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    63K Gal. Brine Spill at Inflection Well Pad in Lycoming County

    Approximately 63,000 gallons of treated brine (naturally occurring, very “salty” water that comes out of a well long after it’s drilled) spilled in an accident at an Inflection Energy well pad in Eldred Township, Lycoming County, PA, on Monday. Inflection blames a contractor and operator error for the spill, which happened after an already-full tank was overfilled. Some of the brine (no word on how much) reached a nearby unnamed creek that flows into the Loyalsock Creek. However, testing done on the Loyalsock shows no presence of contamination. The Loyalsock flows into the Susquehanna River, and the Susquehanna is used as a public drinking water source–hence the concern. There are no warnings to public drinking water operations along the Susquehanna because there is no problem to report. Now comes an investigation, and no doubt fines, for the accident. Here’s what we’re able to find out about the episode–an occurrence so rare it’s newsworthy when it happens…
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    Williams Files FERC Appl for Transco “Gateway Expansion Project”

    Yesterday Williams filed an application with the Federal Energy Regulatory Commission (FERC) to upgrade certain facilities in New Jersey along the Williams mighty Transco Pipeline, in order to flow an extra 65,000 dekatherms per day (or 65 million cubic feet) of natural gas to a couple of utility companies that have already signed on the dotted line as customers. The project is called the Transco “Gateway Expansion Project” and will cost roughly $85 million. The upgrades include a new compressor unit at Transco’s existing Compressor Station 303 in Essex County, NJ, a new valve and electric transformer also in Essex County, and equipment upgrades at a metering station in Passaic County, NJ. Both PSEG Power and UGI Energy Services have signed up to receive the extra gas–to be distributed to their customers in the region. The extra 65K dekatherms that will flow because of the upgrades is enough natural gas to meet the daily needs of ~300,000 homes. Here’s the lowdown on this latest Williams project…
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    PA Rep. Garth Everett Explains Severance Tax Comments to MDN

    PA Rep. Garth Everett

    Earlier this week MDN ran a story (and our response) highlighting what appears to be a change in position by Pennsylvania Rep. Garth Everett, Republican from Muncy (Lycoming County), PA, on the issue of a severance tax (see Et tu Brute? PA Rep. Garth Everett Falls for Severance Tax Trap). Everett had spoken to the local Williamsport Sun-Gazette and the resulting article quoted Everett as saying he, “feels the time has come for the gas industry to pay a tax on production costs.” The article also said that he is, “fine with a [severance tax] measure that doesn’t transfer the tax to landowners.” Which led us to chide Everett–someone we’ve long admired. Folks around Lycoming County, where Marcellus drilling is big business, read the Sun-Gazette article and the MDN response and began calling Everett to ask him about his sudden change. Everett contacted MDN, requesting a call to clarify what he did–and did not–say to the Sun-Gazette. MDN is happy to report that we now have the full story, and feel much better, about Everett’s position on the severance tax. Here’s a summary of our conversation with Rep. Garth Everett…
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    A Closer Look at Kalnin Ventures and Their Marcellus Investments

    It’s time to look deeper into Kalnin Ventures, a Denver, CO-based investment firm that invests in U.S. upstream (mostly shale) deals. Sound familiar? Kalnin has been the “front man” for Banpu Pcl, Thailand’s largest coal producer. Over the past year and a half Kalnin/Banpu have snapped up some 55,000 acres and 355 shale wells–in the northeast Pennsylvania Marcellus (see our Kalnin/Banpu stories here). At least, we thought Kalnin was the “front man” for Banpu. It’s certainly Banpu money buying the leases and the wells, so we figured Kalnin was just an American subsidiary on paper for Banpu. But it turns out the truth is more nuanced. Kalnin is its own company. Yes, Banpu is the major benefactor providing the funds, but Kalnin is clearly in the driver’s seat with these Marcellus deals. Kalnin is not an operator. While news coverage may say Kalnin is “a top-20 gas producer,” as the Bloomberg article below says, that does not mean Kalnin is an operator. They’re investors. They’re owners. Other people do the actual drilling and management of the wells. In checking out the Kalnin website we found this description of the company: “Kalnin Ventures currently is backed by investors with equity fund commitments of USD 500 million, within its oil and gas fund BKV Oil and Gas Capital Partners, L.P. The company seeks to invest in attractive upstream oil and gas opportunities in North America (United States of America and Canada) with the goal of creating long-term sustainable value in the energy industry.” And right under that statement, this interesting statement: “Kalnin Ventures supports and upholds biblical principles as the foundations for the company’s values and underpins our company’s promise of integrity and transparency to our investors and partners.” Hats off to Kalnin for being upfront and unashamed of their God-honoring, faith-based principles. Not many companies have the guts to be so bold these days. Here’s an inside look at Kalnin Ventures, and how they continue to make money on Marcellus shale deals–even in a low-gas-price world…
    Read More “A Closer Look at Kalnin Ventures and Their Marcellus Investments”

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    EQT’s 4-Pronged Strategy for Defeating Corp Raider Jana in Rice Deal

