Don't let the door hit ya...

Remember when they owned everything here? Even Santa?

Hey, hey, hey, goodbye.

Chesapeake Energy exits the Barnett Shale with a whimper

Royalty Rip-off

Around the country, landowners are suing Chesapeake and other drillers for massive deductions from royalty checks.

Read the Fort Worth Weekly cover story for the scoop.

Royalty income from the first month’s production alone totaled more than $8,500.

But five months later, with the wells still producing the same amount of gas, his royalty check suddenly shrank by more than 80 percent, to just under $1,700, eaten away by what Chesapeake called “post-production costs.” In the following months, his checks dwindled even further, to almost nothing.

“In October 2013, I got a check that said my royalty was $6,000,” said Feusner, “but after one set of deductions it was reduced to $115; after another adjustment it dropped further. They wound up taking 99.3 percent of my royalty. I got $46.”

How many times do we have to tell you?

Don't mess with Texas Women.

Read more here...

WHERE's Tommy Lee now??

Seems Arlington has jumped on the suing Chesapeake bandwagon. Others suing the company include the DFW Airport, the Fort Worth Bass family, unnamed landowners and folks out in Johnson County.

The list (and someone's nose) keeps growing.

Read about it in the Fort Worth Star-Telegram.

Especially if you've been fracked...

WHO's next?

The city is suing Chesapeake Exploration, saying the company underpaid royalties on natural gas pumped from about 1,908 acres of public land.

The lawsuit, filed Monday in a civil District Court in Tarrant County, alleges that the Oklahoma City-based energy company has deducted post-production costs from the city’s royalty payments that are not only unauthorized under the lease agreements but also appear to be “excessive and unreasonable.”

Arlington said it has not been able to quantify its monetary damages for the contract breach because Chesapeake has withheld lease documents. But the city said in the suit that it expects to seek monetary relief in excess of $1 million.

Arlington said it has not been able to quantify its monetary damages for the contract breach because Chesapeake has withheld lease documents. But the city said in the suit that it expects to seek monetary relief in excess of $1 million.The suit also alleges that these deductions are not apparent from the information that Chesapeake has provided to the city, saying that those statements “misleadingly reflect” that no deductions are being taken. 

The city sent a letter to the company in April raising concerns about underpaid royalties and the improper deduction of costs. The company did not respond, according to the suit.

“Instead, Chesapeake continues to engage in a scheme of affiliated transactions aimed at hiding or embedding impermissible cost deductions and suppressing the royalties it pays to the city,” the suit says.
Arlington’s suit is similar to one filed against Chesapeake in federal court this year by Fort Worth investor Ed Bass and more than a dozen other landowners in far south Tarrant County. That lawsuit claims that Chesapeake has cheated them out of potentially millions of dollars in royalties for leases on 3,952 acres at the Tarrant-Johnson County line, south of Benbrook Lake.

Last year, Chesapeake Energy agreed to pay Dallas/Fort Worth Airport $5.3 million to settle a similar lawsuit after the airport alleged it had been shortchanged on royalty money from wells Chesapeake drilled on its property. The airport used its gas money to help pay for capital projects including the $1.9 billion terminal renovation.

Joining these large entities in suing Chesapeake are individual landowners. In 2012, Charles and Robert Warren, along with another couple in Johnson County, were seeking class action status in a lawsuit filed in federal court, a rarity in a Texas oil and gas royalty dispute. The case was dismissed by U.S. District Judge Barbara Lynn in May and is currently on appeal.

The suit against Chesapeake isn’t Arlington’s only legal battle with the natural gas drilling industry. 

Last year, the Texas Oil & Gas Association and the Texas Independent Producers & Royalty Owners Association sued Arlington over the creation of a gas well fee.

The fee was expected to generate about $800,000 a year so that Arlington, which has 300-plus gas wells, could hire six more firefighters and to train and equip 42 current firefighters for the creation of two gas well emergency response teams. 

Ding dong...

Julie Wilson, who has been referred to as a witch by some, has left the building.

(http://www.fwcando.org/node/346)

Seems Friday will be her last day at Chesapeake.  Now WHY would that be?

Says she's going back to consulting.  We can only guess for WHO.

Well, what do we have here?

Seems normal folks aren’t the only ones getting screwed.

Read in the Fort Worth Star-Telegram about Ed Bass and others suing Chesapeake over royalties, or lack thereof.  And Julie Wilson had no comment??  What’s the world coming to?

