The Daily Digger

From The Columbus Dispatch: A Monroe County shale-well site still was smoldering last night, and some residents were sheltered at a nearby high school, after an explosive fire yesterday morning.  Officials said yesterday that the fire at the Eisenbarth well pad was caused by a mechanical malfunction in hydraulic tubing and that it was limited to the equipment on the surface of the well pad, which is the area that surrounds the natural-gas wells.  Flames spread from the tubing to 20 trucks that were lined up on the well pad, causing explosions and thick, black smoke that stayed for hours.  None of the 45 workers on site was hurt, state and oil-company officials said yesterday. One firefighter was treated for smoke inhalation. Read many more details in the rest of that article by clicking here. Thank goodness that no one was injured.  This is yet another reminder that whatever side of the fracking debate you fall on, there is always a risk of accidents tha...

New York ruling is a painful loss for the oil & gas industry From Village Voice: Huge news this morning for shale-gas drilling skeptics: the highest court in New York state ruled that towns have the authority to ban oil and gas companies from operating within city limits. Deborah Goldberg, the lawyer who argued on behalf of the town of Dryden, New York, tells the Voice, will have a "huge impact here in New York state and may very well influence similar efforts around the country."  In 2011, residents of Dryden passed a zoning ordinance prohibiting oil and gas drilling; Six weekes later Anschutz Exploration Corporation sued the town, arguing that only the state had the authority to make a decision like that. Dryden, one of two respondents in this case, was the first town in New York to ban fracking. More than 170 towns and cities in New York have since joined them, in absence of any significant action to regulate fracking at the state level. There has been a mo...

From the Courthouse News Service: HARRISBURG, Pa. (CN) - Chesapeake Energy Corp. and its subsidiary Access Midstream Partners cheated Pennsylvania landowners of more than $5 billion in gas and oil royalties through inflated and unreasonable fees, a RICO class action claims in Federal Court.  Lead plaintiff, the Suessenbach Family Limited Partnership, seeks damages for racketeering, unjust enrichment, mail fraud, wire fraud, honest services fraud, conversion and civil conspiracy.  Chesapeake is the nation's second-largest producer of natural gas.  The complaint states: "Since at least 2010 Chesapeake engaged in unlawful conduct to improperly extract billions of dollars in royalties owed to plaintiffs and other lessors by artificially manipulating and deducting from royalty payments the cost of 'marketing,' 'gathering,' and 'transporting' natural gas. The marketing, gathering and transportation deductions at issue in this action were b...

HOUSTON, TX--(Marketwired - Jun 24, 2014) - Magnum Hunter Resources Corporation (NYSE: MHR) (NYSE MKT: MHR.PRC) (NYSE MKT: MHR.PRD) (NYSE MKT: MHR.PRE) ("Magnum Hunter" or the "Company") announced today that the consolidated securities class action lawsuit filed against the Company last year has now been dismissed in its entirety by the judge overseeing the case in the United States District Court for the Southern District of New York. With the dismissal of this consolidated securities class action lawsuit on June 23, 2014, the Company has been successful in securing dismissals of a total of five separate securities class action and shareholder derivative lawsuits filed in four different judicial courts without any monies paid to any plaintiffs or their respective legal counsel. Three of the lawsuits were dismissed on motions by the defendants, while the other two were voluntarily dismissed by the plaintiffs. The Company is currently working to obtain dismissal ...

From NGI's Shale Daily: Despite poor results and the unabashed early decisions of some unconventional operators to abandon altogether what was once thought to be the core of Ohio's Utica Shale, neither the oil and gas industry nor the communities waiting for economic opportunity have written off the play's northern tier. Even as operators push farther south into West Virginia to replicate the dry gas success of southeast Ohio and as a similar pattern slowly unfolds nearby in southwest Pennsylvania (see Shale Daily, March 26 ; June 5 ), optimism for the future of the Utica Shale in the northwestern part of the keystone state has not subsided.  In nearly a dozen interviews with oil and gas professionals, local landowners and community leaders in Ohio and Pennsylvania, and through the analysis of both state production data and the plans of some of the Appalachian Basin's leading operators, there appears to remain significant enthusiasm about the Utica's black a...

