output to keep their own economies healthy even as U.S. production continues to surge.  The move came in a week in which oil fell to near $50 a barrel, a price that four years ago would have panicked U.S. drillers. But since then, shale explorers have cut costs, boosted fracking efficiency and made wells longer and more productive. The result: Break evens for a 30 percent profit have been almost halved to just $45 a barrel in the prolific Permian Basin. “The shale industry can now thrive in a $50 oil world,” David Deckelbaum, a New York-based analyst at Cowen & Co., said by phone. The OPEC decision to support prices over $50 in the U.S. “un

Four Injured in Processing Plant Fire

From the Pittsburgh Post-Gazette: Four people were injured and one was in critical condition Thursday night after a fire at a Washington County gas processing plant Thursday night .  The explosion involved a condensate tank at the MarkWest Energy facility at 800 Western Ave., in Houston, Pa. It was reported at 6:03 p.m. and the fire brought under control within an hour, according to county emergency officials. Work was being performed by a contractor, Energy Transportation LLC of Bridgeport, W.Va., according to the U.S. Occupational Safety and Health Administration which opened an investigation into the incident on Friday.  All of the injured workers suffered burns. Two were flown to UPMC Mercy, including one person who was in critical condition Friday morning, officials said. The other two injured were flown to West Penn Hospital. Click here to read more. 

Monroe County Shale Rail Project Gets $20 Million Federal Grant

From a press release: The following press releases from certain members of Congress were recently released to announce a $20 million federal grant for rail and pipeline infrastructure improvements at the Long Ridge Energy Terminal, wholly-owned by Fortress Transportation and Infrastructure Investors LLC.  Brown Announces $20 Million in Federal Funding for Monroe County Infrastructure Project  Funds will Support Economic Development Efforts in Hannibal, Ohio  Thursday, December 6, 2018  U.S. Sen. Sherrod Brown (D-OH) today announced $20 million in new federal funding for the town of Hannibal, Ohio to invest in its rail transloading project. This funding will allow the Ohio Rail Development Commission to construct a railyard and pipeline facility in order to increase the Long Ridge Energy Terminal’s capacity and connect it to existing rail infrastructure. This will give the area’s energy exports, including natural gas, better access to global markets. Brown wrote to the Depa

Some Recent Oil and Gas Numbers Are Very Impressive

From Forbes: They say numbers don't lie, and the last two weeks for the U.S. oil and gas industry have seen the announcements of some pretty amazing numbers. These are numbers that demonstrate exactly how productive and efficient the business has become, and numbers that must be put into some context to understand how extraordinary they really are.  So, as we move into mid-December 2018, let's give it a shot:  The U.S became a "net exporter" of petroleum liquids for the first time 75 years. - That's right, the week of November 30 through December 5 saw the United States of America actually export more crude oil and other oil-derived liquids than it imported from other countries. The key part of that sentence is "other oil-derived liquids," which include gasoline, diesel and other refined products. Rolling all of those products into the equation, the U.S. exported about 211,000 barrels per day more than it imported for the week, a s reported by Bl

OPEC and Allies Agree to Slash Oil Production

From CNBC: Major oil producers have reached a deal to cut oil production and boost the market, following two days of grueling negotiations and despite opposition from U.S. President Donald Trump .  OPEC clinched the deal with allied oil-producing nations including Russia at its headquarters in Vienna, Austria on Friday. The gathering came after deep divisions in the energy alliance were laid bare at a closely-watched meeting on Thursday, with OPEC unable to agree on the terms of crude output cuts.  The alliance will take 1.2 million barrels per day off the market for the first six months of 2019. The 15-member OPEC cartel has agreed to reduce its output by 800,000 bpd, while Russia and the allied producers will contribute a 400,000 bpd reduction. The deal is in line with expectations for the allies to throttle back output by 1 million to 1.4 million bpd. Now we will likely see U.S. shale drillers ramp up oil production.  Click here to read the rest of this story from CNBC.

