South Fayette, PA Restrictive Drilling Ordinance Tossed by Judge

court-gavel.jpgSomething noteworthy has happened in western Pennsylvania and (so far) local media has chosen not to cover it. So MDN is happy to break the following story about South Fayette Township in Allegheny County (near Pittsburgh). South Fayette is one of seven PA towns that sued the state after the Act 13 law was enacted in 2012 (see Lawsuit Filed: PA Towns Sue State over Marcellus Act 13 Law). Ultimately the towns won their case at the PA Supreme Court level, winning the right to enact their own ordinances with respect to oil and gas drilling. A nutty concept that towns have the necessary skills to regulate a complex industry like oil and gas–but there you go. Range Resources and landowners in the town, including Cuddy Partners, have had a long-running feud with the town over their hyper-restrictive ordinances (see Pittsburgh Post-Gazette article Drilling regulations face challenge in South Fayette). In 2015 South Fayette decided to revise their ordinance yet again with respect to shale drilling, making the ordinance even more restrictive than before. Cuddy Partners and Alpine Partners (landowners in the town) sued over the revised ordinance. The lawsuit alleged the ordinance was improperly enacted–rushed through without proper public notice. Last week Allegheny Court of Common Pleas Judge Joseph James agreed and ruled that the South Fayette revised ordinance is “invalid, null and void”…
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PennEast Responds to Sham NJ Lawsuit Re Surveying w/o Permission

PennEast Pipeline Route Map
PennEast Pipeline Route Map – click image for larger version

A couple of radical anti-fossil fuel groups, aided and abetted by a few landowners (members of said groups) have filed a frivolous lawsuit on Monday in New Jersey Superior Court against PennEast Pipeline claiming surveyors have illegally trespassed on private property to conduct surveys–against the wishes of said radicals, some of whom happen to be landowners in the path of the proposed pipeline. PennEast Pipeline is a $1 billion, 118-mile pipeline project that will run from near Wilkes-Barre, PA to near Trenton, NJ. The two groups behind this latest sleazy lawsuit are Homeowners Against Land Taking – PennEast Inc. (HALT PennEast) and the New Jersey Conservation Foundation. There’s nothing like a good lawsuit to drive more donations. “Help! We’re David and we’re suing Goliath. We need YOUR money.” Pathetic. PennEast has responded that the claims of trespassing to survey are (our words) horse manure. PennEast checks carefully before entering a property to survey. The pipeline company said when they get a copy of the frivolous lawsuit they will mount a vigorous defense. The radicals just may have bitten off more than they can chew this time…
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EQT, Rice Energy Deals Show Price per Acre for Leases Still High

money-bag.jpgYesterday MDN brought you the news that EQT has cut a deal to buy all of Norwegian Statoil’s operated Marcellus assets in West Virginia for $407 million (see EQT Buying 62.5K “Core” WV Marcellus Acres from Statoil for $407M). One of MDN’s favorite energy analysts, Richard Zeits, writing on the Seeking Alpha website, does a close examination of the deal. We have a portion of this thoughts below. As part of Zeits’ deep dive on this deal, he takes a side road and compares how much EQT is paying per acre in this deal with the recently announced Rice Energy deal to purchase the Marcellus assets of bankrupt coal company Alpha Natural Resources (see Rice Energy Offers Bankrupt ANR $200M for Marcellus/Utica Assets). Zeits finds the per-acre price being paid by EQT is less than the Rice deal. But the real eye-opener is that the prices each are paying is still quite high–perhaps an indication that once unleased or expired lease acreage heats up again, prices will remain high…
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Halliburton CEO Talks About Failed BH Merger, Industry Turnaround

David Lesar
David Lesar

Halliburton, the second largest oilfield services company in the world, released its first quarter 2016 update yesterday. Along with it, Halliburton CEO Dave Lesar held court with stock analysts on a ubiquitous quarterly earnings call. Among Lesar’s comments is that he thinks the oil and gas industry is right now beginning to turn more positive. Lesar believes that drilling will begin to pick up again later this year. He also had a number of comments, and questions, about the failed takeover/merger attempt with Baker Hughes (see Obama DOJ Kills Halliburton/Baker Hughes Merger, Deal “Terminated”). We found Lesar’s prepared remarks interesting and thought you would too…
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EXCO Resources 1Q16: Marcellus Production Up w/o New Drilling?

