Shell Shuts Down SWPA Cracker Plant Construction re COVID-19

Yesterday MDN told you that Shell had not (yet) closed down construction of the mighty ethane cracker plant they are building in Beaver County, PA (see COVID-19: Shell Keeps SWPA Cracker Construction Site Open). After a confirmed case of COVID-19 coronavirus in the county, the Board of Commissioners asked Shell yesterday to shut down the site for now. Within a few hours Shell did just that, sending home some 8,000 workers. The work stoppage will last from a few days to a few weeks.
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Gulfport Energy Hires Debt Restructuring Advisers

On Tuesday MDN told you that Chesapeake Energy has hired “debt restructuring advisers,” to help the company figure out how to stay afloat with $9 billion worth of outstanding debt (see Chesapeake Energy Hires “Restructuring Advisers”). Now comes word that Gulfport Energy, a major Utica Shale driller, has also hired debt restructuring advisers to help it with some $2 billion worth of outstanding debt.
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Marathon Petroleum Won’t Sell MarkWest Midstream Subsidiary

Marathon Petroleum, the parent company of MPLX (formerly called MarkWest Energy) announced some big changes last November. Namely, they caved to “activist” investors (we still call them corporate raiders) and their demands to split the company in three and dump the current CEO (see Partial Activist Victory: Marathon to Sell Speedway, CEO Retiring). The one thing the activists didn’t get was a commitment from Marathon to sell off the MarkWest/MPLX division. However, to keep the raiders happy, Marathon did commit to reviewing a sale of MPLX/MarkWest. The review is now done and yesterday Marathon announced not only will they keep MPLX/MarkWest, but the CEO of MPLX is also becoming the CEO of parent Marathon.
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New Fortress Convinces Jamaica to Use CNG for Bus Fleet

We continue to be impressed with New Fortress Energy and its aim to own as much of the LNG supply chain as possible. The company is building an LNG (liquefied natural gas) liquefaction plant in northeast Pennsylvania (see Work Continues to Clear Site for NEPA Landlocked LNG Export Plant). They plan to truck and use rail cars to get the Marcellus LNG to a new dock facility they plan to build on the New Jersey shoreline of the Delaware River (see DRBC Reconsiders New Fortress LNG/NGL Shipping Dock on Dela. River).
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Jones Act Discussed on ‘Shale Gas News’ Radio Program

Shale Gas News is a weekly radio program that plays on three radio stations in Pennsylvania. Last weekend’s show featured a segment with Colin Grabow, a policy analyst at the Cato Institute’s Herbert A. Stiefel Center for Trade Policy Studies. Grabow’s research focuses on domestic forms of trade protectionism such as the Jones Act and the U.S. sugar program. Yes, the Jones Act again! During the segment, Grabow describes what the Jones Act is and how it negatively affects U.S. shale gas exports to places like New England and Puerto Rico (see Puerto Rico Imports Russian LNG Thanks to U.S. Jones Act).
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Bloody: Permian Oil Dips to $16.24/Bbl; NYMEX Dips to $1.55/Mcf

It’s getting bloody out there. Just two days ago we told you the “unthinkable” may happen, that oil may approach or hit $20/barrel (see Oil Heading for $20/Barrel; Price in Freefall; Uncharted Territory?). Yesterday (one day later) the price for West Texas Intermediate (WTI) crude closed at $20.37. However, the price in the Permian traded as low as $16.24, the weakest level since 1999. That’s less than the price of a steak at the Outback Steakhouse! As for natural gas, the NYMEX futures price closed yesterday at $1.60/Mcf, but not before briefly hitting $1.55/Mcf. Some analysts now say the price of oil could hit (gulp) $0/barrel. Is such a thing really possible?
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Prediction: NatGas Prod. Down 2.4 Bcf/d, Oil Down 1M Bpd This Yr

Nobody knows just how low the price of oil and natural gas will go due to the COVID-19 coronavirus crisis (see today’s companion story), but that doesn’t stop prognosticators from rendering estimates of prices and (in this case) production levels. We spotted a couple of stories of interest. One story takes a stab at estimating where natural gas production in the U.S. will end up this year (down 2.4 Bcf/d), and another story estimates where oil production will end up this year (down 1 million barrels/day). Here are those predictions and rationale, for what it’s worth…
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Shale Energy Stories of Interest: Thu, Mar 19, 2020

MARCELLUS/UTICA REGION: Rep. Conor Lamb supports Biden’s ‘no new fracking’ push; NATIONAL: Seven of the most prolific Texas shale drillers cut $7.6 billion from budgets as oil prices collapse; ConocoPhillips and other oil producers slash their budgets deeper; Oil’s crash is both a help and a hazard for LNG export projects; In the oil business, everything flows downstream, including the pain; Crude market vaporizes; contango and storage plays take center stage; INTERNATIONAL: Canadian heavy oil plunges to lowest price on record.
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