Dominion Brunswick NatGas-Fired Plant Begins Electric Generation

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Brunswick County Power Station – click for larger image

The newest member of Dominion’s power generation fleet, the 1,358 megawatt, natural gas-fired Brunswick Power Station (Brunswick County, Virginia) began producing electricity for customers on Monday, April 25. The station produces enough electricity to power 325,000 homes. The power plant will eventually be fed by Marcellus Shale gas coming from Dominion’s own $5 billion, 550-mile Atlantic Coast Pipeline. But right now it uses at least some Marcellus/Utica gas coming from the Williams Transco pipeline. Last September Williams completed and put into service the Virginia Southside Expansion project to feed this power plant (see Williams Completes $300M Pipeline Expansion in Virginia on Time). As we pointed out at the time, Williams has upgraded parts of the Transco in New Jersey and Pennsylvania in order to make the Transco bidirectional–pushing Marcellus/Utica gas southward. A plethora of these new plants in the region is an important new source of demand for abundant, clean-burning Marcellus/Utica Shale gas. Here’s the details about the latest clean energy plant from Dominion going online earlier this week…
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CONSOL Energy 1Q16: Record NatGas Production, Record Financial Loss

CONSOL EnergyCONSOL Energy, once up a time a coal company that is now a natural gas driller, issued its first quarter 2016 update yesterday. CONSOL lost $97.6 million in 1Q16, nearly half of it coming from the Bailey Mine coal complex in southwestern PA. Another $29.3 million of the loss came from commodity derivative investments. And $12.6 million of the loss came from the sale of a gathering pipeline. Revenue was $558.5 million in 1Q16, down 30% from 1Q15. Natural gas revenue dropped 19% in 1Q16 while coal revenue fell 40%. On the positive side of the ledger, CONSOL’s natural gas production hit a new record high of 97.5 billion cubic feet equivalent (Bcfe), and CONSOL’s banks reaffirmed the company’s $2 billion borrowing base. Here’s the update…
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CONSOL Call: We’re Now a NatGas Co.; Where They Drill Next; More!

CONSOL EnergyAlong with a first quarter update, yesterday CONSOL Energy’s top management held a quarterly analyst conference call. The call was loaded (and we mean LOADED) with useful information. As soon as CONSOL CEO Nick DeIuliis started speaking and sharing his prepared remarks, he noted that CONSOL is now, officially, no longer a coal company–but instead is an exploration and production (E&P) company (i.e. natural gas driller) who happens to own one last coal mine. DeIuliis said the natgas division now provides 71% of CONSOL’s revenue, and that “CONSOL is now an E&P company with essentially one remaining coal complex.” Although they’re a Marcellus/Utica driller, CONSOL hasn’t been drilling since the middle of last year. When will they restart? The jury is still out. The company wants to wait another 3-6 months to see how the market shakes out. However, they know where they will restart drilling when it happens: Monroe County, OH and Westmoreland County, PA. Also discussed on the call: CONSOL believes the NEXUS pipeline will get built; details on CONSOL’s use of “plugless completions”; how much CONSOL pays to drill a Utica well now, and how much they predict it will drop in the next year or two; and CONSOL’s crystal ball with respect to an ethane cracker plant. Buckle up!…
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Constitution, Other NE Pipeline Delays – Blessing in Disguise?

good news bad newsMDN is certainly not of this opinion, but we spotted a Reuters article that quotes several natural gas market analysts who say recent announcements of pipeline delays may boost natgas prices–and that’s a good thing. Of course being a good thing is in the eye of the beholder. Pipeline delays in the Marcellus/Utica–like the Constitution Pipeline–mean (a) lack of takeaway means natural gas prices in the Marcellus/Utica region will continue to be the lowest in the country, which means (b) drilling in the Marcellus/Utica will continue to slow and won’t restart any time soon, consequently (c) that will lead to less production, and so (d) less supply in the northeast will mean prices for natural gas, and things that natgas produces (i.e. electricity) will go higher in places like New York City and New England. Whether that’s all good news or bad news depends on your point of view…
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Ouch: Halliburton Axed ~200 Jobs in Lycoming County Last Friday

cutting jobsJust a few years ago Halliburton, the second largest oilfield services company in the world, employed 600 people in its operation center located in Lycoming County, PA. Today? There are 40 working there. Some 200 of Halliburton’s Lycoming employees were laid off last Friday. Lycoming County is relatively rural with the city of Williamsport as its county seat. Losing 560 jobs, 200 of them in one go, is a huge blow to the area. We grieve with those who have lost their jobs–and with their families who depended on those jobs…
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EQT, APP Challenge Rice Energy’s $200M Bid for ANR Shale Assets

