At the Well Weekly – Oil and Gas Update for Week Ending 11/17/2017 – WV/China MOU for Natural Gas Development Investments Makes Headlines, Fuel Gas Royalty Class Action Survives in Oklahoma, Colo. Supremes OK Refund for Overpaid Oil/Gas Production Taxes

Spot prices in Appalachia increased since our last report based largely on cold temperature forecasts while the rig count and oil prices maintained their positions.  In Appalachia, West Virginia reports that it reached a memorandum of understanding with China for investments in natural gas development projects.  Elsewhere, Texas courts tackle disputes over mineral interests, a royalty class action in Oklahoma survives preliminary motions to dismiss, and Colorado’s Supreme Court blesses a refund bid by a production company that mistakenly overpaid oil and gas production taxes.  Here’s the week in review:  Read more ›

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At the Well Weekly – Oil and Gas Update for Week Ending 10/27/2017 – Federal Court Says Ohio Supreme Court Would Adopt “At the Well” Rule for Royalty Calculations

Natural gas prices in Appalachia haven’t rebounded much since our last report, hovering around $1/MMBtu amidst a small decline in the rig count, but the good news is that the Brent Crude surpassed its $60/bbl benchmark earlier in the week. In Appalachia, a federal court in Ohio took a shot at predicting how the state supreme court would deal with oil and gas leases that provide for royalty payments based on the “market value at the well.”  Here’s the week in review:  Read more ›

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Oil and Gas Update for Week Ending 10/6/2017 – Natural Gas Prices Slide, PA Superior Court Addresses Reserved Royalty vs. Oil/Gas Interest, and ND Tackles Ownership of Minerals Underlying Streambeds

Natural gas prices have fallen pretty harshly since our last report, particularly in Appalachia where prices dropped below $1/MMBtu, amidst a slightly sliding rig count. In Appalachia, the Pennsylvania Superior Court addressed the distinction between royalty vs. oil/gas interests in a deed reservation while courts in Ohio address whether an oil well is “capable of producing gas” for purposes of drawing up well drilling units.  In other news, the North Dakota Supreme Court asked a trial court to review its determination of state ownership of minerals underlying streambeds in light of new state legislation allocating mineral ownership under the high-watermark of the Missouri River.  Here’s the week in review:  Read more ›

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Oil and Gas Update for Week Ending 9/8/2017 – Pipeline Projects Dodge Several Roadblocks; DRBC Plans Ban of Hydraulic Fracturing Ops

It’s been a relatively quiet week since our last report. Natural gas spot prices in Appalachia took a nose dive amidst only modest increases in the Henry Hub and the rig count. In Appalachia, a federal judge denied a bid to dismiss a class action brought by royalty owners alleging improper payments. The Pennsylvania Department of Environmental Protection and the FERC did their part moving various pipeline projects along, with DEP issuing an air permit for the Atlantic Sunrise project and FERC denying bids from environmentalists to halt construction of that pipeline and the Northern Access pipeline. Finally, the Delaware River Basin Commission plans to ban hydraulic fracturing operations within the basin. Here’s the week in review:

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Oil and Gas Update for Week Ending 9/1/2017 – Hurricane Harvey Drives Oil, Nat Gas Prices Up and Down; PADEP Releases 2015 Methane Emissions Data from Oil/Gas Ops; Pipeline Projects Facing Challenges

After a brief hiatus we are back at the well. Since our last report in early August, Hurricane Harvey ravaged southeastern Texas, affecting oil, natural gas, and gasoline prices all over the country. In Appalachia, the PADEP issued the 2015 numbers for methane and other emissions from oil and gas sources, pointing to a modest increase in methane emissions from oil and gas sources despite significant increases in operation and production alongside significant decreases of other emissions. In other news, pipeline project sponsors in Appalachia and elsewhere continue to face challenges in pursuit of their state and federal approvals, gaining ground with agencies on permit applications while facing challenges from environmental and other groups. The struggle may continue as a result of a recent D.C. Circuit ruling that chastised FERC for a faulty NEPA review of pipeline projects in the south and their potential for greenhouse gas emissions.  Here’s a roundup of the last couple of weeks:

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Oil and Gas Update for Week Ending 7/28/2017 – PA Senate Floats Severance Tax, Permit Reforms, as Part of Ongoing PA Budget Negotiations.

