Mariner East 2 Permits May Come Today – Antis Foment Civil Unrest

According to rumors floating around the Pennsylvania environmental wacko movement, today is the day the Pennsylvania Dept. of Environmental Protection (DEP) will issue the final permits needed by Sunoco Logistic Partners to begin construction of the Mariner East 2 NGL pipeline that will stretch across the entire state. Neither Sunoco nor the DEP would confirm the rumor, but the wackos are agitated and saying their “inside sources” (of which they appear to have many) are telling them it’s today. And what if it happens? According to Maya van Rossum (THE Delaware Riverkeeper), the antis will employ their two favorite tactics: Sue in court, and whip up the more radical folks in the movement into a frenzy so they “rise up in protest.” You know, like the “protesters” (i.e. criminals) did in North Dakota–the ones who fired shots at police officers, burned tires, and engaged in illegal actions to stop work on the Dakota Access Pipeline (see Police Remove Pipeline Protesting THUGS from Private Land in ND). Here’s the latest from the rumor mill about the permits coming possibly today…
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FERC Approves SC Pipeline to Flow Marcellus Gas to Charleston

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In March 2016, Dominion filed an official application with the Federal Energy Regulatory Commission (FERC) for a 55-mile pipeline project called the Transco to Charleston Project (see Dominion Files Application to Move Marcellus Gas to Charleston, SC). As the name implies, it will be a short pipeline to connect the Transco pipeline, which is in the process of reversing flows to bring Marcellus and Utica Shale gas south. This new pipeline will grab Transco’s Marcellus/Utica gas and send it to the Charleston, SC area. The projected in-service date is November of this year. However, this project, like every square inch of every pipeline project in the Eastern U.S., faces opposition from nutty anti-drilling radicals who vow to try and stop it even if it gets FERC approval (see SC Antis Fuss Over Pipeline to Carry Marcellus Gas to Charleston). The antis will now get their chance to deliver on their big boasts. In what is turning out to be a busy week at FERC, the three remaining Commissioners granted Dominion the certificate to build the Transco to Charleston pipeline. Great news indeed!…
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EQT Snaps Up Another 14K ‘Core’ Acres in WV for $130M

EQT, one of the biggest and best drillers in the Marcellus/Utica, issued their fourth quarter and full year 2016 update yesterday. As is typical when issuing the updates, EQT’s top brass held a conference call with analysts to discuss results and take questions. In reading through a transcript of the call, one of the most interesting passages (for us) was in the prepared comments by incoming EQT CEO (currently president) Steve Schlotterbeck. In a brief passage excerpted below, Steve provides a quick update on several items: the Mountain Valley Pipeline project, EQT’s Utica drilling program, and the fact that “this week” EQT has purchased an additional 14,000 “core” West Virginia acres in Marion and Monongalia counties for $130 million, which works out to be $9,286 per acre…
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EQT 2016 Update: Proved Reserves & Production Way Up, Loses $453M

EQT, one of the biggest and best drillers in the Marcellus/Utica, issued their fourth quarter and full year 2016 update yesterday. The bad news is that EQT lost $453 million last year ($192 loss in 4Q16). But the bad financial news was offset by a lot of good news. EQT’s full-year production volumes hit a new high of 759 billion cubic feet equivalent (Bcfe), up 26% from 2015. The company drilled 135 gross wells, including 117 Marcellus wells, with an average length of 7,300 feet. EQT predicts production of 190-195 Bcfe in 1Q17. In 2017, EQT plans to use 6-8 rigs to drill a total of 119 wells in the Marcellus, 81 wells in the Upper Devonian, and 7 wells in the Utica. In a separate announcement also issued yesterday, EQT reports year-end 2016 proved reserves of 13.5 trillion cubic feet equivalent (Tcfe), up 35% from 2015. Below are the two updates from yesterday, along with the latest company PowerPoint presentation, loaded with great slides…
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Shell CEO Says PA Cracker Up & Running “Not Anymore This Decade”

