Cabot to Double PA Gas Production by 2019 – Without Constitution

with-or-without-youIt’s no secret that Marcellus and Utica drillers need new pipelines–and they need those pipelines urgently. Especially in Pennsylvania where lack of pipelines is keeping inventories high and prices for natural gas the lowest in the country. However, drillers must deal with reality as it is–today. Pipelines take time to build, and recent efforts to block pipelines are delaying important projects like the Constitution and PennEast pipeline projects. The good news is that some pipeline projects *are* being built in the northeast, some of which are almost done. Drillers like Range Resources are ramping up new drilling now, about six months in advance of when new pipelines are due to go online. That’s about how long it takes to put the pieces in motion. The other good news is that some drillers, like Cabot, are finding new markets that DON’T require new pipelines–like selling a tremendous volume of natgas to new gas-fired electric generating plants situated in close proximity to Cabot’s wells. Here’s an update on which drillers are picking up the pace with the prospect of new pipelines (or new nearby markets), and which drillers are waiting a little longer before they pick up the pace…
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The Secret to CONSOL Energy & Rice Energy’s Record Production

secret to successWhile many drillers across the U.S. have cut their gas drilling programs back to the bare bone, even temporarily halting new drilling, two Marcellus/Utica drillers didn’t get the memo. CONSOL Energy and Rice Energy continued to break new records for natural gas production through the first six months of this year. Even though CONSOL and Rice may spend less and drill less than they previously did, natgas production from both companies continues to increase–due to new strategies, new efficiencies, and smart people. Here’s a peak behind the curtain at what CONSOL and Rice, both currently focused on the Utica Shale, are doing to boost production…
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Williams Appoints 3 New Board Members, Confounds Corp Raider

As the World TurnsIf you’ve read MDN for any length of time, you already know of the ongoing soap opera of corporate raiders attempting to pressure Williams, a huge pipeline company in the northeast (and in the rest of the country) into selling itself to Energy Transfer Equity–a deal that fell apart in June (see Dead as a Doornail: ETE Terminates Merger with Williams). You also know that one of the corporate raiders (Carl Icahn protege) Keith “Mini-Me” Meister tried to force Williams CEO Alan Armstrong to resign, and when that didn’t happen, Meister and five others quit the board of directors in a huff (see Half of Williams Board, Including 2 Corporate Raiders, Quit). The raiders’ sole purpose in forcing Armstrong out is to force a new sale to a different company, Enterprise Products Partners (see Here We Go Again: Enterprise Products Wants to Buy Williams). Williams isn’t having it and announced earlier this month they were on the hunt to replace three of the six losers who quit the board with bona fide/qualified/independent board members (see Williams to Appoint 3 New Board Members, Replace Raiders Who Quit). Last week Mini-Me Meister launched a proxy war to elect himself and nine other of his lackeys to the Williams board (see Corvex Raider Launches Hostile Takeover Attempt of Williams). Good news: Williams has confounded Meister by naming three new board members. Each of them comes with stellar qualifications to help guide the company into the future WITHOUT selling itself to line the pockets of corporate raiders…
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Drill Cuttings Used to Build New Road in Lycoming County, PA

drill cuttingsImagine this: a backhoe sinks its bucket into the ground, scoops out some dirt, and the dirt is used to build a road. No big deal. Now imagine this, a very long drill goes down into the earth and digs out dirt. Because the dirt comes from deep down, some of it may be mixed with minerals not found near the surface, so a company processes the deep down dirt to remove any extra minerals, and the dirt is then essentially the same chemical composition as the dirt from near the surface–and it’s used to build a road. The dirt from deep down is called drill cuttings. Environmental Nazis repeat the magical incantation, “It’s been fracked!” and therefore they begin to hyperventilate that “fracked waste” is being used to build a road. Our example illustrates antis’ intellectual dishonesty about what drill cuttings are. When we spotted a story that a private hunting club in Lycoming County (Williamsport area) in PA will build a new road using processed drill cuttings, and the spin job done by the anti-drilling shills at the taxpayer-funded PBS StateImpact Pennsylvania, we had to laugh…
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Taxation of Oil and Gas Reserves in Ohio Changing in 2016

tax revenueListen up Ohio landowners and drillers: there are important new changes coming in the way oil and gas reserves are taxed, starting THIS YEAR. One such change: tax bills will now only be issued to producers (i.e. drillers) and NOT to royalty interest holders (i.e. landowners). Therefore drillers will be responsible to collecting taxes owed by landowners. The new changes will “significantly change how the ad valorem tax is collected” and because of the changes, it will be “very important” for drillers to accurately report production volumes to the Ohio Dept. of Natural Resources (ODNR). Here’s a rundown of the changes from the legal beagles at top energy law firm Vorys…
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EPA Shale Wastewater Rule Will Crush PA’s Conventional Drillers

regulationIn June MDN reported on yet another new unlegislated law (called a “rule”) issued by the rogue federal Environmental Protection Agency (EPA) that bans the disposal of wastewater from oil and gas drilling via public wastewater/sewage treatment plants (see EPA Bans Disposal of Frack Wastewater at Public Sewer Plants). The rule is meant to ban wastewater coming from unconventional (shale) wells, and not conventionally drilled oil and gas wells, which are shallow wells compared to shale wells. However, conventional drillers in Pennsylvania are raising the alarm that the way the rule is written, it will prevent them from disposing their shallow (and much lower volumes of) wastewater by carting it to the local sewage treatment plant–as many of them do now. The upshot is that the EPA needs to revise its rule…
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PA House Holds Hearing on Regulations for Conventional Drilling

conventional-v-unconventional-gas-drilling.jpgRecently a group of 12 Pennsylvania state representatives held a hearing in Armstrong County, PA on the topic of separate regulations for PA’s small conventional vs large shale drillers. You may recall that new drilling rules from the state Dept. of Environmental Protection (DEP) have been approved for shale drillers, called Article 78a, but not for conventional drillers, called Article 78 (see New PA Drilling Regs Closer to Reality, Questions Remain). PA’s conventional drillers say regs for shale drillers are far too strict for small conventional drillers and will drive them out of business. Radical environmental groups, like PennFuture, actually want that outcome, mouthing platitudes that super-strict regulations “may hurt some businesses but create opportunities for others”–so it all balances out in their ethereal pretend world. Here’s some of the comments from the recent House Majority Policy Committee hearing held in Armstrong County…
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PDC Energy’s Head Turned by Another Pretty Shale Play

PDC Energy logoPDC Energy, a driller in the Wattenberg Field in Colorado and the Utica in Ohio, paused their Utica drilling program in 2015 (see PDC Energy Pushes Pause Button on OH Utica Drilling for 2015). In December the company announced they would restart Utica drilling in 2016 with plans to drill five wells (see PDC Energy to Restart OH Drilling in 2016, Drilling 5 Utica Wells). Earlier this month, PDC released their second quarter 2016 update. There are a few mentions of the Utica in the update. It appears the Utica program is once again up and running. In fact, one of the Utica wells they’ve drilled, the PDC “Neff” well, has come online earlier than expected and began producing in 2Q16 (see PDC Energy 2Q16: Utica Program Active Again, Neff Well Online). However, another shale play has turned the head of PDC–the Delaware Basin in Texas. Last week PDC announced it has purchased two drillers in the Delaware for $1.5 billion. Does that mean PDC will give up on the Utica?…
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Duke Univ Shamed, Withdraws $10M Claim Against McClendon Estate

blowbackDuke University, as MDN has chronicled, has a long history of pumping out faux research that bashes fracking and fossil fuels, “research” that’s bought-and-paid-for by the Park Foundation, one of Duke’s major contributors (see What’s Missing in Latest Duke “Radioactive” Study? Real Science; Yet Another Duke University Study Smears the Marcellus Industry; Duke Hit Piece on Shale Water Usage from Same Park-Sponsored Prof; Duke U Study: Property Values Drop When Marcellus Drilling Begins; and Latest Case of Duke U Bought & Paid “Research” by Park Foundation). Higher education is a cesspool of such sponsored junk science. However, another Duke financial contributor (and alum) was Aubrey McClendon, who had personally contributed tens of millions of dollars over the years to the school. Before his death, Aubrey had committed to contributing nearly $10 million more to the school. As you know, Aubrey died in a fiery crash in March (see Stunned: Former Chesapeake CEO Aubrey McClendon Dies in Car Crash). So what did Duke U do? They filed a claim against the McClendon estate for the money Aubrey had promised before his death. Talk about gall. Once their sleazy move was exposed to the light of day, the university withdrew its claim with a feeble excuse and apology…
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Marcellus & Utica Shale Story Links: Tue, Aug 30, 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 amazing Marcellus (& Permian); Cuomo’s crony solar project going down; rig count in PA highest since March; DEP appoints new regional director for NWPA; Duke-Piedmont deal almost done; natural gas recovery; fight ISIS by fracking; o&g states struggle with taxes during downturn; and more!
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