PSEG Closing Last 2 NJ Coal-Fired Plants, Replacing with NatGas

closedTwice in the past week MDN has either heard (in person) or read the statement that “regulations aren’t killing coal, natural gas is.” One of those times MDN heard it at the Benposium East event held in New York City last Wednesday. The other instance was President Obama talking about natural gas at talk on the South Lawn of the White House (see Obama and Man-Child Leo DiCaprio Talk Global Warming at WH Event). Is it true? Sort of. While Obama’s war on coal has contributed, the fact is, low prices for natural gas is causing a shift away from using coal to fire electric generating plants and instead using clean-burning natgas. The trend continues. PSEG–Public Service Enterprise Group–announced yesterday they are retiring their final two coal electric plants in New Jersey. The stated reason is that they are replacing those plants with new natgas-fired plants. It doesn’t take a rocket scientist to know that the new plants coming online in NJ will use Marcellus Shale gas to power them. The closure presents a problem for the nutty Sierra Club and others of their ilk. While they are ecstatic that the coal plants are closing, they are less-than-thrilled that another evil fossil fuel will take its place to power new plants…
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Rice Energy’s Purchase of Vantage a Way to Quickly “Scale Up”

M&AMore analysis continues to roll in on Rice Energy’s plan to buy Vantage Energy for $2.7 billion (see Rice Energy Buys Vantage Energy for $2.7B, 85K Marcellus Acres). We ran a post following the initial announcement pointing out there is one main reason why Rice is buying Vantage: 85,000 Marcellus Shale acres in Greene County, PA (see Why Did Rice Energy Pay $2.7B for Vantage Energy? It’s Simple…). We have part of another article tackling the buyout–this time from top energy analyst and Seeking Alpha writer Richard Zeits. He points out a few interesting facts, like the fact that if you do the math, Rice is essentially paying Vantage $20,000 per acre! But Zeits you have to put the price in context: Rice is using a stock swap as their currency for purchasing the acreage. In other words, this is a clever way for Rice to “scale up” quickly without breaking the bank…
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Construction Begins for Transco’s VA Southside Expansion Proj II

under-constructionIn June Dominion began building Virginia’s largest natural gas-fired electric plant in Greensville County (see Dominion Begins Building Virginia’s Biggest NatGas Power Station). The $1.3 billion state-of-the-art natural gas-fired electric generating station will generate 1,600 megawatts of electricity. Dominion’s own 550-mile Atlantic Coast Pipeline (when built) will provide cheap, abundant, clean-burning Marcellus/Utica Shale gas to power it. However, the plant will get done before Dominion’s pipeline will, so how will they power it? Enter Williams’ Transco pipeline and the Virginia Southside Expansion Project II, which will add more capacity (and build a 4-mile pipeline) to provide abundant, clean-burning Marcellus/Utica Shale gas for the new plant. MDN told you in July that the Federal Energy Regulatory Commission (FERC) had approved the Southside Expansion Project II (see FERC Approves Transco Expansion Projects in NYC & Virginia). Now comes word that FERC has granted permission to Williams to begin moving earth around in Virginia as well as North and South Carolina as part of the project…
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Warren Resources Exits Bankruptcy, Turned $545M Debt into Equity

Warren ResourcesWarren Resources, a small driller that drilled and brought online their first two Marcellus Shale wells last year, is based in Houston and operates in California, Colorado, Wyoming and Pennsylvania. In February MDN told you that Warren missed an important $7.5 million payment, the first ominous signal of what was to come (see Warren Resources Misses $7.5M Debt Payment, 30-Day Clock Ticking). The next week the company announced no new drilling, anywhere, in 2016–hinting they might have to file for bankruptcy (see Warren Resources: Potential Bankruptcy, No Drilling in 2016). That happened, in June (see Warren Resources Files for Bankruptcy, Wiping Out Stockholders). Yesterday Warren announced it has emerged from bankruptcy proceedings and ready to continue on. Warren had over $545 million in debt that they magically waved the bankruptcy wand over and turned into equity (stock ownership). In the process, previous stockholders/owners got nothing–their shares became worthless…
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NGSA: Colder Winter + Lower Production = Higher NatGas Prices

ngsaLast winter was pretty unusual by everyone’s standards. It was much warmer and less snowy than normal in the northeast, and natural gas production/levels remained high over the course of the winter. It meant that the price of natural gas stayed in the basement during the time of year when it normally at least makes it to the first floor. What about this year? MDN recently reported that it’s going to be colder and snowier than average in the northeast this year (see AccuWeather Winter Forecast: “Frequent Snow” Will Blast Northeast). The Natural Gas Supply Association (NGSA) issued its 16th annual Winter Outlook assessment of the wholesale natural gas market yesterday (full copy below). What do they say? NGSA affirms the AccuWeather forecast saying they expect temps to be 12% colder this winter–increasing demand for natural gas and thus putting “upward pressure” on the price of natural gas…
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NatGas a Zero Carbon Emissions Energy Source?!

