Time to Start Prosecuting Towns that Pass Illegal Frack Bans?

indictmentAs a general rule and principle, local control over decisions that affect an entire community is a good thing. Our great country as founded gives precedence to individual freedom. However, what do you do when two neighbors disagree on an important, community-changing issue? Our founding fathers wrestled with this concept and crafted an ingenious solution. If everyone in a community voted on every issue, the founding fathers recognized such a system descends into mob rule. However, in order to preserve democracy and cherished individual freedom, people should have the right to vote. Instead of voting on every issue, the founders created a system where citizens vote for small groups of representatives who act as a buffer between the “mob” and common sense/fairness for everyone–people who dedicate their time to understanding issues, how their constituents feel about those issues, and then voting in accordance with their own conscience and findings. Such a representative democracy is called a republic, which is the political system we have in the United States (NOT a straight up democracy). Even among the layers of elected representatives (local, state, federal) there is a pecking order. The founders recognized there are certain rights and issues best decided and enforced on either the federal or state level, rather than the local level. Each local community (lets call it a township) does NOT have the right to craft its own constitution and confer rights on individuals, corporations, eco-systems or any other entity. Conferring of such rights is the purview of either the federal or state government–NOT a local government. For example, in every state in the union oil and gas development is regulated by the state–not by local entities. In some states, Pennsylvania among them, zoning can affect and influence oil and gas development–where it happens, when it happens–but not control how it happens. So what if a community decides to ban oil and gas development (or pipelines, or injection wells)–in other words, “whether” such an activity happens? Such a ban is illegal. Introducing zoning regulations that result in a de facto ban is also illegal–but it’s happening in pockets across the Keystone State. Perhaps it’s time to criminally charge local representatives who pass these illegal laws (laws that trample individual property rights guaranteed under the U.S. Constitution) under a PA law called “official oppression.” That’s what the Pennsylvania Independent Oil & Gas Association (PIOGA) is considering right now…
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Lawyer Breaks Down PA Supreme Court’s Latest Act 13 Ruling

one-more-timeWe’re not trying to beat a dead horse here with yet more coverage of last week’s PA Supreme Court ruling in yet another Act 13 case (see PA Supreme Court Rules Against Act 13 Drilling Law, Yet Again), but that decision is important enough that it bears viewing from multiple angles. Below is an article from the Saul Ewing law firm. It does a good job of breaking down the key items decided by the judges, and what it means for the drilling industry and for PA residents–in terms non-lawyers (like us!) can understand. The article also points out there is at least one more aspect of the Act 13 case that has yet to be decided…
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Ohio Startup Plans to Convert Utica Drill Cuttings into Clean Fill

energreen360enerGREEN360, a young Ohio company that cleans up material heading to landfills so it can get re-used instead, has a plan to clean drill cuttings from Utica drilling to reuse those cuttings as clean fill on brownfield sites. The company has its sights set on an industrial park south of Cambridge, OH as its first location to dump the treated drill cuttings. Everyone wins in this instance–less material filling up local landfills, fill needed at the industrial park, the cuttings get treated before being used (minimizing any potential exposure risks). The only ones who lose are radical environmentalists, who will try their best to demagogue this plan, painting it as unsafe and harmful to locals who live and work in the area. The only problem for enerGREEN360 is that the Guernsey County Board of Supervisors is unanimously opposed to the plan (see Guernsey County, OH Opposes Facility to Treat/Store Drill Cuttings)…
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Utica Oilfield Services Co. Mammoth Energy Floats ~$150M IPO

mammothlogoOilfield services company Mammoth Energy Services, headquartered in Oklahoma City, OK, operates in both the Utica Shale and Permian Basin. Mammoth offers services like “completion and production services, natural sand proppant services, contract land and directional drilling services and remote accommodation services.” Mammoth is a baby company, formed in 2014, but already booking $243 million in revenue for the 12 months ended June 30th. Mammoth announced yesterday an initial public offering (IPO) of stock, which will trade under the ticker TUSK (keeping with the theme of a woolly mammoth–clever). The company plans to raise between $128-$169 million (call it $150M) by offering 7.75 million shares. What is noteworthy is that this is one of the very few new IPOs to be offered this year in the o&g sector…
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How to Keep PA Livestock Safe During Pipeline Construction

biosecurityMDN spotted an announcement that says PennAg and Sunoco Logistics (building the Mariner East 2 pipeline project) have collaborated to produce a “biosecurity education module.” What the heck is that?! It’s fancy language for “here’s how you keep farm animals safe when building a pipeline.” Building a pipeline is no easy thing. It starts with surveyors entering a property to map out a route–traipsing around the land, sticking markers in the ground. Eventually bulldozers, backhoes and truckloads of pipe show up. Then welders show up to stitch it together. Then it gets covered up, and later landscapers come along to replant, reseed, and re-whatever to restore the land to its former glory. With all of those people and equipment entering and exiting a property–particularly a farm–there’s an increased chance they will track something, or perhaps do something, that ends up being harmful to the livestock living on that land. So-called “biosecurity” is the name given to keeping the living things safe and free from harm from the people building (in this case) a pipeline. Sunoco has teamed up with PennAg Industries, a PA non-profit that promotes agriculture in the Keystone State, to make sure nothing bad happens when their workers show up at the farm. They’re creating an online course and making it available to anyone and everyone…
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EIA’s 2015 Natural Gas Annual Report – Charts, Graphs & More

EIALast Friday the U.S. Energy Information Administration, our favorite government agency, released its Natural Gas Annual 2015 report. Weighing in at 212 pages (yikes!), this report is full of data. It is a datamonger’s dream come true. Right off the bat the report shows record U.S. natural gas production levels for the fifth consecutive year, and record consumption levels for the sixth consecutive year. Natgas is growing in the U.S. and it’s growing big-time. Another interesting factoid from the report: For the first time since 2007 natural gas imports *increased* year over year. That’s interesting! The report has a number of fascinating charts and graphs. We list a few of them below, along with a full copy of the report…
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Rex Energy Borrowing Base Re-Affirmed for $190M, 2nd Time in 3 Mos.

Rex EnergyThree months ago MDN told you that Rex Energy’s bankers had reaffirmed the company’s “borrowing base” as being worth $190 million (see Rex Energy’s $190M Borrowing Base Reaffirmed by Bankers). Rex is a pure play driller focused on the Marcellus/Utica. A company’s borrowing base is the value of its assets–in this case the value of the leases and oil/gas wells Rex owns. Those assets are used as collateral to back up loans and IOUs. Rex has plenty of both (see Rex Energy Swapping $631M in Private IOUs for Public IOUs). Three months later and once again Rex’s banks are saying those assets are still worth $190 million. Usually banks reevaluate the borrowing base every six months. For some reason they felt it necessary to do it sooner. However, in yesterday’s announcement from Rex, the company mentions that the next redetermination will happen in April 2017–six months from now. Must be the bankers are getting more comfortable with Rex’s finances…
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Marcellus & Utica Shale Story Links: Tue, Oct 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: Northeast shale the backbone of production growth; WVU economist says “nothing wrong with natural gas”; FERC invites comments on Driftwood LNG export project; shale oil firms hedging like crazy with higher prices re OPEC; why does Food & Water Watch hate women and poor people?; natgas is more than just a “bridge fuel”; and more!
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