Barnett Shale

Chesapeake CEO's compensation tops $21 million

Aubrey McClendon, chairman and CEO of Chesapeake Energy, the No. 2 producer in North Texas’ Barnett Shale, received total compensation slightly exceeding $21 million in 2010, according to a proxy statement filed late today by the Oklahoma City-based company with the Securities and Exchange Commission.

The compensation includes $975,000 in salary, a $1.95 million bonus; stock awards totaling more than $16.8 million; and other compensation exceeding $1.3 million.

McClendon's compensation is only a smidgen less than the $21.5 million total for Rex Tillerson, CEO of the far more profitable and much-larger Exxon Mobil, the Irving-based oil giant that is the world's largest publicly traded company and just posted a first-quarter profit of $11 billion.

Tillerson's 2010 compensation included $2.2 million in salary, a $3.4 million bonus, stock awards worth $15.5 million and $443,921 in various company perks, according to an Associated Press report.

While McClendon's 2010 compensation is hardly chicken feed, it pales in comparison to his highly controversial , headline-making 2008 compensation package of a whopping $112.5 million, which included a one-time $75 million bonus in a year in which Chesapeake's stock plunged by 60 percent.

--Jack Z. Smith

Crude oil prices pushing $115 a barrel

Oil prices  got a boost today from the weaker dollar, which hit a three-year low against six major currencies, according to the Associated Press.

In futures trading on the New York Mercantile Exchange, a barrel of West Texas Intermediate crude, the benchmark U.S. oil, pushed to nearly $115 a barrel. It gained $1.07, settling at $114.93.

Also on the NYMEX, natural gas added 12.8 cents to settle at $4.76 per million British thermal units.

Wholesale gasoline gained 2.88 cents to settle at $3.40 a gallon.

On the ICE Futures exchange in Europe, North Sea Brent crude oil rose 87 cents to settle at $125.89 per barrel.

--Jack Z. Smith

Barnett drilling rig count falls by seven

There were 78 rigs drilling today in North Texas’ Barnett Shale, according to RigData. The leading counties were Tarrant, 23 rigs; Wise, 13; Montague, 9; Cooke, 7; and Johnson, 6.

The leading operator was Devon Energy, with 13 active rigs, including five in Wise County, three each in Tarrant and Johnson counties and one each in Parker and Denton counties.

Chesapeake Energy and EOG Resources each had 12 active rigs. All of Chesapeake's rigs were in Tarrant. EOG had six rigs each in Montague and Cooke counties.

XTO Energy had six rigs going, with three each in Tarrant and Johnson.

The number of active U.S. drilling rigs climbed by 18 this week, to 1,818, according to Houston-based oilfield services firm Baker Hughes. There were 926 rigs drilling for oil and 882 for gas, with 10 miscellaneous rigs (primarily geothermal).

The Texas rig count gained three, to 804.

--Jack Z. Smith

Local gasoline prices keep heading up

The average price for a gallon of regular gasoline is $3.85 in the Fort Worth-Arlington area, according to a report today by auto club AAA, Oil Price Information Service and Wright Express.

That's another three-cent jump in 24 hours; $1.10 higher than a year ago; and just 13 cents lower than the area's all-time high average of $3.98 on July 16, 2008.

Of course, regular is the "cheap" grade of fuel. The average prices for other fuel in grades in the Fort Worth-Arlington area today are: mid-grade, an even $4; premium, $4.13; and diesel, $3.99.

The national average for regular is $3.91 and the Texas average is $3.80.

--Jack Z. Smith

Energy Future Holdings posts $362 million loss

Energy Future Holdings, the former TXU Corp., today reported a net loss of $362 million on revenues of $1.67 billion for the first quarter, compared to a net income of $355 million on revenues of $2 billion in the first quarter of 2010, when it posted large non-cash gains of $639 million as a result of hedging on natural gas prices.

Dallas-based EFH said its results for this year’s first quarter were worsened by $203 million in non-cash losses on hedging of gas prices, severe winter weather in early February that shut down electricity generation at some power plants, lower retail electricity consumption resulting from mild weather in part of the quarter and rising fuel expenses at large coal and nuclear generation units.

