XTO Energy Utica Well Explosion in Belmont County – 100 Evacuated

February 20, 2018 Leave a Comment 

Last Thursday XTO Energy was drilling a fourth Utica Shale well on the Schnegg well pad near Captina Creek (York Township, Belmont County, OH) when XTO “lost control” of the well and it exploded and caught fire. There were 24 people working at the well pad at the time. Fortunately, none of them were injured. Following the explosion and fire, 36 nearby homes and farms (around 100 people) were evacuated. So far the evacuees have not been allowed to return, although that may change today. XTO is putting them up at nearby hotels in St. Clairsville, Moundsville and Wheeling. Crews have worked to try and keep the brine gushing from the well from reaching Captina Creek. XTO hired Wild Well Control to put out the fire (which happened quickly). XTO has also hired Cudd Energy Services to cap the well. Three wells on the pad that were producing have been shut down for the time being. Below is the chronology of the explosion and aftermath, as it happened. This story is still unfolding, now five days later…
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PA DEP Caves to Pressure, Extends Comment Period for Shell Pipeline

February 20, 2018 Leave a Comment 

Once again, in what appears to be a pattern, the Pennsylvania State Dept. of Environmental Protection (DEP) is caving to pressure from virulent anti-fossil fuelers. This time in regard to Shell’s proposed Falcon Ethane Pipeline project. Shell is working on an ethane “pipeline system” with two “legs” to feed the mighty cracker plant being built in Monaca, Beaver County (see Shell Working on 94-Mile Ethane Pipeline to Feed PA Cracker). Last October Shell filed an application with the PA DEP for the PA portions of the pipeline, some 60 miles of the total system (see Shell Files PA Application for Ethane Pipe to Feed Cracker Plant). The DEP advertised an official comment period for the project on Jan. 20, giving interested parties until Feb. 20 to file their comments–an entire month (see PA DEP Invites Public Comment on Shell 60-Mile Ethane Pipeline). However, one month isn’t enough time for anti-drillers to marshal the faithful to try and sink the project. FracTracker Alliance, an anti-fossil fuel organization, colluded with other groups to put the word out to flood the DEP with demands to keep the comment period open. The DEP folded, like a flimsy house of cards, and has now extended the comment period to April 17th along with three public hearings (circus freak shows), which will give the FracTracker faithful time to mount publicity and legal offensives to try and stop the project. If the pipeline doesn’t happen, work at the cracker plant stops. Which, of course, isn’t going to happen. But it illustrates the true aim of FracTracker and other virulent (way, way, WAY outside the mainstream) anti-fossil fuel groups…
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NJDEP Hail Mary – Pleads with FERC to Stop PennEast Pipeline

February 20, 2018 Leave a Comment 

The now fully politicized New Jersey Dept. of Environmental Protection (NJDEP), along with the Delaware and Raritan Canal Commission, filed a joint request with the Federal Energy Regulatory Commission (FERC) last Friday asking FERC to reconsider and rescind its approval of the PennEast Pipeline project, which FERC granted just last month (see FERC Grants Final Approval for PennEast Pipe – Real Battle Begins). PennEast is a $1 billion, 120-mile primarily 36-inch natural gas pipeline that will stretch from Dallas (Luzerne County), PA to Transco’s pipeline interconnection near Pennington (Mercer County), NJ. The pipeline is an important conduit to move gas from the prolific gas fields of northeastern PA to markets in southeast PA and New Jersey. From the beginning of the project there have been a collection of so-called environmental organizations opposing it–including THE Delaware Riverkeeper, NJ Sierra Club, and the NJ Conservation Foundation. All radical groups. Unfortunately NJ elected an authoritarian Democrat as governor–Phil Murphy–who pledged to try and stop the project (see Dem Candidate for NJ Gov Opposes PennEast, After He $upported It). Murphy (a tool of Big Green) has politicized the NJDEP and has caused them to dance to his radical tune. In addition to receiving a formal request by NJDEP, FERC also received the same request from the nutty Sierra Club (no surprise there), and also a far-left Democrat State Senator, who is using the request as a fundraiser for his next campaign…
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OH Supreme Court Rejects Anti Request to Stop Wastewater Disposal

