Marcellus & Utica Shale Story Links: Mon, Dec 23, 2013

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


Disney And Oil Industry Team Up For ‘Rocking In Ohio’ Event
Huffington Post
Radio Disney, “home of the hottest kids’ music,” is teaming up with Ohio’s oil and gas industry to teach school kids that pipelines are awesome. “Rocking In Ohio” is an interactive, game show-like presentation entirely funded by the Ohio Oil and Gas Association and presented jointly with Radio Disney. This “special partnership,” as they call it, “highlights the importance of Ohio’s oil and gas industry, and why science, technology, engineering and math (STEM) are crucial in developing energy resources in Ohio,” according to the association. Hosted by a master of ceremonies and three staffers from Cleveland’s Radio Disney affiliate WWMK, the hour-long event challenges kids, families and dads to head-to-head games that explain the science behind resource extraction and tout the benefits of products made from fossil fuels. Children run, dance and answer questions, and are given prizes from Disney movies and the Radio Disney brand.

Ohio Updates Best Management Practices for Pipeline Installation and Soil Health
Ohio Dept. of Natural Resources
With increasing oil and gas activity in Ohio, including pipeline construction, the Ohio Department of Natural Resources (ODNR) recently updated its Pipeline Standard and Construction Specifications. Last updated in 2009, the standards provide guidelines and recommended best management practices to help rural landowners and farmers restore soil productivity and agricultural drainage after the installation of a pipeline. The standards are not a mandatory requirement, but instead are a technical resource that can be utilized by pipeline companies, landowners, agricultural producers, local soil and water conservation districts and others to minimize the impacts of pipeline construction on Ohio’s soil and water resources. The standards can be found online at: //

Cold Weather Delays Some Magnum Appalachian Production
NGI’s Shale Daily
Magnum Hunter Resources Corp. said it was encouraged by early well results in the Appalachian Basin, where it continues to focus on accelerating drilling. Inclement weather, coupled with heavy liquids volume and a bevy of infrastructure activity in the region has delayed midstream construction in Ohio and West Virginia. The company boosted its position in both states to 180,000 net acres apiece, recently adding 89,000 gross acres in the Marcellus and another 105,000 in the Utica. “Our newly completed wells in the Marcellus continue to improve both in overall gas production volumes and liquids recovery,” said CEO Gary C. Evans. “We are very anxious to test our two new Utica wells recently drilled in Ohio, which are currently in the process of completing.”


No decision yet on whether natural gas driller is criminally liable for spill in Lycoming County
Harrisburg Patriot-News
A district judge who admitted never before having such a case must decide whether a Texas natural gas company is criminally liable for the discharge of fluids at a Marcellus Shale natural gas well site in Lycoming County. Following an all-day preliminary hearing that ended at 6 p.m. Wednesday, District Justice James G. Carn allowed attorneys for XTO Energy Inc. of Forth Worth to file written arguments on why he should dismiss charges filed by the state attorney general’s office. Chief Deputy Attorney General Glenn A. Parno in his closing argument noted the prosecution did not have to prove intent to send three solid waste and five clean stream charges to court. A statewide grant jury recommended the charges that stem from the discharge at an XTO site in Penn Twp. near Hughesville on Nov. 16, 2010, of approximately 55,000 gallons of fluids recovered from operating natural gas wells.

There Is Value In WPX Energy
Seeking Alpha
WPX Energy is a 4 billion cap energy company specializing in the production of natural gas, natural gas liquids and oil. Year to date, the company has outperformed the market with gains of approximately 35%. I believe there are two reasons why this stock could do even better in 2014. The Tulsa-based company, once a subsidiary of Williams, but independent since 2011, has operations in Colorado, New Mexico, North Dakota, Pennsylvania and Wyoming, as well as interests in Argentina and Colombia. Excluding the foreign interests, the company has approximately 80 million barrels of oil equivalent (MMboe) and 3900 billions of cubic feet equivalent (Bcfe) of natural gas in proven reserves.

Aleppo residents upset about gas service abandonment
Washington (PA) Observer-Reporter
People crowded into Aleppo Brethren Church Thursday night wanting answers about why, despite the boom in natural gas drilling in this part of the county, their local gas company was abandoning service. More than 50 people attended the meeting hosted by Aleppo Township and attended by representatives of Mountain Energy Ltd., which is abandoning its system, the state Public Utility Commission, state Rep. Pam Snyder, D-Jefferson, and state Sen. Tim Solobay, D-Canonsburg. Mountain Energy filed a petition Dec. 9 with PUC seeking approval to abandon service to all 86 remaining customers. The company is in the process of abandoning the system since 2007 and, previously with PUC approval, abandoned 84 customers. Residents wanted to know why service was being terminated and why they were being offered so little to connect to another system or to convert to another fuel to heat their homes.