Natural gas spot prices in Appalachia took a nose dive since our last report despite the rig-count rebound and rising oil prices.  In Pennsylvania, the Senate Republicans introduced a severance tax to raise approximately $100 million in revenue in order to close budget gaps in exchange for regulatory reforms designed to hasten actions on permit applications submitted to the Pennsylvania Department of Environmental Protection for approval. In other news, a court of appeals in Texas busted a Permian Basin lease in part based on a retained-acreage provision that didn’t cover non-operational areas on the leased premises while a federal judge in Kansas kept a royalty class action in federal court under the Class Action Fairness Act. Here’s your weekly roundup:

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Oil and Gas Update for Week Ending 7/21/2017 – PA Supremes on the Environmental Rights Amendment, Third Circuit on “Buyers for Value” in Bankruptcy Claim Proceedings, and ND Supremes on Pore Space Ownership.

After a few weeks off we’re back at the well. The national rig count dipped two units last week for the first time in a long time while oil and natural gas prices increased slightly. Since our last report, the Pennsylvania Supreme Court issued its long-awaited decision in Pennsylvania Environmental Defense Fund v. Commonwealth in which the state’s highest court scrapped a longstanding test for determining violations under the state’s Environmental Rights Amendment.  The Third Circuit was also busy issuing decisions on a wide range of topics while a federal court in Kentucky interpreted “oil and gas” as used in a farmout agreement as excluding NGLs for purposes of royalty payment obligations. In North Dakota, the state’s highest court held that a surface owner is the owner of the pore space beneath the land under the state’s surface owner protection act. Here’s the roundup:

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Oil and Gas Update for Week Ending 6/16/2017 – PAPUC Issues Annual Report on Natural Gas Impact Fees.

Oil and natural gas spot prices continued their downward trend since our last report with the Henry Hub dipping below $3 for the second straight week, spot prices in Appalachia dipping below $2, and oil prices hovering around $44/bbl. In Appalachia, the Pennsylvania Public Utility Commission issued its annual report demonstrating that the state collected more than $173 million from impact fees from natural gas producers, although the total dropped about $15 million from 2015.  In other news, a bankruptcy judge denied a claim to hundreds of millions of dollars in royalties based on a division order.  Here’s a roundup of the past several weeks:

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Oil and Gas Update for Week Ending 6/9/2017 – WV Supremes Endorse Net-Back Method for Calculating Royalties and Post-Production Costs; TX Supremes Confirm County-Wide Mineral Grant.

Sliding oil and natural gas spot prices didn’t affect a steady rig count that climbed several more units since our last report.  In Appalachia, the West Virginia Supreme Court signaled a departure from the controversial “marketable product” rule for interpreting royalty clauses and the allocation of post-production costs, at least with respect to certain older leases subject to a state permitting statute that requires an upgrade from a flat-rate royalty clause to a production royalty clause as a condition of getting a drilling permit.  In other news, the Texas Supremes confirmed a county-wide mineral grant despite prior rulings that deeds with conflicting language conveying specific parcels along with all mineral interests within a county created an ambiguity.  Here’s a roundup of the past several weeks:

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Oil and Gas Update for Week Ending 5/26/2017 – PA Production Up, Drilling Down; TX Surface Owner’s Ability to Authorize Horizontal Drilling Through Severed Mineral Estate; Fifth Circuit Interprets Risk Penalty Provisions in LA Forced Pooling Statue.

Natural gas spot prices dropped since our last report despite rising oil prices and more rigs nationally and regionally.  In Pennsylvania, the PADEP issued its annual report for oil and gas operations indicating an increase in production despite the fewest well permits and wells drilled since 2008.  In other news, PADEP Secretary McDonnell can drop the “Acting” label from his title following a unanimous state senate vote to confirm his permanent appointment as the agency’s leader.  At the federal level, the D.C. Circuit hit the pause button on legal challenges to Obama-era rules targeting methane emissions from new oil and gas sources following the Trump Administration’s vow to review the rule as part of a planned overhaul of federal regulatory regimes while the U.S. Senate skipped the opportunity under the obscure Congressional Review Act to rollback a similar measure for operations on federal and Indian lands.  In the courts, the Texas Supreme Court held that a surface owner can authorize a horizontal well through the underlying mineral estate to reach minerals under adjacent lands while the Fifth Circuit interpreted the notice and risk-penalty provisions of Louisiana’s forced pooling statute.  Here’s your week in review:

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At the Well Weekly
Welcome to At the Well Weekly, a blog designed for busy folks in the oil and gas industry. If you haven’t read a thing during the week, our hope is that you can breeze through the update and be up to speed on the basics such as current rig counts, commodity prices, and case law updates on legal issues of interest in Appalachia and elsewhere.
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Cozen O’Connor Blogs