FERC Approves Atlantic Sunrise Pipeline! Cabot Grabs More Capacity

1/4/17 Update: Williams finally issued its own press release about this, which we’ve included below.

On the last business day of 2016, the Federal Energy Regulatory Commission (FERC) issued a favorable final environmental impact statement (EIS) for one of the major pipeline projects in the Marcellus/Utica: the $3 billion Williams Atlantic Sunrise Pipeline project. The FERC EIS for Atlantic Sunrise (full copy embedded below) said that although there may be some adverse environmental effects from the project, those effects can be “reduced to less-than-significant levels” by Williams via the plans submitted. FERC considered five alternative routes and chose to stick with the preferred route proposed by Williams. However, FERC did ask Williams two make minor tweaks to four locations along the route of the pipeline. Cabot Oil & Gas, the main customer for the 1.7 billion cubic feet of capacity, was positively giddy with the announcement. Cabot released their own press release to say that although they previously gobbled up 850 million cubic feet (MMcf) of capacity along the new pipeline, they are adding another 150 MMcf to that number, giving the company a grand total of 1 billion cubic feet (out of 1.7 Bcf) of capacity along the pipe when it’s built. Holy moly! That will be 1 Bcf per day of Cabot’s gas going from Susquehanna County, PA to other states, outside the region. VERY smart move by Cabot. Below we have the news and feedback/analysis about the announcement…
Continue reading

FERC Gives Atlantic Coast Pipeline Thumbs Up, Antis Pitch a Fit

On the last business day of 2016, the Federal Energy Regulatory Commission (FERC) issued a favorable final environmental impact statement (EIS) for the Williams Atlantic Sunrise Pipeline (see today’s companion story). Not to be confused with that project, also on the last business day of the year, FERC issued a favorable draft (not final, but draft) EIS for the $5 billion, 594-mile Dominion Atlantic Coast Pipeline project. This is a huge milestone and an indication that FERC will later issue a favorable final EIS, and then a certificate to allow the project to get built. FERC cautioned there is still more work to be done by Dominion to complete field surveys and submit proposals on certain issues that need to get resolved. However, the draft EIS says based on what they see so far, FERC has confidence that Dominion can minimize damage to the environment in building the pipeline. Of course the childish antis came out of the woodwork to begin bleating and blatting, as they so often do, that they pipeline will kill everyone and everything in its path. Typical…
Continue reading

Marcellus Biggest Drillers Lock in 2017 Gas Prices at $3+ per Mcf

In September, MDN brought you research on 10 of the largest Marcellus/Utica drillers that have “hedged” their 2017 production (see Hedging Gas Prices in Marcellus/Utica – Who Hedges & How Much?). Hedging is a concept of pre-selling the gas you produce at a price you agree to now, in advance. Although that may sound risky, it’s actually an exercise in risk avoidance. It’s less risky to lock in favorable prices now rather than wait and potentially get far less. How do drillers know what the price of gas will be six months or a year from now? They don’t know, for sure, but there is something called the forward market, that predicts what prices will be at future dates. In fact, traders create contracts now based on prices in the future, and those contracts are reported by various news and data services, like NGI’s Forward Look publication. The company that provided the research back in September, S&P, is back with an update. The latest research shows that all of the top 10 drillers have hedged at least some of their production–and some of them have hedged most or even all of their production. What prices have each of these 10 drillers locked in and for how much production?…
Continue reading

Antis’ Hail Mary to Stop Mariner East 2 Fails, Pipeline Rolls On

In December MDN told you that anti-fossil fuelers who oppose Sunoco Logistics Partners’ Mariner East 2 Pipeline were making a last, desperate attempt to stop the project by appealing an eminent domain case to the Pennsylvania Supreme Court (see Desperate Antis Try One Last Legal Maneuver to Stop Mariner East 2). Their “Hail Mary” play to get the Supremes to hear the case hinged on getting the high court to overturn established case law that allows Mariner East 2 status to use eminent domain, which would doom the project. The antis have now flamed out with this latest attempt. The PA Supreme Court has refused to hear the appeal and will let the lower court ruling stand that finds yes, Mariner East 2 does have the right to use eminent domain…
Continue reading

Planned OH Utica-Powered Electric Plant Goes from 1,100 to 1,650 MW

In April 2016 MDN told you about the Guernsey Power Station–a new Utica/Marcellus natural gas-fired electric generating plant proposed for Guernsey County, OH (see New Utica-Powered Electric Plant Proposed for Guernsey County, OH). Apex Power Group at that time said they want to build a large 1,100 megawatt plant in Valley Township–producing enough electricity to power 1 million homes. The plant will generate 500 jobs during construction, and 25 full-time jobs to operate the plant when it’s completed. Apex says construction is targeted to begin in 2018 and will go online in 2020. The good news is that Apex and joint venture partner Caithness Energy have now filed a pre-application for the project–and the application shows they no longer want to build an 1,100 megawatt plant, they now want to build a whopping 1,650 megawatt plant! That’s the biggest natgas-fired electric plant we’ve heard of so far–anywhere. The previous title-holder was Dominion’s 1,600 megawatt plant currently under construction in Greensville County, VA (see Dominion Begins Building Virginia’s Biggest NatGas Power Station). Here’s more about the Guernsey Power Station…
Continue reading

