The Daily Star, Oneonta, NY - otsego county news, delaware county news, oneonta news, oneonta sports

December 17, 2013

Don't blame bans for Norse Energy's woes

The Daily Star

---- — Joe Mahoney’s article, Fracking firm threatens to sue over delay, while in general correct, contains a few details that are misleading.

Norse Energy is not merely “insolvent,” but in liquidation.

Because Norse is being liquidated, it may not exist to serve as plaintiff when the Court of Appeals is scheduled to hear the Dryden appeal next spring. Whoever is financing this appeal would have to find another cat’s paw.

Norse went into bankruptcy as a result of accumulating several tens of millions of dollars of debt from its failed program to drill for gas in the sandstones under Chenango and Madison counties. The last straw was when a judge required the posting of millions of dollars in a bond to cover the expected award in a lawsuit by the partner that Norse took on to finance said drilling program.

While the moratorium on HVHF shale drilling prevents Norse from drilling on its leases, it is not the only impediment. Being bankrupt, Norse cannot afford to keep the lights on, let alone pay the $7 million for drilling even one of these wells. Nor does the geology under its leases support that shale wells would be profitable.

Brian Brock