Maine Wants Marcellus Gas Bad – Plans to Get it via Canada!

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Gov. Paul LePage

The only Republican New England governor, Maine’s Paul LePage, is also New England’s smartest governor. He knows New England residents are screwed bigtime without new sources of abundant, cheap, clean-burning natural gas–for heating and to produce electricity. LePage also understands the best place to get that gas is from the low cost Marcellus/Utica region–just a few hundred miles away from his state. The problem is that Maine’s neighbors have killed the only practical way to get that gas into New England–via pipelines (see MA Supreme Court Ruling Endangers New England Gas Pipelines; NH Regulators Veto Access Northeast Pipeline Contract; and CT Latest New England State to Give Up on NatGas Cooperation). But LePage isn’t ready to give up just yet. Perhaps his neighbors all want to commit economic suicide. Let them. LePage is floating an ingenious idea. It’s kind of a “going around your elbow to get to your thumb” plan, but hey, whatever works! LePage wants to run Marcellus Shale gas up into Ontario, Canada, then across that province into Quebec and from there on into Maine. The plan, which bypasses the rest of New England, is not as far-fetched as it first may sound…
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Another “Tiny” IMG Marcellus-Powered Electric Plant Planned in NEPA

IMD MidstreamMDN first told you about IMG Midstream in August 2014 (see 7 Small Marcellus-Powered Electric Plants Coming to NEPA). At the time, IMG was proposing to build seven “tiny” natural gas-fired electric plants–each plant producing on the order of 20-22 megawatts of electricity (enough to power 13,000 homes). IMG added a couple of more to their plans in November 2014 (see Details on IMG’s “Tiny” Marcellus-Powered Electric Plants in NEPA). The beauty of IMG’s tiny natgas electric plants is that they are really small–about the size of a basketball court; they produce almost no air pollution; and they are quiet. It’s a really cool concept. IMG’s very first tiny electric plant, in Susquehanna County, PA, went online in October 2015. The second plant, in Bradford County, PA, went online this past June (see IMG’s Tiny NatGas-Fired Electric Plants Take Off in the Marcellus). The former 9 planned plants ballooned with plans for 25 plants operating within the next five years! Here’s details for another “tiny” power plant on the way in the northeastern tip of PA, in Wayne County…
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Must-Attend Webinar: The Moral Case for Fossil Fuels

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Alex Epstein – author

Do you believe the argument that says, “Natural gas is just a bridge fuel to help us until renewable energy arrives to save the day”? Let me challenge your thinking with this counter-argument: Fossil fuels, including natural gas, are BETTER than renewables. Is your head spinning yet?

Join me for a live webinar next Friday, Nov. 18, with Alex Epstein, founder of the Center for Industrial Progress and author of one of my favorite books: The Moral Case for Fossil Fuels. I heard Alex deliver a live speech at the 2016 Shale Insight in Pittsburgh in September. Here’s what I wrote at the time:
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Baker Hughes Oct US Rig Count Up by 35, M-U Count Up 4

Baker Hughes logoWhile the worldwide Baker Hughes rig count slide back a bit in October, from 934 in September to 920 in October, the rig count in the U.S. once again, for the fourth month in a row, went up. The average U.S. rig count for October was 544, up 35 from the 509 counted in September. However, the rig count was down 247 from the 791 counted in October 2015–so we still have a long ways to go. The Marcellus/Utica rig count was up for the third month running. In October the M/U rig count went up by 4 with 3 additions in PA (now 25 rigs) and 1 in WV (now 10 rigs). OH stayed even running with an average of 14 rigs…
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Stone Energy 3Q16: Drilled 2 M-U Wells, Sale to Tug Hill Progress

Stone EnergyStone Energy, an independent oil and natural gas exploration and production company (E&P) headquartered in Lafayette, Louisiana drills mainly in the Gulf of Mexico but also has a presence in the Marcellus/Utica Shale with 90,000 acres of leases. Last year Stone quit drilling in the northeast and actually shut-in part of their production due to low prices (see Stone Energy 3Q15: Shut Down 110 Mmcfe/d of Marcellus Production). In June Stone cut a new midstream gathering agreement with Williams to return some of their shut-in Marcellus wells to full production (see Stone Energy Opens Marcellus Spigots Again; New Midstream Deal). In August MDN tipped you off that Stone is looking to unload their Marcellus/Utica assets (see Stone Energy in Talks to Sell 90K Acres of Marcellus Leases/Wells). In October Stone issued an announcement that the company, like others before it, has cut a deal to file a “prepackaged” bankruptcy AND sell it’s Marcellus/Utica assets to Tug Hill for $350 million (see Stone Energy Enters Bankruptcy, Sells Marc/Utica Assets for $350M). Yesterday Stone issued its third quarter 2016 update with details on how the sale to Tug Hill is going, how the bankruptcy is going, and how a number of other issues are going for the company…
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Black Stone Minerals 3Q16: Drilling & Royalties Trending Up

black-stone-mineralsBlack Stone Minerals is one of the largest owners of oil and natural gas mineral rights in the U.S. Black Stone owns mineral interests and royalty interests in over 40 states and 60 onshore basins in the continental U.S–including leases in the Marcellus/Utica region. Black Stone also owns and selectively participates as a non-operating working partner in drilling programs, primarily on its own leased acreage. Black Stone reported its third quarter earnings yesterday. The numbers show the company made $37.5 million in 3Q16 (down a bit from making $53.9 million in 3Q15). However, for the first nine months of 2016 the company is in the black this year, while it was in the red last year at this point. Our point: yet more evidence that drilling and royalties and everything in our industry that was down is now trending up, once again…
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Ohio’s Center Port Transload Terminal – Barging Triples

