Spectra Energy 2Q16 – Access Northeast “Advancing Toward Execution”

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It sure pays to be in the pipeline business. One of the biggest pipeline (i.e. midstream) companies in the U.S. is Spectra Energy. Spectra has a number of existing and planned pipelines in the Marcellus/Utica region. Yesterday Spectra released their second quarter 2016 update, reporting a net income of $305 million for the quarter. Spectra provided a handy list of the ~$6 billion in expansion projects they have under way. One of those projects is the Access Northeast project–representing half of that $6 billion. Access Northeast is the surviving winner of a contest between Spectra Energy and Kinder Morgan to pipe Marcellus and Utica Shale gas to New England and Canada–the “last man standing” when Kinder and their Northeast Energy Direct project bowed out of the race (see NED is Dead – Kinder Morgan Suspends $3.3B New England Pipeline). With respect to Spectra and their Access Northeast project, Spectra CEO Greg Ebel had said yesterday during an earnings conference call that Access Northeast is “advancing towards execution this year” after recently achieving a “number of noteworthy milestones.” That is indeed good news! Here’s yesterday’s 2Q16 update from Spectra, along with an excerpt about Access Northeast from the earnings call…
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Spectra Energy Expects to Pay ~$100M for Ruptured PA Pipeline

Spectra blazeMDN felt that the big news today was word from Spectra Energy that their Access Northeast pipeline project is making excellent progress (see Spectra Energy 2Q16 – Access Northeast “Advancing Toward Execution”). However, a bit of news coming from Spectra disclosed on yesterday’s earnings call comes in at a close second. You may recall there was an explosion and fire in Spectra Energy’s Texas Eastern Transmission’s “Delmont Line 27” pipeline in May (see Texas Eastern Pipeline Explodes near Pittsburgh, Antis Celebrate). The explosion occurred in Salem Township (Westmoreland County), PA, about 30 miles east of Pittsburgh and knocked out four pipelines running through the same area. One man was seriously burned when his house caught on fire and was destroyed. Since that time we’ve tracked the story with a series of updates (see them here). One of the four lines affected was restored to service shortly after the blast. Our most recent update pegs a return to service for the other three pipelines sometime in November (see Ruptured TETCO Pipeline in PA Offline Until November). Until now, we didn’t have any numbers to talk about with respect to how much it’s costing Spectra to locate and fix the problem. Yesterday Spectra’s Chief Financial Officer, John Patrick Reddy, pegged the cost for investors, saying it could go as high as $100 million…
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CELDF Loses Case to Represent Ecosystem – Turtles Disappointed

Gavel-falling.jpgScore an important victory against the forces of darkness. The radical leftist PA-based group Community Environmental Legal Defense Fund (CELDF) does its best to trick townships into passing illegal bans on fracking and injection wells. In 2013 the CELDF fooled Highland Township in Elk County, PA into passing a ban on wastewater injection wells. They also tricked Grant Township in Indiana County, PA to do the same thing. Both towns are in court defending their illegal actions. One of the idiotic legal tactics used by the CELDF in both cases is to claim that an ecosystem is a “person” under the law–a person who can file to join the town’s lawsuit in an effort to protect itself (see It Speaks! An “Ecosystem” has Filed to Join a Lawsuit in PA). Of course the CELDF appoints itself as the representative of said ecosystem. It’s an asinine notion. Will the tree in my front yard sue me for cutting a branch off it? Will my gravel driveway sue me if I decide to pave it? Get real. Back to declaring victory. Pennsylvania General Energy (PGE) filed a lawsuit against Grant Township for $1 million for blocking construction of PGE’s legally permitted injection well. That CELDF has already said it won’t help Grant taxpayers foot the bill if they lose the lawsuit–after adopting the CELDF’s very own ban language (see Anti Group CELDF Won’t Help Grant Twp Pay $1M Judgement). Last week the Third Circuit Court of Appeals in PA ruled that a so-called ecosystem (the Little Mahoning Watershed) does NOT have standing in the case, completely rejecting the CELDF and their arguments. Grant Township taxpayers should be prepared to open up their wallets, they’re about to get soaked (note that the CELDF has already snuck out of town)…
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15 States File Lawsuits to Block EPA O&G Methane Rule

lawsuitIn May the federal Environmental Protection Agency (EPA) once again far overstepped its charter by seizing power that doesn’t belong to it. They issued new methane rules in a back-door way to try and regulate the oil and gas industry (see EPA Does it Again: Tries to Destroy O&G with New Methane Rule). North Dakota was the first state to sue the EPA over the new standard. Not long after Texas also sued. And last week, another 13 states joined together to sue over the standard–to block it from taking effect. All 15 are now combined into a single case. Below is a list of the states with spine, standing up to the bullies at the EPA, along with the paltry, precious-little reporting we can find about the lawsuit launched last week by a group of 13 states joined, to the lawsuits by ND and TX…
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PA’s Annual Oil and Gas Reports for 2013, 2014 & 2015

