Marcellus & Utica Shale Story Links: Tue, Nov 26, 2013

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:


Md. plants show big drop in greenhouse gases (thanks to the Marcellus)
Baltimore Daily Record
Greenhouse gas emissions from Maryland’s power plants fell by more than 26 percent from 2010 to 2012, the sixth-largest drop in the nation during that time, according to data from the Environmental Protection Agency. Only Massachusetts, Virginia, Oregon, Washington state and the District of Columbia saw greater declines, according to the data released last month, with greenhouse gas emissions falling by more than 10 percent nationwide. Experts attribute the unusually large drop in Maryland to the fact that the state’s plants simply generated less electricity, as energy produced by those plants fell by nearly 32 percent over the same period, according to the Energy Information Administration, a government data collection service. The reason for that drop is simple: Maryland’s largely coal-powered plants couldn’t compete with cheaper natural gas plants in neighboring states.

New York

Bye Bye Andy? Astorino on 2014, hydrofracking and casinos
Rochester Democrat and Chronicle
Astorino said he supports hydraulic fracturing in New York, something Gov. Andrew Cuomo hasn’t decided on amid protests from environmentalists. “With the proper safeguards, there’s no reason why we can’t move forward on that,” he said. Asked where he stands on casino development, Astorino said: “If that’s the only economic stimulus, then we’re in trouble.” Westchester has Yonkers Raceway, one of the largest gaming halls in the country. He said he was confident he could raise the money needed to challenge Cuomo, who had $28 million in the bank in July.


Deutsche Bank Says Gulfport Energy Corp. Best Positioned Company in Utica Shale
Zolmax News
Equities researchers at Deutsche Bank started coverage on shares of Gulfport Energy Corp. in a research report issued on Monday, reports. The firm set a “buy” rating on the stock. The analysts wrote, “Not far from Canton, Ohio lies the Utica Shale, an asset with Hall of Fame characteristics (significant resource and growth opportunities) with returns that can compete against the current basins driving US oil and gas growth (Eagle Ford, Permian, Bakken, Marcellus). Sitting at the core of the Utica, we view Gulfport Energy as the most levered to future success of the basin with 2014 an inflection point for peer leading debt-adjusted production and cash flow growth. While the pace of infrastructure build out remains key, GPOR looks to have capacity well in hand for the growth opportunity the basin presents.”


Movers, shakers of shale: Seismic testing adapts to Western Pa.
Pittsburgh Tribune-Review
Three white trucks roll head-to-tail along Route 30 at about 1 mile per hour. Every 250 feet, they stop and slowly lower wood and metal pads to the road. Then they shake. Some in the gas industry call this “getting elephants to jump at the same time.” These are seismic testing trucks, sending vibrations 20,000 feet deep to get a picture of the Marcellus shale just as a sonogram pictures an unborn baby. And it’s the first step for gas companies after they commit to drilling a new region. The trucks working Route 30 in Findlay are on assignment for Consol Energy Inc. as it gets ready to drill for gas on 10,000 acres around Pittsburgh International Airport. These vibration trucks may become a familiar sight for analyzing prospective gas fields as drillers encroach the urban core or more densely populated areas.

Epsilon Energy: Shareholders In Charge
Seeking Alpha
Epsilon Energy is a Canadian E&P with its principal asset in the United States. Epsilon was managed by what I would qualify as “run of the mill” E&P executives, who spent money drilling left and right without too much success. Earlier in 2013, John Lovoi, managing partner of the energy focused advisory firm JVL Advisors (and ex-head of Morgan Stanley Oil and Gas investment banking), along with the $10 billion asset manager Advisory Research acquired a 30% ownership stake in the company (at prices ranging from $3 to $4 a share). Epsilon management responded to JVL and Advisory Research position by initiating a strategic review. The review however failed to produce tangible results; in consequence the stock tumbled and JVL took control of Epsilon. Upon taking control of the company, the new board and management issued the following comments on July 16th…

Interview with Tony Ingraffea (listen at your own risk)
The Environmental Protection Agency (EPA) confirmed in July that drilling in Dimock, Susquehanna County had caused methane to migrate into groundwater in that community. According to the Pennsylvania Department of Environmental Protection, there have been 41,000 wells drilled in the state over the past twelve years—oil, traditional gas and Marcellus Shale. One of the nation’s leading researchers on drilling and fracking says residents in Butler County and other communities in southwestern Pennsylvania could face similar troubles. “One of the most serious threats [from Marcellus Shale gas development] is “from leaking wells—wells that leak hydrocarbons or other liquids into underground sources of drinking water,” says Anthony Ingraffea, professor of civil and environmental engineering at Cornell University. Ingraffea spoke Thursday evening at Butler County Community College about the potential impact of drilling in that county and across the state. “Since many people in that area [Butler] are on private drinking water wells, the incidence rate of contamination of those wells continues to rise.”


