The Daily Digger

The latest report from the Ohio Department of Natural Resources shows that 13 new permits were issued for horizontal drilling in the Utica shale last week. Guernsey County continues to be a hot spot for new permitting.  With 6 new permits last week, it has been the location for 33 of the last 95 wells permitted in the state.  Eclipse Resources is the operator on all 6 of those wells permitted last week.  4 permits were for Monroe County, which is where 5 of the top 10 gas-producing wells on the 2013 fourth quarter production report are located.  2 permits were for Belmont County, which now has 99 total permits.  The final permit went to Carroll County, which creeps within 3 of having 400 permitted wells. The new cumulative totals: 1,230 wells permitted, 838 wells drilled, 392 wells producing.  The Utica rig count is 39. Click here to view the whole report. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

BP made a big splash in 2012 when the company leased about 85,000 acres in Trumbull County for over $330 million.  The company maintained that it was excited about its Utica shale prospects afterwards, even as other drillers in the northern part of the play expressed disappointment with what they were finding there. Now, only a couple of years later, BP is abandoning its Utica shale holdings.  The company announced it with this brief statement while reporting its 2014 first quarter results : “Following on from the decision to create a separate BP business around its US lower 48 onshore oil and gas activities, and as a consequence of appraisal results, BP has decided not to proceed with development plans in the Utica shale. The Upstream result includes a write-off relating to the Utica acreage.” Trumbull County has proven to be an economically untenable location for Utica shale drillers because the shale there has yielded mostly dry gas, but it could reemerge as a tar...

The Ohio Department of Natural Resources released production figures from the state's horizontal shale wells for the fourth quarter of 2013 last week.  I was away from the office because my wife was giving birth, so here is a rundown to get our readers up-to-date on what the report revealed. First, here is what the ODNR said in its statement with the release of the production numbers: The report lists 397 wells, 352 of which reported production results. Forty-five wells reported no production as they are waiting on pipeline infrastructure. The 352 wells produced 1,439,308 barrels of oil and 43,124,803 Mcf (1,000 cubic feet) of natural gas.  Of those 352 wells:  - The average amount of oil produced was 4,089 barrels. - The average amount of gas produced was 122,514 Mcf. - The average number of days in production was 62.  The highest producing oil well was the Gulfport Energy “Boy Scout” well in Harrison County at 26,095 barrels of oil during 80 days of p...

From TribLIVE: EQT Corp. said on Thursday that it has had some disappointing results from wells at the edge of the Utica shale in Ohio and will stop drilling in the formation while it evaluates its prospects.  EQT's decision follows Antero Resources Corp.'s reduction 10 days earlier in what it predicts to get from wells in a similar area on the western edge of the play.  The Utica shale is viewed as the next front for gas drillers who benefited from booming production in the Marcellus shale and are looking to expand to other promising plays.  “The first wells we drilled were not where they needed to be,” Steve Schlotterbeck, an executive vice president at EQT, said during a conference call discussing an otherwise successful quarter for the Downtown company. You can click here to read the whole article. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

Press release:   Gulfport Energy Corporation Names Michael Moore Chief Executive Officer, Ross Kirtley Chief Operations Officer and Appoints Michael Reddin and Michael Moore to Its Board of Directors Weirton Daily Times:   Vendors Benefit From Shale Boom   -    "Eagle Manufacturing soon will hire about 25 additional employees as it prepares to roll out a new spill containment system for oil and gas drilling rig sites, according to..."   Public News Service:   Marcellus Waste Radioactivity In Water Leaching From Landfills    -    "Tests show that wastewater from gas field landfills contains radioactivity. That is raising concerns about the disposal of..." Mansfield News Journal:   Frack Free Ohio Cites Success in Richland   -    "Frack Free Ohio soon will wrap up its Richland County campaign. But the group has its sights set on educational  programs in Ashland and Crawford counties. “We were very suc...

