April 2016 Rig Counts Continue to Slide in World, US, Marc/Utica

chart going downThe rig count–both internationally and domestically here in the U.S.–continues its historic slide. Last Friday Baker Hughes announced the average rig count numbers for April. Rigs operating outside the U.S. slide another 39, from 985 in March to 946 in April. In the U.S., the count slide 41 from 478 in March to 437 in April. In the Marcellus/Utica, the count was down another 2–both rigs lost came in Pennsylvania, which now has the lowest count in decades: just 16 rigs operating in the state. Ohio and West Virginia held constant month over month with 11 rigs operating in the Buckeye State and 12 rigs operating in the Mountain State. Here’s the sad news of the continuing decline in rig counts…
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Spectra Energy 1Q16: Access Northeast Pipeline Not Like NED

Spectra Energy logoLast week midstream giant Spectra Energy provided their first quarter 2016 update, complete with earnings/analyst phone call. The official update (below) contains a number of project updates for major pipeline projects planned or under construction in the Marcellus/Utica region. The earnings phone call with analysts provided a lot of extra color commentary on the project updates. We’ve brought you both below. One thing that stood out to MDN as we read through it: Spectra makes it clear that their Access Northeast project, a competitor to the now defunct Kinder Morgan Northeast Energy Direct (NED) project, is not like NED. There are major differences that Spectra Energy credits with what they predict will be the success of their project where the NED project failed. Not only is there an update for Access Northeast, but also updates for NEXUS, AIM, Atlantic Bridge, and others below…
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What Can We Learn from Spectra’s Success with Pipeline Projects?

Spectra Energy logoWith pipeline projects like Kinder Morgan’s Northeast Energy Direct (NED) deciding to call it quits (see NED is Dead – Kinder Morgan Suspends $3.3B New England Pipeline), and projects like the Constitution Pipeline that runs through New York State on life support (see NY Gov. Cuomo Refuses to Grant Permits for Constitution Pipeline), you have to ask an honest question: What pipeline projects can and do get approved and built? There’s one company that seems to enjoy more success than others when it comes to getting new projects built–Spectra Energy. Kinder’s NED was arguably the superior project when it comes to getting natural gas to New England, yet Spectra’s competing Access Northeast project seems to have won. Why? What can we learn from Spectra that might help the rest of the industry when it comes to getting projects built?…
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PA Democrat Senator Calls for Frack Ban in Lake Erie Watershed

PA State Sen. Sean Wiley

Yet another Pennsylvania Democrat in the state legislature is calling for a frack ban. What is it about PA Dems and their allergies to fossil fuels? This time the pandering Dem is State Sen. Sean Wiley–and he’s calling for a ban on fracking in the Lake Erie watershed of western PA. His reasoning for illegally seizing the property rights of his constituents is really kind of funny. He says there should be a ban until we “see what are the risks associated with unconventional drilling.” Even though PA has been using unconventional drilling (i.e. horizontal drilling with hydraulic fracturing) in the Marcellus Shale since 2004. Apparently 13 years of intense drilling in the Keystone State is still not enough for Sen. Wiley to know what the risks associated with such drilling are. Either Wiley is lying, or he’s a dope. We doubt he’s a dope…
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EIA: Explosion on Texas Eastern Pipeline in PA Cuts Natgas Flow

TETCO Pipeline – click for larger version

As we have been reporting, Spectra Energy’s Texas Eastern Transmission Company (TETCO) pipeline exploded in Westmoreland County, PA on April 29 (see our stories here). Prior to the explosion there was an average of 1.4 billion cubic feet of natural gas per day flowing through the Delmont compressor station located near the explosion. Right now? Zero. So far the main affect of no gas flowing through that area has been a price spike in the Mid-Atlantic region. Natgas supplies are being handled by other pipelines and by drawing from storage. The U.S. Energy Information Administration weighed in last week with their analysis of how the TETCO explosion has impacted the northeast–both with physical gas supplies and with price for that gas. Here’s how the industry is coping…
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Bank Wipes Out Marcellus Welder’s Bank Accounts “Without Warning”

BB&TBe careful who you bank with. That’s the lesson from welding/fabricating company NuWeld Inc., headquartered in Williamsport, PA, NuWeld does a lot of business with the oil and gas industry, and lately that industry has been in decline in the Keystone State. The decline led to NuWeld’s bank, BB&T, getting skittish. BB&T, according to NuWeld, cleaned out their bank accounts. Took all of the money in them–and without money, NuWeld had to lay off all 150 employees. Apparently the money was the bank’s to take–but the reason they took it (cold feet instead of unpaid bills), is what grates. And the way they took it, without any warning, really grates. Here’s the story of “be careful who you bank with”…
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Noble Energy 1Q16: Still Active in the Marcellus, Compl. 25 Wells

