Sunoco LP Wins Major Court Decision for Mariner East 2 Pipeline

Gavel-falling.jpgSeems like Sunoco Logistics Partners has been fighting in court for years to get the right to use eminent domain for it’s Mariner East 2 pipeline project. ME2 is a $2.5 billion, 350-mile natural gas liquids (NGL) pipeline that will run from eastern Ohio through the state of Pennsylvania to the Marcus Hook refinery near Philadelphia–carting ethane, butane and propane to the facility from both the Utica and Marcellus region, where it will be separated and sent on its way to destinations both domestic and international. Because the project technically crosses a state line, opponents have tried to state PA is not the proper government body to oversee it–it should come under the exclusive oversight of the federal government. However, Sunoco LP has maintained from the beginning that it is a public utility, properly regulated by the PA Public Utility Commission (PUC) and not the Federal Energy Regulatory Commission (FERC). The PUC has recognized Sunoco LP and its Mariner pipeline projects as public utilities, with the right to use eminent domain to condemn properties of holdout landowners in PA (see Major Milestone: PA PUC Rules Mariner East IS a Public Utility). However, the PUC’s authority and ME2’s right to use eminent domain was challenged in state Common Pleas Court in Cumberland County, which ruled in favor of Sunoco (see PA Judge Rejects Landowners’ Challenge to Mariner East 2 Pipeline). The judge’s ruling was appealed and now PA’s Commonwealth Court has also ruled in favor of Sunoco LP, saying that Mariner East 2 is regulated by both the PUC and FERC, and it has the right to use eminent domain…
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Antero Resources Picks Up Another 13K Marcellus Acres for $108M

antero resourcesYesterday Antero Resources, one of the largest Marcellus/Utica drillers, issued an operations (not financial) update for second quarter 2016. The big news in the update is that they’ve picked up another 13,000 net Marcellus acres, and with it 3 million cubic feet per day of production, for $108 million. This is related to Antero’s purchase of 55,000 acres from Southwestern that we reported in June (see Antero Takes Southwestern to Cleaners in Deal for 55K Marc. Acres). As we reported at the time, Southwestern had previously paid Chesapeake Energy $12,000 per acre for that same land (see Southwestern Paid Chesapeake $12K/Acre for Land Signed @ $5/Acre). Antero picked up the acreage for $8181 per acre–about $4K/acre (one-third) less than what Southwestern paid for it. Apparently there was an option in the deal Antero signed with Southwestern that Southwestern has the right to sell an additional 13,000 acres, which they’ve now done. If you do the math, Antero paid $8,307 for the new acreage–still a steal compared to what Southwestern originally paid for it. You’ll notice in the announcement below that Antero calls Southwestern “a third party.” Not sure why they don’t name them, but we love naming names on MDN…
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Gulfport Production Up 40% in 2Q16 over 2Q15, Down 4% from 1Q16

Gulfport logGulfport Energy, a driller in Ohio’s Utica Shale, reported their second quarter 2016 operations (not financial) update yesterday. Among the tidbits we pick up from the announcement: Production for Gulfport during 2Q16 was 664.7 million cubic feet equivalent per day (MMcfe/d), or 2/3 of a billion cubic feet per day (Bcf/d). Production during the quarter was up 40% over the same quarter last year, but was down 4% from 1Q16. Gulfport received an average of $1.44 per thousand cubic feet (Mcf) for it’s production during the quarter. Here’s the update…
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PA Independent Fiscal Office Predicts Impact Fee Revenue for 2016

IFO logoIn the past we’ve been pretty critical of the Pennsylvania Independent Fiscal Office (IFO). It claims to provide revenue projections for use in the state budget process along with “impartial and timely analysis of fiscal, economic and budgetary issues to assist Commonwealth residents and the General Assembly in their evaluation of policy decisions.” It’s been our observation the IFO is populated with partisan Democrats. However, we have to acknowledge their prediction of impact fee revenue from 2015 was spot on. Earlier this year the IFO predicted that when the dust had settled, the impact fee would generate $185.5 million (see “Independent” Fiscal Office Says PA Impact Fee Revenue Drops 17%). When the state Public Utility Commission (PUC) finally reported the actual numbers, it turned out to be $188 million (see PA PUC Releases Impact Fee Numbers: Revenue Down $36M in 2015). The IFO is back with predictions for what impact fee revenue may look like for 2016 (full copy of their report below). The IFO gives several scenarios and predicts a further slide in 2016 revenue–anywhere from $5 million less to $56 million less, depending on the scenario…
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Barnesville Reservoir Back Online Following Wastewater Accident

