WPX Pays $1.2M Fine to Settle 2012 Case of Leaky PA Impoundment

In July 2014, MDN told you the water wells for two of three families living near a WPX recycled frack wastewater impoundment (i.e. “pond”), near Ligonier (Westmoreland County), PA, were determined to have been contaminated by that impoundment. That is, the Kalp impoundment leaked into the ground, according to the PA Dept. of Environmental Protection (DEP), and that caused a long-term problem with those wells (see WPX Wastewater Impoundment Source of Water Contamination in W PA?, and our follow-up story, Important Update on WPX Energy Leaking Impoundment in SWPA). A month later the DEP later made a final determination that the third family’s well, the elderly Ken and Mildred Geary, was also affected and that WPX will need to find a permanent water replacement solution for them too (see DEP Says WPX Needs to Replace 3rd Water Supply in SW PA). From the beginning, WPX owned up to the problem and worked hard to make it right by installing water treatment systems–for five (total) affected water wells. The Pennsylvania Dept. of Environmental Protection (DEP) continues to monitor the water for the affected wells. However, the DEP is now ready to close the door on this now three year-old case, by assessing WPX with a $1.2 million fine and a requirement that they complete a remediation of soil in the area that may still be affected…
Continue reading

WV Senate Bill 244 Introduced for Co-Tenancy & Joint Development

The legislative session for West Virginia is in full swing–a session that lasts for 60 non-contiguous days at the beginning of each year. This year’s session opened on Jan. 11 and will conclude on Apr. 8th. As MDN previously reported, perhaps the biggest energy-related issue for this year’s session will NOT be (as it has in five previous sessions) a bill on forced pooling. Instead, the West Virginia Oil and Natural Gas Association (WVONGA) is pushing a legislation on co-tenancy and joint development (see WV Won’t Push Forced Pooling, Will Push Joint Dev. & Co-Tenancy). Senate Bill (SB) 244 has now been introduced to cover both co-tenancy and joint development. Co-tenancy is pretty easy to understand: if there are multiple owners for the mineral rights under a property–something that happens fairly regularly in WV–you would only need a simple majority of those owners to approve a drilling lease. Currently, if one person with a teeny tiny share objects, it stops the process. Joint development, on the other hand, had us stumped. But we got some insight into the issue from a couple of sharp MDN readers (see More on WV’s Push for “Joint Development” Instead of Forced Pooling). Currently there are a number of existing old leases, signed before shale drilling began, that prevents drillers from drilling a horizontal well across an individual property boundary line–until a new lease is signed. Joint development says if the driller already owns the leases on all adjoining properties they want to combine into a drilling unit, they can do so without signing a new lease. WVONGA says it corrects a loophole that prevents more drilling from happening. Rights owners say joint development legislation lets drillers have a freebie–instead of signing a new lease (for more money), the driller gets something never envisioned when the original lease was signed. Who’s right? We expect SB 244 to be hotly contested this year, like forced pooling has been in previous years…
Continue reading

Spectra Energy is No More – $28B Merger with Enbridge Complete

Last September MDN reported on a midstream deal with major implications for the Marcellus/Utica: Canadian pipeline operator Enbridge Inc. announced an all-stock deal to buy out pipeline operator Spectra Energy, based in Houston, for $28 billion (see Canadian Enbridge Buying US Spectra Energy for $28B). Spectra has a number of critical pipeline infrastructure projects under way or planned in the Marcellus/Utica region, including the planned Access Northeast pipeline to New England, the mighty NEXUS pipeline planned to span Ohio, the currently under construction Algonquin Incremental Marketing (AIM) pipeline project, and three projects (Access South, Adair Southwest and Lebanon Express) under way to expand one of the largest natural gas pipelines in the U.S. (and in the northeast)–the Texas Eastern Transmission (Tetco) pipeline. The update is that as of yesterday, Spectra Energy is no more. The merger is complete, and Spectra’s stock has stopped trading, and the name on the door has changed. Yes, this is a big, hairy deal for our region…
Continue reading

Stone Energy Exits Bankruptcy, Sale of M-U Assets to EQT Finalized

Stone Energy is an independent oil and natural gas exploration and production company (E&P) headquartered in Lafayette, Louisiana, drilling mainly in the Gulf of Mexico but also has (or rather had) a presence in the Marcellus/Utica Shale with 86,000 acres of leases. Stone quit actively drilling in the Marcellus in 2015, and filed for bankruptcy last October. As part of the bankruptcy filing, Stone signed a deal with Tug Hill to sell those 86,000 acres to Tug Hill for $350 million (see Stone Energy Enters Bankruptcy, Sells Marc/Utica Assets for $350M). The deal with Tug Hill was called a “stalking horse bid,” which meant Tug Hill would get the deal if no one else came along and bid higher. Someone did come along and bid higher–EQT (see EQT Wins Bankruptcy Auction for 86K Stone Energy M-U Acres, $527M). As of yesterday ownership for Stone’s 86K acres + wells was officially transferred to EQT. As of today, Stone is exiting bankruptcy. Now they have to pay Tug Hill a $10.8 million breakup fee…
Continue reading