EXCO.jpgEXCO Resources, once a sizable player in the Marcellus–with 145,000 net acres in the Marcellus and having drilled and operating 124 horizontal Marcellus wells–has pretty much abandoned the Marcellus at this point (see EXCO Reaffirms No New Marcellus Drilling in 2016, Capex Cut 69%). Yesterday EXCO issued its first quarter 2016 update. The update shows the company continues to ignore the Marcellus and instead concentrate on other areas. They drilled 5 wells in Louisiana during 1Q16. EXCO did increase production in the Marcellus from 4Q15 (although down from 1Q15, year over year). The reason for more production although they didn’t drill or complete any new wells? They had been shutting in production due to low prices. The prices went up a bit, and EXCO eased off a bit on the shut-in wells, resulting in a slight bump in production. Here are select portions of yesterday’s EXCO update…
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NiSource 1Q16: The Gas & Electric Business is Quite Profitable

NiSource service area
NiSource service area

NiSource and Columbia Pipeline split up last summer (see NiSource/Columbia Pipeline Divorce is Final). Columbia retained the midstream business and is the more active of the two in the Marcellus/Utica Shale. However, NiSource with its Columbia Gas utility business is still an important user of Marcellus/Utica Shale gas–and therefore of interest to us. Yesterday NiSource issued their first quarter 2016 update. Being in the utility business ain’t a bad life. Pretty reliable income, even if it is regulated. In 1Q16 NiSource made $309.5 million before income taxes were paid, compared with $275.4 million in 1Q15 (a 12% increase). Below is the update for NiSource’s natgas and electric utility businesses…
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TransCanada 1Q16: Sets its Sights on the Marcellus/Utica

TransCanadaTransCanada Corporation is Canada’s largest midstream (i.e. pipelines and storage) company. TransCanada is the company that wanted to build out the Keystone XL oil pipeline into the United States, but the Obamadroids squashed it (it would flow nasty, icky oil through it). TransCanada is also making a major play to move into the Marcellus/Utica region by buying out/merging in Columbia Pipeline (see Rumor Comes True: TransCanada Buying Columbia Pipeline for C$13B). What’s happening with the buyout? We learn quite a bit from TransCanada’s first quarter 2016 update, released last Friday…
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Customer Announced for Primus Green Energy’s GTL Methanol Plant

Primus Green EnergyIn March MDN brought you the news that Primus Green Energy, a gas-to-liquids (GTL) technology company announced they would build a 160 metric tons per day (MT/day) methanol plant using the company’s proprietary technology at “a manufacturing site in the Marcellus shale region” in 2017 (see Primus Building GTL Methanol Plant in Marcellus Region in 2017). The plant will convert abundant and cheap Marcellus Shale gas into methanol. At the time we commented that the Primus announcement didn’t say as much as it says–namely, who is the customer for the plant? We now have that answer….
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New Study Proves Shale Gas has Big Impact on Manufacturing Sector

NAM logoEverybody knows, anecdotally, that the shale revolution has been great for U.S. manufacturers. Empty plants have roared back to life and new plants have been built, bringing back millions of jobs, due to the huge quantities of natural gas being extracted from shale in the U.S. Now we have a research study to prove what we already knew anecdotally. Yesterday the National Association of Manufacturers (NAM) released a new research report from IHS titled “Energizing Manufacturing: Natural Gas and Economic Growth” (full copy below). The research finds that shale gas has put an extra $1,337 back in the pockets of the average hard-working American family. Wow! Shale gas has also contributed to the creation of 1.9 million jobs throughout the economy. Double wow! Just building natural gas transmission lines has meant more than 347,000 jobs with 60,000 of those jobs in manufacturing. Here’s the best part: All of it is without a government program or taxpayer expense. Read on for more good news about how the shale revolution and the miracle of fracking has benefited every single American…
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Anti Fossil Fuel Fanatics Kick Off 12 Days of Lawless Acts

anarchyIt seems that anarchy is all the rage these days. In vogue. Popular. At least among the non-thinking radical left. Witness Crazy Bernie Sanders and his mind-numbed robot followers. Also witness the radical environmental movement, which whips up emotions among the enviro faithful like a Pentecostal preacher from the back hills. Many of these environmental Nazis are young and haven’t grown a brain yet. But there’s a fair number who are old hippies, burned out from drug use in the 60s and 70s. A group of these dangerous fanatics have begun what they call 12 days of “breaking free” from fossil fuels–a campaign to force law-abiding companies to abandon certain pipeline and drilling projects. The radicals are calling it “peaceful” and “civil disobedience.” However, going by previous such protests, we expect there will be violence associated with this movement–far from the peaceful veneer they hope to project. A number of the most radical, law-breaking groups are behind the effort: 350.org, Greenpeace, Climate Action Network and others. Here’s some of the lawbreaking they have planned for 12 days beginning yesterday…
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Marcellus & Utica Shale Story Links: Wed, May 4, 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: Still no answers about what caused TETCO pipeline explosion in SWPA; Shell getting ready to move on cracker plant?; Surprise! New England needs more natgas; ETE & Williams give SEC more time to review merger; DOE Sec. Moniz says US will be major LNG player; era of cheap oil & gas just beginning; and more!
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