zero-carbonSpeakers at this weeks Energy Dialogues LLC’s North American Gas Forum in Washington, DC were up on their high horses lecturing the natural gas industry that if we only can get our heads out of our backsides and clamp down on fugitive methane emissions we might actually get to stay around a few more decades, providing fuel to power the world. That’s the gist of the comments we read by so-called environmental “leaders” who spoke at the event. (Arrogant snobs, if you ask us.) But the one thing that really caught our attention was the statement that it may be possible to capture and control carbon from burning natgas to the point that it becomes a “zero-emitter.” Bet you never thought you would see “natural gas” and “zero carbon emissions” in the same sentence, eh?…
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Marcellus & Utica Shale Story Links: Thu, Oct 6, 2016

best of the restThe “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Monroe County, OH leads drilling permits in Sept; Utica rig count hits 22; WV tax collections still down from weak oil/gas price; Federal Reserve forcing investment banks out of the energy business; how long before ‘second wave’ of LNG export projects hits; what natgas prices are telling us; GE gets in the o&g drone business; and more!
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Enerplus Energy Puts 47K Marcellus Acres Up for Sale, Wants $500M

for-sale-sign.jpgCanadian energy company Enerplus Corp owns some 47,000 acres of Marcellus Shale leases in northeastern Pennsylvania representing 841 billion cubic feet (Bcf) of reserves. Most of that acreage, according to the company’s website, is currently “non-operated.” Enerplus does actively drill in the North Dakota Bakken Shale play. Enerplus has a problem: the company is about $530 million in the hole (in debt). The way out of that hole? Sell off their non-operated Marcellus acreage for ~$500 million (works out to be $10,638/acre). Reuters is reporting that three sources have confirmed Enerplus has put their Marcellus acreage up for sale–and the the “for sale” sign has caught the interest from investment firms here at home, and in Asia…
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Duke Energy/Piedmont Merger Closes, Dominion Keeps Control of ACP

top-dogIn October of last year, MDN shared the news that Duke Energy, the largest electric power holding company in the United States and a utility with 7.3 million customers in the southeast and Midwest, announced they are buying Piedmont Natural Gas (see Duke Energy Buys Piedmont NatGas for $6.7B, Marcellus Connection). Piedmont is a midstream and natgas LDC (local distribution company, or utility) with operations primarily in North Carolina, South Carolina and Tennessee. It is a story of a big southern electric utility buying a smaller southern natural gas utility. But there’s more to the story. Part of the purchase includes ownership in two very important Marcellus pipeline projects: the Constitution Pipeline and the Atlantic Coast Pipeline (ACP). With respect to ACP, Duke was already one of the project owner/investors. Together with Piedmont’s share of ACP, Duke’s combined new ownership share (47%) threatened to be larger than the builder/sponsor of the project, Dominion (45%). The Duke/Piedmont merger happened on Monday. At the same time, Dominion exercised a clause in the partnership allowing them to purchase another 3% share, making Dominion’s new ownership stake 48%–still the top dog…
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SRBC Amending Water Regs, Schedules 4 Public Hearings for Nov/Dec

srbcThe Susquehanna River Basin Commission (SRBC), charged with protecting and managing the water resources in the Susquehanna River Basin, continues to perform its duty with distinction–unlike the completely dysfunctional Delaware River Basin Commission (DRBC). A fair share of Marcellus drilling happens within the SRBC’s jurisdiction in Pennsylvania. The SRBC has worked with the Marcellus industry, instead of against it (as the DRBC has done), to ensure drilling does not harm the Susquehanna River Basin water supply–a supply that eventually empties into the Chesapeake Bay. We credit the SRBC’s excellent performance to leadership (see SRBC Tells Anti-Drillers “We’ll Stay in Our Lane” on Water Study). The SRBC is about to embark on an effort to update its water regulations–updates that will have an impact on the drilling industry…
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Time to Recognize the Best O&G Companies in the Marcellus/Utica

Oil & Gas AwardsEach year MDN partners with the Oil & Gas Awards to promote their Northeast Awards–a way for companies in the industry that operate with distinction to get recognized by their peers. In March 2017 the Northeast Oil & Gas Awards will celebrate their 5th year. Over the past five years there have been thousands of entries and hundreds of finalists and winners. While the O&G Awards boys keep their ears to the ground to discover stellar performers, they want to know who YOU think are the best companies in the region. Therefore, they have put together a very brief survey (takes less than two minutes). This is your chance to bring a worthy company to the attention of the O&G Awards–perhaps even your own company!

