Alpha Natural Res. Expands in Marcellus, Drilling Begins in 30d

Aaannnd, we're backCoal company Alpha Natural Resources is expanding their operation in the Marcellus Shale natural gas business. Yesterday Alpha announced its wholly-owned subsidiary, Pennsylvania Services Corporation (PSC), has purchased back a 50% interest in its natural gas exploration and production joint venture, Pennsylvania Land Resources Holding Company (PLR) from joint venture partner EDF Trading Resources (EDFTR) for $126 million. Alpha’s PSC subsidiary now becomes the the sole owner and operator of the PLR joint venture (which is no longer joint). Lots of acronyms of subsidiaries owning subsidiaries! Bottom line: Alpha can now control and expand a highly economic natural gas development program with 25,000+ net acres AND associated infrastructure–in the Marcellus Shale. Alpha’s EVP Brian Sullivan says they plan to begin drilling in their Marcellus acreage position (in Greene County, PA) in the next 30 days…
Continue reading

Dominion to Build Electric Plant in S VA Powered by Marcellus Gas

Dominion, a large utility and midstream (i.e. pipeline) company operating in 13 states, including the Marcellus/Utica region, yesterday filed a request with the Virginia State Corporate Commission (SCC) to build a $1.3 billion state-of-the-art natural gas-fired electric generating station in Greensville County, VA. The new power station will generate 1,600 megawatts–enough electricity to power 400,000 homes. Greensville County sits along the southern border of Virginia–sharing a border with North Carolina. Oh, and guess which pipeline flowing boatloads of cheap, abundant, clean-burning Marcellus Shale gas is due to cross right through the middle of Greensville County? Yep–Dominion’s 550-mile, $5 billion Atlantic Coast Pipeline project that will run from West Virginia through to North Carolina…
Continue reading

PA Court Decision: Leases Don’t Go on Pause When Landowners Sue

Put on your hip boots, we have some deep waters to wade through with respect to an important court decision in Pennsylvania that affects landowners and drillers. Last October MDN told you about an important lawsuit that went to the Pennsylvania Supreme Court, a case called Harrison v Cabot Oil & Gas (see Important Landowner/Driller Case Heads to PA Supreme Court). In brief, Susquehanna County, PA landowners Wayne and Mary Harrison signed a lease with Cabot Oil & Gas for $100 per acre and 12.5% royalties in 2010. Learning that others in their area got better deals and feeling they were not only hoodwinked but pressured into signing, they sued Cabot halfway through the lease (before any drilling was done) to dissolve the lease. Ultimately that lawsuit was decided in favor of Cabot. But by the time the lawsuit was done and dusted, the original 5-year term had expired without Cabot drilling. The Harrisons claimed since Cabot hadn’t drilled, the lease is now over with. Cabot said the lease went on “pause” when the Harrison’s sued–you can’t very well drill with an active lawsuit. This “lease on pause” case was appealed all the way to the Supreme Court in PA, and in February the Supreme Court ruled that just because there is ongoing litigation, Cabot didn’t have the presumption that the lease was paused (see Cabot O&G Loses PA Supreme Court Case to Extend Lease). That is, Cabot lost the case. But it was referred back to the Third Circuit Court of Appeals for more work before a final final ruling. We now have that final final ruling…
Continue reading

Shell Greenlights Offshore Platform – Good Sign for PA Cracker?

reading tea leavesTime, once again, to haul out the tea leaves to see if there’s anything we can divine from an announcement yesterday by Shell that they’ve made a “final investment decision” (or FID) to move forward with a multi-billion dollar project to build a new deep-water offshore drilling platform in the Gulf of Mexico. What in the world does that have to do with the Marcellus/Utica? Good question! Let us read the tea leaves and connect some dots for you…
Continue reading

