Partisan Group Wants to Double or Triple WV’s NGL Severance Tax

tax increaseThe partisan (Democrat) West Virginia Center on Budget & Policy, which pretends to be nonpartisan and above the political fray but isn’t, has just published a so-called policy brief titled “A Win-Win Marcellus Shale Tax Incentive” (full copy below). The “brief” attempts to make the case for doubling or tripling the severance tax on natural gas liquids produced in WV (from 5% to 10% or 15%)–giving exemptions to the tax increase for those who keep the NGLs extracted in the state. The recommendation hopes to boost the attractiveness of petrochemical plants like the proposed Odebrecht cracker plant that would use ethane, the primary NGL extracted in WV, by making it more expensive to send WV’s ethane across the border, to say either Shell’s proposed cracker in PA or PTT Global’s proposed cracker in OH. The tone of the “report” is that WV has been raped and pillaged in the past–their precious coal stolen and carted away to other states–and WV can’t let that history repeat itself again. Better to shut down drilling rather than have any of it “exported” to other states. It is misguided and faulty thinking…
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Univ of Michigan Final Report on Fracking: It Can be Done Safely

MI ReportTwo years ago MDN reported on a University of Michigan research project called the Hydraulic Fracturing in Michigan Integrated Assessment (see Univ of Michigan Reports Explore Future of Fracking in MI). The aim of the two-year project is to help guide policy on shale drilling in the state. It actually ended up taking three years, but the final report was just released (full copy embedded below). The report does not advocate for any particular position, pro or anti-fracking. It simply reports findings and, you know, actual science. Let the policy makers use the information to formulate rules and regulations. Michigan, which does contain shale layers, including the Utica, that may one day be commercially tapped, stands in stark contrast to New York where politics got involved and corrupted the process. In Michigan the science determines the outcomes–but sadly, not in New York. The Michigan study shows that with strict environmental regulations, fracking can be done safely…
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OH Commission Sides with ODNR Boss to Keep Injection Well Closed

yes manUPDATE: This is slightly old news–from August. The article we quoted from was run yesterday, but the events actually happened in August. We understand that the case has now been appealed to Common Pleas Court.

The Ohio Oil and Gas Commission, the five-member advisory council that’s part of the Ohio Dept. of Natural Resources (ODNR) set up to hear appeals from any person claiming to be aggrieved or adversely affected by an order issued by the ODNR’s oil & gas division, upheld a decision by the ODNR to suspend operations at a Trumbull County injection well. The injection well is owned by American Water Management Services and following low-level earthquake a year ago, the ODNR’s Rick Simmers shut two injection wells down (see ODNR Temporarily Shuts Down Injection Wells After Low-Level Quake). Since that time, the ODNR allowed one of the two to reopen, but not the other (see ODNR Clears Trumbull Co. Injection Well in August Quake). The ODNR continues to “investigate” (i.e. drag its feet) so finally AWMS got tired and appealed the decision to the body that hears such appeals. Although supposedly independent, the Oil and Gas Commission works for the ODNR, so it’s no surprise they supported the ODNR in their decision to keep the second well closed…
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OH Legislators Will Miss Promised Oct 1 Frack Tax Deadline

past dueLast week MDN told you that Ohio’s RINO legislators continue to work on raising the Utica Shale severance tax in the state “behind closed doors” (see Ohio Legislators Continue Dalliance with Kasich Severance Tax). Those same legislators had previously said that a “study committee” working on a compromise proposal would have that proposal done by October 1. They’re now saying they won’t meet that deadline. We suppose any deadline on raising taxes that slips is good–but the fact remains they’re still hard at work trying to raise taxes on an industry reeling from low prices and laying down rigs left and right. An update on the latest coming from the frack tax hacks…
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Columbia Pipeline’s Mountaineer XPress Project Accepted by FERC

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Columbia Pipeline Mountaineer XPress Project Map – click for larger version