NEXUS Owner and Contractor Facing At Least a Dozen Lawsuits from Ohio Landowners

From The Canton Repository: Several landowners along the NEXUS pipeline have sued the pipeline’s owner and its construction contractor, saying the companies broke agreements to protect and restore properties affected by the project.  Michael Thompson, the Jackson Township attorney representing the landowners, has filed a dozen lawsuits in Stark, Summit, Wayne and Columbiana counties in the last couple of weeks against NEXUS Gas Transmission and Michels Corp.  NEXUS is a $2.1 billion pipeline backed by Detroit-based DTE Energy and Enbridge, a Canadian company. Michels Corp. is a construction firm in Wisconsin.  The 36-inch diameter pipeline can carry up to 1.5 billion cubic feet of natural gas a day from the Utica and Marcellus shales to users in Ohio, Michigan and Canada.  Thompson said he anticipated filing more lawsuits in the coming weeks, and Tuesday he added Michels to a lawsuit filed against NEXUS in July . The lawsuits have two aims: “One, to hold (NEXUS and Michels)

Ohio House Approves Use of Brine for Road De-Icing

From The Ohio House of Representatives on Thursday passed legislation allowing brine from vertical oil and gas drilling to be used for road de-icing, despite concerns that the salty liquid contains dangerous and radioactive chemicals.  House Bill 393 , which heads to the Senate after passing the House 52-31, is touted by supporters as a way to promote the use of a product that is a safer and less corrosive alternative to rock salt to keep roads ice-free.  State Rep. Anthony DeVitis noted that for more than a decade, the Ohio Department of Transportation used brine from drilling operations.  However, in 2014, state lawmakers imposed restrictions on the sale of fracking byproducts that inadvertently applied to vertical wells too. DeVitis said this bill, which would not apply to brine used in horizontal “fracking” drilling operations, would rectify that move. Find out more by clicking here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

New Study: U.S. Shale Boom Has Lowered Trade Deficit by Over $250 Billion

From a press release: The boom in U.S. oil and gas production over the past decade has exerted a moderating force on what is a large domestic merchandise trade deficit by helping reduce the country’s net petroleum imports, a new report by business information provider IHS Markit (Nasdaq: INFO) says. Continued U.S. production growth is now on track to make the country a net-exporter of petroleum for the first time since at least 1949.  The total U.S. merchandise trade deficit in 2017 was nearly $250 billion lower than it otherwise would have been if the petroleum (crude oil, refined products and natural gas liquids – petroleum liquids separated out from natural gas and also known as NGLs) trade deficit had remained at its 2007 level, the report finds. IHS Markit projects that the U.S. petroleum trade balance will further improve by roughly $50 billion between 2017 and 2022.  The findings are part of a new report entitled Trading Places: How the Shale Revolution Has Helped Keep

Permitting Picks Up in Utica Shale

New permits issued last week:   13  (Previous week:  7 )   +6 Total horizontal permits issued:  2948  (Previous week:  2935 )   +13 Total horizontal wells drilled:  2467  (Previous week:  2462 )   +5 Total horizontal wells producing:  2088  (Previous week:  2088 )   +-0 Utica rig count:  17  (Previous week:  18 )   -1 Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

December 2018 Shale Activity Maps Released by ODNR

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EQT Reaches Settlement in Class Action Suit Related to Royalties Scheme

From the Charleston Gazette Mail: The trial of a major lawsuit alleging that energy giant EQT Corp. has been shortchanging thousands of West Virginians on their royalty payments won’t start Tuesday as planned, following the tentative settlement of the case late last week. Details of the deal have not yet been made public. Marvin Masters, lead lawyer for the plaintiffs, said “the parties have tentatively resolved the case,” pending settlement details being worked out. A spokeswoman for the court confirmed the settlement, and said the trial was canceled. Linda Robertson, spokeswoman for EQT, declined to comment on the settlement, citing “pending litigation.” More than 10,000 individuals and businesses in West Virginia are estimated to be members of the class of plaintiffs. They allege that EQT, the state’s second-largest gas producer, was illegally deducting various costs — such as for transporting and processing gas — from their royalty payments. Click here to read more about this.

Ohio EPA Requests Early Stakeholder Input for Potential Oil and Gas Rules

Ohio EPA is requesting early stakeholder input until Dec. 19, 2018, on potential rules that would cover air pollution emissions from existing non-conventional oil and gas facilities that are not currently covered by Ohio EPA’s most recent general permit. The rules would cover similar equipment and requirements that are currently covered in U.S. EPA’s New Source Performance Standards for the oil and natural gas sector, as well as Ohio EPA’s oil and gas general permits. The rules would cover both existing and new sources like oil and gas well sites and gas compressor stations. This early stakeholder outreach provides stakeholders with an opportunity to provide their comments and suggestions before the Agency drafts the language of the rules. After the Agency has addressed comments received during this outreach, it will draft proposed rule language and hold an interested party comment period to solicit comments on the rule language before continuing through the rest of the rule pro