barnesville ohioThis is somewhat old news, but still news for MDN as we’re just learning about it. You may recall back in March MDN reported on a truck crash that resulted in a spill of 5,000 or so gallons of frack wastewater from Utica drilling, some of which ended up in the Barnesville Reservoir #1 (see Truck Crash Spills 5000 Gal. of Brine into OH Reservoir). The wastewater was thought to have very low levels of radiation, so out of a superabundance of caution, Barnesville (in Belmont County) immediately turned off the spigot from Reservoir #1, which isn’t a problem because the town has two other reservoirs from which to draw water. In May, after two months of testing, the village turned the spigot back on…
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Two Major NJ Business Groups Join Chorus Supporting PennEast Pipe

PennEast in NJ
PennEast in NJ

Nearly every major business and labor organization in New Jersey is now on record supporting the much-needed PennEast Pipeline Project. Yesterday two more business groups, on opposite sides of the state, joined the chorus calling for PennEast to get built. The Meadowlands Regional Chamber of Commerce and the Southern New Jersey Development Council, collectively representing hundreds of businesses and thousands of employees, have endorsed the PennEast Pipeline Project. Here’s what they had to say…
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EIA Says NatGas-Fired PowerGen to Reach New Record High in 2016

EIAThe U.S. Energy Information Administration (EIA), our favorite government organization, is out with a prediction that natural gas-fired electric generation will hit a new record high in 2016 over 2015–delivering an average of 3.8 million megawatts of electricity each and every day. That’s up 4% in 2016 over 2015–if the numbers hold. Natgas had played second fiddle to coal generated power plants, but that all changed in April 2015 when natgas, for the first time, surpassed coal generation. Here’s the latest exciting news from the EIA that natgas is ascending…
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Iberdrola, Sierra Clubbers Booed at PA Windmill Hearing

Iberdrola windmill

We have nothing against wind energy–except that it’s produced by huge, ugly turbines that permanently scar the landscape with their presence, and they kill gazillions of bats and birds (including Bald Eagles) each year, and they are LOUD, with a constant wump, wump, wump 24/7/365. Compare that to natural gas. A few months after a natgas well is drilled and connected to a pipeline, you can’t even see the well from 200 feet away. A few years after the pipeline is in the ground, you can’t tell where it is! Everything grows back over top of it. The pipeline, and well, are literally out of sight and out of mind. Not so with windmills. They are a constant, unwelcome presence for many. Which explains why a room full of Pennsylvania residents (more than 300) packed a recent zoning hearing near Allentown, PA to express their opposition to Big Wind company Iberdrola’s plan to install 37 of these monsters on Penn Forest Township land. Iberdrola is a Spanish-based energy and utility company that makes billions of dollars each year from our federal government in return for installing these intrusive monsters. The Sierra Club is Iberdrola’s publicity whore (receiving money from Iberdrola). Both Iberdrola and the Sierra Clubber rep at the recent zoning meeting were, literally, booed out of the room. You won’t read that in the New York Times…
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NatGas Trading Volume Goes Up in 2015, Reverses 4-Year Slide

Cornerstone-ResearchThe amount of natural gas that gets produced, and the amount that actually gets traded (bought and sold) are two different numbers. Don’t try to figure out–just accept it on faith. The companies that buy and sell (i.e. trade) natural gas are required to file “Form 552” with the Federal Energy Regulatory Commission (FERC) once each year, to inform FERC of the volume of gas they’ve traded. Form 552 says right on it that its purpose is: “FERC Form No. 552 collects transactional information from natural gas market participants. The filing of this information is necessary to provide information regarding physical natural gas transactions that use an index and transactions that contribute to, or may contribute to gas price indices.” Cornerstone Research, an economic and financial consulting company, does a yearly deep dive into all of those Form 552 filings, producing a report of their findings (full copy of the report below). What did Cornerstone find from the 552 filings for 2015? The big news is that the volume of gas traded in 2015 went up 4% over 2014. It’s big news because the the volume of gas traded has gone down each year since 2011. Here’s what else they found…
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Marcellus & Utica Shale Story Links: Fri, Jul 15, 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: Cracker plant brings potential to NE OH plastics companies; OH Utica well permits resume decline; corrected University of Cincinnati study shows cancer risk exaggerated by 725,000%; Columbia Gas’ new training site in PA; keep-it-in-the-ground idiots planting fake poop around Philly; meaningless fractivity; depleted crews, idled rigs a problem for shale; and more!
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