Quite a bit of interesting news around
here lately, I’ll add some personal insights…
CONSOL is the largest coal mining
company in the Pittsburgh area, branching out into shale drilling when they
created CNX, which is pursuing an aggressive drilling campaign south of
Washington, Pa that extends into northern Greene County.
SEC charges three former
Consol execs. with insider trading
June 1, 2012 - The U.S.
Securities and Trade Commission today sued three former Consol Energy executives
in federal court, accusing them of using insider trading to either profit or
avoid losses when the company’s stock price dipped through the purchase of a
Marcellus Shale exploration and production company.
The SEC named in the lawsuit
Charles E. Mazur Jr. of Eighty Four, James S. Poland of Washington and Joseph A.
Cerenzia of Canonsburg, claiming they sold their Consol stock prior to the
Southpointe-based company’s March 15, 2010, announcement it acquired Appalachian
Exploration and Production from Dominion Resources Inc. for $3.74
billion, court records show.
Great Lakes Energy Partners is the
banner that Range Resources first entered our area under, when they were
partnered with First Energy. Range later bought out First Energy (see ‘Range
History’ at bottom of email).
Chesapeake Energy, lease at
crux of lawsuit
June 2, 2012 – An Avella
couple has filed a lawsuit against Chesapeake Energy Corp. claiming the natural
gas drilling company filed a false legal notice in an attempt to extend its
lease. According to the complaint, the Briggses entered into an oil and gas
lease with Great Lakes Energy Partners in 2005 for 131 acres, for which they
were paid $8 an acre and 12.5 percent royalty. The lease expired five
years later but the couple had 60 days to extend or renew it under similar
terms.
By this time, the lease had
been acquired by Chesapeake Energy. In 2010, Chesapeake entered into
negotiations with the Briggses to extend the 2005 lease and made an offer of
$4,250 an acre with 18 percent royalty. However, the company and the
Briggses were unable to reach an agreement prior to the expiration of the
lease.
There is no doubt that leased acreage is
worth much more than what gets paid to landowners, but how much more? Depends on
who is valuing those leases, and when, it appears.
Chesapeake: Utica Shale Is
Worth $13,000-17,000 Per Acre
June 2, 2012
- Chesapeake Energy believes every acre of its oil and liquids-rich Utica Shale
play is worth $13,000 to $17,000. Chesapeake
recently noted that wet gas wells - those producing ethane, butane, propane,
pentane and other liquid properties, as well as the dry methane gas - can be
worth about three times as much as the wells that yield only the dry methane
gas.
The investor presentation shows that Chesapeake classifies its West Virginia acreage in the same category as its Ohio acreage under the Utica Shale banner. It shows the company having significant holdings in Jefferson, Harrison, Columbiana and Carroll counties in Ohio, along with some holdings scattered throughout Belmont County. According the investor presentation, Chesapeake places a value of $30,000 to $50,000 on each acre of land in its Eagle Ford Shale play, based in Texas.
Why does this story remind me of
Pinocchio and his ever-lengthening nose? Great place for a *possible* fracking
and gas well site, next to a surgery center and medical office building! If
someone was writing this book, you would have to title it ‘Stranger than
Fiction.’
Range seeking permit for
South Strabane
June 2, 2012 - Although Range Resources says
it has no current plans to drill for natural gas in South Strabane
Township, the company is applying for a well pad permit there. Range
has submitted an earth disturbance application to the state Department of
Environmental Protection for property on Route 19 where a mixed-use development
is planned. The property is known as the Meadows Landing development, located
across the highway from the former Curringa's restaurant.
Matt Pitzarella, director of
corporate communication for Range, said the company has no plans to
drill. He said it is not unusual for the company to apply for more
permits than it intends on drilling to provide them with planning
flexibility. The Meadows Landing development fronts Route 19 and is
undergoing grading. The first project in the mixed-use development will be
construction of a surgery center and a medical office building.
This is the same judge who
presided over the sealing (and potential unsealing) of the Hallowich case.
Judge
stripped of criminal cases
June 1, 2012 - Washington County Judge Paul
Pozonsky was stripped of his criminal caseload Thursday in a two-sentence order
handed down by the president judge.
The administrative order by
President Judge Debbie O'Dell Seneca reassigning Pozonsky's duties to include
only civil jury and nonjury trials seemingly took everyone at the courthouse by
surprise - except for the president judge and District Attorney Eugene
Vittone.
RANGE HISTORY (Source:
Reference for Business)
“In 1998
Range Resources lost $175.2 million while generating $146.6 million in revenues,
the result of poor commodity prices and failure of the company's recent
purchases to perform up to expectations. Much of 1999 was devoted to retrenching
efforts. Noncore assets were sold off to reduce debt and the company cut back on
its drilling budget for the year. Range Resources formed Great Lakes Energy
Partners, a joint venture with FirstEnergy Corp. in the Appalachian Basin
that allowed Range to contribute property that included $200 million in debt,
thus allowing the company to reduce its bank debt considerably, to just $160
million. An exchange of common stock for fixed income securities helped to
reduce debt further, to approximately $90 million. By the end of the third
quarter energy prices rebounded and Range Resources finally began to return to
profitability.”
If you think drill rigs don’t belong in kitchen windows, join us in D.C. to stop the frack attack!