PA DEPOn Tuesday MDN brought you what we thought was the very first Annual Oil and Gas Annual Report from the Pennsylvania Dept. of Environmental Protection (see PA Releases 2015 Oil & Gas Annual Report (Very Cool)). In pretty short order we heard from several MDN readers that the DEP’s excellent report was, in fact, started in 2014 under then-Gov. Tom Corbett. We should have known such a useful report would be the creation of a Republican administration. MDN heard from Pat Henderson, formerly PA Gov. Tom Corbett’s Energy Executive and now Director of Regulatory Affairs for the excellent Marcellus Shale Coalition, about the report. The very first report was issued by the DEP in 2014 and covers 2013. Unfortunately the DEP under current Democrat Gov. Tom Wolf removed that report from the DEP website. But Pat kept a copy and sent it to us. Below we have all three Annual Oil and Gas Reports for PA, covering the years 2013, 2014 and 2015 (dated 2014, 2015 and 2016). Thanks Pat!…
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Getting NEPA Gas to Market – Go West, Young Molecule!

go west young manMDN spotted what we thought was an interesting article on the Seeking Alpha investors website about the existing pipeline bottleneck in Northeastern PA and what can be done about getting all of that gas to market. Pipeline delays out of NEPA, including the delayed Constitution Pipeline and projects currently underway but taking a long time, like the Atlantic Sunrise, are forcing producers like Cabot Oil & Gas, Southwestern Energy and Chesapeake Energy to look for other ways to move their abundant supplies of natgas out of the region. Eastbound routes out of NEPA are full, but westbound routes *may* be a possible solution–at least in the short-to-medium term. National Fuel Gas’s pipeline system has expanded recently to allow more gas to flow west. NFG has additional projects in the coming years to build on that capacity. Is it time to Go West, Young Molecule?…
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Rice Energy Adding $65M to Utica Drilling Budget in 2016

Rice EnergyRice Energy, a young company headed by relatively young leaders (the Rice boys), continues to impress with their latest quarterly update, for 2Q16. Net production for Rice hit a record 758 million cubic feet equivalent per day (MMcfe/d), which is a 43% increase over 2Q15 and a 12% increase over 1Q16. As CEO Dan Rice said, “We had a remarkable quarter, marked by several notable achievements, including record-low development costs and lease operating expenses, record-high production and midstream throughput volumes, and we turned to sales a company-record 18 operated wells in April.” Rice continues to focus completely on the Marcellus and Utica region, a “pure play” company. Because they’ve lowered costs, Rice is adding another $65 million to their Utica drilling budget in 2016. Cool. About the only bad news from yesterday’s quarterly update is that the company lost $138.7 million in 2Q16, versus losing $63.5 million in 2Q15. But keep an eye out. The Rice boys are bound to turn the financials around. Here’s the update, with details on what Rice accomplished in both the Marcellus and Utica in 2Q16…
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Noble Energy’s 2Q16 Production in the Marcellus Goes Up 28%

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). Yesterday Noble issued their second quarter 2016 update. We’ve grabbed out the Marcellus update section to share with you below. You’ll see that Marcellus production for Noble went up in 2Q16 by 28% over 2Q15–a nice surprise. You’ll also see that Noble has 79 drilled but uncompleted wells (DUCs) in the Marcellus as part of their joint venture…
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Rhode Island Commies Oppose “Fracked Gas” LNG Plant

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A group of politicians from the Rhode Island Politburo are opposed to a plan by utility giant National Grid to construct a very small facility in the state to liquefy natural gas–turn it into LNG. Eight members of the RI Politburo (all of them socialist Democrats) are calling on the Federal Energy Regulatory Commission (FERC) to reject National Grid’s plan. Why? You guessed it. Because that facility will accept and liquefy evil, vile nasty “fracked gas” from the Marcellus. And EVERYBODY knows that fracked gas is causing catastrophic global warming, right? What a group of dunces. Here’s who they are and what they’re claiming…
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Opposition to PennEast Pipeline Fading Away, Anti Meetings Shrink

ShrinkingWe found this story amusing. A group of 40 anti-fossil fuel nutters met at the Towamensing Township fire hall Tuesday night to “hone their arguments and strategies on how to derail or at least delay construction” of the $1.2 billion PennEast Pipeline. Why is that amusing? Because if the media is reporting there were 40 there, that means there were really 20-25. And when you read the story, you get the distinct impression that a very small group of hardened anti-fossil fuelers move these meetings around–it’s the same small group–and that their movement to stop PennEast is dying. Rapidly. Here’s the latest evidence…
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Marcellus & Utica Shale Story Links: Thu, Aug 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: TransCanada chooses growth over fiscal discipline; Kennametal cutting 1K jobs due to drilling slowdown; crude-by-rail volumes dropping; Magellan merging with Tellurian; AEP industrial sales own on restrained shale development; and more!
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