February 20, 2018 Leave a Comment 

The Ohio Dept. of Natural Resources (ODNR) is actively working on new regulations “regarding storage, recycling, treatment, processing, and disposal of brine and other waste substances.” That is, for wastewater treatment and disposal from the oil and gas industry. It’s taking the ODNR a while to hash out the new regs (they were instructed to do so back in 2014). However, in the meantime, ODNR issues special orders/permits on a case by case basis to allow wastewater treatment and disposal facilities to start up and operate. Hoping to shut down all drilling (in Ohio and other states that send wastewater to Ohio), the odious Food and Water Watch and misnamed FreshWater Accountability Project sued in the Tenth District Court of Appeals, arguing that because ODNR hasn’t released the new regs, they shouldn’t be allowed to keep issuing temporary/special permits. The Tenth District said the radical enviro groups didn’t have standing to file the case and dismissed it. On appeal to the State Supreme Court, the Supremes said the same thing. Therefore, ODNR’s authority to continue granting temporary/special permits for wastewater treatment remains in effect. Another huge loss for Food and Water Watch…
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WV’s Northern Panhandle Sits in the Shale Catbird Seat

February 20, 2018 Leave a Comment 

The Northern Panhandle of West Virginia is doubly blessed. The Panhandle is four counties: Hancock, Brooke, Ohio and Marshall. Some add a fifth–Wetzel County. The first four counties in the list sit in a slice of real estate located between Pennsylvania and Ohio. The Panhandle currently produces 38% of WV’s natural gas production, and nearly 70% of its oil production. That’s the first blessing–good rock sits under those counties. The second blessing is the panhandle’s location between PA and OH. On one side, sitting just a few minutes away, is the mighty Shell ethane cracker plant, currently under construction in Monaca (Beaver County, PA). On the other side, also just a few minutes away, sits the proposed PTT Global Chemical ethane cracker site in Dilles Bottom (Belmont County, OH). The second blessing is this: many petrochemical and manufacturing companies will build, even relocate, their operations to take advantage of the raw materials that will come from both cracker plants. And guess where many of them will choose to locate? Yep–right smack in the middle, which is where the Northern Panhandle happens to be–sitting in the catbird seat…
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Yet Another Fracking-Causes-Earthquakes “Study” – This Time in Utica

February 20, 2018 Leave a Comment 

Yet another “fracking may cause earthquakes” study has been published in the so-called peer reviewed journal PNAS (Proceedings of the National Academy of Sciences). Researchers from the University of Miami (in Ohio) admit the kind of earthquakes they talk about in their paper, potentially caused by Utica Shale drilling, are “rare.” But, they are also “concerning.” Yes, everyone should be concerned that in zero percent of Utica well drilling cases (statistically speaking) there have been NO earthquakes. Actually a couple of cases are thought to be related to fracking over a fault–but it’s still unproven. Statistically speaking, it’s 0%. But, there could be problems! Maybe. If the conditions are “just right.” Ya never know. We note the researchers didn’t address concerns over fans in football stadiums that, when they all stomp their feet at the same time, have caused “earthquakes” that are higher on the Richter scale than the ones they postulate “may, maybe, might” happen in Utica drilling. No mention of football fan earthquakes in this study. Below is the “news” about this latest, breathlessly urgent report that everyone should read…
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PA Town Sues Sunoco for ME2 Pipe Construction “Too Close” to Homes

February 20, 2018 Leave a Comment 

We understand why folks in Uwchlan Township (Chester County, PA) may be upset with Sunoco Logistics and the Mariner East 2 NGL pipeline that’s crossing through their area. Last summer drilling work for the pipeline in Uwchlan created cloudy well water for some residents (see ME2 Pipe Work in Chester County Creates Water Well Issue for Some). The PA Dept. of Environmental Protection (DEP) recently allowed Sunoco to resume work in the township (and elsewhere)–after Sunoco paid a $12.6 million fine (see PA DEP Allows ME2 Underground Drilling to Resume in Chester County). So yeah, residents have some concerns. However, they’re going about venting their frustration in the wrong way. Last week supervisors in Uwchlan Township voted unanimously to enforce an ordinance that requires pipelines like ME2 to be set back 1,000 feet from buildings. In some cases, ME2 is being built within 100 feet of buildings. While we appreciate Uwchlan’s concerns, the simple fact is, local municipal ordinances DO NOT override state regulations. In this case, it is the state DEP and Public Utility Commission that regulate the project. It is state law that trumps local ordinances–as it should be. By all means, wheel and deal and pressure and try to get Sunoco to change the route–but you cannot take the law into your own hands, which is exactly what Uwchlan is attempting to do…
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Williams 17/18 Update: Full Atlantic Sunrise Startup Slightly Delayed

