DRBC: We’ll Make You Guess When We’re Going to Adopt Frack Ban

In September, MDN told you that the obsequious members of the Delaware River Basin Commission (DRBC) had slavishly obeyed their radical environmental masters by voting to move forward with a permanent ban on fracking in the Delaware River Basin (see DRBC Votes Tomorrow on Permanent Frack Ban Resolution). The final ban language/regulation was dropped like a bomb by DRBC staff on Nov. 30 (see DRBC Drops Permanent Frack Ban Bomb – Public Hearings in January). The DRBC announced they would allow public comment through Feb. 28, later extended to Mar. 30 (see DRBC Schedules More Freak Shows on Proposed Frack Ban Regulation). The DRBC received 8,687 comments online and 227 oral comments at the hearings. So what happens now? According to an update issued yesterday, the DRBC said, “There is no set schedule for a vote by the Commissioners to adopt final rules. As always, the Commission may adopt final rules only at a duly-noticed public meeting.” All of the DRBC’s public meetings are ” duly noticed”–meaning the DRBC provides public notice ahead of time. The next public meeting to be held is May 16. Could the DRBC simply vote at that meeting to adopt these illegal ban regulations? Sure. And then again, maybe they won’t. You just don’t know. Apparently the DRBC wants to keep everyone guessing…
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MarkWest Building 6 New Processing Plants, 3 Fractionators in 2018

Attendees at yesterday’s Utica Midstream conference at Walsh University in North Canton, Ohio got an earful about pipelines and processing plants. Perhaps the biggest news coming from the event (for us, anyway), is that MarkWest Energy, now part of Marathon Petroleum, plans to build another six natural gas processing plants and another three fractionation plants in the Marcellus/Utica THIS YEAR. MarkWest plans to spend a whopping $2 billion in the region this year! That’s in addition to building two new processing plants and three fractionation plants last year. A processing plant accepts raw hydrocarbons coming out of shale wells and separates out the methane from everything else–“cleaning up” the methane so it’s pipeline-ready. Fractionation takes what’s left after the methane is removed and separates those other hydrocarbons into their discrete molecules–ethane, propane, pentane, butane, etc. According to MarkWest, M-U moving butane to new markets will be a major focus this year. We also learn that MarkWest’s Sherwood facility (in WV) is now the fourth largest gas processing plant in the U.S.–and by the end of this year, it will be #1! In addition to MarkWest, there were a number of other top notch speakers at yesterday’s event, including Rick Simmers from the Ohio Dept. of Natural Resources. Rick mentioned in passing there’s a shale well pad in southeast Ohio with a whopping 28 wells on it. Below is a summary of what was said at yesterday’s event…
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Just What is Cabot Looking for in Ohio – NatGas, Oil or NGLs?

Two days ago MDN revealed which rock layers Cabot Oil & Gas is targeting with new test wells in central Ohio (see New Details Emerge on Cabot’s Shale Plans in Central Ohio). Today we answer the question, What does Cabot hope to find? Cabot representative Brittany Ramos told an area newspaper that the company is looking for, “a hydrocarbon, an oil, natural gas, natural gas liquid, something, in the layers below the Utica Shale, but the only way to find that out is to actually drill a well and test.” In other words, they don’t know. They know *something* is down there, but they aren’t sure what. We suspect they’re hoping it’s either oil or NGLs. Cabot, long known for their prolific natural gas production in Susquehanna County, PA, had a previous dalliance with oil drilling in the Texas Eagle Ford shale play–assets they ended up selling in December 2017 (see Cabot O&G Sells Texas Eagle Ford Assets for $765M, Focus on Marc.). Does the company have a renewed interest in finding oil? Perhaps. If not oil, certainly NGLs. We seriously doubt they’re looking for yet another dry gas zone. Below is yet another update on Cabot’s foray into central OH. It is one of the more fair and balanced articles we’ve read. Yes, the reporter interviewed a representative from the faux “landowner group” called the Tri-County Landowners Coalition–in reality an anti-fossil fuel group controlled by elements of the Big Green movement (see Fake Ohio Landowner Groups Launch Misinformation Campaign). In this article the reporter actually asks Cabot to respond to the wild claims made by the Tri-County rep, point for point. Cabot obliterates the anti’s arguments…
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Rex Energy Defaults on IOUs, Can’t File Annual Report on Time