They may want to brush up on their “good neighbor” campaign.

Fort Worth investor Ed Bass and more than a dozen other landowners in southern Tarrant County have sued units of Chesapeake Energy in federal court in Dallas, accusing the Barnett Shale's second-largest producer of cheating them out of millions of dollars in royalties.

According to the lawsuit, the companies improperly deducted production costs, expressly forbidden by the leases, and used "sham transactions" with two other Chesapeake affiliates to set a below-market price on which royalties were paid, also a breach of lease terms.

It's not the first time Chesapeake has been sued over royalty payments.

In September, it agreed to pay Dallas/Fort Worth Airport more than $5.3 million in additional royalties after nearly three years of litigation over the sales price for gas used by Chesapeake and other issues.

In 2010, Fort Worth resident Robyn Coffey sued Chesapeake, saying its royalty payments were based on a "fictitious price" for natural gas produced in the White Lake Hills area in east Fort Worth.

Under the lease terms, Chesapeake is not allowed to pass along "any part of the costs or expenses" of producing, gathering, transporting or processing gas, the suit states.

The leases require the owners to bear their share of certain expenses up to 75 cents per 1,000 cubic feet (mcf) "under certain conditions," but those conditions never applied, it says.

Chesapeake imposed costs on the owners exceeding 75 cents per mcf, the suit says.

Here we go again...

If you thought Carter Avenue was going to be the only street they went after, well, you know the drill.

Urgent message from Don Young-----------

Subject: URGENT: City Council-Chesapeake must be stopped

The photo below was taken July 27, 2012, while standing in the front yard of my childhood home, 1105 Haynes Street, Fort Worth, Texas.

Until about a year ago, the prairie field that extended the entire block across the street, where kids like me flew kites and explored nature, remained unchanged. But about a week before Christmas, 2011, Chesapeake Energy received a permit to drill and frack "multiple gas wells" on the site.

Anyone can plainly see from the aerial photo below, this gas well should NEVER have been permitted. At about 300' away from where I took the photo, it's too close. More than 72 properties in this densely populated neighborhood are DIRECTLY affected. It is what the FW Drilling Ordinance used to refer to as HIGH-IMPACT before, at the drillers request, the phrase was discarded. But now it's too late. The City failed the neighborhood. The well is in.

Now. Now, Chesapeake is asking council approval for an 8" diameter pipeline that will run under homes and in front yards of this very low income, working-class, mostly Spanish-speaking neighborhood. The gas will be UN-odorized.

In an epic failure of leadership to protect innocent citizens, City staffers, Rick Trice, Randle Harwood and Fernando Costa have signed off on the pipeline that council will debate on August 7, 2012.

This pipeline proposal is even worse than the infamous, Carter Avenue pipeline that was changed only after resident and father, Steve Doeung refused to be bought off. But it took the persuasive efforts of Senator Wendy Davis, to help convince Chesapeake to pursue a less dangerous route which they ultimately did.

Will you PLEASE take a moment right now and contact your councilperson, Mayor Betsy Price and especially, District 8 City Councilwoman, Kelly Gray. Cut and paste the following to your personal email:

Options exist to reduce neighborhood impact of the Anderson gas well and pipeline. Either plug the gas well or find a better route. The lives of thousands of nearby residents are worth more than the $31,605.20 that Chesapeake is offering for the pipeline permit. Deny Chesapeake's permit request with prejudice.

Kelly.AllenGray@fortworthtexas.gov

betsy.price@fortworthgov.org

Already impacted by drilling and fracking, hundreds of families will be
at serious safety risk if the pipeline is approved.

Just days before Christmas, 2011,
the City of Fort Worth allowed this to happen.

Alternatives exist to this driller-friendly, neighborhood-killer pipeline route.

The Chesapeake owned, Anderson Padsite is one of many across FW that should have never been allowed.

Don Young

FWCanDo

P.O. Box 470041

Fort Worth, TX 76147

http://www.fwcando.org

"God bless Fort Worth, Texas. Help us save some of it."

Bazinga

WHAT happens when reporters start asking questions? 

Read it in the Rolling Stone.  Fracker Aubrey McClendon Booted From Chesapeake Board

The facts of the loan itself were bad enough, but the way the Chesapeake’s PR dweebs handled it – at first they said the board was "fully aware" of the loan and approved it, then the next day reversed themselves – just made the whole deal more rancid. Chesapeake is a publicly-held company, with a market cap of about $12 billion.
 