Noble Energy logoNoble Energy, a driller with a significant presence in the Marcellus but with a bigger presence in other shale plays, (and operations in other countries and offshore), announced in February that of the four shale plays they operate in onshore in the U.S.–the DJ Basin, Eagle Ford, Delaware and Marcellus–in 2016 they plan to focus on the first three and scale back in the Marcellus, limiting their Marcellus activity to completing previously drilled wells (see Noble Energy Loses $2.4B in 2015; Marcellus Scale-Back in 2016). Last week Noble issued its first quarter 2016 update. We are, of course, most interested in their Marcellus activity. Noble reports, true to their word, that although they didn’t drill any new wells, they did complete 25 wells and production in the Marcellus spiked up 46% in 1Q16 over the same quarter in 2015…
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Carrizo O&G 1Q16: Still Not Active in the Marcellus, Prod. Down

Carrizo logoCarrizo Oil & Gas, a Houston-based driller, actively drills in the Eagle Ford Shale in South Texas, the Delaware Basin in West Texas, the Niobrara Formation in Colorado, and until mid-year in 2015, they did have an active drilling program in the Ohio Utica and Pennsylvania Marcellus. No more. They haven’t drilled in Appalachia since 3Q15, and according to their 2015 year-in-review udpate, they won’t be drilling in the Marcellus/Utica in 2016 (see Carrizo O&G 2015: Loses $1.2B, Stops Drilling in Northeast). Not only that, they have curtained (shut-in) some of their Marcellus/Utica production. Last week Carrizo issued their first quarter 2016 update and it shows the company is doing what it said it would: no new drilling or completions in 2016, production even in the Utica where it gets better prices, and production is down in the Marcellus because they’re curtailing production where prices are poor…
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Williams 1Q16: Lost $65M; Constitution, Atlantic Sunrise Updates

Williams logoLast week midstream giant Williams issued its first quarter 2016 update. The company reported a net loss of $65 million in 1Q16, compared to making $70 million in 1Q15. The company said the difference was because of higher interest expenses and due to a change in internal accounting practices–not because of lost business. Along with the update Williams’ top brass held an analyst/earnings call. Notably on the call they refused to take any questions dealing with the impending merger/takeover by Energy Transfer Equity (ETE). Williams has sued ETE over that plan and apparently Williams’ lawyers put the fear of God into management that they could not talk about the case or the merger during the phone call–which is disappointing given that ETE did talk about it on their call (see ETE CEO Kelsey Warren Says Williams Merger “Can’t Close”). Below is the update and select portions of the phone call with updates on a number of northeastern pipeline projects, including the Constitution Pipeline, Atlantic Sunrise, and others…
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Gulfport 1Q16: Lost $242M; Utica Production Nears 700 Mmcf/d

Gulfport logGulfport Energy, a sizable driller in the Utica Shale, lost a lot of money last year (see Gulfport Energy 2015: $1.2 Billion Loss, Most of it in 4Q15). Gulfport issued its first quarter 2016 update last week. Although Gulfport’s Utica production is up, averaging close to 700 million cubic feet per day, the company lost another $242 million in 1Q16. Ouch. Interesting factoid: Gulfport has drilled a total of 244 Utica wells in Ohio–the second most wells after Chesapeake Energy. Although Gulfport also owns wells in Louisiana, most of its production comes from the Ohio Utica. Gulfport drilled 10 new Utica wells in Ohio in 1Q16 and brought 15 wells online. Here’s the 1Q16 update from Gulfport Energy…
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Dissertation on How Big Green Manipulates People, Secret til 2018

secret-meeting.jpgMDN noticed an announcement for the publication of a new dissertation by a student in the masters degree program at the University of Vermont. The title of the student’s dissertation is, “Influence of Mission, Audience, and Policy Context on Issue Framing: A Case Study of Mobilization Against Hydraulic Fracturing in the Marcellus Shale.” When you dig into the abstract (i.e. summary) of the dissertation, it appears the student did research on a number of anti-drilling Big Green groups in the Marcellus/Utica and the techniques they use to manipulate public opinion. Sort of a look at how the Joseph Goebbels of our day do propaganda. We thought, “Hey, this is great! Somebody will finally lay bare how these incestuously-funded Big Green groups lie to and manipulate public opinion!” We tried to download the paper and promptly found that it won’t be available to the public for download until April 2018–two years from now. What’s up with that?…
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Marcellus & Utica Shale Story Links: Mon, May 9, 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: Borealis to import Marcellus/Utica ethane later this year; Rice Energy expands midstream footprint; Congressman calls out Gov. Cuomo over Constitution Pipeline refusal; Pittsburgh engineering firm tied to shale files for bankruptcy; Cali going coal-free; Obama doesn’t mind windmills killing bald eagles; and more!
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