Guest Column in Record Delta Newspaper
EQT is Buying West Virginia Leases from Statoil
Statoil has sold their interest in leases in Wetzel, Tyler, and Harrison counties to EQT. EQT is one of the few companies that is making money right now, and is increasing its footprint in the Marcellus/Utica sweet spot. It’s a good move by EQT.
Anyone who had a lease with Statoil in those counties could expect to be dealing with EQT in the future.
As a heads up, EQT’s standard agreement allows EQT to deduct post-production costs from the royalties they pay, so they may try to get away with deducting post-production costs from any leases Statoil may have signed that do not allow for the deduction of post-production costs. If you find yourself wondering why your royalty check is suddenly much smaller, check the deductions column.
Gas Pipeline Explosion
A 30-inch gas pipeline exploded in Westmoreland County, PA on Friday. We’ve been a bit busy around here, so we haven’t been keeping up with the news.
The Pittsburgh Post-Gazette has some good pictures and interviews. It’s really scary to think what one of these pipelines does when it explodes. I’ll have one about 200 yards or so from my house in about two years, and I’ll be preparing an escape plan.
The Fire Chief said he parked 1/4 mile away and he couldn’t get out of his truck because of the heat.
We’re big fans of having the pipelines built, as we really need them for continued development in this area. We also have to be careful about them. They don’t fail often, but when they do fail it’s spectacular and extremely dangerous. We have to be prepared, and we have to make sure the companies are doing their work correctly.
Royalty Cases Against Chesapeake and Southwestern
Some folks are suing Chesapeake and Southwestern for back royalties, among a couple other things. The other things are not likely to be high-dollar amounts, but the royalties could add up.
There are quite a few cases against Chesapeake for back royalties in other states. We’ve been surprised that there haven’t been more cases against Chesapeake in West Virginia. It seems that CHK would have done the same thing to West Virginia royalty owners that they did to Ohio, PA, and Oklahoma royalty owners.
If anybody out there has a case that they’d like to take up against Chesapeake for back royalties, give us a call. It won’t hurt and could help. It could help a lot.
304-473-1403
WDTV News: Oil and Gas Attorney Discusses Pipelines with Lewis Co. Commission
Kyle Nuttall attended the Lewis County Commission’s meeting on Monday and spoke about the proposed pipelines that will be going through the County, the Mountain Valley Pipeline and the Atlantic Coast Pipeline. The short write up in the newspaper only touched on a portion of what he talked about. He’ll be attending a number of other events in the next few weeks and we’ll post about those events as they happen.
Ohio Natural Gas Fired Power Plants
This article over at Energy In Depth shows that Ohio will eventually be powered entirely by natural gas. There are seven natural gas-fired power plants either under construction or in the planning stages. Once they are complete, they will create 6,458 megawatts of electricity, enough for 5.85 million homes. Ohio has 4.5 million homes. Ohio will be sharing electricity with surrounding areas through the grid, of course.
West Virginia is a net producer of electricity, but it’s all coal-fired. We have several gas-fired plants in the works, with one in particular up in Moundsville, WV that will be the first to come online. Last we heard they were hoping to start construction on it this spring, but that was last fall and there doesn’t seem to be any activity at this time.
Atlantic Coast Pipeline Construction Delayed
Dominion has announced that it is delaying the start date for construction on the Atlantic Coast Pipeline. Interestingly, they still plan on putting the pipeline into use at about the same time they had originally planned. The new target for construction is summer of 2017, with the pipeline slated for first use sometime in 2018. So what they’ll be doing is running more crews over a shorter period of time.
UPDATE: This article says the ACP will have an 18 month construction period. If construction starts in the summer of 2017, that’s cutting it pretty close to 2019 before it will be finished. Work on a pipeline can go awfully fast, but if there are any delays at all they simply won’t be able to finish before 2019.
West Virginia’s Politicians are Looking for Japanese Investments in Natural Gas
There was a big event a few days ago down in Charleston. Governor Tomblin and Senator Manchin hosted a bunch of Japanese businessmen, apparently in an attempt to interest Japanese money in investing in West Virginia natural gas. While it certainly hasn’t been said outright, it seems that Odebrecht’s failure to move forward on the cracker plant has disappointed people. It’s disappointed us for a while, and we’re excited to see public evidence that people in charge are working to bring in new investment partners.
We really need to make sure that West Virginia takes full advantage of the opportunity that has been presented to it. We’re shipping natural gas out of the state in its raw form. We need to be using it here and shipping electricity and plastics out instead. We can piggy back on natural gas to improve our internet infrastructure, and our tourism. The big plants and the technology that comes with them will not be content with poor internet, and the people that work in the plants are going to want nice places to live, work, and play. Investing in the use of natural gas within the state is a great first step.
While this article about Governor Manchin’s trip to Japan which is coming up in a month focused mainly on the automobile parts industry, it’s still heartening to see that the Governor’s office had a talking point that included investment in natural gas.
ACP Changes Route Through Randolph County, WV
It’s not every day that you hear about a big corporation going out of it’s way to, literally, go out of it’s way. Particularly when it’s just based off people making requests that the big company do so. That’s exactly what happened in Randolph County, WV this week though.
A number of citizens voiced concerns about the Atlantic Coast Pipeline crossing through an area called Mingo Flats. A Google search for Mingo Flats, WV brings up a surprising number of interesting and diverse articles, including a 5-minute first-person view of someone riding a motorcycle along Mingo Flats Road. Apparently there is some historic value to the area. This blog post by Granny Sue’s News and Reviews was enlightening.
The article in the Inter Mountain is behind a paywall, but if you do a Google search for the exact title of the article “Dominion gives ACP plan update” and click on the link Google provides, you can get around the paywall.
Tangent Warning: I’m not sure why so many news sites work that way, but many of them do; it’s so easy to get around that it doesn’t make sense to have a paywall like that. Try it, it works for a surprising number of paywalls.
Back on point: the article hints that there have been other concerns raised by Randolph County residents, and it sounds like this was the only one that the ACP is going to address. Perhaps the other concerns were not voiced by large numbers of residents, or they weren’t significant to the ACP. I’m sure they were significant to the owner of the property.
If you need help negotiating with the Atlantic Coast Pipeline people, give us a call. That’s what we do, all day, every day. We can also help you actually understand what that Easement Agreement says and does. You might be surprised at what you don’t realize you don’t know. It pays to get some professional help with this kind of thing. After all, this agreement is going to be in effect for decades. It will be in effect for longer than that if you don’t get the right changes made to it. Don’t make the mistake of burdening your property with an Easement Agreement that is never going to expire just to save a few bucks now. Call us, you’ll be glad you did.
304-473-1403