The company’s stock tanked by 10 percent or so, vaporizing more than a billion dollars of shareholder value. The Internal Revenue Service is investigating the loan, as is the Security and Exchange Commission. No less than three shareholders filed lawsuits. You just know Chesapeake’s lawyers are going to be dealing with fallout from this for years. And who knows what other sweet nuggets of impropriety investigators might unearth along the way?

As I learned a few months ago while reporting for Rolling Stone, the Chesapeake is really a land-acquisition company disguised as a natural gas producer, and one that is leveraged up the wazoo.

If I were a Chesapeake shareholder, I’d have lots of questions – like, if the company is playing games with financial disclosure, what kind of foolery are they up to with disclosure about, say, the chemicals they are pumping underground during fracking operations, or what they are doing with the hundreds of millions of gallons of toxic flowback water they dispose of every year?

Enron with drilling rigs.

WHO'd have thought...

It's brilliant, really.  A music magazine doing news.  A real article on fracking.  The Rolling Stone doesn't need campaign donations and gas drillers wouldn't be their typical advertisers.  We'll be buying a subscription.  Rock on. 

If you read nothing else today, read this article.  YOU can't afford not to.

According to Arthur Berman, a respected energy consultant in Texas who has spent years studying the industry, Chesapeake and its lesser competitors resemble a Ponzi scheme, overhyping the promise of shale gas in an effort to recoup their huge investments in leases and drilling. When the wells don't pay off, the firms wind up scrambling to mask their financial troubles with convoluted off-book accounting methods. "This is an industry that is caught in the grip of magical thinking," Berman says. "In fact, when you look at the level of debt some of these companies are carrying, and the questionable value of their gas reserves, there is a lot in common with the subprime mortgage market just before it melted down." Like generations of energy kingpins before him, it would seem, McClendon's primary goal is not to solve America's energy problems, but to build a pipeline directly from your wallet into his.

"...the shale-gas boom could turn out to be an economic and environmental disaster."

"Our approach is to go in early, quietly and big," says Henry Hood, who directs Chesapeake's land purchases. "We like to get our deals signed before anybody knows what we're up to and tries to run up prices."

New laws in Pennsylvania now prohibit companies from discharging flowback into rivers and streams. Instead, operators like Chesapeake either "recycle" their water by running it through a filtration system, or haul it off to Ohio and inject it underground – a process which, some seismologists now suspect, is the reason Ohio was hit by an uncharacteristically large number of earthquakes last year.

I ask her how she feels about the promise of fracking now. "I think the industry is destroying our water resource to extract a gas resource," she says. "And in the long run, I don't think that's a very smart trade."

It's all fun and games

Till someone gets hurt, or goes broke.

Read about the Party in Fort Worth, sponsored by Chesapeake, on Durango.  Tickets were $200.00 for individuals and up to $25,000 for a table.  WHO paid for YOUR elected leaders to attend?

There were several in attendance, from Mayor Price to Queen Earmark. 

How much did that cost YOU?

The Pirates are Coming

Oh wait, they're already here.  They are throwing the Party in Fort Worth this year. They even put a rig with their flag on the invitation. 

The Fort Worth Promotion and Development Fund throws this party every year with a theme and a sponsor.  Radio Shack hosted the River of Dreams back in 2006, highlighting the Trinity River. Mayor Moncrief asked Chesapeake to sponsor 2012 before his reign was over. 

The purpose of this group is basically to "promote" Fort Worth to national media. Where is the group promoting the citizens?  Those who should be will be at the party.

The Fort Worth City Council will be Honorary chairs.  At up to $25,000 a table (that level does come with parking, there are other options in the thousands that do not) WHAT is that costing us?

We noticed many familiar names on the "list".  The circle of Fort Worth.

We noticed an unofficial list too, looks like Durango will be in attendance, maybe it will be THE Party in Fort Worth after all.

Come on In

How many times do we have to tell you?  This is Texas.  YOU always shut the gate.

Apparently, these boys don't get it.

Since they didn't, Durango takes us on a tour.

3 LLC's and a Partridge in a Pear Tree

Earlier this year, the Fort Worth Weekly had an article on the dealings of the Haltom City Economic Development Corporation and the LLC it created.  It was smartly titled, A High Priced Can of Worms. 

