The Daily Digger

From the Chronicle-Telegram: A group of Lorain County landowners whose properties will be affected by the proposed NEXUS pipeline on Wednesday asked the county commissioners to back their efforts to reroute the natural gas pipeline.  “The pipeline is a bad idea in so many ways,” said Richard Baumgartner, a Westlake resident who owns property in Grafton Township.  He said the safe distance from structures should be close to 1,000 meters, but the pipeline’s route will be far closer to homes and businesses.  The danger of an explosion, Baumgartner said, is small but would be catastrophic if it were to happen. He said the explosion of a 30-inch pipeline a few years ago killed several people, took 10 hours to extinguish and required a massive outpouring of firefighting resources to bring under control.  “The result of a 42-inch gas pipeline explosion would be horrific,” Baumgartner said. The property owners said they would prefer an energy corridor for the pip...

Source: Tom Armistead of The Energy Report   (1/29/15) http://www.theenergyreport.com/pub/na/michael-waring-has-seen-the-energy-downturn-movie-before-and-hes-not-worried With oil and gas prices down, it's time to cull the herd, sell marginal producers and double down on the strong ones in your portfolio, says Michael Waring, founder of Galileo Global Equity Advisors Inc. In this interview with The Energy Report , Waring explains that this kind of correction happens every 10 years in this space. It presents opportunities for companies to improve and investors to profit—and he names four companies he considers most likely to succeed. The Energy Report: Michael, you said in November that the Organization of the Petroleum Exporting Countries (OPEC) expected the U.S. to share in reducing production growth to help stabilize the oil market. Have events justified that expectation? Michael Waring: Events have not. But I think we need to address that statement. ...

Are one-day performance tests misleading investors? From Bloomberg: Tests done on new wells that boosted the fortunes of oil developers by billions of dollars during the U.S. shale boom are increasingly coming under scrutiny.  The one-day performance tests, which regularly spike company shares on their results, don’t provide enough data to predict future potential, according to a study by Drillinginfo, an Austin, Texas-based analytics and data firm. Additionally, few rules or standards govern the tests, industry observers say, making for inconsistent findings at best.  The result is that a practice that helped draw significant financing for drillers in an era of $100-a-barrel oil could become a liability as the price collapse leads investors to take a closer look. “Now more than ever, it’s a priority for the industry to be more transparent, and do a better job at communicating what the longer-term productivity of wells in basins are,” said James Sullivan, a New York-...

From Fuel Fix: Baker Hughes said Tuesday it will lay off 7,000 mostly in the first quarter of 2015, amid a crude oil price slump and drilling slowdown it expects to worsen in the next quarter.  The announcement came shortly after the oil service company reported that its net income for the three months ending Dec. 30 rose to a record high of $663 million, or $1.52 a share. After adjustments to exclude deconsolidation of a joint venture, the company reported an earnings per-share of $1.44.  In the same period of 2013, Baker Hughes reported $248 million in profit.  The layoffs are an about 11 percent cut to the 62,000-plus employees Baker Hughes said it employs globally on Tuesday. The company said it expects to book a one-time charge in the next period in the range of $160 million to $185 million for severance, and said it is reviewing its facilities for possible closures.  “This is really the crappy part of the job, and this is what I hate about this indu...

DENVER ,  Jan. 20, 2015  /PRNewswire/ --  Antero Resources Corporation  (NYSE: AR)  ("Antero" or the "Company") today announced its 2015 capital budget and guidance. Capital Budget and Guidance Highlights: Initial capital budget for 2015 is  $1.8 billion , a 41% reduction from the 2014 capital budget of  $3.05 billion Drilling and completion budget for 2015 is  $1.6 billion , a 33% reduction from the 2014 capital budget of  $2.4 billion Plan to operate an average of 14 drilling rigs between the Marcellus and  Utica Shale  plays in 2015, down from 21 at year-end 2014 Plan to complete 130 horizontal Marcellus and  Utica  wells in 2015, down from 179 in 2014 Net daily production for 2015 is projected to average 1.4 Bcfe/d, an approximate 40% increase over 2014's average net daily production of 1.0 Bcfe/d Net daily liquids production for 2015 is projected to average 37,000 Bbl/d (16% of total production) Anter...