Shell CEO Ben van Beurden

In June 2016, MDN was one of the first to unearth the announcement by Shell, almost hidden away inside another announcement, that the company had made it’s “final investment decision” (FID) to move forward with building a multi-billion dollar ethane cracker in Beaver County, PA (see Breaking: Shell Pulls the Trigger, PA Ethane Cracker is a Go!). At the time of the announcement, and since then, Shell has been cagey in not pegging any specific date for when they predict the plant will be built and online–although they have said the plant would start to contribute cash to Shell’s bottom line “after 2020.” That’s about all we’ve been able to find about timing for the plant–until now. Shell released their fourth quarter and full year update yesterday, and as part of that update, held a conference call with analysts. On the call, Shell CEO Ben van Beurden said, in response to a question from an analyst, that Shell will begin spending big money to build the plant “by the end of the year [meaning this year], certainly in 2018.” van Beurden also said, “We haven’t announced exactly when it will start up, but expect that to be not anymore this decade.” He’s not a native English speaker, so we’re having a tough time figuring out exactly what he meant. Does he mean the cracker will be running “not anymore *than* this decade” (meaning before 2020), or “not anymore *in* this decade” (meaning it is now pushed out after 2020). You’re guess is as good as ours…
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Patterson-UTI Jan Rig Count – Continues to Climb

As we do every month, MDN tracks how many rigs oilfield services company Patterson-UTI Energy reports operating–as a proxy for when/if the drop in rig counts for the Marcellus/Utica will turn around. Patterson operates a number of rigs in the northeast, as well as other areas of the continental United States (and Canada). Month by month Paterson’s rig count has declined over the past year plus–until June (see Tide has Turned: Patterson-UTI June Rig Count Ticks Up by 2). June was the turning point–the first time in over a year that Patterson’s rig count reversed and began to climb once again. Since June the count has steadily risen. The latest count, for January, saw the second biggest month over month increase since the trend reversed. In January, Patterson’s rig count hit 76, up 5 from 71 in December…
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Weatherford Loses $3.4B in 2016, Announces Partnership with Nabors

Weatherford 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. Since November we’ve highlighted the financial problems at the company (see Oilfield Srvs Co Weatherford in Financial Trouble). Not long after, Weatherford fired their CEO (see Weatherford Fires CEO/Chairman, CFO Interim CEO). And in December, the company announced it would stop doing any more fracking work (i.e. “pressure pumping”) in the U.S. this year (see Weatherford Shutting Down US Fracking Operations in 2017). In two separate announcements on Wednesday, Weatherford released 2016 results (not good, lost $3.4 billion) and they announced they are latching onto a competitor, Nabors, to form a joint venture, without actually calling it a joint venture, to continue drilling in the U.S….
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NFG/Seneca Qtly Update: Swings from Loss to Profit

National Fuel Gas Company (NFG) covers the full span of the oil and gas business–from upstream (with its wholly-owned drilling subsidiary Seneca Resources), to the midstream (with wholly-owned subsidiary Empire Pipeline) to downstream (NFG’s natural gas utility service to 740,000 customers in NY and PA). Big company. Diverse operations. Yesterday NFG issued what they call their first quarter update (everyone else’s fourth quarter update), covering October through December. The good news is that NGF swung from losing $189 million in the same period last year, to making an $89 million profit this year. Commenting on what matters most to MDN (the Marcellus/Utica), Ronald Tanski, NFG’s CEO, said this: “We expect to keep moving forward with our plans to build our Northern Access pipeline by the middle of next fiscal year. In the meantime, our efforts will remain focused on the efficient development of our Marcellus acreage to prepare for the Northern Access capacity while continuing to evaluate our opportunities in the Utica Shale on the very same acreage. Together, these stacked formations provide plenty of running room on our acreage and will fuel our growth for an extended period.” Plenty of running room. Sounds good to us! Here’s the update from yesterday…
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Clean Energy Future Blasts Plan to Re-Regulate OH Powergen

