Williams Sues NY Over Constitution Pipe – DEC May Lose Authority

lawsuitThree cheers for Williams. Hip hip horray! Williams announced yesterday a two-pronged legal challenge against New York State and its decision to deny stream crossing permits for the federally-approved Constitution Pipeline project (see NY Gov. Cuomo Refuses to Grant Permits for Constitution Pipeline). The first prong is a lawsuit filed in the U.S. Circuit Court of Appeals for the Second Circuit–challenging the decision itself as “arbitrary and capricious.” The second prong is a lawsuit filed in the U.S. District Court for the Northern District of New York–seeking recognition by the court that New York doesn’t even have jurisdiction over the project. It is this second case that should have Cuomo, the DEC and the antis VERY worried. If the case goes against them, it means that New York will forever be cut out of decision-making with regard to any FERC-approved projects. Properly so. NY has shown itself to be motivated by politics and not by science and certainly not by common sense. It’s time to remove NY from the equation. Staffers at the state Dept. of Environmental Conservation (DEC) feared this might happen and counseled Cuomo to approve the Constitution project–sage advice he ignored…
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NY Attorney General Asks FERC to Investigate Constitution Pipe

Eric-Schneiderman.jpg
NY AG Eric Scheniderman

Apparently the lawless attorney general of New York State, Eric Schneiderman, suspected Williams would sue the state over the Constitution Pipeline (see today’s lead story). In anticipation of such a lawsuit, last Friday Schneiderman sought to provide the corrupt Gov. Cuomo and his corrupt Dept. of Environmental Conservation (DEC) with political cover by demanding a federal investigation into the Constitution Pipeline. Schneiderman petitioned the Federal Energy Regulatory Commission (FERC) accusing Williams of (gasp) cutting down some trees along the pipeline route before New York’s dictatorial governor granted his “Mother, May I?” permission to do so. The petition/request is a not-so-transparent attempt to smear the Constitution project and deflect attention away from the lawless way in which the state has acted in not allowing this federally-approved project from advancing. In this case the feds trump the state–and that very issue will now play out in court…
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Range Resources Buys Louisiana Driller in Deal Worth $4.4B

Range-MRD combo
Credit: Oil & Gas Journal – Click for larger version

Range Resources, the very first driller in the Marcellus Shale (in 2004) and one of the largest Marcellus drillers, has decided to take advantage of the down market and branch out into another shale play. Yesterday Range announced a deal to buy Memorial Resource Development Corp. (MRD) in a stock swap/debt assumption deal worth $4.4 billion. MRD holds 220,000 acres of leases and drills in the Terryville Field in northern Louisiana. Essentially Range has purchased themselves a Gulf Coast operation which sets them up nicely to export natural gas to Mexico. That’s at least part of the attraction. Perhaps another part of the attraction is that gas from Terryville Field, part of the Cotton Valley Tight Gas formation, is cheaper to drill and in many cases just as productive as shale wells in the Marcellus. At least according to an MRD investor’s presentation (see below). Below is the Range announcement and other associated details to help understand that announcement…
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Williams Announces Open Season for Northeast Supply Enhancement

Transco Northeast Supply Enhanacement Project map
Transco Northeast Supply Enhanacement Project map – click for larger version

Last week MDN brought you the news that Williams has pre-filed an application with the Federal Energy Regulatory Commission for the the Northeast Supply Enhancement project–a project to expand the Transco pipeline to increase pipeline capacity and flows heading into northeastern markets (see Williams Pre-Files with FERC to Expand Tranco Pipeline in PA, NY). Yesterday Williams announced an official, “binding” open season for the project–to sign customers to long-term contracts to use the expanded capacity…
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When Will Drilling Pick Up in the Marcellus/Utica? It Depends…

questionWhat will it take for drillers to begin drilling again? That’s a question getting asked frequently by analysts on quarterly earnings calls with Marcellus/Utica drillers. The short answer is for the price of natural gas to go up and stay up. How high? Here’s some interesting economics from Southwestern Energy CEO Bill Way: every time the price of natural gas increases another quarter ($0.25), it translates into $185 million in cash flow for his company. If the price went up 50 cents, Southwestern would reactivate two drilling rigs. Another key factor in when drillers will start drilling again are DUCs–drilled but uncompleted wells. The DUC inventory is going down–but many drillers still have a year’s worth of DUCs they can leverage before they have to sink new holes…
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EIA May DPR: Utica Production Up, Marcellus Loss Slows