A Look Back: 2013 in energy
Pittsburgh Business Times
One of the top stories of 2013 was a long time coming, the state Supreme Court ruling on Pennsylvania’s Marcellus Shale zoning and impact fee law that was challenged in early 2012. Another 2012 story — Royal Dutch Shell’s proposal to put a cracker in Beaver County — remained unresolved. Here are some of the top stories we’ve covered in 2013 from the energy industry:

Supreme Court sends Act 13 “doctor gag rule” challenge back to lower court
StateImpact Pennsylvania
The Pennsylvania Supreme Court ruled on some controversial provisions of Act 13, the 2012 overhaul of the state’s natural gas drilling laws. The justices also weighed in on the so-called “doctor gag rule,” sending a part of the law that deals with physicians’ legal access to information about the chemicals used in natural gas drilling. Act 13 allows physicians to see a full list of these chemicals, including those that are deemed a trade secret. But some doctors say language in the law prohibits them from sharing that information with their patients and with other doctors. You can read our annotated version of Act 13 here.

FERC Approves Pair of CGT Projects in Marcellus
NGI’s Shale Daily
FERC issued a certificate Thursday authorizing Columbia Gas Transmission LLC (CGT) to build and operate a compressor station in Pennsylvania and to add compression to an existing station in neighboring West Virginia. Both plans are part of the $81.8 million Smithfield III Expansion Project [No. CP13-477], which CGT, a NiSource Inc. subsidiary, said will enable it to provide an additional 444,000 Dth/d of firm transportation service on its system from the Appalachian Basin to an interconnect with Columbia Gulf Transmission LLC pipeline near Leach, KY.


Surreal: EPA’s Leading Climate Change Expert Pleads Guilty to Elaborate Fraud
…And the fraud didn’t even have anything to do with global warming! (Rimshot). Seriously, though, NBC News’ Monday report on the misconduct of former EPA official John Beale is must be read to be believed. Honestly, if the following details didn’t involve a lazy, greedy congenital liar swindling taxpayers out of nearly a million dollars over more than a decade of abuse, they’d be laugh-out-loud funny. Alas, it’s all true, so indignation is the only proper response:

Critics blast Reddit over climate-change skeptic ban
Fox News
Critics are slamming Reddit over a single moderator’s decision to ban climate-change skeptics from contributing to its science forum, attacking the move as “political censorship.” In an op-ed titled “Reddit’s science forum banned climate deniers. Why don’t all newspapers do the same?” Nathan Allen — who described himself a Ph.D. chemist for a major chemical company and a moderator on Reddit’s “/r/science” forum — explained his decision to wipe comments from some users he dismissed as “problematic.” “These people were true believers, blind to the fact that their arguments were hopelessly flawed, the result of cherry-picked data and conspiratorial thinking,” Allen said in his article, which is posted on “They had no idea that the smart-sounding talking points from their preferred climate blog were, even to a casual climate science observer, plainly wrong.” Allen went on to attack climate-change skeptics further, saying that evidence to support their position “simply does not exist” and that such people are “enamored by the emotionally charged and rhetoric-based arguments of pundits on talk radio and Fox News.”

Why Green Energy May Not Be All Good
The Motley Fool
Green, clean, non-polluting energy has been the holy grail of Western society for years. With growing concern over pollution and global warming, more nations look to renewable energy as part of their energy portfolios — a good idea in many regards, but green energy has some drawbacks. This past summer, The Guardian ran a story on how British hospitals were asked to generate their own electricity. It seems that in the push for renewable green energy, Britain hit a snag. While they embraced green energy as a nation, Her Majesty’s subjects weren’t following suit as individuals. The electric utility powers that be knew that, given the erratic nature of green energy (e.g. wind power), overall electricity consumption had to decline or risk power interruptions. Didn’t happen. So to ensure power fluctuations didn’t disrupt things like ventilators and anesthesia machines, hospitals were encouraged to go off grid by generating their own electricity with diesel generators.

U.S. Rig Count Declines by 14 to 1,768, Baker Hughes Says
Rigs targeting oil and natural gas in the U.S. fell by 14 this week to 1,768, according to Baker Hughes Inc. Oil rigs fell by 16 to 1,395, data posted on the company’s website show. The gas count rose by three to 372, the Houston-based field services company said. The total count has increased six out of the past eight weeks, rising from 1,738 on Oct. 25, as producers increasingly use a combination of horizontal drilling and hydraulic fracturing to reach shale deposits of crude and gas in places like Texas, Pennsylvania and North Dakota. The technological improvements have helped drive domestic oil production to the highest level in a quarter-century.

