Patterson-UTI Rig Count Continues to Rocket Skyward – 159 in May

As we do every month (and have for two years), MDN tracks how many rigs oilfield services company Patterson-UTI Energy reports operating–as a proxy for rig count health in the Marcellus/Utica. In April the Patterson rig count rocketed to 115, up an amazing 27 rigs in a single month–the biggest jump we’ve seen (see Patterson-UTI Huge Increase in Monthly Rig Count – SSE Factored?). Why the big jump in April? We theorized that rigs from Seventy Seven Energy, which Patterson recently bought/merged with, influenced those numbers (see Patterson-UTI Energy Completes Merger with Seventy Seven Energy). Last month we reached out to Patterson and got confirmation of our theory from Mike Drickamer, Vice President, Investor Relations: “We completed the merger with Seventy Seven Energy on April 20 and so the April rig count did reflect 10 days of rigs acquired from Seventy Seven Energy.” Patterson released their May rig count number yesterday, and it zoomed to another new high–of 159 rigs. That’s up an amazing 38% in one month! It is the most rigs we’ve tracked for Patterson since we began keeping track. The reason for May’s high number is, of course, that Patterson’s numbers now reflect a full month of SSE rigs now part of the Patterson fleet…Continue reading

Rover Pipeline Helps OH Short Line Railroad Expand

For some reason we’ve always loved stories about how shale energy has revitalized the short line railroad industry. Maybe it’s from some deep-seated psychological connection of playing Monopoly as a child and loving to own the railroads on the board–including the Short Line. Who knows? We’ve just stumbled across another such shale energy story connected to a short line railroad. This one involves the mighty Rover Pipeline, now under active construction across Ohio and in Michigan. When Energy Transfer, the company building the $3.7 billion, 711-mile Marcellus/Utica natural gas pipeline began to look at logistics and where they would store all of the pipeline and other materials needed to construction the mammoth project, they happened across a rail yard and transloading facility located in Massillon (Stark County), OH. Massillon Logistics, founded in 2004 by Steve and Dave DiPietro, had launched Republic Short Line Railroad (RSL), along with four other subsidiaries, to operate at a former steel mill site (465 acres) now called the Massillon Energy & Technology Park. RSL and the expansive park were just what Energy Transfer needed for Rover. The pipeline project has provided RSL with a boatload (or rather, rail yard) of business and money to grow…Continue reading

Baker Hughes, GE Release Roster of Coming Management Changes

Yesterday MDN provided an update about the fast-approaching merger/buyout of Baker Hughes by GE Oil & Gas (see Europe Approves GE Takeover of Baker Hughes, Co Gets a New Name). We noted that it appears the new company, when launched, will have a new name: Bear Newco. However, would GE (and Baker Hughes) throw away the brand they’ve created over the past 100+ years in the Baker Hughes name? No, very doubtful. Which was more-or-less confirmed yesterday when Baker Hughes (and GE Oil & Gas) released the official leadership roster for the new company. We had already mentioned a few of the top names. This new list fleshes it all out–who will do what in the newly merged company, a company that will be bigger than current #2 in the world, Halliburton. The infographic (we call it a roster) of who will do what contains this name emblazoned across the top: “Baker Hughes, a GE Company.” The press release headline includes it too. So that’s what the new company name will be for branding/public purposes. Even though Bear Newco will be the company name filing paperwork with the government, the public-facing name will be Baker Hughes, a GE Company. Here’s the leadership roster for the new Baker Hughes (which doesn’t contain very much Baker Hughes)…
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Antis Ask Army Corps of Engrs to Yank Rover Pipeline Blanket Approval

Several radical environmental groups, including the Sierra Club, Michigan Residents Against the ET Rover Pipeline, and the Ohio-based nutters at FreshWater Accountability Project filed an official request with the U.S. Army Corps of Engineers to pull the Corps’ issuance of a “blanket” approval for the Rover Pipeline to use underground horizontal directional drilling (HDD) and instead require Rover to get a permit for each of the 45 bodies of water they intend to drill under with the technique. Which would, of course, bring the project to a halt–the intended outcome by the radicals. The groups are attempting to capitalize on several leaks experienced by Rover using HDD, including a 2 million gallon drilling mud spill in April that continues to generate headlines today (see OH EPA Says Diesel Fuel Found in Rover 2M Gal Drilling Mud Spill). So far the Corps is keeping mum, only acknowledging receipt of the request. Here’s a bit of news you won’t get in mainstream media: Rover continues to use HDD actively, every day, even now. Yes, HDD activity in a few locations (under waterways) has been halted, but HDD activity continues in 23 other locations. In addition to the news about the request by anti groups to the Corps, we’ve pulled the latest weekly construction report from Rover, embedded below…Continue reading