From the Wall Street Journal: Like their bigger rivals, the upstarts frack to tap previously untouchable oil and gas deposits in dense shale formations. But these companies have focused on the  right  property instead of the  most  property—and raked in big stock paydays as a result.  For the most part, neither the less-is-more upstarts, nor the bigger-is-better graybeards are bringing in more than they spend to drill and frack. The difference is that Wall Street no longer is throwing cash at established shale players holding loads of acreage. "It's quality over quantity. We don't have one million acres and we don't strive to have one million acres," says Daniel Rice IV, the 33-year-old chief executive of  Rice Energy  Inc., RICE  0.00%  which drilled its first well in 2009. The company, which went public in January, has a stock-market value of $3.9 billion, its stock up 44% since its initial public offering. The Rice family owns a...

The Fresh Water Accountability Project put out the following press release after the Muskingum Watershed Conservancy District signed a lease agreement with Antero Resources last week. Property Owners Organizing Against Conservancy District The Muskingum Watershed Conservancy District (MWCD) Board Meeting held last Friday, April 18, 2014, provided another stunning example of how the conservancy district is allowed to tax property owners in the district without accountability to respond to their concerns, represent their best interests and “conserve.” The MWCD is a large political subdivision in the State of Ohio created in the 1930’s for flood control and other public interest protections. This mandate to operate for “public benefit” was the basis of the 2005 amendment to the District’s “Official Plan” that justified the implementation of additional property taxes in the district. These taxes were reduced at last Friday’s Board Meeting, but the meager savings to property owners in n...

From the Alliance Review: With as many as 179 underground disposal wells, Ohio has absorbed more than 1 billion gallons in hydraulic fracturing wastewater since 2010, according to state records. But with all that wastewater comes potentially devastating side effects: Earthquakes. While officials and scientists spar over the relationship between fracking, wastewater disposal and quakes, Ohio is aiming to advance its understanding of the industry and protect the  property values  of homeowners. This month, Buckeye State regulators joined Kansas, Texas and Oklahoma officials to address the earthquake risk associated with hydraulic fracturing. The  Interstate Oil and Gas Compact Commission  gathered in Oklahoma City and was said to be off to a “productive start” on discussions and potential new regulatory practices for this burgeoning industry. Click right here to read the rest of this article. Connect with us on Facebook and Twitter! Follow @EnergyNewsB...

Join Fairmont Supply on Friday, April 25 th as they celebrate the official Grand Opening of their new location in Uhrichsville, OH. 305 E. McCauley Drive Uhrichsville, OH 44683 Take some time and visit with the suppliers on-site and to check out the storefront location’s full-line of merchandise. Sales management and representatives will be on-site to answer any questions about support and Fairmont Supply’s services. The event will run from 9 am to 3 pm and lunch will be provided from 11 am to 1 pm, sponsored by Phoenix Specialty. Fairmont Supply hopes to see you there! Shop Online at FairmontSupply.com Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

From the Youngstown Vindicator: Nothing has changed on the legal front from last year when proponents of the anti-fracking amendment to the Youngstown Home Rule Charter twice failed to win voter approval. And yet, the misnamed Community Bill of Rights is back on the ballot in Youngstown in the May primary.   We say misnamed because passage of the amendment will not give city government any of the rights detailed in the 1,300-word tome. It is unenforceable. The Ohio General Assembly has given the Ohio Department of Natural Resources sole authority to oversee the hydraulic fracturing process used to extract oil and gas from shale formations deep beneath the earth’s surface.   The Legislature’s authority to act on issues of statewide importance is provided for in the Ohio Constitution and has been upheld by the Ohio Supreme Court.   The proposed Youngstown charter amendment is designed to place the city outside the reach of either the Ohio Constitution or the U.S. ...