EIAYesterday MDN’s favorite government agency, the U.S. Energy Information Administration (EIA), issued our favorite monthly report–the Drilling Productivity Report (DPR). The DPR is the EIA’s best guess, based on expert data crunchers, as to how much each of the U.S.’s seven major shale plays will produce for both oil and natural gas in the coming month. Our first interesting observation from the May report: The EIA projects that in June (the report is a forecast looking forward) that once again the Utica Shale will be the only play out of the seven major plays that will continue to produce more natural gas than it did the month before. In April the EIA said the Utica would produce 1 million cubic feet per day (Mmcf/d) of natural gas above what it did the month before, and this report says the Utica will produce 4 Mmcf/d more than it did last month. Second interesting observation: Production in the Marcellus Shale, while it continues to produce each month than it did the month before, is slowing down. That is, the rate of decline is slowing, which means we may be getting close to the point when Marcellus production begins to pick up again. Keep a close eye on Marcellus production, because it’s the largest producing shale play in the country…
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Microwaves – Coming to a Well Pad Near You? Maybe!

microwaveWe’ve heard of microwaving popcorn (one of our favorite things to microwave), but we’ve never heard of microwaving “nanoribbons.” We suspect you haven’t either. All’s it takes is a 30-watt microwave to nuke nanoribbons and voila–drillers have a new, cheap and better way to seal up tiny fractures in wellbores. Researchers at Rice University have discovered wellbores drilled to extract oil and gas can be “dramatically reinforced” with a small amount of modified graphene nanoribbons–added to a polymer and microwaved. Think of it as nuking a tiny bit of plastic over a rock and the plastic melts into and firms up the rock. It’s quite possible there will be a microwave coming to a well pad near you!…
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New Pipeline Safety Company Launches in Pittsburgh

Dan Garcia
Dan Garcia

We don’t run every “hey we have new business starting up to service the oil and gas industry” story that’s sent our way. But we do sometimes–especially those that catch our eye and tickle our fancy. Pipeline Compliance Group is one such startup. Dan Garcia, a pipeline safety attorney (we didn’t know there were such things) has started up a new consulting company in Pittsburgh to provide pipeline safety consulting to local governments, regulators and even pipeline operators. We took a look at the website (www.pipelinecgllc.com) and liked what we saw–including the fact that Mr. Garcia is a veteran…
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CO2 Emissions Will Go Up 33% Despite Paris Summit, Obama Bluster

cigarYou may recall a few months back when President Barack Hussein Obama signed the Paris climate treaty, referred to as COP21. As we wrote at the time, the treaty is not binding on the U.S. because it’s not been ratified by the Senate (see Paris Climate Treaty Signed by Obama NOT Binding on U.S.). Nice try O. Close, but no carbon-emitting cigar for you. The treaty aims to force the countries of the world to subjugate themselves and their national sovereignty to the United Nations, who will impose draconian steps to lower the amount of carbon dioxide (the stuff you breathe out with every breath you take) in an idiotic attempt to solve man-made global warming. We know we know, global warming doesn’t exist. But you can’t tell that to people with closed minds. Here’s the thing: Obama’s own executive branch in the form of our favorite government agency–the U.S. Energy Information Administration (EIA)–has just released a report that says even with COP21 the amount of carbon that will be emitted into the atmosphere by 2040 will go up at least one-third! Why? Because the countries outside of the group signing COP21 have absolutely no plans to shoot themselves in the head and will continue to belch out carbon as fast as they can. So yes, COP21 was futile and meaningless…
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Marcellus & Utica Shale Story Links: Tue, May 17, 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: Columbia files app with FERC for Mountaineer, Gulf XPress pipelines; anti-oil protest in Albany rail yard fizzles; court won’t dismiss class action by PA landowners against XTO Energy in royalty case; surviving the slump in natgas industry; Trump appoints ND Congressman as energy advisor; EPA violating Supreme Court; Chesapeake pushes a boulder up a hill; and more!
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