ETP's Sloppiness on Rover and Mariner East 2 Pipeline Led to Over 800 Permit Violations

From Reuters: Energy Transfer LP ( ET.N ) and its Sunoco pipeline subsidiary have racked up more than 800 state and federal permit violations while racing to build two of the nation’s largest natural gas pipelines, according to a Reuters analysis of government data and regulatory records.  The pipelines, known as Energy Transfer Rover and Sunoco Mariner East 2, will carry natural gas and gas liquids from Pennsylvania, Ohio and West Virginia, an area that now accounts for more than a third of U.S. gas production.  Reuters analyzed four comparable pipeline projects and found they averaged 19 violations each during construction.  The Rover and Mariner violations included spills of drilling fluid, a clay-and-water mixture that lubricates equipment for drilling under rivers and highways; sinkholes in backyards; and improper disposal of hazardous waste and other trash. Fines topped $15 million.  Energy Transfer also raised the ire of federal regulators by tearing down a his

PARTA Opens Natural Gas Filling Station in Portage County

From the Record-Courier: With Ohio’s status as “the Saudi Arabia of natural gas,” it only makes sense for some expansion of infrastructure to make it available to area motorists, said CNG-One’s Michael Battaglia.  About 60 people were on hand Wednesday as PARTA celebrated just that — the opening of its compressed natural gas filling station, which it uses in some of its buses and makes available to the public. The station is located at 2000 Summit Road just east of Kent State University.  With the addition of CNG on the site, PARTA General Manager Claudia Amrhein said the agency now has two compressed natural gas buses and plans to buy eight more during the next several years. She encourages other fleet managers to consider converting as well.  “The station is now open to the public, which makes it really possible for local fleet owners to consider converting to natural gas-powered vehicles,” she said.  According to Battaglia, several area fleet managers are weighing whether

Ohio EPA Seeks Input on Proposed Modifications to Belmont County Cracker Plant

Hearing scheduled for 6 p.m. Dec. 12, 2018 Ohio EPA will hold a public meeting to present information and accept comments on draft modifications to the wastewater discharge permit related to the proposed PTTGCA Petrochemical Complex that would be located at Old Route 7 and Ferry Landing Road (Hwy. 2), Shadyside. The information session is scheduled for 6 p.m. on Dec. 12, 2018, and will be held at Shadyside Community Center, 50 E. 39th Street. The public hearing will immediately follow, during which the public can submit comments for the record concerning the draft modification. The modifications to the wastewater discharge permit conditions requested by PTTGC America LLC would: decrease the levels of pollutants to be discharged to the Ohio River; change the locations where storm water, which is water that runs off impervious surfaces after rain events, will be discharged; and modify limits at an internal monitoring station that does not directly discharge to surface wate

State Lawmakers Increase ODNR Budget for Plugging Wells

From The Times Reporter: The Ohio Department of Natural Resources is revving up its program to plug oil and gas wells that were left behind by their owners.  State lawmakers more than doubled the plugging program’s budget earlier this year to $15 million.  ODNR plans to plug 173 wells this fiscal year, and has entered contracts to plug 55 of those wells at a cost of $3.6 million since July 1.  ODNR spent $6 million to plug 83 wells last fiscal year, a price tag and number of wells that were records for the plugging program, which has been around since the mid-1970s.  The new funding has allowed the program to put together a robust plugging plan, said Steve Irwin, spokesman for ODNR’s Division of Oil and Gas Resources Management.  “It’s exponential growth headed in the right direction,” Irwin said. Continue the article by clicking here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

Paid to Protest: Lifting the Curtain on Keep Wayne Wild, LLC

by Jackie Stewart, Energy in Depth EID has been exposing the underhanded “Keep It In the Ground” (KIITG) tactics aimed at halting oil and gas development in the Wayne National Forest for years, including the  Center for Biological Diversity’s (CBD)  deliberate efforts  to obstruct the federal mineral leasing and permitting process.  Keep Wayne Wild is another example that has taken a page out of this KIITG playbook, working in conjunction with CBD to ban fracking in the Wayne under the guise of a so-called “local volunteer concerned citizens organization.” According to Keep Wayne Wild’s filing with the Ohio Secretary of State, the self-described “volunteer environmental conservation organization” is actually a  for-profit Limited Liability Company (LLC) whose spokeswoman is listed as a   current  employee of the Sierra Club . Keep Wayne Wild, LLC also has direct ties to the  Ohio Health Registry , Buckeye Forest Council, and the  Heartwood —groups that have been active in multiple