From the New York Times: The study, “ Toward a better understanding and quantification of methane emissions from shale gas development ,” was published in the Proceedings of the National Academy of Sciences and undertaken by  Dana R. Caulton and Paul B. Shepson of Purdue  and a host of co-authors, including Anthony Ingraffea and Robert Howarth, Cornell scientists who are  prominent foes of fracking , along with Renee Santoro of the anti-fracking group  Physicians Scientists & Engineers for Healthy Energy  (Ingraffea is affiliated with the group, as well). Much of the news coverage and commentary was greatly oversimplified, implying that airplane measurements taken on two days in 2012 and showing high methane levels over a handful of wells (and nothing unusual over almost all the other wells in the region) pointed to an extraordinary new pollution and climate change risk. A case in point was this Climate Central post: “ Huge Methane Leaks Add Doubt on ...

From ThinkProgress: A family claiming they were sickened because of pollution from hydraulic fracturing operations near their home should be awarded $2.95 million for their troubles, a jury ruled on Tuesday.   The Parr family had sued Aruba Petroleum Inc. in 2011, alleging the oil and gas producer exposed them to hazardous gases, chemicals and industrial waste that seeped into the air from 22 wells drilled near the family’s 40-acre plot of land, which sits atop the Barnett Shale.   The jury returned a 5-1 verdict saying Aruba “intentionally created a private nuisance,” awarding $275,000 for losses on property value, $2 million for past physical pain and suffering, $250,000 for future physical pain and suffering, and $400,000 for mental anguish.   “They’re vindicated,” David Matthews, one of the Parr’s attorneys, wrote on his firm’s  blog  Tuesday. “I’m really proud of the family that went through what they went through … It’s not easy to go through a l...

Business Journal Daily:   Company Gets Permit to Handle Radioactive Waste   -    "Activists in Ohio are concerned that a local company may soon be handling waste from the oil and gas industry that they say is just too hot to handle. But a principal of the operation says that the objective of his company is to protect..." ENR:   Fracking Foes Cringe as Unions Back Drilling Boom   -    "After early complaints that out-of-state firms got the most jobs, some local construction trade workers and union members in Pennsylvania , Ohio and West Virginia say they're now benefiting in a big way from the Marcellus and Utica Shale oil..." Energy in Depth:   Shale Development Boosting U.S. Retail Sector   -    "The model for a successful business has always famously been: “location, location, location.” And according to a recent Wall Street Journal article , “location” is now synonymous with drilling permits.  Thanks to advancemen...

The debate over the proposed severance tax for Ohio oil and natural gas production seems to have been going on forever now, and it isn't letting up.  There have been many voices on both sides of the issue, and now Washington County commissioner Ron Feathers has added his to the throng with a letter to the Parkersburg News and Sentinel: We are told that oil and gas producers are not paying their fair share, however the taxes paid by the oil and gas industry and landowners are many; income tax, property tax, motor vehicle gas tax, ad valorem tax, commercial activity tax, and sales tax.  I am opposed to any additional increase in the Severance Tax. I believe our local landowners and private business know best how to manage their profits. If the industry is not strapped with the burden of more taxes, local and regional revenues will increase substantially by the advance of business development and employment.  I refuse to accept the falsehoods that government can pick...

Source: JT Long of The Energy Report (4/17/14) http://www.theenergyreport.com/pub/na/do-you-practice-quality-of-life-investing-michael-berry-does Energy and food will be hot commodities as emerging middle classes start buying cars and beef. That is why, in this interview with The Energy Report , Discovery Investing Founder Michael Berry explains the importance of quality of life investing. Oil and gas, uranium and fertilizer stocks are on sale now, but might not be in the years to come. The Energy Report: When we last interviewed your son, Chris Berry , he advised to invest based on the reality of a growing, emerging market in China. That included both energy and agriculture sectors. Are you also bullish on quality of life-based (QOL) investing? Michael Berry: I am bullish; I developed the QOL concept a few years ago. What I'm seeing is quite a few big institutions—life insurance companies, family offices and money management companies—opening quality of life funds, althou...