Today, on Reuters.com there is another telling article about an LLC, this one a Chesapeake affair.  
Seems when the folks in Michigan wanted to collect their signing bonuses they were promised, they couldn't find out WHO to collect from.  WHY?

In fact, the company issuing the rejections wasn't much of a business at all. It was a shell company - a paper-only firm with no real operations - called Northern Michigan Exploration LLC.
Northern has voided hundreds of land deals, and was indeed a facade - a shell company created so that one of America's largest energy companies could conceal its role in the leasing spree, a Reuters investigation has found. Oklahoma-based Chesapeake Energy Corp. (CHK.N), the nation's second-largest gas driller, was behind the entire operation.

Chesapeake had created one shell company that set up another, Northern Michigan Exploration.

So, WHO will step up to the plate and protect the taxpayers from the newly formed Trinity Vision Partners LLC that just purchased the Fort Worth Cats?  Wouldn't you love to know WHO all is involved in that shell game?

Ask.

Did that just happen?

We hear the Fort Worth City Council unanimously voted down the Cheseapeake Compressor Station command center on Randol Mill Road near Mallard Cove.

We also heard talk of letters sent to the residents saying the request for the 15 compressor station site had been pulled, and there was no need to attend the meeting.  If the request was pulled, why would the council vote?  WHO knows, it's the Wild West.

Kudos to the citizens involved in protecting their neighborhoods.  The rest of you could learn a thing or two from these folks.

More Connections

Today the Fort Worth Star-Telegram tells you about a large land purchase.  Land that's being drilled on, lots of it.  Of course only the surface rights were for sale.

WHO would buy that much land?  Michael Mallick.  110 drilling sites, thousands of acres, millions of dollars.  Apple REIT Nine.  Coming soon to a neighborhood near you.

We looked for some Mallick info, not surprisingly, the Fort Worth Weekly had some. 

Project developer Michael Mallick is Anglo, with offices on the west side of town. Those opposing Hicks and Mallick on the project are a few black business leaders, led by controversial real estate developer Leonard Briscoe, Sr., who went to prison in the 90s for illegal kickbacks. He contends that black developers like him are being aced out of projects in favor of white, politically connected developers like Mallick.

She points to the two Mallick Group developments on the map. The Sierra Vista development will provide about 230 new single-family homes on the site of the old Riverside Village apartment complex, plus retail sites nearby. About a mile to the east. the Masonic Home property will be transformed into about 500 homes plus 63 acres of commercial development. There will also be 16 acres set aside for natural gas drilling. Hicks helped broker a deal earlier this year that created a tax increment financing district to include both Mallick Group properties. As tax income to the city increases because of the development, the extra dollars will pay for infrastructure improvements — perhaps one of the few instances when Fort Worth has used the TIF device in the kind of blighted area it was intended for. The East Berry TIF could produce as much as $10 million for things like streets and sewers in what will be known as Masonic Heights, bounded by Wichita and East Berry streets and Mitchell Boulevard. Homes likely will sell for $140,000 to $200,000.

He's back...

Read about Moncrief's new gig in the Fort Worth Business Press.  Be sure to note WHO else is in this group.  We use the word "group" loosely.

It's business as usual with representation from Chesapeake, Tarrant Regional Water District, Devon Energy, Freese and Nichols, the Fort Worth Mayor, Linda Christie....the beat goes on.

The North Texas Commission, a regional non-profit consortium of businesses, municipalities, chambers of commerce, economic development entities and higher education institutions, has appointed its leadership for 2012.

Under Pressure

Dear Neighbor,

At the risk of being repetitive, Cheaspeake Energy Corporation wants to bring unreliable noise control, uncertain air borne emissions systems, a track-record of inconsistent maintenance and event-response systems, and likely real estate value losses, to our backyard.  They want us to let them trade our former equestrian center for north Texas' (and maybe the nation's) largest, loudest, smelliest and ugliest "enclosed gas compressor station."  Imagine 15 of these massive engines sitting side by side and running 24/7/365 and you've got it!

Your neighborhood committee and many others are fighting this proposal with all of the resources at our disposal.

WITH SINCERE THANKS FOR ALL YOU HAVE DONE, A BIT MORE OF YOUR HELP IS URGENTLY NEEDED RIGHT NOW! So, PLEASE, PLEASE, PLEASE...

CALL 817-392-8028 Monday or Tuesday, 8:00 am - 5:00 pm..  TELL the Zoning Department you DO NOT WANT Chesapeake's request for a continuance approved and you do not want case #ZC-11-098 approved.