Protesters engaged in criminal activity at an injection well in March of this year From Ohio Gas & Oil: "From all the complaints and issues I've heard, it wasn't what I expected to see," Commissioner Lenny Eliason said. "It looks like a very clean operation."  Eliason toured the wells last week at the invitation of the owners.  "They seem to be a concerned organization, to run things in a proper manner," Eliason said.  Eliason said he was told the company went beyond the requirements of the law in terms of containment. There is a concrete pad with drains, surrounded by a concrete wall, to capture a spill if one occurs at the storage tanks. Eliason said he was told that setup exceeds legal requirements.  Eliason said he did not detect any odors at the sites.  "From my layman's view, it seems to be operating well," Eliason said. You can read that whole article by clicking here. In further related news, from The At...

From anti-drilling group Policy Matters Ohio: House Bill 375, passed by the House in May, has a rate so low and a base so narrowed by deductions that revenues would not cover the needs of the state and impacted communities.  That is the key conclusion of a report on the bill that Policy Matters Ohio issued today. While conventional, vertical wells would retain the current volume-based severance tax structure and see a 50 percent cut in severance tax rates under the bill, horizontal wells would be taxed differently, with a 2.5 percent tax based on the value of production.  “As passed, the bill contains millions of dollars in new deductions, exemptions and other tax breaks,” said Wendy Patton, report author and senior director of Policy Matters Ohio’s State Fiscal Project. “As a result of these tax breaks and a very low rate, even the highest forecasts show that funding will fall short of needs.”  Legislators pushed the share of revenues for impacted local gover...

From Shale Play: An oil and gas exploration company in July could begin seismic testing in Fearing Township, officials said.  Protege III Energy of Tulsa, Okla., in the process to begin the seismic mapping and held a meeting at the community building in Fearing Township this month.  Protege was "very forthcoming," Washington County Commissioner David White said. "They said (the company and landowners) were all in partnership and they wanted landowners to know (what would be happening)."  Morris Hall, vice president of Protege Energy and vice president of Geosciences, said work will start in early July.  "(Residents will) see plainly marked survey crews," he said. "It'll be a six-week effort when we start. If we start the first of July, it'll be the middle to end of August before we're done." Read the whole article here. Co nnect with us on Facebook and Twitter! Follow @EnergyNewsBlog

Source: JT Long of The Energy Report (6/26/14) http://www.theenergyreport.com/pub/na/are-you-ready-to-capitalize-on-emerging-world-growth-and-u-s-oil-independence With 400 million more people set to get on the grid in India alone, smart investors will profit from new demand for all kinds of energy. In this interview with The Energy Report , Frank Holmes and Brian Hicks of U.S. Global Investors share some of their favorite ways to build a diversified portfolio that takes advantage of opportunities large and small, domestic and international. The Energy Report : India's new prime minister, Narendra Modi, has pledged to bring electricity to the 400 million (400M) Indians currently without power. How is he going to do this, and how can investors get exposure to this massive infrastructure investment? Brian Hicks: One of our investing tenets is to follow government policy, because that is a precursor to change. Infrastructure investment in India is a long-term theme, and is going ...

Velocys plc (VLS.L), the technology innovator for smaller scale gas-to-liquids (GTL), is pleased to announce the acquisition of Pinto Energy LLC ("Pinto Energy") and the Ashtabula GTL project. Pinto Energy is one of the leading project developers of smaller scale GTL in North America. As its first facility, Pinto Energy is developing an approximately 2,800 barrels per day (bpd) plant at an 80 acre industrial site that it owns near the Port of Ashtabula, Ohio, USA. The project will have access to abundant low-cost natural gas from the Marcellus shale region, as well as benefitting from substantial existing infrastructure. Initial engineering for the facility is complete and the air permit has been issued. Final investment decision is expected within six to nine months. Future expansions could see installed capacity of 10,000 bpd or more at the site. In addition to Ashtabula, Pinto Energy has a pipeline of smaller scale GTL projects it is seeking to develop throughout North ...