The latest weekly update on Utica shale permitting from the Ohio Department of Natural Resources shows that only 8 new permits were issued last week, in only 2 different counties. 5 new permits were issued for Monroe County sites, all to Antero Resources.  The other 3 permits were all issued to American Energy Utica for wells in Jefferson County.  Those 3 permits push Jefferson County to 52 total permits, making it the 8th Ohio county to cross the 50-permit mark. With this latest activity, there are now 1,781 horizontal permits issued for Utica shale drilling in Ohio.  1,324 wells have been drilled, 726 wells are producing, and after dropping down to 43 last week, the Utica rig count is back up to 48. View the report here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

From Reuters: Oil and natural gas producer Magnum Hunter Resources Corp said on a conference call on Friday it has cut all capital spending amidst plunging commodity prices, expecting prices to remain low for at least the next year.  The small exploration company focused on natural gas production in the Marcellus and Utica Shales, had scheduled the call with investors with one day's notice to assuage concerns about its future as its shares have plunged 81 percent in the past year amid sinking natural gas prices.  "Rumors of our death have been greatly exaggerated," Chief Executive Gary Evans told investors.  Magnum's board plans to meet on Monday to discuss 2015 budget plans. At most, the company will spend $100 million this year, Evans said. "When you're in a death spiral of prices in this business, you're crazy to be spending money," Evans said. "We're not spending any money right now." Click here to read that whole arti...

From a Stone Energy press release: 2015 Capital Expenditure Budget   Stone's Board of Directors has authorized a 2015 capital expenditure budget of $450 million, which assumes planned sales of minority working interests in certain targeted assets. The budget also excludes acquisitions and capitalized SG&A and interest. The budget is allocated approximately 75% to Deep Water/Gulf Coast, 8% to Appalachia, 4% to Business Development and 13% to Abandonment expenditures. The capital budget and allocation of capital across the various areas is subject to change based on several factors, including commodity pricing, liquidity, permitting times, rig availability, regulatory, non-operator decisions and the sales of working interests in certain targeted assets.  The Deep Water capital budget is focused on development and exploration drilling, facility installations for development work, completion operations, and seismic and lease acquisition. Stone expects to participate i...

This report on New Matamoras, Ohio comes from the Marietta Times: The village saw its 2015 general fund nearly quadruple Wednesday night as officials accepted a check for more than $300,000 from Marietta-based MNW Energy LLC at the Village Council meeting.  Mayor John Schmidt was hesitant to say how the village will spend the $307,687.25, which was received as an up-front payment for leasing the mineral rights under 72 acres owned by the village to Triad Hunter for five years. MWN facilitated the lease.  “I’ve got committees and every committee is going to be involved in this with input to the rest of the council. We’ve made no decisions whatsoever,” said Schmidt.  Town finances are tight. The village has only barely managed to operate in the black for the past three years, noted Schmidt.  The $300,000 check was so large that village clerk Patty Martin sought guidance on how the village should handle the funds.  “I called the state auditor’s office...

From The Motley Fool: Last year started off with so much promise as Chesapeake Energy Corporation (NYSE: CHK ) was about to turn the corner on its long anticipated turnaround. The company's first quarter was exceptional as its earnings beat the street and were up 97% from the first quarter of 2013. As the second quarter drew to a close its stock was up nearly 15% and was vastly outperforming the market. Unfortunately the company's positive momentum hit a brick wall when oil prices unexpectedly rolled over and crushed what had been turning out to be a great year for the company. In the end the nearly 44% crash in oil prices pushed Chesapeake Energy's stock down by more than 22% as we see on the following chart.  CHK  data by  YCharts   Obviously, we can point a finger at oil as being the culprit that ruined the company's year. However, on the bright side, things could have been much as the company was in a much better position to weather the storm this time e...