A few weeks ago MDN highlighted a developing issue in Ohio that potentially impacts Utica/Marcellus shale in the region (see OH Power Cos. Try to Stop Gas-Fired Plants with “Re-Regulation”). Three large utility companies–FirstEnergy, American Electric Power, and Dayton Power and Light–are behind an effort to re-regulate the electric power generation industry in Ohio. The electricity industry is a complicated industry, with some some power producers operating as “regulated” and some operating as “unregulated.” Regulated power producers have their rates, and rate of profit, set by government regulators–which limits profits but also guarantees profits. Unregulated power producers, on the other hand, do not have the safety net of the government forcing ratepayers to pony up–they operate in the free market, taking all of the risks, and reaping the rewards if those risks prove worthwhile. Many (most?) of the new natural gas-fired electric plants getting built, like those we have focused on in Ohio, are of the unregulated kind. If Ohio rolls back the clock 18 years to re-regulate, it would likely spell the end of billions of dollars of investments in unregulated/shale-powered electric plants. A disaster. And that’s just what Bill Siderewicz, president of Clean Energy Future (investing $4.5 billion in five new shale-fired electric plants in Ohio) said on a conference call yesterday…
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Mass. Senators Ask FERC to Reverse Atlantic Bridge Certification

Two of the most unfit Senators in the U.S. Senate are Ed Markey and the faux American Indian, Elizabeth Warren. Both radical extremists–both kind of loopy. So it is no surprise that they are calling on the Federal Energy Regulatory Commission (FERC) to reverse the decision FERC made just last week to authorize Spectra Energy’s Atlantic Bridge project (see FERC Approves Atlantic Bridge Project for New England/Canada). What makes their request so bizarre is there isn’t a chance in Hates that FERC will reverse that decision–especially with President Donald J. Trump in charge (yes, elections have consequences). So why ask FERC to do it? Ostensibly antis like Markey and Warren are worried about FERC for the same reasons pro-gas supporters are worried. With the huffy departure of Commissioner Norman Bay today (calculated to do maximum damage to the Trump Administration), there won’t be enough Commissioners to make decisions on big pipeline projects (see FERC Commissioner Resigns Threatening Major M-U Pipeline Projects). Our concern is that important projects will get delayed. Markey/Warren’s concern is that already-approved projects, like Atlantic Bridge, won’t get a vote to reconsider for the same reason…
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Lack of NatGas in New England Pushed CO2 Emissions UP in 2015

For whatever insane reason, some in New England, including the two U.S. Senators from Massachusetts (see today’s companion story) irrationally hate natural gas because it is a “fossil fuel.” These demented folks believe that by burning natural gas, more carbon dioxide (CO2) is pumped into the atmosphere and that increasing amounts of CO2 are causing the earth to warm up, catastrophically. At least that’s what they say they believe. The problem with their theory (libs always have problems because their theories never work out in reality), is that CO2 levels have decreased across the U.S.–because of the increased use of natural gas. Except for New England. Because New England is not using as much natural gas as other regions, making them rely on oil-fired electric plants, New England’s CO2 levels went UP in 2015! They not only pay more for electricity and energy than any other region of the United States, they’re using dirtier energy–all while claiming they love the environment and don’t want “dirty” natural gas. What idiots…
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Marcellus & Utica Shale Story Links: Fri, Feb 3, 2017

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Activist ire rises as Dakota Pipeline review begins; Xcel wants to replace coal plant with natgas plant; US LNG exports hit record high in January; new oil tech means more oil coming; Cheniere’s Arctic freeze; nuclear gas; US exports more oil in 2017 than four OPEC countries; Chesapeake Energy’s huge victory; South Korea generates electricity using US shale gas; and more!
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