The Daily Digger

WEEK ENDING 10/19/19 New permits issued last week:   10  (Previous week:  0 )   +10 Total horizontal permits issued:  3187  (Previous week:  3177 )    +10 Total horizontal wells drilled:  2708  (Previous week:  2708 )   +-0 Total horizontal wells producing:  2340  (Previous week:  2340 )   +-0 Utica rig count:  13  (Previous week:  13 )   +-0

From The Review: The lawsuit concerns leases landowners signed with Ohio Buckeye Energy or Chesapeake Energy from 2010 through 2012. Ohio Buckeye Energy later became part of Chesapeake.  Last October, Encino Acquisition Partners bought Chesapeake’s Utica holdings in Ohio for $2 billion. EAP is a partnership between the Canada Pension Plan Investment Board and Encino Energy, a private oil and gas company based in Houston.  EAP’s purchase included 900,000 acres and approximately 900 wells, with related equipment and property. Encino Energy’s Utica office is in Louisville.  Royalty dispute After the purchase, the Encino defendants began to significantly underpay royalties to landowners, according to the lawsuit.  William G. Williams, an attorney for the landowners, said his clients initially couldn’t wait for Encino to take over because Chesapeake had been making large deductions from their royalties, a practice that is the subject of another lawsuit.  ...

by Nicole Jacobs & Dan LAlfaro Eight of Ohio’s top Utica Shale development counties collected more than $141.9 million in real estate property taxes on oil and natural gas production since 2010, according to an  updated report  by Energy In Depth and the Ohio Oil and Gas Association. The  Utica Shale Local Support Series  report entitled, “ 2019 Update: Ohio’s Oil and Gas Industry Property Tax Payments ,” analyzes the economic impacts of oil and natural gas real estate property ( or ad valorem ) taxes paid in these counties from 2010-2017:  Belmont ,  Carroll ,  Columbiana ,  Guernsey ,  Harrison ,  Jefferson ,  Monroe  and  Noble . Data was collected through Freedom of Information Act requests, and builds on EID and OOGA’s previous 2017 reports on  real estate property taxes  and  road use management agreements . The  Utica Shale Local Support  Series  shows the real dollars b...

From Vorys' Energy & Environmental Law Blog: The Seventh District Court of Appeals reaffirmed that claimants can use both Ohio’s Marketable Title Act (“MTA”) and Dormant Mineral Act (“DMA”) to extinguish and abandon, respectively, mineral interests. In West v. Bode, 2019-Ohio-4092, the appellant-surface owners attempted to extinguish a severed oil and gas royalty interest under the MTA. The holders of the royalty interest argued, in part, that the MTA did not extinguish the royalty interest because, as between the MTA and DMA, the DMA is the more specific statute with regard to terminating mineral interests and the DMA did not abandon the royalty interest. The Court rejected the royalty holders’ argument, as it had done in similar, prior cases. However, in its decision, the Court offered its strongest defense of the MTA to date. Read the rest of this post by clicking here. 

From the Oil & Gas Law Report: The Ohio Department of Natural Resources – Division of Oil & Gas Resources Management (DOGRM) recently revised its rules governing spacing of horizontal oil and gas production wells. The new rules, which became effective on Oct. 10, 2019, will bring Ohio’s horizontal well spacing regulations in line with what accepted science and drilling data indicates is a more efficient and productive spacing for horizontal wells in Ohio.  Under the prior version of Ohio Administrative Code §1501:9-1-04, which applied to both conventional and horizontal wells, any oil and gas production well drilled into a pool located at least 4,000 feet in depth must be set back at least 500 feet from the boundary of the leased tract or drilling unit. That prior version of the rule also required a spacing of at least 1,000 feet between wells producing from the same pool.  Effective Oct. 10, 2019, Ohio Administrative Code §1501:9-1-04 was revised to require only...

An Encino Energy press release: Encino Energy made major donations from the Encino Energy Community Partnership Program earlier today supporting environment, health and safety projects in Carroll and Jefferson counties.  In Jefferson County, Encino was asked to provide funding for the Wintersville Fire and Rescue to purchase eight Conex shipping containers. These containers will be used to build a training facility for the Wintersville Fire and Rescue, which will be located adjacent to the burn building and to support hose line operations, search and rescue, roof operations, ladder operations, confined space rescue, rope rescue, sprinkler systems, and foam operations. The training center will be available for use by fire departments from Jefferson, Belmont, and Harrison counties. Encino invested $20,000 from its Community Partnership Program toward this effort.  “These new containers are incredibly important—and Encino Energy was the first to answer our call for action...

