From the left-winger himself……."David has defeated Goliath." By affirming every Pennsylvanian’s constitutional right to clean air and clean water and upholding the right of local communities to govern themselves when it comes to certain aspects of natural gas development, a clear message has been sent to Governor Corbett and his friends in the energy industry: our fundamental Constitutional principles cannot be auctioned off to wealthy special interests in exchange for campaign dollars.” -- Cecil Twp. Jessy White.
Let's not forget the Youngstown and Southeastern Railroad purchase. Thinking we will be hearing some type new development related news in time. There appears to be a lot of room for industrial development along the line, on the PA side, and perhaps the OH side as well. There is evidence of one or more product pipelines here also. The railway itself has direct connections to two competing rails, this is the NS and CSX in OH.
The company has at or about 2 billion, mostly likely Milton Drysdale-type source credit. Lower ROR asset sales and focusing on higher ROR assets has always been RRC’s methodology ever since I became a holder. I haven’t in past several years RRC regret a previous sale yet, nor myself as a shareholder over the years. My guess is selling the Permian assets allow for funding of, 1) the OL-KS Mississippian may provide greater ROR, that is through early, data appears perhaps similar to the Marcellus, 2) Marcellus is great and getting better, for one, you can export NGLs, but not crude at least for now. In fact some analyst note that crude could be over abundant and have heard some note to at or about 72 in 2014. 3) product pricing power has been on the upside, though could be better, but the NGL uplift is there as you and you can export it, in country or out of. 4) nat gas as well as NGLs usage is on the way up to one could argue at the expense of coal, oil, and other more costly petrochemicals. 5) the midstream as well as the downstream takeaway is getting better. Just 2 years ago, the worry was too much ethane, and nowhere to go. Mariner West, ATEX, and what appears to be a now a bidding war for more NGL takeaway has eliminated this problem. The rails are playing a big part in takeaway as well. This is all in addition to the fact the (Marcellus/Utica/Upper Dev.) are one of lowest capital intensive areas being develop, and RRC is doing better there also (lowering costs), as are others. 6) Production mile-stones at 20-25% YOY assumes your selling more product, which coupled with a low capital intensive play and great and getting better takeaway options, makes stagnate prices about irrelevant. Having a huge cash position and holding on to ridiculous amount it really doesn’t get you much. Building net asset value does. IMO they are doing good job of building net asset value and they have certainly helped build mine. That's what I expect; I am confident.
I'll respond to the SA post later, but in sum, I suggest you learn the business and disregard disgrunted unit holder, if this one is in fact a holder. Regardless of the new sale, in my opinion, MWE maintains above 62 per unit.
Likely, and to Buffalo NY. Line N runs right through RRC core area. The old Columbia is replacing transmission lines in Washington Co. also. Williams could also tie into the Line N as it goes right past a small processing plant.
This will all help RRC and the rest when the dry Utica is tapped in Washington Co. later next year.
Key Points (Marcellus Side of the Business noted here only) Released by RRC - 17 Dec 2013):
Marcellus gross production reached 1 Bcfe per day.
Year to date, Marcellus super-rich wells continue to significantly outperform the type curve.
Mariner West ethane pipeline fully operational.
ATEX ethane pipeline commenced operations.
17 super-rich wells drilled in 2012 and turned to sales during the early part of 2013 are consistently producing approximately 40% above the 1.32 Mmboe type curve established at year end 2012.
22 super-rich Marcellus wells during mid-year 2013 which have produced on average just over 114 days. These wells are performing approximately 74% above the 1.32 Mmboe EUR type curve. Initial 24-hour production rates for these wells averaged 2,487 (2,059 net) boe per day with 65% liquids assuming 80% ethane extraction (476 barrels per day of condensate, 1,149 barrels per day of NGLs and 5.2 Mmcf per day of gas).
Mariner West project has become fully operational. Range supplied the initial ethane for the line fill of the system during the commissioning stage of the project from the MarkWest processing plant in Houston, Pennsylvania for the 400 mile delivery into storage facilities just outside Sarnia, Canada. Range expects to be flowing 15,000 (12,525 net) barrels of ethane per day on January 1, 2014.
ATEX pipeline project began operations this month. Range has secured the rights to transport 10,000 (8,350 net) barrels of ethane per day on ATEX for the next two years, increasing to 20,000 (16,700 net) barrels of ethane per day for the remaining 13 years under the contract.