Fill out the survey here

Michigan AG Lends His Full Support to NEXUS Pipeline

bill-schuette

Michigan AG Bill Schuette

In June 2012 Reuters tried to stir up trouble against Chesapeake Energy by broadcasting “leaked” emails that somehow magically appeared on the Reuters doorstep that supposedly show Chesapeake trying to collude with Encana Energy to keep the price of Michigan state land oil and gas leases artificially low (see Did Reuters Break the Law with Latest Chesapeake Story?). Eventually Michigan Attorney General Bill Schuette filed charges against Chesapeake, even though the federal government investigated and didn’t find anything worth pursuing. Schuette put his reputation on the line and was hell-bent to ensure he got something/anything out of Chesapeake. Schuette finally has a settlement–for a measly $25 million (see Michigan Succeeds in Shaking Down Chesapeake for Measly $25M). It likely cost Schuette’s department more $25 million to pursue Chesapeake. But, Schuette’s shakedown let him save face. Perhaps in an effort to repair the damage done to his reputation with the drilling industry, Schuette recently delivered the keynote speech at the Michigan Oil and Gas Association’s Annual Meeting. We have a copy of the speech below. The interesting part is Schuette’s full-throated support for the NEXUS Pipeline: “A great example of the work being done in the energy industry is the DTE NEXUS pipeline. The NEXUS project is a way to look to the future, and ensure that Michigan customers have the natural gas supply we need. I applaud the work being done to make sure we have efficient, modern pipelines in our state.” We’re glad to see Schuette, a Republican, back on the right side of the ledger…
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Duke University Exposed for Scientific Grant Fraud

fraudDuke University, as MDN has chronicled, has a long history of pumping out faux research that bashes fracking and fossil fuels, “research” that’s bought-and-paid-for by the Park Foundation, one of Duke’s major contributors (see What’s Missing in Latest Duke “Radioactive” Study? Real Science; Yet Another Duke University Study Smears the Marcellus Industry; Duke Hit Piece on Shale Water Usage from Same Park-Sponsored Prof; Duke U Study: Property Values Drop When Marcellus Drilling Begins; and Latest Case of Duke U Bought & Paid “Research” by Park Foundation). Higher education is a cesspool of such sponsored junk science. Now comes word that a whistleblower is accusing Duke of doctoring research data in a scheme to grab $200 million in grant money. While this particular instance does not appear to be connected to previous faux research that bashes the Marcellus Shale, we will point out is that there appears to be a climate (pun intended) of dishonest research occurring at Duke University. It always boils down to “follow the money”…
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Obama and Man-Child Leo DiCaprio Talk Global Warming at WH Event

sxsl-climate-talkRight at the top of our list of things that tick us off are uber-arrogant Hollywood actors who pretend to have gray matter in their heads, especially on the issue of man-made global warming. At the top of that list, for us, is the man-child pretender Leo DiCaprio. He parades around pretending that he’s some sort of expert on global warming. He nakedly states that if you have a different opinion from him on the topic of global warming, your right to free speech should be yanked away. He is, as most leftists are, a totalitarian at heart. Someone with more in common philosophically with Adolf Hitler than with Mahatma Gandhi. Man-child DiCaprio was parading his stuff on Monday at the White House, hosting a talk with Our Supreme Leader, B.H. Obama. Although Obama is a full-throated global warming fanatic who wants to end the use of fossil fuels, he is, nevertheless, a pragmatist. To his credit, Obama gave lukewarm support to natural gas as a “bridge fuel” that will (for now) lower carbon emissions, while waiting for his so-called precious renewables to become commercially viable and take over the energy world. Here’s how it went down on the South Lawn of the White House on Monday…
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The Many Flaws with President Obama’s Clean Power Plan

guest postStephen Heins, an energy and regulatory consultant for a Wall Street firm, and former vice president of communication for Orion Energy Systems, is an occasional guest blogger here on MDN. Steve calls himself a “luke warmer” when it comes to the fairy tale that mankind is causing Mom Earth to toast. That is, he’s not convinced that man-kind is causing a catastrophic warming up, but he’s also not ruling it out. That’s OK, we forgive him. A lot of intelligent people believe in such things. At least he’s a skeptic! Steve recently penned an article that finds “several flaws” with President Obama’s so-called Clean Power Plan (which has been challenged in court by 29 states). The CPP outright kills coal, and it mortally wounds natural gas, as we’ve previously written (see Obama’s CPP Targets Not Just Coal, but NatGas for Termination). Steve’s article does more than find flaws, it shreds the CPP into tiny atoms of carbon…
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Marcellus & Utica Shale Story Links: Wed, Oct 5, 2016

best of the restThe “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Utica Shale drilling rigs now at 22, wells drilled 1,807; union members pack the hall to support OH pipeline; sales tax revenue up 65% in Utica counties; manufacturing jobs are the “crown jewel” of the shale revolution; oil and gas prices will rally, but it won’t last long; natgas rig count matters more than oil rig count; and more!
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