Posts Authored by Zachary D. Eddy

Ohio Supreme Court issues another major decision for surface and mineral owners in Ohio

On December 17, 2020, just days after its decision in West v. Bode, the Ohio Supreme Court issued another major decision for surface and mineral owners in Ohio. In Gerrity v. Chervenak, Slip Opinion No. 2020-Ohio-6705, the Court formally weighed in, for the first time, on the level of diligence required by a surface owner who is researching severed mineral interest holders in order to serve a notice of abandonment pursuant to the Ohio Dormant Mineral Act (DMA). R.C. 5301.56 et seq. Appealing a Fifth District decision that upheld the purported abandonment of oil and gas mineral interests created by a 1961 reservation, and attacking the due diligence performed by the surface owners, the mineral owner presented two propositions of law for acceptance by the Court. For more, read the full article

Ohio, Oil & Gas Litigation

Continued low natural gas prices spark new round of impairments

Several oil and gas companies have been “forced to recalculate and reduce the value of their assets to reflect a down market,” as continued low natural gas prices “have been putting a damper on corporate earnings for many months,” the Pittsburgh Post-Gazette reports. CNX Resources Corp. recently “wrote down $46 million in assets in Central Pennsylvania,” according to the article, following a “blockbuster $10 billion impairment by Chevron Corp. last month, more than half of which was attributed to Appalachian oil and gas assets.” EQT Corp, the largest natural gas producer in the country, “is expected to write down between $1.4 billion and $1.8 billion in assets” next month. The wave of impairments means “some oil and gas leases will be allowed to expire without follow-up and some potential drilling locations are now off the table.” For more, read the full article.

Pennsylvania

Ohio oil production gains outpaced natural gas gains for third quarter of 2019

While oil and natural gas production in Ohio’s shale region saw gains in the third quarter of last year, oil production gains were higher than natural gas on both a percentage and annual basis for that period, according to a recent article in The Daily Reporter. Horizontal wells “produced more than 7.2 million barrels of oil and nearly 673.97 billion cubic feet of natural gas for the quarter compared with more than 5.54 million barrels of oil and 605.71 billion cubic feet of natural gas for the third quarter of 2018,” the article reports. Those numbers “reverse the script” from 2018, “when oil production trailed natural gas on a percentage basis.” Ohio’s shale region has produced “more than 18 million barrels of oil and more than 1.9 million cubic feet of natural gas” in the first three quarters of 2019.

Ohio

Utica Shale’s third-quarter production sets new state records

Figures released by the Ohio Department of Natural Resources (ODNR) show Ohio’s horizontal shale wells produced a record 7,200,304 barrels of oil and 673,962,146 Mcf (674 billion cubic feet) of natural gas in the third quarter of 2019, The Daily Jeff reports. These totals, which represent increases of 29.84 percent and 11.27 percent for oil and natural gas production respectively over the same quarter last year, set new state records for quarterly production. The ODNR report lists 2,470 horizontal shale wells, with 2,419 of those reporting production during the quarter. For more, read the full article.

Ohio

Marathon Petroleum will split off Speedway and replace CEO

Findlay-based Marathon Petroleum Corp. announced plans to “spin off its Speedway gas-station business” and replace Chairman and CEO Gary Heminger, who will retire next year, The Columbus Dispatch reports. The announcement reverses Marathon’s position from recent statements that the company intended to continue under its current structure despite pressure from investors (see our October 15, 2019 blog post). Elliott Management Corp., part of the group of shareholders that pushed for the split, said in a statement the move “will unlock substantial value for shareholders,” according to the article. For more, read the full article.

National