As Deadline for Mountain Valley Pipe Final EIS Nears, Antis Squirm

Local anti-drilling reporters in Virginia are breathlessly hyping the fact that the Federal Energy Regulatory Commission (FERC) is set to issue a final environmental impact statement (EIS) on June 23 for the Mountain Valley Pipeline (MVP), a $3.5 billion, 301-mile pipeline that will run from Wetzel County, WV to the Transco Pipeline in Pittsylvania County, VA. Antis are only too happy to provide a load of bull for local reporters to use in articles to scare the general public. For example, when talking about the pipeline, it’s always the “deeply controversial” Mountain Valley Pipeline. Of course it’s only “deeply controversial” to a few hundred people. Everyone else couldn’t care less. A bunch of pipeline opponents, who don’t like how the system works, want to change the rules. Funny, isn’t it, when the other side can’t win in the realm of public opinion, or in the courts, they resort to demanding the rules get changed–to favor them. Antis now want FERC to do something it has never done: Issue a revised or supplemental draft EIS, instead of a final EIS–which would restart a public comment period and seriously delay the project. Which is the point. We expect FERC will ignore this latest transparent effort to stop the project…
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Ridgetop Energy Services Buys Keystone Wireline Inc.

You know those Russian nesting dolls, which are called matryoshka dolls, where you open one and inside you see another? And you open that and inside is yet another? And on it goes four or five times. That’s how we felt when digging into this story. The news is that Ridgetop Energy Services, headquartered near Pittsburgh, has purchased Keystone Wireline Inc., located in Bradford (McKean County), PA. Who is Ridgetop and how does Keystone Wireline fit into the picture? That’s what leads us to a matryoshka doll…
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Williams Swaps $1.4B of Old Debt for New Debt, Lowers Interest Rate

As we have noticed with many upstream (drilling) and midstream (pipeline) companies over the years, these companies often float new IOUs (or “notes”) to pay off old IOUs. Midstream giant Williams is one of the latest to do so. Last Wednesday, May 31, Williams announced they would float $1.45 billion in new notes, due payable in 2027. The reason? To pay off notes due in 2023. Yesterday Williams said they got the new notes all sold. The up side to swapping debt, in this case, is that the new notes pay an interest rate of 3.75%, whereas the notes they are paying off (due in 2023) have an interest rate of 4.875%. So Williams shaved more than a full point off the interest they are paying for their IOUs–a technique that will save the company big bucks…
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Is Virginia Governor Race a ‘Referendum on Pipelines’?

Will Virginia in the south become what New York is in the north: a block to Marcellus/Utica gas leaving the region? Perhaps. At least, that’s what radical environmentalists are hoping is what happens. On June 13 Virginia will hold a primary. We recently wrote about its importance (see Fate of 2 Important Pipelines May Rest in Virginia Governor Race). Former Congressman Tom Perriello (far-left Democrat) says he’ll block both the $5 billion Atlantic Coast Pipeline and the $3.5 billion Mountain Valley Pipeline if he wins the primary and the general election. He may well win it. Antis are positioning this primary and the election as “a referendum on pipelines.” The brutal truth is that most people in the Old Dominion could care less about pipelines. It is only a small cadre of gentry-class horse farmers and radical anti-fossil fuelers who oppose the pipeline projects. But if you read local news, you wouldn’t know that. We’d like to say, “Hey, it doesn’t matter who wins, the law is the law and a governor can’t stop a federal pipeline project.” But then, we’re from New York where that is exactly what has happened! At least so far. Both the Constitution Pipeline (Williams) and the Northern Access Pipeline (National Fuel Gas Company) have been blocked by Democrat Gov. Andrew Cuomo for political reasons. Both pipelines have taken the state’s Dept. of Environmental Conservation to court, where it’s quite possible, even likely, the state will lose. However, nothing is 100% certain–and because of Cuomo’s actions, both pipelines are now years delayed. Our concern is that a major delay may happen in Virginia too, if the state elects someone like Perriello…
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Sleazy: Former EPA Head Gina McCarthy Joins Pegasus Capital

One of the things we admired about Donald Trump and his candidacy was his pledge that members of his administration would agree to a lifetime ban against lobbying for foreign powers, and a five-year ban on lobbying for American companies after leaving their jobs. It’s about time we cleaned up the sleaze in Washington–the revolving door of achieving power and then using (we’d call it abusing) their former position of power by becoming a lobbyist, or as it is sometimes called, an “advisor” in a firm. Advisor is just another name for lobbyist. Companies, oh say like Pegasus Capital (investment firm with boatloads of money) hires a former high-level official who has long tentacles still reaching into the agency they once worked in, oh say like Gina McCarthy at the Environmental Protection Agency. What do you know? It’s just happened. Pegasus has hired McCarthy as an “operating advisor.” Disgusting and sleazy…Continue reading

Marcellus & Utica Shale Story Links: Tue, Jun 6, 2017

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Cuomo packs PSC with his own people; NYC Mayor de Blasio green philosophy – do as I say, not as I do; Chest Twp, PA reviews applications for gas well site; Sierra Club denies fracking science; NOAA study shines light on Obama-era methane research (way overblown); BlackRock buys energy infra franchise from First Reserve; US crude exports soar in Q1; old school gas sellers try new tricks to lure buyers; Qatar LNG shipments to Japan not affected by Arab boycott (so far); and more!Continue reading