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52 barge docking, moorings, cranes and conveyors for NS Rail transloading – click for larger version

According to Center Port Terminal, McKees Rocks Harbor Services (MRHS) has put the “Port” back in Center Port. Center Port Terminal is the former Ormet Aluminum Plant site located on the shoreline of the Ohio River in Monroe County, OH. The plant closed its doors as an active aluminum plant in 2014 after Ohio regulators and Gov. John “foreigner hunter” Kasich failed to get high electric rates reduced for the plant, and refused to allow Ormet to burn coal to produce their own electricity until they could begin using natural gas to create electricity from gas wells drilled on the property (see Final Chapter of Ormet Plant Closing – Utica Could have Saved It). The new owner, Niagara Worldwide LLC, first tried to market the property, renamed Center Port Terminal, to Marcellus/Utica Shale drillers and oilfield services companies (see New Ormet Aluminum Plant Owner Shops Barge Facility to Shalers). The terminal has also been marketed as the perfect place to locate a natgas-fired electric plant (see Old Ormet Site in Monroe, OH Shopped as Power Plant Location). Earlier this year, the facility was marketed to manufacturing companies (see 3rd Time the Charm: OH Center Port Terminal Woos Manufacturers). One of the chief advantages of the facility is cheap transportation to/from on the Ohio River. Center Port has 52 barge slips. It’s also connected to rail lines and highways. MRHS opened “fleeting operations” at the facility and within 90 days barge traffic to the facility tripled. That’s good for everybody, including the Marcellus/Utica industry…
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Oilfield Srvs Co Weatherford in Financial Trouble

weatherfordWeatherford International is the fourth largest oilfield services company in the world, employing some 44,000 people. They have a branch office in Canonsburg, PA (Pittsburgh area) with major operations in the Marcellus/Utica. By comparison, Weatherford competitor Halliburton is the #2 largest oilfield services company in the world. A strange thing happened to Weatherford in September 2015. The public company floated new shares of stock and new IOUs (i.e., convertible notes) hoping to raise $1 billion in cash. But a few hours after they announced the offering, they withdrew it because “while investor interest was strong for this offering” the price those investors were willing to pay for the new stock and notes was not anywhere near what Weatherford wanted (see Oilfield Services Weatherford Flip Flops on Stock/Note Offering). Needless to say the company’s stock got hammered. Things didn’t improve. Weatherford has a branch office in Buckhannon, WV. In July they announced the company would lay of 147 positions in the Buckhannon office by the end of August (see Heartbreak: Weatherford, ECA Lay Off Combined 175 Jobs in WV). A stock analyst writing on the Seeking Alpha website offers evidence that Weatherford is insolvent and will either have to do an “equity raise” (wiping out existing shareholders) or continue to burn through the remaining cash it has and go belly up sometime next year…
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IHS Markit Says October Saw Historic Drop in US NatGas Production

ihs-markitIHS Markit, an information and analytics company that keeps a close eye on the energy industry, says its analysis shows natural gas production in the U.S. went down “nearly 2%” in October from September. It doesn’t sound like much, but it’s a big deal. Production levels in South Texas and the Northeast, according to VP Jack Weixel, “fell off a combined 1.3 Bcf/d from September to October.” That is the largest regional month over month decline IHS Markit has seen since it began tracking these numbers. What does it mean? Typically it means higher prices are coming–less supply, the same or increasing demand equals higher prices (classic economics 101 stuff). However, there are so many complex and contributing factors, it’s not as simple as less supply = higher prices. Not anymore! Here’s what IHS Markit is saying…
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U.S. Ethane, Including Marcellus/Utica, Now Supplies 4 Continents

ethane-crystalOne of the more interesting stories over the past year has been the export of Marcellus/Utica ethane to other countries, for use in their ethane cracker plants. Just last month we told you how northeast ethane gets transported to Texas, then loaded on Samsung ships and sails off to India (see Marcellus/Utica Ethane Heads to India via Texas on Samsung Ships). We spotted another article about U.S. ethane, who sells it and who (in the world) buys it. We don’t know for sure, but we’re guessing something approaching half of the ethane that gets exported now comes from our region–so the article below that details where the ethane ships from, and who buys it, is actually the story of Marcellus/Utica ethane…
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