Guest Post: The Political Disaster that is Gov. Wolf’s PA Severance Tax Proposal

MDN friend Charlie Schliebs, managing director of Stone Pier Capital Advisors in Pittsburgh, sent along a copy of his firm’s latest newsletter yesterday. In it, Charlie has penned a superb article about the PA Gov. Tom Wolf administration’s current disaster with respect to the state budget (and Wolf’s demand for a high severance tax). As MDN reported yesterday, Wolf did something no governor has done for 40 years–he vetoed the entire budget (see PA’s Partisan Gov Wolf Vetoes No-Severance-Tax State Budget). Let’s put Wolf’s veto in perspective. He turned down, wholesale, a balanced budget that raises education funding (for the chil’ren) all while holding the line on tax increases. Instead, Wolf chose to shut down the PA state government. Why? Because he wants a nosebleed high tax on Marcellus Shale drillers to transfer their hard-earned money over to teachers’ unions. It’s sick. Charlie is more of a diplomat than we are and uses nicer words, but make no mistake, he has an iron fist in his velvet editorial glove when it comes to “The Political Disaster that is Gov. Wolf’s PA Severance Tax Proposal”…
Continue reading

Athens County Asks Gov Kasich & ODNR to Stop New Injection Wells

Athens County, OH Commissioners have just passed a resolution calling for a ban on new injection wells in the county. The resolution has zero force and no weight of law–it’s not a legal document and if it were, it would be illegal. Only the Ohio Dept. of Natural Resources (ODNR) can decide whether or not to issue permits for Class II injection wells in Ohio. Local municipalities have no say in the matter. But that doesn’t stop the nutters in Athens County from mouthing off (the thing they do best). Here’s their latest haughty communication requesting the Governor and the ODNR immediately and indefinitely refrain from issuing any more injection well permits not only in the People’s Socialist Paradise of Athens County, OH, but throughout the entire state of Ohio as well…
Continue reading

NiSource/Columbia Pipeline Divorce is Final

The NiSource/Columbia Pipeline Group are now officially divorced. Well, they call it a “separation,” but it’s really a divorce. Amicable, but permanent. Last September MDN brought you the news that NiSource, owner of Columbia Gas, would be spinning Columbia off into its own company in 2015 (see NiSource Splits in Two: Columbia Pipeline Will be Separate Company). NiSource the utility will remain focused on being a utility, and Columbia Gas will be spun off into it’s own company called Columbia Pipeline Group (CPG) under a master limited partnership (MLP) structure. As of yesterday the divorce is final and the two companies have gone their separate ways…
Continue reading

Ohio Chamber of Commerce Endorses NEXUS Gas Pipeline Project

People in Ohio continue to choose sides in the debate over whether to build the NEXUS Gas Transmission pipeline, a $1.5-$2.0 billion natural gas pipeline that will carry Utica and Marcellus Shale gas spanning 11 counties in Ohio, 3 counties in Michigan, and eventually connect to the Dawn Energy Hub in Canada. NEXUS is a joint venture between Detroit-based DTE Energy and Houston-based Spectra Energy. Plenty of wackos have come out of the woodwork to oppose it (see Medina County, OH Antis Trot Out Home Rule Ballot Measure and NEXUS Pipeline Files Draft Reports w/FERC, Rejects CORNy Re-Route). Plenty of people have also endorsed the project. The latest power-house group to endorse the NEXUS is the Ohio Chamber of Commerce. The Chamber points out the NEXUS project will not only be a super stimulant for Ohio’s economy and create jobs, it will also save consumers money on their gas and electric bills…
Continue reading

Fossil Fuels Will Continue to Rule for Next 50-100 Years

Let’s disabuse ourselves of the fantasy that so-called renewable energy sources will, in our lifetimes, provide most of our energy needs. Ain’t gonna happen. And not because “we don’t have the political will” or “big oil is stopping it” or any of those malarkey utterings from so-called environmentalists who behave and think on a kindergarten level. Fact: Right now, today, if you lump together wind, solar, geothermal and biomass into the “renewable energy” category, all of them together provide an astounding, astonishing, hugeoriffic…5% of our energy needs in this country. Evil, nasty fossil fuels? They provide 80%+ of our energy needs–and it’s been that way for more than 100 years. So says the U.S. Energy Information Administration, a division of the Dept. of Energy, which belongs to the executive branch, which belongs to Barack Hussein Obama…
Continue reading