From Columbus Business First: When hydraulic fracturing and horizontal drilling led to a new wave of domestic natural gas and oil drilling last decade, the common tactic was to buy, buy and buy some more. But companies who have played the shale plays differently, focusing on quality and not quantity, are the victors so far , the Wall Street Journal reports.  “The land-grab approach, pioneered by Chesapeake and copied by its rivals, left companies spending more than wells generated in revenue,” the paper reported, citing Oklahoma City-based Cheseapeake Energy (NYSE:CHK), Ohio’s most-active driller.  Opposite of Chesapeake are two smaller drillers: Denver-based Antero Resources Corp. (NYSE:AR) and Canonsburg, Penn.-based Rice Energy Inc. (NYSE:RICE). Click here to read this full article. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

The latest round of permitting in Ohio resulted in 12 new permits for horizontal drilling. 5 permits each were issued for Belmont and Harrison counties.  All 5 in Belmont were issued to Gulfport Energy, while the 5 Harrison County permits went to Chesapeake Energy.  1 permit was issued to Chesapeake Energy for a Carroll County well, and 1 went to Aubrey McClendon's American Energy Utica for the Shugert Daddy Wls Gr 5H well in Guernsey County. Last week's activity pushes the Utica shale in Ohio up to 1,218 total permits, with 829 wells drilled and 389 wells producing.  The Utica rig count is 36. You can view the full report from the Ohio Department of Natural Resources by clicking here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

From Crain's Cleveland Business: The Ohio Department of Natural Resources' announcement of new, stronger permit conditions for horizontal drilling near faults or areas of past seismic activity will add extra costs for some drillers looking to set up wells, but those watching the shale play in the state don't expect the change to drive away operators or investors. The new permit conditions, announced April 11, would require companies to use seismic monitors if the proposed drill pad is within three miles of a fault or the site of previous seismic activity of more than 2.0 magnitude. If a “seismic event” — known as an earthquake to most of us — of more than 1.0 magnitude was detected, any activity at the site would have to halt while an investigation is conducted. And if that investigation showed the event likely was related to hydraulic fracturing, commonly known as “fracking,” drilling at that site would cease. But the department wants to make it clear: The new perm...

From the Akron Beacon Journal: Landowners in the 18-county Muskingum Watershed Conservancy District will see a 50 percent reduction in annual assessments starting next year.  The district’s board approved the cut at a meeting today in which it also announced what appears to be the most lucrative drilling-rights lease deal ever signed in Ohio.  Colorado-based Antero Resources will pay $15,000 per acre to drill on more than 6,300 acres of district-owned land at Piedmont Lake in Guernsey, Harrison and Belmont counties.  That would produce a one-time signing bonus for the district in excess of $94 million, plus royalty payments of 20 percent on natural gas and liquids produced by those wells.  The biggest bonus paid landowners by drillers in eastern Ohio is about $7,500 an acre. There have been deals between companies where the price per acre has been $10,000 to $12,000. But the price paid by Antero to the district is unprecedented.  Another 300 acres ...

From the Youngstown Vindicator: Despite a sharp increase in economic activity, the number of new shale-related jobs in Carroll County fell far below industry promises, Policy Matters Ohio said.  The report found that shale-related employment in Ohio topped out around 3,000 jobs, a far cry from the 40,000 estimated early on by one leading industry group. The biggest growth has been in ancillary shale industries that support drilling companies and their supply chains.  The county’s 7.7 unemployment rate in February had decreased from the recession peak of 14 percent, but it still lagged behind its pre-recession level of 5.8 percent in July 2007.  Most jobs have gone to transient, out-of-state workers, who follow drilling rigs from place to place, and the temporary nature of their work created high demand for temporary housing. The interest has spurred the construction of two new hotels in Carrollton and saturated local campgrounds and rental markets.  The hou...

