Who *Sold* the Most NatGas in the U.S. in 3Q18?

Who are the biggest natural gas sellers in the U.S.? You might be surprised to learn that the biggest *sellers* are not necessarily the biggest *producers* of natural gas. Oh, you might recognize some of the names of the top sellers (BP, Shell, ConocoPhillips). But others might be more of a mystery (Macquarie, Tenaska, Sequent, and J. Aron & Co.). Would it surprise you to learn that BP (i.e. British Petroleum) is the #1 seller of natgas in the U.S., and has been for years? Last quarter BP sold 21.01 billion cubic feet per day of natural gas here in the colonies. Each quarter NGI (Natural Gas Intelligence) runs the numbers and publishes the list of 25 top natural gas marketers in the U.S. They recently published the third quarter 2018 list, which shows that overall volumes are up from the same quarter a year ago, and that we are on track to have the highest growth in production for a single year since the new millennium began.
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“Growing” Opposition to Shell Ethane Cracker Pipe from One Source

In June, Shell said that they plan to build their Falcon ethane pipeline in 2019 (see Shell Says Falcon Ethane Pipeline to Get Built in 2019). The pipeline won’t actually flow ethane to the Shell cracker in Monaca (Beaver County), PA until 2020 at the earliest–because the cracker plant itself won’t go online until 2020 at the earliest. The 97-mile, two-legged Falcon Pipeline is interesting because Shell didn’t use eminent domain. Shell negotiated with every landowner and got them all to sign on the dotted line. Yet we’re now hearing from Pittsburgh media that there is “growing” opposition to the project. Unless you’re a landowner with the right to stop it, or the Sierra Club with billions in the bank to launch frivolous lawsuits, there is no stopping this project, “growing opposition” or not. When you dig into the news, you will find the “growing” opposition seems to be coming from a single source–the Ambridge Water Authority.
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Williams Unveils “Leidy South Project” to Expand Transco in PA

It’s the birth of a brand new pipeline expansion project. Several weeks ago Williams pre-filed with the Federal Energy Regulatory Commission (FERC) to make certain upgrades (all of them in Pennsylvania) to its mighty Transco Pipeline. The upgrades include replacing smaller pipeline with larger pipeline in some areas, adding “looping” in other areas, and upgrading four compressor stations. The changes will flow an extra 582 million cubic feet per day (MMcf/d) of Marcellus gas from northeast and southwest PA to “growing demand centers along the Atlantic Seaboard.” Williams is holding two (of four) open houses next week to discuss the project. Below are details about the project and a copy of Williams’ FERC pre-filing application.
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Open Season – for Mariner East Pipelines?!

We spotted a notice from Energy Transfer, the company building (via its Sunoco Logistics Partners unit) the Mariner East pipeline projects, that seemed odd to us. It was an open season announcement, a time when companies can “sign on the dotted line” to reserve capacity along any of the three pipelines–Mariner East 1 (ME1), Mariner East 2 (ME2), or Mariner East 2X (ME2X). ME1, a repurposed gasoline pipeline built in the 1930s, has been up and running since 2016. ME2 & 2X are due to go online any day now. ME2 and 2X (built side-by-side) are about two years behind schedule. Normally a pipeline company won’t dig one shovelful of dirt or lay an inch of pipeline until/unless customers have already signed up during an open season. And yes, all three pipelines have had open seasons and have signed-up customers eager to use them. So what’s with this new open season? We think we know.
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Drilling the Utica Shale in PA & WV – Leveraging Stacked Plays

Last week MDN friend and ace reporter Rick Stouffer from Kallanish Energy hosted a one-day event in Pittsburgh called “Kallanish New Horizons: Appalachin Basin.” One of the speakers was Tom Murphy, director of Penn State’s Marcellus Center for Outreach and Research (MCOR). MDN editor Jim Willis had the pleasure of presenting on the same panel with Tom at the National Association of Royalty Owners (NARO) Pennsylvania Chapter annual convention in State College, PA last March. Tom never disappoints! He certainly didn’t at last week’s Kallanish event. Tom spoke on the topic of Utica drilling–in PA and WV. Normally you think “Ohio” when you think Utica. And indeed, Ohio has the vast majority of Utica wells drilled (2,080 and counting). But there’s a fascinating trend of drilling Utica wells in both PA and WV. How many?
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PA DEP Releasing Expensive New O&G Emissions Reg

The liberal PA Gov. Tom Wolf administration continues to tinker with (i.e. destroy) the Marcellus miracle in the Keystone State. In August the Wolf Dept. of Environmental Protection (DEP) finally, after years of work, implemented onerous new regulations to cut down on so-called fugitive methane emissions from *new* drilling and pipelines (see PA Harms Drillers, Pipelines with Over-Strict Methane Rules). Don’t worry, *existing* well pads and pipelines are now in Wolf’s crosshairs. On a different but parallel track, the DEP has, for some time, considered requiring new regulations to further reduce volatile organic compound (VOC) emissions at oil and gas sites (see PA DEP Considers Rule Reducing/Eliminating VOC Emissions for O&G). The DEP has just released a draft of those regs, and will hold a meeting to discuss the new proposed regulation on Dec. 13.
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Elba Island LNG Key for Kinder Morgan Profits in 2019

Yesterday Kinder Morgan, one of (perhaps THE) country’s largest midstream company, issued guidance (their best guess) for how much money the company will make in 2019. Aimed at investors, of course. Usually these types of things are dry as toast, but we happened to notice the third sentence in the update which says Elba Island, Kinder’s LNG export facility on the coast of Georgia, along with the Gulf Coast Express pipeline project, will both enter service in 2019 and will help lead the company to record revenue–about 10% more revenue next year than was generated this year. Which got us to thinking once again about Elba Island, and the Marcellus molecules that will get exported from it. It also reminded us of a recent email exchange we had with a subscriber who swears that LNG shipments are already departing from the facility.
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Energy Stories of Interest: Tue, Dec 4, 2018

The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading: Exelon generation to retire nine economically challenged generation facilities within PJM; Auditor General DePasquale announces plans for special report on climate change in PA; Westmoreland Transit to roll out two new natural gas-powered buses on Tuesday; Capstone Turbine announces order for expanding oil and gas projects in Utica shale; Those French fuel riots and the “Great Wall of Cuomo”; Tight supply-demand balance brings back natural gas price volatility; Perry again calls for US energy infrastructure plan, cites national security; New Brunswick legislature narrowly OKs lifting ban on unconventional natural gas drilling; Is Qatar’s OPEC exodus a blow to Saudi Arabia’s dominance?
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