Payment

Wyoming Gov. Matt Mead last week laid down the gauntlet to an edict by the U.S. Interior Department to withhold payment of mineral revenues to his state because of federal sequestration. Wyoming is faced with not receiving more than $53 million due over a five-month period through July.

Wyoming Gov. Matt Mead laid down the gauntlet Tuesday to a proposal by the U.S. Interior Department to withhold payment of mineral revenues to his state because of federal sequestration. Wyoming is faced with not receiving more than $53 million due this month through July.

A subsidiary of Royal Dutch Shell plc has been given another six months to decide whether to purchase property in western Pennsylvania for a proposed “world scale” ethane cracker in the heart of the Marcellus Shale.

Aubrey McClendon, who has run Chesapeake Energy Corp. and helmed the board of directors since he co-founded the company in 1989, officially will step down as chairman of the board at some point this week.

Rex Energy Corp. recently spud it first Utica Shale well in Carroll County, OH.

Although Norse Energy Corp. ASA has applied for a permit to drill an unconventional gas well in New York’s portion of the Marcellus Shale, the state Department of Environmental Conservation (DEC) said the company’s application is premature.

Chesapeake Energy Corp. has sold a five-year volumetric production payment (VPP) to an affiliate of Barclays Bank PLC for proceeds of $1.15 billion related to its production from the Barnett Shale of North Texas, the company said Monday.

Chesapeake Energy Corp. has sold a five-year volumetric production payment (VPP) to an affiliate of Barclays Bank PLC for proceeds of $1.15 billion related to its production from the Barnett Shale of North Texas. The deal, which closed on Sept. 30, includes about 390 Bcf of proved reserves and about 280 MMcf/d net production in 2011. Chesapeake retained drilling rights on the properties below currently producing intervals and outside existing producing wellbores. Since December 2007 Chesapeake has completed eight VPP transactions and monetized approximately 1 Tcfe of proved reserves for combined proceeds of approximately $4.7 billion, or approximately $4.70/Mcfe (see Daily GPI, May 6). Earlier this year Chesapeake announced a reorganization of its natural gas operations in a plan to raise up to $5 billion to repay up to $3.5 billion of senior debt and to increase its investment in liquids-rich plays by up to $1.5 billion (see Daily GPI, May 11). Jefferies & Company Inc. was adviser to Chesapeake on the latest VPP transaction.

An agreement announced late Monday among federal and provincial governments and five Indian tribes — that includes a C$500 million payment by the Canadian government — may be the lynchpin that finally makes the stalled multi-billion dollar Mackenzie Gas Project more than a pipe dream.