The Pennsylvania Supreme Court has just ruled on a case with huge consequences for the natural gas drilling industry in the state. We won’t keep you in suspense: the ruling is favorable to the drilling industry.
In Butler v Powers, the Supreme Court justices took up the issue of whether or not natural gas rights should be part of the broader concept of “mineral rights” in PA. In most states when a deed or lease agreement is signed for mineral rights it includes natural gas as well, on the theory that the gas comes from a mineral—shale rock. But that has not been the case in PA. Going all the way back to a case in 1882, PA has had “the Dunham rule” which separates natural gas rights from the broader concept of mineral rights (for background on the Dunham rule, see the MDN article PA Supreme Court Hears Arguments in Critical O&G Case).
The two organizations behind FracFocus, the Ground Water Protection Council and the Interstate Oil and Gas Compact Commission have responded to the charges leveled by Harvard. FracFocus points out Harvard never even talked to them or asked to see the inner workings of the organization and how it operates—so how in the world can Harvard come to the conclusions they did? MDN knows: Lefty bias—how else? Who needs facts when your own anti-drilling opinions will do just fine? Here’s the detailed response from FracFocus utterly refutes and humiliates the “study” from Harvard:
Yesterday, Cabot Oil & Gas issued financial results for the first quarter of 2013. Natural gas production for the company was up a whopping 50% over last year, and up 13% from last quarter! As MDN had previously noted, the company was the first to hit 1 billion cubic feet of production per day in the PA Marcellus Shale (see Who’s a Member of the Marcellus “1 Bcf/d” Club?).
Net income for the company was up over last year ($42.8M as opposed ti $18.3M last year in 1Q). According to company CEO Dan Dinges, the key to their success is the Marcellus. The Cabot statement from yesterday:
An attempted smearing of the independent consulting company Ecology and Environment, Inc. by Gannett and anti-drilling groups like NYPIRG has not worked. In 2011 E & E authored a study for the state Dept. of Environmental Conservation on the economic benefits of shale drilling and fracking. Earlier this week the Independent Oil & Gas Association of New York (IOGA of NY) sent a letter to Gov. Cuomo telling him his indecision is killing all drilling in the state (see IOGA of NY to Cuomo: Your Indecision is Killing ALL NY Drilling). One of the 200 signatories of the letter was E & E, which Gannett and NYPIRG trumpeted as proof the study was not impartial and that the entire set of draft regulations it’s a part of should be scrapped (see NYPIRG calls on Cuomo to rescind fracking review).
Not so fast, says E & E. They are not members of IOGA of NY and only paid membership dues for one of their employees so that person could monitor the meetings and publications of IOGA of NY, according to a letter they sent to the DEC (letter embedded below). What will anti-drillers use now to try and discredit the DEC’s work on new rules for fracking? Here’s the story on E & E and IOGA:
EQT turned in a report on the first quarter of 2013 today and the numbers are excellent. Marcellus Shale production for the company rose 103% over the same period last year. Midstream volumes are up, revenue is up, profits are up. Hey, it’s all looking up for EQT!
EQT had 79.4 billion cubic feet of natural gas production in the Marcellus Shale for 1Q13–they’re closing in and will soon become the second member of the 1 Bcf/Day Club (Cabot is already in the club). Here’s the EQT report issued this morning:
On March 1, MDN told you about the complex deal agreed to between EQT and People’s Natural Gas. EQT wants to swap its gas utility division, called Equiptable Gas Company, to People’s in return for cash and a midstream company owned by Peoples called Allegheny Valley Connector (see Pittsburgh Driller & Gas Utility Co Want to Swap Assets). Good news today from EQT. They report the Federal Trade Commission has “not objected” to (meaning it approves of) the transfer–a big hurdle to completing the deal. However, there’s still a number of other approvals from state agencies that need to be obtained before the deal can be finalized.
The announcement today from EQT about the FTC “approval”:
In New York, public opinion polling shows the state is largely split on the question of whether or not fracking for natural gas should be done. Over the past few years it’s been pretty close to a 50/50 split—which is what keeps Andy “Ditherer” Cuomo up at night agonizing over his presidential aspirations which have gone “poof” because of the drilling issue.
However, the folks in Ohio don’t have freak shows like Yoko Ono wandering around to inspire angst (and if they did, they would ignore her as should be done). In Ohio, public opinion polling shows a strong 2/3 majority favor fracking and drilling…
Several interesting speakers addressed the spring natural gas conference held by West Virginia University in Morgantown on Wednesday. Among them was keynote speaker David McCurdy, president and CEO of the American Gas Association. He told attendees he believes natural gas will stay in the $4-$6 per Mcf range “for a decade or more.”
Dominion Resources was also on hand, talking about their plan to export natural gas to Japan and India from Cove Point, MD. Highlights:
Yet another positive sign for the Ohio Utica Shale. The Youngstown-Warren (OH) Regional Airport is looking to add direct flights to and from Houston, TX. They’ll likely begin with a regular, chartered service and after that, add a permanent route…
Hats off to UPS—the shipping company that’s probably made a delivery to your business or home within the past week. A week doesn’t go by that MDN HQ doesn’t get a delivery from the big brown truck! UPS currently has a fleet of 2,600 alternative fuel vehicles—running on everything from electric to biomethane. They’re adding another 700 new vehicles to that number—all of them liquefied natural gas (LNG) tractor trailers. UPS will also build four private refueling stations as part of the program—three in Tennessee and one in Texas.
LNG is different from CNG, or compressed natural gas. LNG is natural gas cooled to the point it becomes a liquid and is typically used in long haul vehicles, like tractor trailers. CNG is typically used in passenger vehicles and short haul trucks. Here’s the announcement from UPS about growing their long haul fleet using LNG: