Civil War: Bradford PA Escalates Fight with MSC re Royalty Bill

civil-warYesterday MDN reported that Wilmot Township, located in one of the most-drilled counties in Pennsylvania (Bradford County) has taken the unusual step of demanding that drillers (in particular Chesapeake Energy) stop flowing natural gas from drilled wells unless/until they start paying landowners a minimum 12.5% royalty for the gas produced (see Righteous Royalty Anger: PA Town Votes to Block Gas Production). In August MDN reported that at the county level in Bradford County, the same issue has turned personal and somewhat nasty–with Bradford County Commissioners chairman Doug McLinko (a big pro-gas guy) blaming the Marcellus Shale Coalition and its leader David Spigelmyer for blocking a vote on House Bill (HB) 1391 that would rectify the royalty issue (see PA Landowners, Drillers Fight over HB 1391 Minimum Royalty Bill). McLinko called Spigelmyer a “reverse Robin Hood” last month. The fight continues and now escalates. Today, McLinko and the other commissioners in Bradford are set to vote on hiring a public relations firm to produce several short videos so the county can use those videos in a state and national PR campaign. McLinko says the MSC’s lobbying against royalty reform has cost Bradford County “probably $100 million” and the new campaign aims to get HB 1391, or something like it, passed…
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Dominion Locks Out Union Workers at Compressor Stations/Pipelines

lockoutYesterday MDN reported the story that Dominion Transmission has decided to lock out union members from working at their jobs in Dominion installations over a contract dispute (see Dominion Locks Out Labor Union Workers in WV-PA-OH-NY-VA-MD). We asked the question of whether and how this might affect certain ongoing projects at Dominion. Apparently some of our comments about Dominion “union busting” rankled some MDN subscribers and may have led them to feel as though we’re taking sides in this issue. In this case, we are not taking sides. We are (uncharacteristically) remaining neutral and simply reporting what we observe based on press reports. We have a number of updates today, including comments from Dominion about why they took the action they took, the response from UGWU Local 69, and clips from stories showing that indeed, as we feared, some of the workers locked out are workers at Dominion compressor stations and pipelines. The somewhat hopeful news is that both sides are set to meet today in West Virginia with a federal mediator for more talks on settling the dispute…
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An Answer to “How Much Gas Will My Marcellus Well Produce?”

how-much9/12/16: See an update to this article at the bottom, offered by a major Marcellus/Utica producer.

People always want to know, how much natural gas will the well drilled on my property produce? And tangentially, how much money am I going to make? There are consultants and (very) rough back-of-the-envelope methods for calculating how much a well will produce. However, researchers at the University of Texas at Austin researched the issue, specifically for Marcellus wells, and have made an amazing discovery: The estimated ultimate recovery (EUR) for a Marcellus well can be predicted based on the wells initial production, and the EUR prediction will have “surprising accuracy.” The authors do offer a general, overall average EUR for the over 5,000 wells they analyzed: 3.9 billion cubic feet, or Bcf, of production over the life of the well. But the specific well on your property can only be estimated by looking at its initial production. Here’s some of the highlights from their research…
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FERC Approves Another KM Pipeline Project in the PA Marcellus

approvedIn April 2015 Kinder Morgan’s Tennessee Gas Pipeline (TGP) subsidiary filed an application with the Federal Energy Regulatory Commission (FERC) to build 8.2 miles of new looping pipeline in Tioga County, PA and beef up two compressor stations in Bradford County, PA. The $142 million project is called the Susquehanna West Project. The project will increase capacity along a section of the TGP, bumping it up by 145 million cubic feet per day (Mmcf/d). All of the extra capacity is spoken for by Statoil and the wells they’ve drilled in NEPA. Good news: On Tuesday FERC issued their approval for the project, which means construction will begin in January 2017…
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MarkWest Sues Contractor for Shoddy Work at WV Processing Plant

lawsuitOver the years, MarkWest Energy, now a part of MPLX, has built a number of natural gas processing plants in Wetzel County, WV, collectively called the Mobley plant. In September 2014 MarkWest signed a contract with paving and construction company J.F. Allen to design and build a retaining wall so MarkWest could then build the Mobley V plant (in Smithfield). MarkWest says, in a lawsuit they’ve filed against J.F. Allen and other subcontractors, that they didn’t do the job right and it resulted in long delays and millions of dollars in extra costs for MarkWest. Which MarkWest is now trying to recover, requesting a jury trial…
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OH Anti-Pipeliners Allege Some Letters to FERC were Forged

pot-kettle-blackVirulent anti-fossil fuel nutters who are opposed to Spectra Energy’s $2 billion, 255-mile NEXUS interstate pipeline that will run from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada, have stayed up late at night reading through all of the comments sent to the Federal Energy Regulatory Commission (FERC). The habit of antis is to generate a blizzard of negative comments to FERC on any given project, sometimes using the names of their children (see Delaware Riverkeeper Scams FERC in Review of PennEast Pipeline). The antis say after reading thousands of comments supplied to FERC, they’ve found “maybe 200” that support the pipeline that are suspicious. In one case they said a letter was signed by someone who has been dead since the 1990s. In other words, the antis are alleging fraud–that pro-drillers or even Spectra Energy itself is engaged in fraudulently sending letters of support from people that don’t support the pipeline. Which is kind of funny, since antis themselves are typically the ones who engage in this kind of fraud! We guess it takes one to know one…
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Williams Reorganizes to Focus on NatGas and “Drive Value”

As the World TurnsWilliams continues to tread water as it is under assault by corporate raiders who want to toss out Williams management, fire a bunch a people and sell the company. We’ve chronicled the chaos endlessly (see our Williams stories here). It seems like every day there’s something new in this soap opera. Here’s the latest: Williams announced yesterday the company is streamlining its operations by consolidating what is currently five business units into three units: (1) Atlantic-Gulf, (2) West and (3) Northeast Gathering & Processing. The stated purpose is to “advance a natural gas-focused strategy” and to “drive value.” Here’s the details…
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Musical Chairs at LNGL – New Chairman of the Board as Losses Mount

LNG LimitedFor some time now we’ve been tracking progress with an LNG export plant planned for the eastern shore of Nova Scotia, the Bear Head LNG project. Of all the Canadian LNG export projects that will export Marcellus gas, Bear Head seems to have the most momentum. The project has received most (if not all) of the necessary permits it needs to proceed. The most recent regulatory hurdle was a greenhouse gas approval from Nova Scotia, issued in July (see Bear Head LNG Gets GHG Plan Approval from Nova Scotia). However, there are a few troubling signs. The already-small parent company, LNG Limited, laid off 13 workers in July (see Bear Head LNG Parent Lays off 13 People, “LNG…difficult market”). In August the founder of the company left (see Bear Head LNG Export Plant: Bad News & Good News). We now learn that another member of the board, David Gardner, who was the secretary of the board, has left. Plus the chairman of the board is stepping down (but staying on the board for now). There is a new member of the board appointed to be chairman. At the same time we notice LNGL quietly posted a copy of their financials for the year ending June 30. The company lost A$115,187,000 last year, verses losing A$85,747,000 the year before. Converting to U.S. dollars, LNGL lost $89 million last year and $66 million the year before. Perhaps we now see why there’s been a shake-up on the board?…
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Marcellus & Utica Shale Story Links: Thu, Sep 8, 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: Former PGT Trucking building sold to Shell in Beaver County; Apache strikes it big in Texas Permian; Freeport LNG wants more export capacity; o&g industry still improving according to the Fed; and more!
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