Fracking Bonanza Eludes Wastewater Recycling Investors
After two years searching for a blockbuster investment in oilfield water management, fund manager Judson Hill is still holding on to his money. Hill’s NGP Energy Capital Management saw potential in what looked like a hot growth area in energy: treating and recycling the 21 billion barrels of wastewater flowing annually from U.S. oil and natural gas wells — particularly from shale. Instead, it found the market “too fragmented and too frothy,” said Hill, a managing director at the private equity firm in Texas whose latest fund has invested $3.6 billion. “It’s not as though we look back and say, ’Wow, half the ones we passed on were just home runs.’ They weren’t.” Cleaning up water in the oil patch is a tougher slog than many expected.

Colorado’s Ambulance Chasing Fracking Activists – Part III
Time for yet another update on our favorite anti-fracking activists who work every day to mislead the public about the facts related to shale development in Colorado. We have described these folks in two prior reports here as “Colorado’s” ambulance chasing fracking activists. Turns out that is more than a little misleading – and the professional activists working on the ground in that state are working feverishly to hide that fact from the public, as this report by Michael Sandoval at “The Complete Colorado” documents.

Jerry Brown Lashes Out Against Environmentalists Over Fracking
Gov. Jerry Brown was on KQED Forum today discussing the recently signed regional pact with Oregon, Washington state, and British Columbia to fight global warming. But as Paul Rogers, managing editor of KQED Science and an environmental reporter for the San Jose Mercury News wrote yesterday, rather than hailing Brown, environmentalists are focusing on an area in which they disagree with Brown. Just a day after the global warming pact was signed …

The Backdoor Bid to Ban Fracking [in California]
National Journal
In politics, it’s not what you know, it’s whom you know. That’s the logic a group of political insiders are banking on in a push to ban fracking in California, a state that appears on the precipice of a fracking boom. A coalition of former advisers to Democratic Gov. Jerry Brown is preparing to send its old boss a letter asking him to impose a statewide moratorium on fracking unless a string of scientific studies on the drilling’s environmental consequences can be studied. “As you read this, the oil industry is actively exploring the Monterey Shale and using unconventional, untested, and incredibly dangerous extraction techniques to squeeze more dirty oil out of California,” the advisers write. The group is headlined by Wendy Wendlandt, former national organizer on Brown’s 1992 presidential campaign, and Michael Kieschnick, one of Brown’s former economic advisers. In an email obtained by National Journal, the duo claim to have more than a dozen former Brown advisers on board.

The Dodd-Frank Energy Train Wreck
Abraham Energy Report
With the 2010 passage of the Dodd-Frank Act, Congress set a course to damage one of the key tools used by energy suppliers and users to tamp down energy price volatility, according to a new study released today by the Abraham Energy Report. The study urges Congress to consider entirely exempting physical commodity businesses from financial regulation that was meant to address the players that caused the global financial crisis. The study finds that unless Congress takes remedial action, the effects of energy price volatility will be felt throughout the entire economy. The study, entitled “Dodd-Frank and Energy Price Stability: Time to Rein In Unintended Consequences,” was written by Spencer Abraham and Mark P. Mills. Abraham, former U.S. Secretary of Energy, is the Chairman & CEO of The Abraham Group, an energy consulting firm. Mills is CEO of Digital Power Capital and a Senior Fellow at the Manhattan Institute.

What Does The Iran Deal Mean For Oil Prices?
Seeking Alpha/Richard Zeits
Iran and the six world powers reached a deal yesterday to temporarily curtail Iran’s nuclear program in exchange for limited sanction relief. Crude oil futures yawned in reaction to the announcement, with the front-month contract actually closing in the positive territory. Oil producer equities, on the other hand, were down in the U.S., pretty much across the board. Is the calm reaction from the commodity market rational? There is a simple explanation to the lack of oil price volatility following the news. The announcement, despite its major political importance, is largely “yesterday’s news.” The breakthrough in the negotiations between Iran and the P5+1 group was acknowledged by the market more than two months ago when the information of the Iranian Government’s decision to come to the negotiation table was broadly publicized.

The Weekly Oil & Gas Follies
EPA Trying to Cheat on Fracking Rules – Texas Republican Rep. Bill Flores claims the Environmental Protection Agency is skirting scientific review in its analysis of hydraulic fracturing. “With respect to hydraulic fracturing, the EPA has been trying to cheat on that process,” Flores said in a teleconference. The House recently passed a bill introduced by Flores that would block the Obama administration form regulating hydraulic fracturing, or fracking, in states that already have regulations on the books.

Wind and Natural Gas: Best Friends, Worst Enemies
National Journal
“This week has been a very unusual week on our Colorado system for wind,” said Eric Pierce, Xcel’s managing director of power operations. “There have been some challenges.” The challenges Pierce speaks of get at the heart of what is one of the biggest obstacles facing widespread adoption of wind power: its inherent intermittency. The wind blows only sometimes (and sometimes it blows too much). By contrast, you can almost always rely on a steady source of coal, natural gas, or nuclear power.

Renewables and Natural Gas are Partners Not Opponents
The Energy Collective
Renewable energy sources and natural gas should be considered as complements and not rivals. A hybrid gas-electric clean energy provides a workable engineering solution while 100% Renewables models based heavily on wind, solar and efficiency fall short of the meeting the functional needs of a modern technology intensive society. Natural gas and renewables are already functional partners on the grid. Because wind and solar are intermittent sources of electricity, some form of backup power is required to fill the down times.