3 Parents Give Birth to New Fracking Co: BJ Services

Update: MDN’s headline and opening graf below are a tad confusing. As we pointed out in our previous story (here) BJ Services used to exist as a standalone company before it was purchased by, and merged into, Baker Hughes in 2009–for $5.5 billion. Now BH is spinning what is left of the company–an internal division–back into a standalone company once again. So perhaps our tongue-in-cheek analogy of a new company being “born” with “3 parents” is confusing. Our apologies! And our thanks to a sharp MDN reader for pointing out the confusion.

A quick post to note the birth of a new fracking company. As we noted in November, Baker Hughes, Goldman Sachs, and CSL Capital Management pledged to combine investments and assets to form BJ Services, a “pressure pumping” (i.e. fracking) company (see Baker Hughes, CSL & GS Form New US Fracking Co: BJ Services). Baby BJ has officially arrived and is now open for business. Yes, baby BJ has three parents. Hey, if three parents worked for Bridge Jones’s Baby, it can work for a fracker…
Continue reading

Gulfport CFO Leaves Suddenly to “Pursue an External Opportunity”

In the closing days of 2016, Gulfport Energy, an Oklahoma City-based independent oil and natural gas exploration and production company (“driller”) that is a “top 5” driller in the Ohio Utica Shale, announced that its chief financial officer (CFO) has up and left. Just like that. Aaron Gaydosik, Gulfport CFO, is leaving “to pursue an external opportunity.” While defections in the top ranks of big drillers like Gulfport are not unheard of, they do give investors the jitters. And it makes one wonder what’s going on at the company, given that Gaydosik had only been in that job for the past 2.5 years. Was he pushed out? Did he find a better gig? Inquiring minds want to know…
Continue reading

PA O&G Jobs Drop 32% in 2Q16, but O&G Jobs Double Over Last 9 Yrs

Last week the Pennsylvania Department of Labor and Industry released employment numbers for the Marcellus industry for the second quarter of 2016. Yes, you read that right–the jobs numbers released were for 2Q16, April through June. Why such a delay? Who knows!? What followed is instructive. The numbers show that year over year, from 2Q15 to 2Q16, those employed by the Marcellus industry went down by 32%. However, the same report shows overall those directly employed by the drilling industry doubled over the past nine years. Yes, we hit a down cycle and lost some jobs, but we’re still light years ahead (and a heck of a lot better off) than where we were just a decade ago. Also keep in mind: we are once again on the upswing with jobs, since 2Q16…
Continue reading

Top 10 MDN Stories for 2016 – Can You Guess Most Popular Topics? [Free]

Each weekday Marcellus Drilling News locates and shares news from the Marcellus and Utica Shale. Over 50,000 people read MDN each month. Here is a summary of the top 10 most-read stories on MDN for all of 2016. We hope this will give you insight into what stories captured the interest of those in the industry, and landowners as well. Let’s do this David Letterman Top 10 style…
Continue reading

Marcellus & Utica Shale Story Links: Tue, Jan 3, 2017

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Friends and foes wait on appeals court for ruling in Constitution Pipeline; OH voters want no part of frack bans; natgas shows signs of returning to Lycoming County; PA Gov Wolf rejects natgas-powered data center, kills 500 jobs; Spectra paying $1.2 million to run pipe through few miles of New England forest; shale gas in north Georgia?; RBN’s top 10 for 2017; Trump’s energy policy; what lies ahead for 2017; and more!
Continue reading

WV Supreme Court Rules EQT Can’t Deduct P-P Costs from Royalties

A significant court case was decided last week in West Virginia. The WV Supreme Court ruled in a gas royalty case that not only has significant implications for WV landowners (and drillers), but also may reverberate across the border into neighboring Pennsylvania where the same issue has been a long and contentious fight–what we call a civil war between landowners and drillers. Like all such cases, this one is complicated and not easy to summarize, but we’ll do our best. The WV Supremes have just handed down a decision that says, in essence, that EQT (and by extension other drillers) cannot deduct post-production expenses when calculating royalty payments to landowners. Specifically, the justices in their ruling said that drillers can “not deduct from that (royalty) amount any expenses that have been incurred in gathering, transporting or treating the oil or gas after it has been initially extracted, any sums attributable to a loss or beneficial use of volume beyond that initially measured or any other costs that may be characterized as post-production.” Yikes! That is fantastic news for landowners who now have a case to recoup money deducted from their checks–and really bad news for drillers who will owe that money. The big winners are, of course, the lawyers who will litigate this for years to come. However, hold on to those briefs–EQT has just appealed the decision, asking the WV Supreme Court to reconsider their decision, gently chiding the court for erring in their interpretation of state law on royalties…

