Marcellus & Utica Shale Story Links: Fri, Aug 8, 2014
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:
‘Time in New England’ – Resolving the Gas Vs. Hydro Debate
The New England states and ISO-New England, which manages the region’s electric grid, are taking steps to keep the lights on during polar vortex events until new natural gas pipeline capacity through New England comes online. They also are making progress on an effort to have electric customers pay to help support new pipeline capacity developed specifically to serve gas-fired units. But while new gas-fired generation is being built in the region to replace older coal (and nuclear) capacity being retired, gas’s role in New England electricity production may well be stymied by a push to import large amounts of eastern Canadian hydroelectric power. Today we examine how New England is playing gas against hydro, and how the outlook for gas consumption by generators may be less bullish than some think.
Central Ohio Adds Stations Dispensing Compressed Natural Gas
A North Side fueling station has nine pumps and not a drop of gasoline. The station, opened on Tuesday by Columbus city government, dispenses compressed natural gas, or CNG. Another CNG station near Hilliard officially opened the same day. The stations, which bring the total to eight in the Columbus metro area, are part of an effort to encourage drivers to adopt a fuel that powers a tiny share of vehicles. The early adopters are almost all businesses and local governments.
Antero to ship Ohio natural gas to Louisiana to become LNG
Akron (OH) Beacon Journal
Colorado-based Antero Resources has agreed to sell a portion of its Utica shale natural gas for foreign export from the Gulf Coast. The company intends to sell up to 200 million cubic feet per day to Texas-based Cheniere Energy Inc. to be turned into liquified natural gas for shipment by tankers to overseas destinations. The gas will be shipped from Ohio via pipelines to the Sabine Pass Liquefaction LLC and its plant in Louisiana’s Cameron Parish. The volume being turned into LNG will increase as the plant grows.
The Marcellus Shale Boom: Boosting Wages by 36 Percent
National Center for Policy Analysis
A report from the Bureau of Labor and Statistics identifies the impact that natural gas production has had on Pennsylvania. While overall employment in Pennsylvania dropped by 1.3 percent from 2007 to 2012, employment in the oil and gas industry rose by 259 percent (an increase of 15,114 jobs). Similarly, average annual wages increased by 11.9 percent ($5,158) in Pennsylvania over the 2007 to 2012 period. But in the oil and gas industry, wages rose by 36.3 percent ($22,104).
Here’s How the Marcellus Shale Industry Gave Me a Second Career
Harrisburg (PA) Patriot-News
I was retired at age 49. After service in the military and a career as an Electronic Quality Engineer, I was pleased to be working independently at what I enjoy most, small construction projects. I was living comfortably while doing work for friends and community members. But then came the economic collapse of 2008, and like so many Americans, my fortune – quite literally – changed. Overnight I lost much of what I’d saved for my future and I needed to return to work. It’s a familiar story. After time away, the job market I found was quite different from the one I’d left behind.
Shale Gas Area Home Values Grow: Tourist Area Values Fall
Natural Gas Now/Tom Shepstone
Fractivists speculate shale gas development lowers home values, but the evidence keeps coming showing the opposite. Relying only on tourism is the problem. A regular reader of NaturalGasNOW.org, an individual who is keen on monitoring economic trends, passed along an interesting chart to me yesterday morning. It’s from an extremely informative website called City-Data.com (check it out) and depicts a disturbing trend in our own area of Wayne County, Pennsylvania, which is one of three well-known Pocono counties where tourism has long been an economic mainstay. Home values are in free fall.
Must-Know: Cabot Oil & Gas Compared to Its Peers
Market Realist/Yahoo! Finance
Cabot Oil & Gas’ (COG) closest competitors include Southwestern Energy (SWN), Range Resources (RRC), and EQT Corporation (EQT). EQT is the largest company in the group by market capitalization and enterprise value (or EV). Market cap for EQT is ~$15 billion and EV is $18 billion.
Fewer Restrictions in New Hydrofracking Draft Ordinance
Bristol (VA) WCYB News
The Washington County Board of Supervisors has decided to throw out an ordinance that would allow hydraulic fracturing in the county. They’re not giving up on the idea and are creating a new ordinance that’s less restrictive. The county’s original ordinance determined where hydrofracking could take place in the county and included regulations such as water testing and ways to reduce light pollution. The Board decided Tuesday night to abandon that ordinance, passed along to them from the Planning Commission. “[We] felt that we did not need to over-regulate what was already being regulated by the state, federal regulatory agencies,” said Bill Gibson, a member of the Board of Supervisors. The Virginia Department of Mines, Minerals and Energy currently regulates the hydrofracking process.
Unconventional Energy, New Technologies Give Halliburton The Edge
Halliburton (HAL) is a stock that is known for its long-term value. Over the past 24 months HAL has witnessed a 138% surge, jumping up to the current $69 mark from $29. Unconventional energy sources have been the vanguard of the company’s growth over this two-year period, and with the company incorporating new technologies to facilitate both customers and investors, HAL increasingly seems like the stock to back, if you’re eying long-term returns. Unconventional energy segment – tight gas and complex gas, shale gas and oil, heavy oil and coal bed methane – would be pivotal for the company. Growth from the unconventional segment and the use of HAL’s services in Permian, Marcellus and DH basins, among other places, has been crucial in driving the stock northwards. Now with the latest technology ensuring environmental friendliness, HAL’s customers are experiencing wells that excel both in productivity and reliability.
PwC Reports Surge in Oil, Gas M&A Activity in Q2’14
Oil and gas companies looking to consolidate their portfolios led to a spree of high-dollar M&A activity in the second quarter of 2014, PricewaterhouseCoopers said in a report released July 31. According to PwC, there were 54 oil and gas deals with values greater than $50 million during the quarter, totaling $42.2 billion. That was up 15% from the 47 deals in both the second quarter of 2013 and the first quarter of this year. But, as PwC U.S. Energy Sector Deals Leader Doug Meier noted, the value of the deals skyrocketed 131% from $18.3 billion in the first quarter.
Is EPA Looking To Delay Major Texas Natural Gas Terminal?
The Environmental Protection Agency sent a letter to federal energy regulators charging that their environmental review of a liquefied natural gas export terminal in Corpus Christi, Texas was “insufficient.” EPA Region 6 says that the Federal Energy Regulatory Commission’s environmental review of Cheniere Energy’s proposed Corpus Christi liquefied natural gas export terminal does not “contain enough information to fully consider environmental justice, wetlands, indirect effects and greenhouse gas emissions.”
Energy Sector To Finally Achieve Free Cash Flow
Free cash flow in the North American energy sector is about to soar, and that trend should continue for the next 5-10 years—even with declining oil and gas prices—says US brokerage firm Raymond James (RJ). For investors, it could (should?) mean higher multiples as energy producers turn into more sustainable cash flow machines. The heart of RJ’s argument – outlined in a July 14 “Energy Brief” – is that the massive overspending by producers on new land plays is almost over, and production costs have stabilized. At the same time, oil and gas production per well is increasing–sometimes dramatically. Stable costs and higher production. The result? A new era of positive, free cash flow that should last several years.
Needed Pipelines for Utica, Marcellus Gas are Couple Years Away
Bloomberg/Akron Beacon Journal
It could take a “couple of years” to build enough pipelines to handle surging natural gas production from the Marcellus and Utica shale formations, the chief executive officer of Spectra Energy Corp. said. Spectra, which owns 22,000 miles (35,400 kilometers) of oil and gas pipes, is rushing to alleviate a glut that has helped depress profits for drillers unable to get their product to market, CEO Greg Ebel said today in a phone interview. Lack of pipeline capacity to New England should have the region “very concerned” about a repeat of shortages last winter that drove up prices for gas and propane, Ebel said after the Houston-based company announced quarterly earnings.