FERC Issues Favorable Enviro Report for Mountaineer & Gulf XPress

In December, the Federal Energy Regulatory Commission (FERC) threw a little cold water on two important pipeline upgrades to carry more Marcellus/Utica gas to southern markets. A final environmental impact statement (EIS) was due from FERC for both the Mountaineer XPress and Gulf XPress projects no later than April 28, 2017. FERC said that the deadline would slip by three months due to reroutes and additional environment information requested (see FERC Delays EIS for Mountaineer XPress & Gulf XPress Pipelines). MDN previously reported on Mountaineer XPress, which includes 165 miles of new pipeline with approximately 2.7 billion cubic feet (Bcf) per day of transportation capacity from existing and future points of receipt along or near the Columbia pipeline system–most of it located in West Virginia (see Details on Columbia Pipeline Mountaineer XPress Pipeline Project). Gulf XPress consists of constructing seven new midpoint compressor stations along the existing Columbia pipeline system in Kentucky, Tennessee and Mississippi, with the aim of moving an additional 875 million cubic feet (MMcf) of Marcellus/Utica gas per day southward, to the Gulf Coast region. However, before FERC issues a final EIS for both projects, they must first issue a draft EIS (or DEIS)–which they did yesterday. The good news is that it was a favorable DEIS, signaling a favorable EIS will be issued by the end of April. The further good news is that FERC has scheduled five public hearings (four in WV and one in TN) for late March. We have FERC’s DEIS announcement below, along with a copy of the full DEIS (all 532 pages!)…
Continue reading

Southwestern Loses $2.8B in 2016, Ramps Up Utica Drilling “Early”

After idling most of its rigs in the Marcellus/Utica during 2016, Southwestern Energy, one of our regions biggest drillers, is restarting rigs and drilling new wells in 2017–according to announcements made by the company over the past several days. Southwestern issued its 2016 update, and 2017 guidance, late last week. Some of the most exciting news to come from Southwestern came on the earnings call last Friday. Southwestern CEO Bill Way said this: “We are very encouraged by the early results of our first Utica well [in Marshall County, WV] and as a result have accelerated the timing for our second test well located in Washington County, Pennsylvania, which was spud earlier this month. And you will recall that we had originally planned to begin our Utica testing in 2018, but results from wells and circling our position and our first well, provided us with the confidence to accelerate this activity.” Although rigs got idled in 2016, it doesn’t mean there was no drilling. Last year Southwestern invested a total of $623 million in drilling, and drilled 62 wells, completed 86 wells, placed 85 wells to sales and had 135 wells in progress. Of the 135 wells in progress at year-end, 73 were located in Northeast Appalachia, 42 in Southwest Appalachia and 20 in the Fayetteville Shale. On the down side, the company reports losing $2.8 billion (mostly a paper loss for “impairments”–write-downs of asset value). But that’s a vast improvement over losing $4.7 billion in 2015…
Continue reading

Rover Pipeline Files Eminent Domain Against 58 Michigan Landowners

Earlier this month Rover Pipeline, a $3.7 billion, 711-mile Marcellus/Utica natural gas pipeline that will run from PA, WV and eastern OH through OH into Michigan and eventually into Canada, received its final authorization from the Federal Energy Regulatory Commission on Friday (see ET Rover Pipeline Gets Final Approval by FERC). Because FERC was late in issuing its final approval, and because Energy Transfer, the builder of Rover, has promised to deliver the project on time, there is no time to waste. As soon as the final approval was issued, Rover filed eminent domain lawsuits against Ohio landowners who have refused for over a year to negotiate (see Time’s Up – Rover Pipe Uses Eminent Domain on Holdout OH Landowners). As it turns out, Ohio isn’t the only state where Rover has filed eminent domain lawsuits. The company has now filed 58 such suits in Michigan as well…
Continue reading

Marcellus Shale Saving Family Farms Across Pennsylvania

Across the Keystone State (i.e. Pennsylvania), the shale revolution is “boosting agriculture,” says a farm expert. How? By providing new sources of capital (cash) to buy new equipment, more livestock, fix buildings, etc. Shale is also lowering the cost of fuel and fertilizer for farmers. And it provides jobs for members of farming families–bringing in an important new income stream. It is not an overstatement to say that shale is literally saving the family farm in PA…
Continue reading

Still Time to Join MDN in Pittsburgh on Thursday – Here’s How!

For those in the Pittsburgh region, there is still time to register and attend this year’s Oil & Gas Awards Northeast Industry Summit, being held on March 2 in Pittsburgh. MDN editor Jim Willis will moderate two of the panel discussions at the event. Jim invites Marcellus Drilling News readers in the Pittsburgh orbit to attend the Summit–for FREE. Just sign up here. The Agenda for the Northeast Industry Summit is now complete (see it online). MDN readers are invited to attend as complimentary guests. The Industry Summit takes place at the Westin Convention Centre, Pittsburgh, PA, on Thursday, March 2, 2017, between 8.30 am and 12.30 pm.

Marcellus & Utica Shale Story Links: Tue, Feb 28, 2017

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: OH hotels lose business with drilling downturn, slowly regaining; PA’s natgas industry poised for a rebound; confirmation votes for Energy, Interior picks coming this week; second coming of shale even more powerful than the first; U.S. drillers add rigs for 6th week in a row; oil production increasing in 2017; and more!
Continue reading