From Fuel Fix: U.S. oil and gas reserves increased 9 percent last year, according to a newly released analysis, and almost all of it was due to independent producers — not major, integrated oil companies.  The report by audit firm EY analyzed data reported by the 50 largest publicly traded companies based on their 2013 end-of-year reserve estimates. It analyzed proved reserves which, according to federal finance standards, are reserves that companies plan to drill within five years.  U.S. oil reserves increased by 2.1 billion barrels last year to nearly 25.4 billion, according to the report. That figure marks a 52 percent increase since 2009. Read the whole article by clicking here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

From Bloomberg: The U.S. Commerce Department opened the door to more U.S. oil exports as long as the crude is lightly processed, tempering the impact of a law that’s banned most overseas petroleum shipments for the past four decades.  The department widened its definition of what’s traditionally been considered a refined product eligible for shipping to customers abroad. That means more of the oil being pumped from U.S. shale formations may be eligible for export after being run through small-scale processing units.  The Commerce Department issued its ruling after Pioneer Natural Resources Co. petitioned for approval to export a type of ultra-light oil that had been stripped of lighter gases to make it less volatile for transport -- a minimal level of processing known as stabilization. The ultra-light oil, known as condensate, has been abundant in shale formations during the drilling boom, leading to oversupplies on the Gulf Coast .  “It’s a crack in the door wh...

Energy From Shale has taken a look at some stories and numbers that demonstrate the positive effects that shale development has had on Ohio's economy.  Here are a few of the items that are featured: Drilling pipe awaits use on a Hess drilling site.  As shale energy production has picked up in Ohio and across the Pennsylvania state line, demand for materials to support the energy industry has grown in tandem.  According to a recent study, shale development has brought $18.7 billion in investments to Ohio, which has included the construction of several new steel mills. A drilling rig hums in the early morning on a farm outside of Carrollton, Ohio. "[Energy development has] been so good for the farmers because it got a lot of farmers out of debt... Even though we've got farmers who are millionaires, most of them stay on the farm and keep turning the soil.  They just love farming." - Ralph Lucas, retired sheriff of Carroll County, Ohio You can view the whole...

Energy in Depth:   Ohio Water Use, Fracking, and the Utica Shale   -    "Activist groups committed to banning fracking have frequently claimed that water withdrawals from oil and gas development would lead to severe droughts in eastern Ohio. In reality, actual data show the amount of water in Ohio and specifically eastern Ohio is quite plentiful, and..." The Columbus Dispatch:   Fracking planned at Morgan County spill site as cleanup ends   -    "Tanker trucks and vacuums are still whirring on a piece of Morgan County land, trying to clean up thousands of gallons of oil and chemicals that spewed eight weeks ago from a not-yet-completed..." Marietta Times:   Study links crime rates to influx of temporary oil & gas workers   -    "The narrow dining room at RJ's Cafe was awash in a sea of neon-clad diners Friday afternoon as busy waitresses scurried about bringing heaping piles of fries to the wall-to-wall lunchtime...

From Natural Gas Intelligence: Onshore explorers that boast about holding and developing the "core of the core" won't find a fan in Chesapeake Energy Corp. CEO Doug Lawler. He doesn't think there's any such thing.  Limiting the focus only limits the options, he said Wednesday at Tudor, Pickering, Holt & Co.'s 11th annual Hotter 'N Hell energy conference in Houston.  "I am an anti-core guy," Lawler said. "When I hear the 'core of the core,' when...companies talk about all the great stuff around the core, all that means to me is they've set a finite limit on their technical ingenuity, their innovation and their drive for continuous improvement."  A few months after he took over in June 2013, Lawler told analysts the company would no longer be driven by capturing land and holding it by production (see Shale Daily, Nov. 6, 2013 ). The new mantra is to test and develop selectively the quality assets and monetize som...

From Insurance Journal: In its announcement, the ODNR said that if a seismic event in excess of 1.0 magnitude is detected, “activities would pause while the cause is investigated. If the investigation reveals a probable connection to the hydraulic fracturing process, all well completion operations will be suspended.”  “ODNR’s directives are a sensible response to a serious issue that regulators across the country are closely examining,” said Gerry Baker, associate execu­tive director of the Interstate Oil and Gas Compact Commission, which works with Ohio and other states to share scientific data in order understand the relationship between seismic activity and oil and gas drilling.  The new regulations in Ohio, which has seen an uptick in drilling activity in the Marcellus and Utica shale regions, make sense for regulators, oil and gas operators, and insurers, according to Bolz, a geologist who worked in the oil and gas industry before he entered the insurance business...