TXU Energy, a retail electric provider and EFH subsidiary, continued to see a reduction in its residential customer base as a result of the competitive deregulated electricity market. The number of residential customers fell from 1.85 million in the first quarter of 2010 to 1.74 million in the first quarter of 2011, a decline of 110,000.

EFH had an adjusted net loss, excluding special items, of $265 million in this year’s first quarter, compared to a net loss of $215 million for the first quarter of 2010.

EFH CEO John Young said the company “had solid operational performance during the quarter, despite the severe winter weather, and continues to serve a rapidly improving Texas economy.”

EFH, also the parent of power generator Luminant and electric transmission and distribution company Oncor, has been hurt by heavy debt and low natural gas prices that have reduced revenues from electricty sales in the wholesale market.

EFH’s total long-term debt is $34.2 billion, excluding Oncor, which has about $5 billion in debt. Oncor has a special “ring-fencing” arrangement that shields it substantially from EFH’s financial difficulties. EFH got good news recently when lenders holding more than 80 percent of the company’s $20 billion in debt due in 2014 agreed to extend the payments in exchange for EFH paying added fees and interest.

Oncor today reported a first-quarter net income of $65 million on operating revenues of $706 million, compared to a net income of $79 million on revenues of $703 million a year earlier.

--Jack Z. Smith

Chevron earnings up sharply

Chevron's first-quarter earnings rose 36 percent, the company said today. The San Ramon, Calif. based oil and gas giant received higher prices for the oil it produced, and also made more money from refining oil, the Associated Press reported.

Net income rose to $6.21 billion, or $3.09 per share. The results topped Wall Street expectations and marked Chevron’s best three months since it earned $7.9 billion in the third quarter of 2008. Analysts expected net income of $2.97 per share.

Revenue rose 25 percent to $60.34 billion.

Chevron’s results are the latest in a string of improved earnings from the major oil companies. Exxon reported a profit of almost $11 billion, while Shell earned about $8 billion.

Chevron sold its oil for an average price of $89 per barrel in the last quarter, compared with $71 a year ago.

--Jack Z. Smith

Small lizard prompts big oil patch debate

The little dunes sagebrush lizard, less than three inches long, is triggering intense debate in the Permain Basin of West Texas and southeastern New Mexico. Click here for the full Associated Press report.

 --Jack Z. Smith 

Oil giant Total positioning into solar power

The French oil company Total SA said today it will offer $23.25 a share for up to 60 percent of the shares of solar panel maker SunPower Corp., a move that would put Europe's third-largest oil firm into the solar business. Click here for the Associated Press report.

--Jack Z. Smith

Exelon snares Constellation in big power merger

Chicago-based Exelon Corp., which has electric power generation plants in east Fort Worth and Dallas, agreed to buy Constellation Energy Group for $7.9 billion today, the latest in a string of acquisitions in the electric power industry. Click here for the full Associated Press report.

--Jack Z. Smith

Natural gas, oil and gasoline prices continue rise

Long-depressed natural gas prices continued their recent rise today. In futures trading on the New York Mercantile Exchange, gas rose 15.7 cents to settle at $4.63 per million British thermal units, the Associated Press reported.

Rising gas prices are good news for natural gas producers in North Texas' Barnett Shale and for mineral owners who get substantial royalty checks from gas production under their properties. But it's bad news for Texas electricity consumers because natural gas is burned to generate much of the state's power.

Electric rates in Texas' deregulated market have fallen sharply in the past two and a half years as a result of gas prices making a dramatic fall from more than $13.50 per million BTUs in the summer of 2008.

Oil settled higher in volatile trading today, pushed up by a weaker dollar. After jumping to nearly $114 a barrel, West Texas Intermediate crude settled up 10 cents, at $112.86, in futures trading in New York.

Brent North Sea crude oil dropped 11 cents to settle at $125.02 per barrel on the Ice Futures exchange.

Soaring oil prices have been the primary driver behind rising gasoline prices. The average price of a gallon of regular gasoline in the Fort Worth-Arlington area is $3.82, according to a report today by auto club AAA, Oil Price Information Service and Wright Express. That's up three cents from a week ago and $1.08 from a year ago. The $3.82 average is only 16 cents under the all-time are high of $3.98 reached July 2008.

--Jack Z. Smith