Colorado Peak Politics:   Do Fractivists Even Know What They’re Protesting?   -    "A recent Bloomberg article revealed an interesting fact about some of the fractivists in Colorado trying to push a so-called local control measure that would stunt the growth of any business in Colorado localities – either they don’t understand what they’re pushing or are willfully misleading..." Forbes:   Harold Hamm: The Billionaire Oilman Fueling America's Recovery   -    "Two Scotches in, with seats on the floor of Oklahoma City’s Chesapeake Energy CHK +2.47% Arena, Harold Hamm is feeling good. And why not? His hometown Thunder is spending the evening whupping..." Washington Post:   Radioactive Waste Booms With Oil as U.S. States Weigh Rules   -    "Oilfields are spinning off thousands of tons of low-level radioactive trash as the U.S. drilling boom leads to a surge in illegal dumping and states debate how much landfills can safely...

From Energy in Depth: The Fresh Water Accountability Project announced this week that they have appealed to the  U.S. EPA Region 5 , urging the agency to revoke the Ohio Department of Natural Resources’ (ODNR) Class II Underground Injection Control ( UIC ) program.  While they have not published the actual request, their  press release  borders on comical and inflammatory, with an alarming lack of knowledge regarding the oil and gas industry and the agencies who oversee them.   This isn’t the first time FWAP has appealed to Region 5, either.  In their press release, the group details a similar request on March 5 th , which shows this group isn’t interested in regulation at all, but rather stopping the industry from operating anywhere.   “Please consider this to be the statutorily-required notice that the citizens of Ohio, a/k/a the victims of this  sinister, politically compromised and profit-driven plot , are putting the USEPA on notice o...

From Cleveland.com: Overwhelming majorities of voters across the state support increased production of oil and gas, a poll commissioned by the American Petroleum Institute has found.   The statewide telephone poll, conducted April 3-7 for API by Harris Poll of 600 registered Ohio voters, found 79 percent favor increasing current levels of production.   The poll also found that:   • 82 percent support increased development of the nation's energy infrastructure;   • 88 percent agree that more domestic production could strengthen national energy security;   • 90 percent think it could create new jobs;   • 82 percent think it could lower consumer energy costs; and   • 79 percent agreed producing more domestic oil and natural gas could benefit state and federal budgets.  You can read the rest of this article by clicking here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

From Bloomberg: Aubrey McClendon, the pioneering shale wildcatter who helped usher in the U.S. energy renaissance, has hired the company that fired him to drill wells for his newest natural gas venture.  A subsidiary of McClendon’s American Energy Partners LP is paying between $23,500 and $26,000 a day to rent seven rigs from Chesapeake Energy ( CHK:US )Corp., the Oklahoma City-based gas producer he co-founded a quarter century ago, according to a proxy filing today.  Chesapeake, which terminated McClendon last year amid a shareholder revolt, signed the six-month agreements in October, according to the filing. Chesapeake’s rigs are drilling for American Energy-Utica LLC in the Utica shale formation that stretches beneath much of Ohio. You can read more by clicking here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

From FreshWater Accountability Project: April 16, 2014 — The Ohio Department of Natural Resources is the sole regulator of the horizontal hydraulic fracturing (fracking) industry which includes the permitting of not only fracking itself, but the disposal of its toxic and radioactive waste. As fracking continues to grow in the state, so does the amount of waste, including toxic liquids, solids and semi-solid waste, which is also radioactive to varying degrees. As fracking in Ohio produces millions of gallons of liquid and tons of solid waste, it also accepts frack waste from other states such as Pennsylvania and West Virginia. The ODNR issues permits for the disposal of this waste in Class II injection wells, solid waste dump sites and through various processing and recycling facilities.   With proof that the ODNR has become captured by the very industry it is supposed to regulate ( http://content.sierraclub.org/press-releases/2014/02/kasich-administration-caught-fracking-conspi...