auction-gavel.jpgTwo weeks ago MDN told you that Rice Energy had offered a “stalking horse” bid of $200 million for the shale assets of now-bankrupt coal company Alpha Natural Resources (see Rice Energy Offers Bankrupt ANR $200M for Marcellus/Utica Assets). ANR and Rice were joint venture partners for other shale acreage. Rice previously bought ANR out in that deal. So Rice and ANR are already buds. It appears part of the process in making a so-called stalking horse bid involves certain conditions and assurances (and payouts should someone else bid more). It’s all complicated financial stuff, not our specialty. But EQT and American Petroleum Partners (APP), two other Marcellus/Utica drillers, are also interested in ANR’s assets and apparently willing to bid at least as much as Rice. But because of these special conditions, bidding $200 million will cost them more than it will for Rice. So EQT and APP complained to the bankruptcy judge that Rice Energy is getting a sweetheart deal from ANR–a deal that should be canceled. The bankruptcy judge disagreed…
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FirstEnergy Installs $92M Electric Line in WV for Shale Industry

FirstEnergy
FirstEnergy building new electric line in WV – click for larger image

FirstEnergy is one of the nation’s largest investor-owned electric systems, serving customers in Ohio, Pennsylvania, New Jersey, West Virginia, Maryland and New York. FirstEnergy loves the shale industry. We told you in December 2014 that FirstEnergy was planning to invest $100 million in new electric transmission projects to service the growing Marcellus and Utica Shale industry in WV (see FirstEnergy Investing $100M in Electric Projects for WV Marcellus). Good news: FirstEnergy’s construction crews have begun erecting steel poles for a new 18-mile high voltage power line that will run through Harrison and Doddridge counties in WV. The new power line will help power both processing plants and compressor stations that flow Marcellus and Utica Shale gas…
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Penn Twp Blocks Apex Energy Well Pad Request, What Next?

Penn TwpHow do you prove a negative? You can’t. But that’s the (illegal) demand Penn Township (near Pittsburgh) is placing on Apex Energy. Penn Township’s zoning board has denied Apex permits to begin building a well pad for an eventual nine wells–wells that are fully permitted and permissioned by the PA Dept. of Environmental Protection (DEP). The Penn Township ordinance “states that drillers have to prove that the drilling site won’t violate Penn Township citizens’ rights to clean air and water.” Apex provided air and water studies showing possible risks from accidental spills, etc.–along with how they will prevent such things from happening. But the zoning board was tone deaf and rejected it. So what’s next? We’ve seen this movie before. Last year a group of anti-drillers took Apex to court to stop drilling on two wells, with the town backing them. Apex’s lawyers roared that the company was losing $70K per day by not drilling, threatening to sue. The town backed down, and Apex drilled the wells…
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U.S. Natural Gas Production Dipped by 1 Bcf/d in March

Bentek EnergyIn February the natural gas industry in the Lower 48 States made history by hitting record high production (see US NatGas Production Hits Record High in February – 73.3 Bcf/d). What about March? Bentek Energy, the energy analytics divison of Platts, has just issued its estimate of production for March. The country slipped, losing about 1 billion cubic feet per day in production. Although all of the major shale-producing basins contributed, Platts analysts say it was mostly 50/50–about 50% of the decrease came from less production in the Marcellus/Utica, and the other 50% from Texas…
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Carl Icahn Protege Gets Burned from Meddling in ETE/Williams Deal

Mini-MeWe knew that corporate raider Carl Icahn’s protege, Keith “Mini-Me” Meister, had been meddling in Williams since 2013 (see Bad News: Corporate Raiders Take Aim at Williams and Evil Corporate Raiders Double Investment (& Control) in Williams). What we didn’t know, until now, is that Mini-Me Meister was the puppet-master behind Williams’ decision to cave and accept Energy Transfer Equity’s “indecent proposal” (see Williams Accepts ETE’s “Indecent Proposal” – Price Went Down $10B). It seems that Mini-Me Meister doesn’t have quite the same touch that Godfather Carl does, because the ETE/Williams deal is falling apart and Mini-Me Meister has gotten burned on his investment in Williams. He’s lost a LOT of money…
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Marcellus & Utica Shale Story Links: Wed, Apr 27, 2016

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: Appeals court hears NEXUS pipeline case; Dimock verdict “aberrant result”; why do researchers hide good news about fracking?; PHMSA schedules hearings on LNG regs; Schlumberger’s new tech may be competitive threat; E&P capex spending plunges again; and more!
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