Is the Administration trying to regulate Hydraulic Fracturing through OSHA?
Institute for Energy Research
The federal rulemaking process depends on sound science, especially when human lives are at stake. A proposed rule from the Occupational Safety and Health Administration (OSHA) would stiffen regulations for crystalline silica, a group of minerals used in numerous industries, including hydraulic fracturing. Prolonged exposure to respirable crystalline silica is associated with silicosis, an incurable disease that causes impaired respiratory function and scarring of the lungs. Unfortunately, OSHA’s proposed rule fails the sound science test. OSHA’s rule relies on outdated data and ignores declines in silicosis mortality rates, according to Susan Dudley and Andrew Morriss of The George Washington University Regulatory Studies Center. Moreover, the rule would impose enormous costs on American manufacturers, including oil and gas companies involved in hydraulic fracturing. As Dudley and Morriss explain in a public interest comment submitted to OSHA:

Shale Gas to the Rescue?
Project Syndicate
The developed world is slowly emerging from the Great Recession, but a question lingers: How fast and how far will the recovery go? One big source of pessimism has been the idea that we are running out of investment opportunities – and have been since before the 2008 crash. But is that true? CommentsView/Create comment on this paragraphThe last big surge of innovation was the Internet revolution, whose products came onstream in the 1990’s. Following the dot-com collapse of the early 2000’s, speculation in real estate and financial assets – enabled by cheap money – kept Western economies going. The post-2008 slump merely exposed the unsoundness of the preceding boom; the mediocrity of the recovery reflects the mediocrity of previous prospects, coolly considered. The risk now is that a debt-fueled asset spike merely perpetuates the boom-bust cycle. CommentsView/Create comment on this paragraphThe economist Larry Summers has reintroduced the term “secular stagnation” to describe what awaits us. By the mid-2000’s, Summers argued at a recent International Monetary Fund conference, the average prospective return on new investment in the United States had fallen below any feasible reduction in the Federal Reserve’s benchmark interest rate.

The Weekly Oil & Gas Follies
Great stuff from Dr. Mark Perry: Imagine this letter – ‘Senator Menendez to Obama: Expanding car exports only enhances Big Three profits?’ – MP: Well, if that seems a little absurd, that’s because it is totally absurd. But the letter above essentially captures the spirit of a letter that Senate Foreign Relations Chairman Robert Menendez (D-NJ) just sent to President Obama (“Menendez to Obama: Expanding Crude Car Exports Only Enhances Big Oil Three Profits“). The only difference as you might guess from the revised title is that Rep. Menendez is objecting to easing the outdated, 1970s-era ban on crude oil exports, not a ban on car exports as I fictitiously present above.

Natural gas saves water, even when factoring in water lost to hydraulic fracturing
A new study finds that in Texas, the U.S. state that annually generates the most electricity, the transition from coal to natural gas for electricity generation is saving water and making the state less vulnerable to drought. Even though exploration for natural gas through hydraulic fracturing requires significant water consumption in Texas, the new consumption is easily offset by the overall water efficiencies of shifting electricity generation from coal to natural gas. The researchers estimate that water saved by shifting a power plant from coal to natural gas is 25 to 50 times as great as the amount of water used in hydraulic fracturing to extract the natural gas. Natural gas also enhances drought resilience by providing so-called peaking plants to complement increasing wind generation, which doesn’t consume water. The results of The University of Texas at Austin study are published this week in the journal Environmental Research Letters.


US shale player Carrizo open to third-country tie-ups
Business Standard
Carrizo Oil & Gas has said it was open to third country tie-ups with its joint venture partners (outside their origin countries) for shale gas production. The US-based shale gas company has partnerships with all big Indian oil & gas companies, including Reliance Industries and state-controlled Oil and Natural Gas Corporation. Carrizo has also forged an alliance with a private Chinese company for exploration in that country. “We see the opportunity to sit down with each of our India partner and try to find potential where we can cooperate in India. The same would be true for investment in third countries,” Gerald A Morton, general counsel and vice-president, business development, told Business Standard. Morton said the company was looking for capital and its Indian partners are among the strongest — financially stable and with good credit ratings. “As an American company, we are relatively small. We have looked at third countries and if we find one where economic return is good, we will always look first towards our joint venture partners.”

Hurrah! The European Union Will Not Be Regulating Fracking For Natural Gas
One of the worries that we over here in Europe have had is that the European Union will decide to regulate the practice of fracking for natural gas. No, this isn’t because we believe (nor that I believe either) that there should be no regulation at all. Rather, because the EU itself is the wrong organisation to be doing the regulating. And there’s two very good reasons for that. Here’s the news that the EU isn’t going to be the regulator: