MDN Launches 2015 Marcellus/Utica Databook – 4th Year!

2015 Databook coversEarlier this week Marcellus Drilling News launched the fourth series of our Marcellus and Utica Shale Databook. The 2015 edition of the Databook, Volume 1, officially launched on Tuesday. Never in our wildest dreams did we think back in 2012 that the Databook would become so popular. We’ve now published three complete series–the 2012, 2013 and 2014 series (3 volumes each, or nine volumes total) and this week begins the fourth series–for 2015. The heart and soul of the Databook is a series of maps–one for every county where permits for drilling have been issued–throughout Pennsylvania, West Virginia and Ohio. The “secret sauce” for the Databook is to visually, through maps and charts (89 of them in this edition), show you who is drilling right now or soon will be–and where they are drilling…
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PA 2014 Impact Fee Disbursement Info: Why Did PUC Delay?

delayedOnce again the Pennsylvania impact fee–the equivalent of a state severance tax on all oil and gas drilling in the state–will bring in an enormous amount of revenue for the state: $223.5 million for calendar year 2014 to be exact. That’s down slightly from the $225.7 million levied in 2013. Yesterday the PA Public Utility Commission (PUC) released the official numbers, a day after state Republicans leaked a draft version of the report. Those rascally Republicans wanted to share the news that the impact fee is doing just fine, thank you very much, and we don’t need Democrat Gov. Tom Wolf’s Marcellus-killing severance tax of 17.3% just to feed the beast (teachers’ unions). Note that drillers are required to pay their impact fee/tax by April 1st. Last year the PUC, under then-Gov. Tom Corbett, released a preliminary report of monies raised and to be distributed on April 4th (see 2013 PA Impact Fee Sets Record: $224.5M, Grand Total Now $630M). This year the PUC, under Gov. Tom Wolf, still hadn’t released the report by early June. Why did the PUC hold back the report this year? It took Republicans leaking the details to force the hand of the PUC into releasing the official numbers. Was the PUC, under Wolf’s newly appointed chairperson Gladys M. Brown, sandbagging for political reasons–to influence the debate on the severance tax by withholding important information? You decide. Below we have a breakdown of the numbers for 2014–who’s getting how much–along with some pretty charts from the PUC…
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PA 2014 Impact Fee Payments: List of Drillers & What They Paid

pickpocketAfter being shamed into it by state Republicans, the Pennsylvania Public Utility Commission (PUC), after delaying it for two months, yesterday released the numbers for the 2014 impact fees–the equivalent of a severance tax on PA’s drillers. The total raised was $223.5 million, to be divvied up between those places where drilling takes place (receiving 60% of the fee) and other boondoggles cooked up by Harrisburg politicians (the other 40%). See today’s companion story on who gets what from the 2014 impact fee (PA 2014 Impact Fee Disbursements: Why Did PUC Delay?). This post concentrates on the drillers themselves and how much money each one contributed to the impact fee pot for 2014. Below are some helpful pie charts from the PUC (including the number of active wells in the most-drilled counties), followed by the entire list of who paid how much…
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WV’s GDP Soars Thanks to Marcellus/Utica Wells & Pipelines

Last year West Virginia’s gross domestic product–the total value of all goods and services produced in the state–increased by 5.1%. Only two other states–Texas and North Dakota–had bigger increases in GDP. What was the reason for the growth? Was it tourism? Nope. The solar and wind industry? Nope. Timber harvesting? Nope. Surely because of coal–WV is a big coal state? Nope. Coal is in decline in the state. You may have guessed by now the reason for WV’s hot GDP growth rate is the Marcellus/Utica industry. With the expansion of drilling, the buildout of “massive” processing plants and yes–the addition of major new pipelines–the state is on a tear economically. So what? Higher GDP equals more investment, more jobs, more prosperity for everyone in the Mountain State…
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Williams Buys Less of Utica East Ohio than Previously Planned

In April MDN told you that Williams would buy out EV Energy Partners 21% share in Utica East Ohio (UEO)–a midstream/pipeline company operating in Ohio (see Williams Buys Out EVEP Interest in Utica East Ohio Midstream for $575M). The original press releases in April, from both Williams and EVEP, clearly state that Williams would buy the entire 21% EVEP share in UEO. But that didn’t happen. Yesterday Williams announced they have closed on an additional 13% from EVEP (not 21%) and for $357 million (not $575 million). The Williams press release says the other 8% share went to the other partner in the venture. You have to read the EVEP press release to learn that the other partner is M3 Midstream, otherwise known as Momentum. Seems a funny thing happened on the way to the forum…
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PA Republicans Hold Firm in Opposing Wolf Severance Tax

Pennsylvania Gov. Tom Wolf continues to face stiff opposition from the public at large, and (more importantly) from Republicans in the PA state legislature. The leadership of both the PA House and Senate have lined up against Wolf’s severance tax, which he claims is 5% but now everybody freely admits is really closer to 17% (see PA Official Admits Wolf Severance Tax Highest in Nation @ 17.3%). The PA budget is due by June 30. Negotiations between Gov. Wolf and the legislature continue. When the two sides meet, the temperature in the room noticeably drops. Wolf is in over his head and apparently doesn’t know it–or won’t admit it. He set an unrealistic expectation with teachers’ unions that he would pay them off for their support by taxing the #$#@ out of the Marcellus industry–transferring the hard-earned money of Marcellus producers to Big Education takers. PA Republicans in the state legislature are the firewall. Let’s hope the firewall holds…
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Anti Drillers Demand DRBC Hold 7 Meetings on PennEast Pipeline

Some 16 so-called “environmental and community” groups (leftist/socialist groups) are calling on the Delaware River Basin Commission (DRBC) to hold seven public hearings on the proposed PennEast Pipeline, a 114-mile pipeline slated to run from the Scranton, PA area to the Trenton, NJ area. Why stop at seven? Why not 10? Or 20? Or 50? Let’s have a public hearing every day of the week! The aim is, of course, to provide free publicity and a forum for anti-drillers to engage in their freak shows. We’ve watched plenty of them at the podium at these kinds of meetings–and yes, it’s a freak show. The DRBC, itself tending to the anti-drilling side of the isle, is trying to interfere with the Federal Energy Regulatory Commission’s (FERC) sole authority to permit or not permit the PennEast. Apparently there’s a bit of detente on the issue and FERC will hold one joint public hearing with the DRBC. The freaks, er, a “environmental groups” are demanding the DRBC up that number to seven–because two minutes allotted for each speaker in front of the microphones and cameras is just not enough…
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ATEX Express Ethane Pipeline Says it’s Tax-Exempt in Ohio

School districts and local governments in 13 Ohio counties along which the ATEX (Appalachia-to-Texas Express) natural gas liquids pipeline runs, are miffed that ATEX doesn’t want to pay property taxes on the pipeline. The 1,230-mile ATEX pipeline originates in Washington County, PA and connects to four fractionators in the Marcellus/Utica Shale region. The pipeline, which crosses 265 miles of Ohio, went online in early 2014 (see Let it Flow! ATEX Ethane Pipeline Testing Now, Online Soon). State law stipulates that only pipelines classified as public utilities are liable for property taxes. Private, non-public utility pipelines are not on the hook for local property taxes. However, ATEX may be liable for Ohio’s commercial activity tax…
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PA Electric Co Spending $6M in Upgrades to Help Mariner East Pipe

Pennsylvania Electric Company (Penelec), a subsidiary of FirstEnergy Corp., is an electric utility that serves 600,000 customers in 31 Pennsylvania counties. Penelec also serves some of the electric needs for the Marcellus/Utica industry in the state. Penelec announced Monday that the company is spending $6 million to construct several new power lines and rebuild several others. Why? To serve natural gas pumping stations being constructed in central Pennsylvania by Sunoco Logistics’ Mariner East pipeline. Penelec is quick to add that the improvements will also “enhance service reliability” for 3,000 customers in the area as well…
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Marcellus Driller MDS Sets up Financial Subsidiary in Denver, CO

A small Marcellus-focused drilling company based in western Pennsylvania is expanding–to Denver, Colorado! But not to drill wells. MDS Energy was established in 2005 by Michael D. Snyder. By 2006 the company offered its first investment partnership. Drilling companies today are as much about investments and finance as they are about sinking holes in the ground. MDS quickly grew and in 2007 founded a sister company to concentrate on oilfield services (drilling, construction, etc.) called First Class Energy. First Class has gone on to drill over 1,000 wells, mostly for MDS competitors since MDS themselves haven’t drilled all that many wells–we count 39 permits in PA, some of which are likely duplicates, issued to MDS Energy from January 2013 through April 2015, according to the newest edition of the Marcellus and Utica Shale Databook just released. In 2011 MDS formed MDS Energy Development, LLC, an investment firm concentrating on oil and gas investments. In order to offer investments as a broker-dealer (able to execute trades for themselves or others), MDS formed the subsidiary MDS Securities, LLC. It is MDS Securities that is expanding and moving its headquarters to Denver…
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