Rex Energy filed two regulatory filings with the Securities and Exchange Commission earlier this week that don’t bode well for the company. In a Form 8-K filing (a form used to notify investors of events that may be important to investors), Rex let it be known they could not make an interest payment due on senior notes, a semi-annual payment due on April 2nd. Rex said in the filing that the noteholders to whom payment is due (Angelo, Gordon & Co.) have signed a temporary “forbearance” agreement that gives Rex a little breathing room–precious little. The forbearance agreement gives Rex until April 16 to pay up. Angelo, Gordon & Co. have promised not to take any action until that date. The second filing, a Form 12b-25, says that Rex will not be able to file its annual 2017 report on time. In February we reported that it looked like, at that time, that Rex was getting ready to file for bankruptcy (see Rex Energy Preparing to File for Chapter 11 Bankruptcy?). They still haven’t filed for bankruptcy, but surely a missed interest payment and pressure from a major debtholder is not a good sign…
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EV Energy Partners Files for Chapter 11 Bankruptcy

In the middle of March, MDN warned readers that EV Energy Partners (EVEP), a subsidiary company of EnerVest, would soon be filing for bankruptcy (see EV Energy Partners Filing for Chapter 11 Bankruptcy in Next 2 Wks). On Monday, the company succumbed and filed. At one time (in 2012), EVEP owned more than a half million acres in the Utica Shale alone (see EnerVest Puts 539,000 Utica Shale Acres on Auction Block). We couldn’t find updated statistics for the company, but we believe they still own a significant amount of Utica (and Marcellus) acreage. Here’s the EVEP announcement that the company has entered into a prepackaged bankruptcy deal…
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Exposing PA Gov. Wolf’s Lies – He is No Friend of the Marcellus

The gloves have finally come off. Typically the Marcellus industry, as represented by the Marcellus Shale Coalition, has used restrained language when talking about Pennsylvania Gov. Tom Wolf. Hey, the industry has to work with the guy because the state Dept. of Environmental Protection (DEP)–the agency that regulates shale drilling–is part of the executive branch (under Wolf’s thumb). The industry often can’t say what it really thinks. No more. Wolf, who pretends to be a friend of the Marcellus industry and mouths words of support, recently launched a vicious, lying attack against the industry over the severance tax issue (as part of his re-election campaign). The gloves are now off and the MSC is punching back. MSC president Dave Spigelmyer published an editorial in today’s Philadelphia Inquirer pointing out the difference between Wolf’s words and his deeds. In a bout of political schizophrenia (some would say hypocrisy), Wolf says shale gas in PA represents “enormous economic opportunity.” He then turns around and claims high-paid Marcellus lobbyists have spread money around Harrisburg like candy, bribing legislators to block a severance tax. What Wolf doesn’t tell you is that he himself has received millions of dollars from the teacher’s unions he’s promised to give severance tax money to…
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Report: The State of Natural Gas in Pennsylvania

The Commonwealth Foundation is Pennsylvania’s premier free-market think tank. The aim of the Foundation is to “transform free-market ideas into public policies so all Pennsylvanians can flourish.” We’ve highlighted their excellent work over the years. They’ve just done it again. The Commonwealth Foundation has just published a report called “The State of Natural Gas in Pennsylvania” (full copy below). The opening begins this way: “Pennsylvania’s regulatory and tax environment is stunting job growth and deterring investment. A decade after the Marcellus Shale boom, lawmakers are still debating how to tax the industry instead of fixing the policies contributing to Pennsylvania’s increasingly uncompetitive energy market.” At the end of the report the Foundation shows a severance tax comparison of existing severance taxes in other states that PA competes against, like Ohio, West Virginia, Texas, Colorado, and Oklahoma. The chart shows that the existing impact fee (in essence a severance tax) runs around 1.1%. The severance tax in Ohio is running around 0.7%, and in West Virginia 3.5%. In places like Texas, which increasingly competes against PA with prodigious quantities of natural gas production, the severance tax is 4.2%. However, Gov. Wolf’s proposed severance tax would be 5%–the highest in the nation except for New Mexico’s 7.9% (which doesn’t compete with PA). The report shows how PA is restricting Marcellus activity with over-regulation and a high corporate income tax…
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Other Energy Stories of Interest: Thu, Apr 5, 2018

The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading: Lauren Barr Katarski joins Bravo Group’s energy and environmental practice; natgas coming to homes and businesses in Tunkhannock, PA; Permian price differential widening on wave of new crude; CT residents curious about natgas pipeline expansion; US crude production grew 5% in 2017, heading for record in 2018; cyberattack affects at least four pipeline systems; fracking, BREXIT and an oil and gas shale bonanza; and more!
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