Columbia Pipeline’s Mountaineer XPress Project (MXP) includes approximately 165 miles of new pipeline from Marshall County, WV to Wayne County, WV with approximately 2.7 billion cubic feet per day (Bcf/d) of transportation capacity from existing and future points of receipt along or near CPG’s system (see our previous Mountaineer XPress stories here). In addition to new pipeline, the $2 billion project also includes constructing three new compressor stations and upgrading three existing stations. Columbia announced yesterday that the Federal Energy Regulatory Commission (FERC) has accepted Columbia’s “pre-filing” application for the project. Columbia will file the formal/full application next April and if all goes well, they plan to begin construction in the fall of 2017…
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Negative WSJ Article Causes CONSOL’s Stock to Slide, CEO Responds

short sellingIt’s strange, but true. Sometimes a single article that quotes a single financial expert/leader can dramatically affect a company’s stock price. Such is the case with CONSOL Energy. Last week an article in the Wall Street Journal quoted a hedge fund manager (investor playing with big piles of money) who said, in essence, he continues to bet that CONSOL’s stock will continue to drop in value, called a “short position” (for background on understanding short selling, see our article “Short Selling” – An Important Signal for Marcellus-Related Companies). The hedge fund manager accuses CONSOL of being driven by “financial engineering.” Since that news broke last week, CONSOL’s stock has gone down 16%. CONSOL CEO Nick DeIuliis, in an interview with the Pittsburgh Business Times, explains why the hedge fund manager is wrong about his company and its future prospects…
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Gulfport Energy Makes $35K in Education Grants in 4 Ohio Counties

education grantsGulfport Energy recently announced they have awarded $35,000 in grants for 10 projects in four Ohio counties, including projects benefiting local citizens in Guernsey and Belmont counties (Utica Shale country). The grants in varying amounts were given to schools, labor unions and colleges–for educational programs. One of the grants, for $5,000, will be used to purchase Google Chromebooks for 150 middle school students. Google’s Chrome OS is the official operating system for MDN (we LOVE it). Nice to see Gulfport blessing local schools and organizations in the regions where they operate…
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Oilfield Services Weatherford Flip Flops on Stock/Note Offering

nevermindWeatherford International is the fourth largest oilfield services company in the world, employing some 44,000 people. They have a branch office in Canonsburg, PA (Pittsburgh area) with major operations in the Marcellus/Utica. By comparison, Weatherford competitor Halliburton is the #2 largest oilfield services company in the world. A strange thing happened to Weatherford on Monday. The public company floated new shares of stock and new IOUs (i.e., convertible notes) hoping to raise $1 billion in cash. But a few hours after they announced the offering, they withdrew it because “while investor interest was strong for this offering” (so said the company), the price those investors were willing to pay for the new stock and notes was not anywhere near what Weatherford wanted. After withdrawing the offering, Weatherford’s stock tanked. Last Thursday Weatherford’s stock (WFT) traded as high as $11.15 per share. Yesterday it closed at $8.87 per share, down 20% from Thursday’s high…
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US Govt Report Shows Economies in Shale Regions are Expanding

gdp_metro0915MDN spotted an interesting report released yesterday by the U.S. Dept. of Commerce’s Bureau of Economic Analysis. The report evaluates the change in GDP by metropolitan areas across the county. What the heck is GDP? It is gross domestic product (GDP), one of the primary indicators used to gauge the health of a region’s economy. GDP represents the total dollar value of all goods and services produced over a specific time period. Think of it as the size of the economy in a given metropolitan (or state or country) region. What is interesting about the report to MDN is that it mentions shale energy and the Marcellus in particular as one reasons why certain areas of the country expanded. When you look at the map (below) we want you to note two things: (1) Most of the metro areas/regions in upstate NY are shrinking, rapidly; and (2) those areas in northeast and southwest PA, eastern OH and northern WV that have Marcellus/Utica drilling are expanding, rapidly. It is no accident. The Marcellus/Utica is a huge economic engine…
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Marcellus & Utica Shale Story Links: Thu, Sep 24, 2015

best of the restThe “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: job cuts continue in the Marcellus; NY town mulls supporting waterless fracking; NY energy prices go down thx to shale; MA energy prices go down thx to shale; secretive Rogersville Shale; Hillary disses XL pipeline; Leo DiCaprio dissess all fossil fuels; many myths about fracking; Obama enviro policies making blacks poorer; OPEC says they’re winning against US shale; and more!
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