Project underway as the old Line N ROW has been surveyed and flagged in the Mt. Pleasant Twp. portion of the project.
Mainer 2 details I do not have. As I suggested in the past, SXL will have to run perhaps a new 20-inch across PA. Three years to complete, I don't think is rational. I witnessed ATEX pipeline row and pipeline work at Liberty this summer, just a few months ago. Today the line is being filled. That's alot of work done in a very short period of time. So SXL has some leg work to do.
Another alternative it for EPD to lay a larger NGL line on the TEPPCO ROW.
I recall KMP trying a similar project a couple of years back and scraped the project. Perhaps NOVA is getting a little nervous about the Monac cracker. Sure there are other to be announced projects on the blue prints that we here do not know about.
Appears this project is Canadian bound, KMP/MWE is PADD 3 bound. However, how could this impact Mariner West as well as related producer customers in the SW Pa Marcellus?
In August 2013, MWE announced plans to install a 38,000 Bbl/d de-ethanization facility at the Sherwood Complex. Sherwood is connected to Mobley via NGL pipeline, and a new ethane line in under construction from Sherwood to Mobley, then to Majorsville. Northern portions of Lewis is about 20 miles to Sherwood. Harrison is a little more to the east of Sherwood.
What he forgot to mention is Natrium is still shut down due to fire and safety issues. Recall sometime in Feb to restart. I would also suggest the "skid-equipment" assumes a what I call a sloppy operation. AKA cutting corners.
Some past messages lost on this post. Anyway you know where Lewis and Harrison Counties WVa are located. In the same area as AR. So I would think Sharwood is the best option for NX/NBL on the wet side.
I think we are fine. So far we held above as I noted in the past, a major retrace as far as the unit price, that is 62. Today's 2% jump was a good confirm to me that we may have bottomed on the unit price, I have yet to see the unit price come to or go below my retrace guestimate (50%) going back several years. Some are calling for a market correction, but this is already built into MWE. I think EQM did well today also, and that's about it. Others noted the 12 -18 month customer and MWE plant completions relationship. From last weeks hunting trip, I noted one super wet six well pad spudded and ready for frac work, the rig moved just down the road a couple of miles to begin another super wet six well pad. And as Mr. Semple noted, MWE is for the most part ahead of customers. These two pads I noted already have field gathering in place. In addition, I talked to one landowner in the area. Prior to getting to my post position in the wood before day lite I learned the up coming locations for additional pads, and there are a lot of them. Finally, I would suggest that Washington Co. has had an uptick in permitting from Oct to today, to the tune of about 131 permits. All but about two of these are served by MWE. Most if not all are wet to super wet wells. Also now that CNX has made a decision to become more of an E&P out fit, we should see a marked increase in service required here also. Mr. Harvey noted that the companies target CARG is in the 40% range for 2014 and beyond. The recent CNX/Dominion wet portion of this lease should go to Sherwood.
As noted before, RRC is selling off a good portion of its Permian. Some suggest it could fetch at or about 1 billion. Have to wait and see on that, but what is interesting is what will RRC do with some of that money.
Really to me sends a mixed signal. For one, setting the price at or about 27% below the pervious day close. Second, at the same time the spread between WTI and Brent is again narrowing again. One the other hand, debt will be reduced, but will future earning power be there to offset the new amount of outstanding shares? So the question is, does one take advantage by adding to current position assuming better than expected earning power in the coming quarters?
I'll stick with the 62 range assuming 50% retrace, though it has not done that to date since I have been applying this technical method. If I had to rate the price now, and I did, I would say buy. We go down to the 70% retrace, then strong buy.
Could be due to, for one thing CNX’s 90,000 acre Marcellus and Upper Devonian purchase from Dominion announced today. Acreage includes the northern portion of Lewis County and the southern portion of Harrison County of which at least half is considered wet gas.
We talked about unit price movement before. CAGR, distribution growth, treasury yields, etc. For unit price action, outside of the other factors noted, my guess is a bottom at or near the 62 level, assuming a typical 50% retrace. At that price, it's big decision for me to buy more versus other equities. At 58 (unlikely), I will add more. In the past, the price never made it to the 50% retrace level, I would be surprised if it would reach that level in the coming weeks or months.