PA state employees ordered to a code of silence on drilling? From StateImpact Pennsylvania: Two retirees from the Pennsylvania Department of Health say its employees were silenced on the issue of Marcellus Shale drilling.  One veteran employee says she was instructed not to return phone calls from residents who expressed health concerns about natural gas development.  “We were absolutely not allowed to talk to them,” said Tammi Stuck, who worked as a community health nurse in Fayette County for nearly 36 years.  Another retired employee, Marshall P. Deasy III, confirmed that.  Deasy, a former program specialist with the Bureau of Epidemiology, said the department also began requiring field staff to get permission to attend any meetings outside the department. This happened, he said, after an agency consultant made comments about drilling at a community meeting. You can read more of this article here. Connect with us on Facebook and Twitter! Follo...

From The Guardian: A study of abandoned oil and gas wells in Pennsylvania finds that the hundreds of thousands of such wells in the state may be leaking methane, suggesting that abandoned wells across the country could be a bigger source of climate changing greenhouse gases than previously thought.  The study by Mary Kang, a Princeton University scientist, looked at 19 wells and found that these oft-forgotten wells are leaking various amounts of methane. There are hundreds of thousands of such oil and gas wells, long abandoned and plugged, in Pennsylvania alone, and countless more in oil and gas fields across the country. These wells go mostly unmonitored, and rarely, if ever, checked for such leaks.  A growing list of studies conducted over the past three years has suggested that crude oil and natural gas development, particularly in shale formations, are significant sources of methane leaks — emissions not fully included in US Environmental Protection Agency greenh...

HOUSTON, June 16, 2014 /PRNewswire/ -- Gastar Exploration Inc. (NYSE MKT: GST) ("Gastar") reported today that it has reached total depth on the vertical pilot hole for its first Utica/Point Pleasant well in Marshall County, West Virginia. The Simms 5-UH well was drilled to a total depth of 11,410 feet and encountered approximately 92 net feet of pay in the Point Pleasant formation with measured porosities up to 17%. Gastar expects estimated formation pressures to be approximately 9,400 psi upon completion of the well. Gastar is currently plugging back the well in order to drill a 4,200 foot horizontal section in the Point Pleasant formation. After drilling the lateral, a 23-stage completion is planned followed by a three week "soaking" of the well with first production expected in late August 2014. Gastar's President and CEO, J. Russell Porter, commented, "These results have confirmed our expectations regarding the Utica/Point Pleasant formation. ...

The Ohio Department of Natural Resources has released its weekly permitting update for the Utica shale, and it was another busy week. 32 new permits were issued last week.  Harrison County was leading the way, with 8 permits - all issued to Chesapeake Energy.  Those 8 new permits bring Harrison County's cumulative total to 243. 7 new permits were issued for Monroe County sites, marking 103 permits there and making Monroe the 7th county in Ohio to pass 100 Utica shale permits. 6 permits were issued for Belmont County, 4 for Guernsey County, 3 each for Carroll and Noble counties, and 1 permits was issued to Halcon Resources for a Trumbull County well. All of that activity means that there have now been 1,364 permits issued for horizontal drilling in Ohio's Utica shale.  925 wells have been drilled and 470 are producing.  The Utica rig count is 45. You can view the whole report by clicking here. Connect with us on Facebook and Twitter! Follow @Energy...

From Reuters: American Energy Partners LP, founded by former  Chesapeake Energy Corp chief executive, Aubrey McClendon, and private equity firm Energy & Minerals Group, have formed a company to invest in oil and gas pipeline and processing assets. American Energy Midstream will invest in shale formations where the firms are operating, including the Marcellus and Utica shales in Pennsylvania and Ohio, the Permian Basin in West Texas and the Woodford in Oklahoma, the companies said on Wednesday. Read a little bit more by clicking here. It's interesting to watch McClendon continue to expand and grow American Energy Partners as Chesapeake Energy continues to fire sale assets and streamline their operations.  Is he directing the ship at this new company towards the same rocky waters that Chesapeake has had to navigate over these past couple of years, or will McClendon be vindicated?  Only time will tell. Connect with us on Facebook and Twitter! Follow @Ener...