Continue reading

OH Gov Kasich May Veto Misnamed ‘Tax Relief’ for Utica Drillers

“The Nerve”

Ohio Gov. John “foreigner hunter” Kasich has been hellbent for leather to tax Utica drillers more, over the past, what? Four years now? He’s wanted to hike the existing severance tax in a bid to give away driller’s money to other people–like a good Democrats and RINOs do (see OH Gov Kasich the Bully: Accept My 6.5% Tax or Risk a 10%+ Tax). So image how it must have galled Kasich to learn that a bill he’s about to sign, or veto, has provisions “slipped in” that clear up language regarding tax exemptions for the oil and gas industry (the nerve of those lawmakers!). Ohio state auditors have taken advantage of unclear language to “aggressively” go after oil and gas companies over legitimate tax breaks they receive under Ohio law (to not pay taxes on equipment used directly in producing oil and gas). Lawmakers want to end the tax witch hunts by clearing up language, and Democrats and RINO Kasich are trying to position the issue as a “tax break” under which up to $264 million would have to be refunded to Big Oil. It’s nothing of the sort…
Continue reading

UGI Ready to Begin Flowing Gas via $150M Sunbury Pipeline in PA

Sunbury Pipeline map – click for larger version

In December 2014 Pennsylvania utility company UGI pre-filed an application to build a new 35-mile, 20-inch pipeline to feed a natgas-powered electric generating plant being built in Snyder County, PA (see UGI Pre-Files with FERC for New Marcellus Pipeline in Central PA and UGI Building 35-Mile Pipeline for Panda Power Electric Plant). The project, called the Sunbury Pipeline, was estimated to cost $150 million–money that goes into the local economy. It took long enough, but in May 2016 the Federal Energy Regulatory Commission (FERC) finally approved the project (see UGI Sunbury Pipeline Gets FERC Approval, Built by November?). UGI broke ground on the project in August (see UGI Breaks Ground on Sunbury Pipeline for NEPA Electric Plant). Here it is December, and the Sunbury Pipeline is done and expected to go live in January…
Continue reading

FERC Issues Certificates for 3 Spectra Energy Pipe Projects in M-U

In August, the Federal Energy Regulatory Commission (FERC) issued a favorable environmental assessment (EA) for three Spectra Energy projects: Access South, Adair Southwest and Lebanon Express (see FERC Approves 3 Spectra Energy Pipe Projects in Marcellus/Utica). The three are part of an expansion of the Texas Eastern Transmission (Tetco) pipeline, owned by Spectra Energy. The combined projects will transport an additional 662,000 dekatherms per day (or 662 million cubic feet) of Marcellus and Utica Shale gas from Pennsylvania to Ohio, Kentucky and Mississippi. Once a favorable EA is issued, the final step is for the fat lady to sign–that is, for FERC to issue the final, actual certificate that says a company can begin building. That just happened. FERC has just issued the final certificate for the three projects, meaning compressor station upgrades will now begin, and new pipeline will get built through eastern Ohio…
Continue reading

Updated List of Proposed Laws in PA-OH-WV Affecting Marcellus/Utica

The legal beagles at global law firm Norton Rose Fulbright continue to do us all a huge favor. Researchers at the law firm issue a quarterly legislative action update looking at bills and laws previously voted on, and new bills/laws introduced, affecting the oil and gas industry in Pennsylvania, Ohio and West Virginia. The “Quarterly legislative action update: Marcellus and Utica shale region” for 4Q16 (full copy below) begins with a quick listing by state for existing or new laws introduced, with descriptions for each bill/law. This is, in one place, pretty much everything you need to know about what new laws (i.e. regulations) are coming down the pike that will affect the Marcellus and Utica Shale drilling industry…
Continue reading

Canadian Bear Paw Pipeline for LNG Exports Gets Favorable EA

In March of this year, MDN told you that LNG Limited (from Australia) registered with the Canadian government for an environmental assessment for a pipeline they want to build in Nova Scotia–the Bear Paw Pipeline (see LNGL Applies to Build Pipeline to Bear Head LNG Export Facility). It is the first (and perhaps most important) step in getting a new 39-mile pipeline built that will run from the Maritimes & Northeast Pipeline to LNGL’s proposed Bear Head LNG export facility. LNGL envisions plentiful shale gas coming into the Maritimes & Northeast Pipeline either from the Marcellus region (via Spectra Energy’s Access Northeast Pipeline connecting to M&N) or from a long-shot plan to bring in gas to M&N from western Canada (see Canadian Bear Head LNG’s Long-Shot Plan to Get Gas). The “what gas will it be?” question still lingers. In the meantime, back at the Bear Paw Pipeline ranch–the Canadian government has just received a favorable environmental assessment (EA) for the pipeline project–which means the project has cleared all the major hurdles it needs to clear. The question now is, will LNGL actually build it?…
Continue reading

« Older Entries   Recent Entries »

Password Reset
Please enter your e-mail address. You will receive a new password via e-mail.