February 20, 2018 Leave a Comment 

Last week Williams, the largest pipeline/midstream company operating in the Marcellus/Utica region, released its fourth quarter and full year 2017 update. While the company lost $342 million in 4Q17 due to “non-cash charges related to Tax Cuts and Jobs Act of 2017,” the company made a profit of $871 million for the year, up 100% from making $431 million in 2016. The company brought five big projects online in 2017–Gulf Trace, Hillabee Phase 1, Dalton, New York Bay and Virginia Southside II–which added an extra 2.8 billion cubic feet per day of capacity and led to record-breaking volumes of gas flowing along the Transco pipeline (see Williams Marcellus Buildout Leads to Record Transco Pipe Volumes). However, it was the Atlantic Sunrise Pipeline project that stole most of the limelight in last week’s update. Atlantic Sunrise is a $3 billion, 198-mile pipeline project running through 10 Pennsylvania counties to connect Marcellus Shale natural gas from northeastern PA with the Williams’ Transco pipeline in southern Lancaster County, PA. The pipeline will be ready in July, on schedule. However, an associated compressor station will take “a few months longer” than July, meaning the pipeline won’t be online until early fall sometime (not on schedule). Below is last week’s Williams update, a copy of the latest PowerPoint presentation, and excerpts from the analyst phone call…
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TransCanada Spending $1.9B to Bring More Canadian Gas to Northeast

February 20, 2018 Leave a Comment 

TransCanada, one of Canada’s leading midstream/pipeline companies, cooked up a deal in 2016 to pipe natural gas from Canada’s West Coast to the East Coast in order to fend off cheap supplies of Marcellus/Utica gas that will flow into Canada from the NEXUS and Rover pipelines (see TransCanada Pipe Drops Price 42% to Compete with Marcellus/Utica). TransCanada dropped their pipeline price to lure drillers by (theoretically) making it less expensive to get gas from Western Canada, some 2,400 miles away, than from the Marcellus, just 400 miles away. Following a couple of open seasons and stiff regulatory hurdles, the plan was adopted and went into service last November (see TransCanada Pipe Begins Lowball Shipping to Compete with Marc/Utica). Last week TransCanada announced a $1.9 billion plan to expand its Western Canadian pipeline system in a bid to gather up and send even more Western Canadian gas to the East Coast–to compete with the Marcellus/Utica…
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Other Energy Stories of Interest: Tue, Feb 20, 2018

February 20, 2018 Leave a Comment 

The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: PA’s rig count hits highest level since 2015; OH compressor company returns to full employment; Bethlehem wants PennEast Pipeline moved; NY in a natgas death spiral; U.S. northeastern economy at risk from high energy costs; flaring still a problem in ND; Democrat Mayor in Illinois wants to slap 4% tax on natgas; my bloody valentine (natgas stats); U.S. methane emissions have virtually no impact on climate; OPEC & shale together keep oil above $60/barrel; China-Russia gas pipeline; and more!
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MDN Off Today – President’s Day Holiday

February 19, 2018 Leave a Comment 

Believe it or not, today is a New York Stock Exchange holiday (i.e. bank) holiday. MDN rarely takes a day off, so we tend to track with those holidays observed by the NYSE. Have no fear, we are monitoring the news and if anything earth-shattering happens, we’ll bring you the latest.  Otherwise, look for full-strength MDN to return tomorrow. In the meantime, we have issued the weekly calendar of events.

– Jim Willis, Editor

Calendar of Marcellus/Utica Events for Feb 19 – May 18

February 19, 2018 Leave a Comment 

Events related (or of interest) to the Marcellus and Utica Shale, primarily pro-drilling events.

To have your event included (or if you are aware of a worthy event you believe should be on this page), please send the details and/or a link to have it included to the [email protected] email address. Thank you!
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EQT Big Announcement Coming Within 2 Wks to Split Co. in Two

February 16, 2018 Leave a Comment 

Yesterday EQT, now the largest natural gas producing company in the United States following its acquisition of Rice Energy, released 2017 numbers. On an analyst call to discuss the number, CEO Steve Schlotterbeck turned the conversation in the direction of “sum of the parts”–which turned out to be the really big news. What in the world is “sum of the parts?” In October 2017, prior to EQT consummating its deal to buy Rice, Steve Schlotterbeck said following the merger EQT would study a plan to split the newly consolidated company into two pieces–upstream/drilling and midstream/pipelines (see EQT CEO Signals Company Likely to Split in Two After Rice Merger). EQT is considering a split under pressure from a corporate raider (aka “activist investor”). You know what we think of corporate raiders. Scum of the earth. Anywho, in high finance, the theory is that if you split a company in two different lines of business into pieces, with each piece focusing on a different market (drilling vs. pipelines in the case of EQT), the two companies would be worth far more to investors as standalone companies than they are joined together. In other words, the “sum of the parts” is worth more than the whole. EQT honored its word, hiring two new board members following the Rice merger. Their role is specifically to help with reviewing and crafting a plan to split the company. The outcome of the review (and the plan to split the company in two) was due out by the end of March. However, on yesterday’s analyst phone, Schlotterbeck said the review and a plan will be released by “the end of February”–in less than two weeks. Frankly, there’s no doubt the review will recommend a split, judging by Schlotterbeck’s comments (see below). Schlotterbeck said yesterday, “[W]e intend to implement the plan on an accelerated basis.” Welcome to splitsville…
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EQT Makes $1.5B in ’17; Drilling Fewer Wells in ’18; Tax Cut Helps