From the Observer-Reporter: Range Resources will be held responsible for disclosing a full list of products and chemicals it used at a Marcellus Shale gas-drilling site in Amwell Township, according to a pair of recent rulings. Both a state Environmental Hearing Board judge and Washington County President Judge Debbie O’Dell Seneca ruled last week Range Resources is in the best position to obtain the list of chemicals, including proprietary substances, from its manufacturers. A Washington County Court order in November 2013 required Range Resources’ suppliers – about 40 contractors and subcontractors – to provide that list. According to O’Dell Seneca, the suppliers could not or would not comply. Range Resources is the defendant in a lawsuit filed by three Amwell Township families who claimed they suffered health problems attributed to drilling activity and an impoundment at the company’s Yeager well site on McAdams Road. O’Dell Seneca waited to give her opinion until a related deci...

Russian President Vladimir Putin From FT.com: Russian intelligence agencies are covertly funding and working with European environmental groups to campaign against fracking and maintain EU dependence on Russian gas, the head of Nato has claimed.  Answering questions after a speech in London, Anders Fogh Rasmussen , Nato secretary-general, said improving European energy security was of the “utmost importance” and accused Moscow of “blackmail” in its dealings with Europe.  “I have met allies who can report that Russia, as part of their sophisticated information and disinformation operations, engaged actively with so-called non-governmental organisations – environmental organisations working against shale gas – to maintain European dependence on imported Russian gas,” Mr Rasmussen, former Danish prime minister, told an audience at Chatham House, the international affairs think-tank. Read the entire article by clicking here. Connect with us on Facebook and Twitter! ...

From the Dayton Business Journal: The new $500 million energy plant proposed in Middletown is moving forward. St. Augustine, Fla.-based NTE Solutions has filed for permits with the Ohio Power Sitting Board for the new natural-gas fired power plant to be built on a 45-acre campus off Cincinnati Dayton Road, which will be called The Middletown Energy Center. The company has created a new subsidiary for Ohio, NTE Ohio LLC, which has hired the Columbus office of Bricker & Eckler LLP as legal counsel. It’s estimated the construction of the project will create 300 to 400 jobs, and the plant will be run by a 25 to 30-worker crew. Read more on this story here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

From StateImpact Pennsylvania: A new study shows the public views both the natural gas industry and the anti-fracking film, Gasland, as among the least trustworthy sources of information when it comes to hydraulic fracturing. According to a paper published last month in Energy Research and Social Science, people are more likely to trust information from university professors, environmental groups, newspapers, and landowner groups. Regulatory agencies ranked fifth in trustworthiness among the eight possible choices. They were followed by cooperative extensions and the natural gas industry. The 2010 film, Gasland , came in last place. Read more about this survey by clicking here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

WTRF 7 News Sports Weather - Wheeling Steubenville Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

From Business Journal Daily: The geological makeup of the southern Utica shale play in eastern Ohio explains why energy companies drilling there are experiencing higher rates of production than in the northern sections of the play.  Much of it has to do with geological pressure and the porosity of two rock formations -- the Point Pleasant and the Utica -- often collectively referred to as the Utica shale, explains Jeff Ventura, president and CEO of Range Resources. "The reservoir quality is much better in the Point Pleasant than it is in the Utica," Ventura told the Hart Energy DUG East conference June 4. "The northern third of the play is more about the Utica than it is the Point Pleasant."  The hydrocarbons in the Utica shale are less prolific as those found in the Point Pleasant, a stratum of rock that rests just below the Utica, Ventura said, as he pointed to a map that details a cross section of the play as one moves north. Read the whole article by ...

Increasing Access Midstream Partners Ownership to 100% of GP and 50% of LP via Acquisition Planning Williams 3Q 2014 Dividend Up 32% to $0.56, or $2.24 on an Annualized Basis; $2.46 for 2015, With Follow-on Annual Dividend Growth of Approximately 15% through 2017 Accelerating Transformation of Williams to Pure-Play GP Holding-Company Structure Proposing Subsequent Merger of Williams Partners and Access Midstream Partners; If Consummated, Creates Industry-Leading MLP With Expected 2015 Adjusted EBITDA of Approximately $5 Billion, Strong Coverage, and 10%-12% Annual LP Distribution Growth Rate Through 2017 Expecting 2015 Distributions for Merged MLP to Be at Least 25% Above Access Midstream Partners’ Current 2015 Distribution Guidance; Up More Than 40% vs. Current 2014 Distribution Guidance Acquiring Access Midstream GP, LP Interests Not Contingent on Merger of the Two Partnerships Providing Update on Geismar and Williams Partners Segment Guidance for 2014 Holding Investor C...