2 New Shale Layers in Eastern Ohio “Good Candidates” for Drilling

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A new report has just been issued by the Ohio Dept. of Natural Resources (ODNR) Division of Geological Survey. The report is titled “Mapping Source Rock and Thermal Maturity of the Devonian Shale Interval in Eastern Ohio” (full copy embedded below). The report, with lots of helpful maps, takes a close look at the Devonian Shale layer, which is composed of a number of sub-layers. The report concludes that two of those sub-layers–the Huron Shale and Rhinestreet Shale–have “significant oil and gas potential and may be good candidates for modern-day horizontal drilling techniques.” Cool! Beyond the Utica/Point Pleasant and the Marcellus, it appears that there are now other very promising layers in eastern Ohio–enough shale oil and gas to keep Ohio drillers busy for the next 100 years and more…
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Preliminary Guess on TETCO Pipeline Explosion Cause: Corrosion

Spectra blazeThere was an explosion and fire in Spectra Energy’s Texas Eastern Transmission’s (TETCO) “Delmont Line 27” pipeline last Friday (see Texas Eastern Pipeline Explodes near Pittsburgh, Antis Celebrate). The explosion occurred in Salem Township in Westmoreland County, PA, about 30 miles east of Pittsburgh. Although the cause of the explosion is still not known for sure, investigators do have a working theory–corrosion along welded seams in the pipeline. Investigators from the U.S Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) still say, officially, that the cause is “unknown” and the investigation “ongoing.” However, those same investigators have said they found evidence of corrosion and they’ve ordered another section of the pipeline in the area to be dug up, removed, and sent for analysis. Here’s the latest on the situation, along with an estimate of when service might be returned on this very important pipeline…
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Shell Says PA Cracker Decision Coming < 12 Months - Looking Good

Shell.jpgThe muckety-mucks from Shell held their quarterly earnings phone call with analysts yesterday–and there is what we consider big news to report coming from that call. In response to a question from an analyst, Shell’s Chief Financial Officer, Simon Henry, commented there are four major “chemicals” projects currently under consideration by Shell. He also said a decision on the PA cracker plant project planned in Beaver County will likely be the first decision to be made because of “the timing of certain commitments that are already in place.” He added these glowing words about the PA cracker: “It’s an excellent project…[that] provides quite some portfolio resilience relative to the rest of the opportunities.” He later said “It’s a very strong and robust project.” If the price of oil were higher than the current $40, pulling the trigger on the PA cracker would be “a very easy decision.” When you read his comments, it’s hard to miss the enthusiasm at the highest echelons inside Shell…
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PTT Global Says OH Cracker Decision “Delayed” Until 2017

PTT Global logoIt’s only been one year since Thailand-based PTT Global Chemical announced they are interested in building a $5 billion ethane cracker plant complex in Belmont County, OH (see It’s Official: Belmont County Chosen as POSSIBLE Cracker Plant Site). Since that time PTT has been busy, spending (by our estimates) at least $150 million on the project (see our list of PTT stories here). However, from the very beginning, PTT let it be known a final decision on whether or not to invest the whole $5 billion would not come until 2016 or 2017. We know have confirmation from PTT that the final decision will (disappointingly) come in 2017. The reason for the “delay” in the decision? Falling oil prices…
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Patterson-UTI Rig Count for April Hits Another New Low

chart going downAs we do every month, MDN tracks how many rigs oilfield services company Patterson-UTI Energy reports operating–as a proxy for when/if the drop in rig counts for the Marcellus/Utica will turn around. Patterson operates a number of rigs in the northeast, as well as other areas of the continental United States (and Canada). Month by month Paterson’s rig count has declined over the past year plus. April was no different. Patterson reports operating an average of 56 rigs in April, versus 64 in March–a big 12.5% drop and a new low. Once again we ask, how low can it go? Below is our running Patterson-UTI rig count chart that shows the sad story…
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TransCanada to Refile FTC Merger Notification in Columbia Deal

TransCanadaIn March MDN reported that Canadian midstream giant TransCanada wants a bigger piece of the Marcellus/Utica midstream (i.e. pipeline) pie and has decided to buy Columbia Pipeline Group for $10 billion (see TransCanada Makes Play to Buy Columbia Pipeline for $10B). Columbia Pipeline shareholders are due to vote on the deal in June (see Columbia Pipeline Shareholders to Vote on TransCanada Deal June 22). But what’s this? Apparently there’s been a small bump on the road to a happy union. TransCanada announced yesterday they have withdraw their pre-merger notification with the U.S. Federal Trade Commission (FTC) and will refile the notification again on May 6 (tomorrow). Why? To restart the clock for FTC regulators who are reviewing the deal. Apparently there is a 30-day period at the end of which the FTC must render an opinion. Sometimes big, complex deals like this one take longer than 30 days, so a common practice is to pull the notification and re-file to buy the FTC more time…
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Rice Energy 1Q16: Prod. Up 53%; Drilled 19 New Wells; Lost $21M

Rice EnergyRice Energy, one of the newest and brightest drillers in the Marcellus/Utica, released their first quarter 2016 update yesterday. The company reports production averaged 675 million cubic feet equivalent per day (Mmcfe/d) during 1Q16, a 53% increase over 1Q15 (and up 8% from 4Q15). On the financial side the company lost $21 million during 1Q16, versus making $152,000 in 1Q15. Pretty mild compared to most. During 1Q16 Rice drilled 11 new Marcellus wells and 8 new Utica wells. Good to see someone is still drilling! Here’s the update, along with a great PowerPoint slide deck…
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Eclipse Res. 1Q16: Drills Longest Shale Well Ever! “Purple Hayes”

Eclipse_logo_hiresEclipse Resources released their first quarter 2016 update yesterday. Although Eclipse, a Marcellus/Utica pure play driller headquartered in State College, PA (but drilling mostly in Ohio), has curtailed or shut-in some of it’s production given low prices for gas, they still posted an impressive 26% increase in production in 1Q16 over 1Q15. While we’ve heard of Prince and his “Purple Rain,” we hadn’t heard of Eclipse’s “Purple Hayes”–which is a Utica well with an underground lateral reaching out 18,500 feet–3.5 miles! During 1Q16 Eclipse drilled their Purple Hayes well in under 18 days. Amazing! Even more amazing–the well was completed with 124 frac stages. It is believed to be the longest onshore later well ever drilled. Kudos to Eclipse! On the downside, the company lost $41 million in 1Q16…
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Marcellus & Utica Shale Story Links: Thu, May 5, 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: The well runs dry for the little guy; BLM finds “no significant impact” in WNF from o&g leasing; Vallourec posts big loss; Hilcorp pad still shut down for earthquake investigation; Baker Hughes evolving; future of U.S. shale is…Mexico?; how is natgas stored?; Trump to keynote Bakken event; and more!
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