February 16, 2018 Leave a Comment 

Yesterday the biggest natural gas producing company in the U.S., EQT, released its fourth quarter and full year 2017 update. As we pointed out in our lead story today, the 800-pound gorilla in the room was talk about an impending announcement to split EQT into two companies (see EQT Big Announcement Coming Within 2 Wks to Split Co. in Two). However, there was plenty of other news coming out of the 2017 update and accompanying analyst phone call. Of course the big news for EQT in 2017 was closing on the deal to buy Rice Energy (see EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US). Sadly, about half of Rice’s employees were fired as a result. EQT kept 275 out of the roughly 500 employees employed at Rice at the time of the merger. EQT reported a net income of $1.5 billion in 2017, which is up from a loss of $453 million in 2016 (a nearly $2 billion swing in one year!). Contrary to the naysayers, the Trump tax cut is having a huge impact on shale companies (on everyone, actually). EQT will be $1.2 billion richer this year due to “deferred tax liability”–taxes it expected to pay at the old rate of 35% rather than at the new rate of 21%. That’s money not going into the black hole of Washington politicians’ hands but instead getting reinvested right here in the Marcellus/Utica. In 2017, EQT picked up an *additional* 110,000 acres in the West Virginia Marcellus/Utica region–and that’s without including the acreage picked up in the Rice Energy deal. How about some hard numbers for drilling? In 2017, EQT drilled 144 Marcellus wells, 49 Upper Devonian wells, and 4 Utica wells (197 wells drilled, total). In 2018 they plan to drill 134 Marcellus wells, 16 Upper Devonian wells, and 25 Utica wells (175 total). So, their drilling program will slightly decrease, and they will drill less Marcellus/UD wells and more Utica wells. EQT also issued an announcement about proved reserves–the amount of gas (and equivalents) in the ground, under their leased acreage, that they could extract using today’s technology at today’s prices. EQT reports total proved reserves at the end of 2017 were a stupendously high 21.4 trillion cubic feet equivalent of natural gas–59% higher than 2016. Below are the announcements issued yesterday from EQT, along with the latest PowerPoint slide deck and excerpts from the analyst phone call…
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CNX Resources CEO Says Average CNX Worker Makes $170,000 per Year

February 16, 2018 Leave a Comment 

It looks like CNX Resources (formerly CONSOL Energy) is THE place to work if you live anywhere in the orbit of Pittsburgh. Our eyeballs about fell out when we read comments made by CNX Resources President and CEO Nick DeIuliis in a speech he gave yesterday at the Pittsburgh Business Times’ VisionPittsbugh event. According to PBT reporter Paul Gough, “He [DeIuliis] said the CNX workforce was young, highly skilled and driven, drawn from Baldwin Borough to Nigeria, and making an average of $170,000 a year.” Wow! Where do we sign up? In commenting on Pittsburgh’s ongoing water issues, DeIuliis said “so-called green fixes is absurd.” A man after our own heart. Here’s more of what DeIuliis said yesterday…
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Frac Sand Barge Facility Near Pittsburgh Gets $638K Grant to Expand

February 16, 2018 Leave a Comment 

McKees Rocks barge facility

While we don’t (yet) have hard numbers for how many shale wells were drilled in the Marcellus/Utica in 2017 versus 2016 and 2015, we’re pretty sure the 2017 number went up–a lot. Why do we think so? Because frac sand use went through the roof in 2017. Yes, drillers are using more sand to frack each well, so the numbers could reflect drilling the same number of wells using more sand–but we don’t think that explains it all. Not this much sand. McKees Rocks Industrial Enterprises operates a barge/transloading facility on the Ohio River in McKees Rocks (Allegheny County), PA. Jim Lind, operator of the facility, says sand shipments soared 200% in 2017 over previous years. Put another way, sand shipments doubled–at just this one facility! Sand is barged in to the facility from the Midwest, then loaded onto trucks and rail cars for delivery to Marcellus/Utica well sites throughout the region. Business is good. The barge facility needs to expand. Pennsylvania recognizes the facility’s value to the shale industry, so the state has just made a $638,015 grant to allow McKees Rocks to handle more barges at the same time at the 100-acre facility. That’s good for the Marcellus/Utica, and it’s good for the regional Pittsburgh economy…
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