WEEK ENDING 10/12/19 New permits issued last week:   0  (Previous week:  19 )   -10 Total horizontal permits issued:  3177  (Previous week:  3177 )    +-0 Total horizontal wells drilled:  2708  (Previous week:  2707 )   +1 Total horizontal wells producing:  2340  (Previous week:  2339 )   +1 Utica rig count:  13  (Previous week:  11 )   +2

WEEK ENDING 10/05/19 New permits issued last week:   10  (Previous week: 0 )   +10 Total horizontal permits issued:  3177  (Previous week:  3162 )    +15 Total horizontal wells drilled:  2707  (Previous week:  2699 )   +8 Total horizontal wells producing:  2339  (Previous week:  2320 )   +19 Utica rig count:  11  (Previous week:  14 )   -3

From the USGS: The Marcellus Shale and Point Pleasant-Utica Shale formations of the Appalachian Basin contain an estimated mean of 214 trillion cubic feet of undiscovered, technically recoverable continuous resources of natural gas, according to new USGS assessments. “Watching our estimates for the Marcellus rise from 2 trillion to 84 trillion to 97 trillion in under 20 years demonstrates the effects American ingenuity and new technology can have,” said USGS Director Jim Reilly. “Knowing where these resources are located and how much exists is crucial to ensuring our nation’s energy independence.”    The assessment unit map for the Marcellus Shale within the Appalachian Basin. Although it occupies similar areas as the Point Pleasant-Utica Shale, the Marcellus is much younger, having formed in the Devonian age.   (Public domain.)  The Marcellus, Point Pleasant and Utica are extensive formations that cover parts of Kentucky, Maryland, New York, Ohio, Penn...

From POWER Magazine: The cost of fuel is one of the most important factors affecting power plant profitability, but flexibility and efficiency are also vitally important to success. One impressive new plant in Ohio—the Lordstown Energy Center—is positioned to profit from inexpensive gas while utilizing proven technology to economically produce reliable power. The project is a notable POWER Top Plant award winner.  The power industry has changed dramatically over the past decade. One of the driving forces behind the transformation has been the growth of shale gas production. Shale gas is natural gas—primarily methane—found in shale formations, some of which were formed during the Devonian and Ordovician periods of Earth’s history.  According to the U.S. Department of Energy, the shales were deposited as fine silt and clay particles at the bottom of relatively enclosed bodies of water more than 300 million years ago. At roughly the same time, primitive plants were forming...

From Law360: Chesapeake Exploration LLC properly calculated and paid oil and gas royalties to landowners, an Ohio federal judge ruled Monday, granting summary judgment in favor of the oil company in a certified class action that’s dragged on for nearly four years.  Dale H. Henceroth, Marilyn S. Wendt and eight other landowners filed suit in 2015, alleging the Chesapeake Energy Corp. unit had breached its contracts with them by underpaying them on royalties. Specifically, the landowners said Chesapeake should be paying them royalties based on a higher price associated with the later-enhanced and more expensive gas further down the line.  But U.S. District Judge Benita Y. Pearson on Monday found that Chesapeake was paying landowners “exactly what the parties negotiated for” in their leases. She granted the company’s motion for summary judgment and denied a competing motion for summary judgment from the plaintiffs.  “The lease language is plain and unambiguous and th...

WEEK ENDING 09/28/19 New permits issued last week:   0  (Previous week:  0 )   +-0 Total horizontal permits issued:  3162  (Previous week:  3162 )    +-0 Total horizontal wells drilled:  2699  (Previous week:  2698 )   +1 Total horizontal wells producing:  2320  (Previous week:  2317 )   +3 Utica rig count:  14  (Previous week:  14 )   +-0

Despite its high energy demands and a surge in energy production, Ohio’s statewide emissions have fallen by as much as 94 percent since 1990 COLUMBUS, Ohio--( BUSINESS WIRE )-- Consumer Energy Alliance  (CEA) today released an  Ohio emissions brief  that looks at key pollutants and the overall environmental improvements seen across the state. The brief offers further support for one of the great untold stories in Ohio and across the country, the United States is leading the world in environmental stewardship and emission reduction. The brief comes as youth across the country marched in support of a healthier environment, and to seek answers from community leaders, policymakers and adults about what is being done to improve our environment while also meeting today’s growing demand for energy. This brief shows everyone that many of their questions have already been answered by ongoing innovation and technology in the U.S. CEA’s brief found that even as Ohio incr...