E-MAIL zoninglanduse@fortworthtexas.org no later than noon this Tuesday. TELL the Zoning Department you DO NOT want Chesapeake's request for a continuance approved and you DO NOT want case #ZC-11-098 approved (mention a COUPLE of reasons including finding a more appropriate location).

ATTEND the Wednesday, November 9th, Zoning Commission meeting at 10am at City Hall. (Be there early as parking can be difficult.)

The more we put the pressure on the City, the less likely it is that Chesapeake will succeed in their unreasonable, inappropriate request.  But, just remember...

YOU Are The Pressure! 

No One else Can Be The Pressure FOR YOU! 

Call!   -  E-mail!   -  Attend!

REVOKED

Arlington has revoked a Chesapeake gas well permit.  WHY would such a pro gas city do such a thing? 

Again, it all comes back to WATER.

If anyone is taking notes, be sure and note for once, Chesapeake declined to comment.  

Don't miss the article in the Fort Worth Star-Telegram.

One of the city's gas well inspectors found that Chesapeake Energy was bringing in water from a Fort Worth pond through a temporary pipeline to its Barron drill site on West Division Street, Community Development and Planning Director Jim Parajon said Friday. The company's permit, however, said water for drilling operations would be supplied through a nearby fire hydrant.

This wasn't Chesapeake's first infraction involving water. In August, Arlington cited Chesapeake for trucking water it bought at one of its south Arlington well sites to a Grand Prairie well site, which violates city ordinance. The water, which Chesapeake had paid for, was pulled from a frack pond filled at the site. The company called the incident a misunderstanding and said it would pay the fine, which the city had recommended the court set at the maximum, $2,000.

This year, Arlington increased inspections at its 384 natural gas wells. Wells are now inspected monthly; previously they were visited once a year or when complaints were filed. Random inspections were also made during drilling, city officials said.

Places please...

The connections in Fort Worth run deep.  Especially in the Culture of Corruption.

A local Chesapeake employee was recently named one of the top "Forty under Forty" by the Fort Worth Business Press.  He was also just added to the Fort Worth Leadership board.

Wonders never cease.  Or do they??

Restrictions...What Restrictions?

From Don Young...

A Fractured Fracking Tale

> August 30, 2011.

> Fort Worth, Texas.

> Worst drought in Fort Worth history is underway.

> Stage 1 water use restrictions went into effect yesterday.

> I took a little hike along the Trinity River today.

> Hundreds of gas wells and related infrastructure dot the entire length of river as it winds through town.

> Drilling companies are among the the largest contributors to Texas politicians.

> Fracking and drilling are exempt from water restrictions.

> Each frack job uses around 5 million gallons of fresh water.

> Prior to 2005 there were ZERO gas wells in Fort Worth.

> As of August, 2011, there are around 2,000 gas wells in the City of Fort Worth.

> Each gas well is re-fracked over and over again for many years.

> Each frack job produces millions of gallons of toxic wastewater.

> Hundreds of tanker trucks loaded with wastewater and drilling chemicals roam city streets day and night.

> Fort Worth is now one of the largest generators and exporters of toxic waste in the state of Texas.

> In late 2010, Chesapeake CEO claimed they had, thus far, only drilled about 20% of planned gas wells.

> Some Fort Worth City Council members received cash donations and gifts from the drilling industry for their political campaigns.

> Mayor, Betsy Price, was openly endorsed by the drilling industry.

> Remember to water you lawn and garden ONLY on designated days.

DY

Trinity River near downtown FW, 8/30/11.

Frack job underway for Chesapeake Energy.
Fish, turtles and other wildlife, beware!

River water being pumped with three huge diesel generators.

A non-English speaking worker kept watch nearby.

Be prepared!

Heavily used bike trail is still open for business.

These water pipes extend about a half mile to the pad-site
along the formerly scenic river bank.

It's all legal, of corse, and safely "stored" for a million years.

More diesel generators at the pad-site add to the already dirty air quality in FW.

We have been warned.

Enormous quantities of water, sand and chemicals pumped
into Mother Earth to make someone rich.

Meanwhile, back at Chesapeake HQ in downtown FW today,
workers are watering the big green lawn.
Restrictions? What restrictions?

Don Young
FWCanDo
P.O. Box 470041
Fort Worth, TX 76147