    On Monday, Rice Energy was merged into EQT, creating the largest onshore natural gas producing company these United States (see Out with the Old: Rice Energy Sign Comes Down Day of EQT Merger). The $8.2 billion deal was first announced back in June (see EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US). There was plenty of drama along the way–primarily opposition to the deal by evil corporate raider Jana Partners, in collusion with Atlas Energy (see Proxy Fight: Jana Partners, Atlas Tries to Stop EQT/Rice Deal). Another corporate raider, D.E. Shaw, piled on too, but at least they supported the deal to merger Rice into EQT (see Under Pressure, EQT Moves Up Timeline to Explore Splitting Co.). You know we loathe corporate raiders. They buy enough stock in a company to get a board seat, then agitate, forcing the company to layoff people and sell assets–all in a bid to make the stock price pop so they can sell their shares at a handsome profit and move on to the next victim. Disgusting organizations and disgusting people. Jana was the primary opponent to the EQT/Rice deal. Jana was fresh off from helping Amazon take over the Whole Foods grocery store chain. Yet somehow EQT was able to fend off Jana’s efforts against their company. How did they do it? That was the subject of a recent post on the Seeking Alpha investor’s website. Here’s a fascinating look at the strategy EQT used to fend off an evil corporate raider…
    Read More “EQT’s 4-Pronged Strategy for Defeating Corp Raider Jana in Rice Deal”

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    PA DEP Sec. Visits Snyder County Gas-Fired Power Plant; 2nd Plant?

    Yesterday Patrick McDonnell, Secretary of the Pennsylvania Dept. of Environmental Protection, went on a field trip and took a tour of the Panda Power Funds Hummel Station natural gas power plant site in Synder County. In February 2015, Panda announced a joint venture with Sunbury Generation to build a whopping 1,124-megawatt plant on the site of a recently retired coal-fired plant near Shamokin Dam in Snyder County (see Panda Power Building 3rd Marcellus-Fired Electric Plant in PA). Since that time the project has made steady progress and is now 88% complete. Panda said on the tour yesterday it expects to complete the plant and begin full operations in February of next year–just a little over three months from now. UGI has already built a 34-mile pipeline to feed the plant (see UGI Ready to Begin Flowing Gas via $150M Sunbury Pipeline in PA). Sec. McDonnell is tickled pink (or should we say natgas flame blue) with the project, and said so yesterday. Perhaps the biggest news to come from the tour yesterday is that Panda and Sunbury Generation have partnered for a second gas-fired power plant–right next door to the Hummel Station plant…
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    Rex Energy 3Q17: $47M Loss, 10 More Utica Wells on the Way

    Rex Energy, a driller focused mainly on the Marcellus/Utica (headquartered in State College, PA), issued their third quarter 2017 update earlier this week. The company continues to bleed money, losing $47 million in 3Q17, versus losing $55 million in 3Q16. An improvement, but showing a profit would be a whole lot better than a loss at this point. Highlights for 3Q17: Rex placed the four-well Wilson pad into sales (Butler County, PA) with initial 24-hour average sales rate per well of ~10.9 million cubic feet equivalent per day (MMcfe/d). Total production averaged 182 MMcfe/d–with 38% of that liquids production. Rex drills in both western PA and eastern OH. Rex officials said they are currently working on 10 new wells in Carroll County, OH that will go online in 2018. So far Rex has drilled 30 wells in the Buckeye State. Below is the full 3Q17 update, along with excerpts from the analyst phone call and the latest Rex slide deck…
    Read More “Rex Energy 3Q17: $47M Loss, 10 More Utica Wells on the Way”

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    PJM Double Talk: Grid Operator Floats Plan to Favor Nukes & Coal

    We’re wondering if anyone else smells a tad bit of hypocrisy with this one. In March, PJM Interconnection–the regional transmission organization (RTO) that operates the electric grid in all or parts of 13 states and the District of Columbia (including PA, OH and WV), released a study saying even with fewer coal plants producing electricity, PJM’s electric supplies–using more and more natgas and renewables–will be just fine (see Is PJM Electric Grid at Risk by Using More NatGas? Study Says No). Then just last month, PJM said DOE Sec. Rick Perry’s plan to favor electricity from nuclear energy plants and coal, in the name of “grid reliability,” is not needed (see Appalachian Grid Operators: We Don’t Need Trump’s Reliability Plan). But yesterday PJM turned around and released their own plan…which does just that! PJM published “Proposed Enhancements to Energy Price Formation” (full copy below) to set rates that supposedly more accurate reflect the contributions “fixed” electric producers like coal and nuclear make to the grid. That is, PJM is proposing changes to the pricing scheme that will cause a 2-5% increase for all electric rate payers in PJM–in the name of grid reliability. They want to deliver on Trump’s aim of grid reliability, but do it in a different way (with the same result of higher prices for everybody)…
    Read More “PJM Double Talk: Grid Operator Floats Plan to Favor Nukes & Coal”

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    Antis at DRBC Meeting Act Like Children, Demand Total Frack Ban

    We told you back in September that the obsequious members of the Delaware River Basin Commission (DRBC) will obey 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 form the final ban language will take has yet to be delivered–it’s due by Nov. 30th. However, the DRBC isn’t singing from the same song sheet as the radicals at THE Delaware Riverkeeper. A total frack ban isn’t good enough for the nutters. You see, they don’t like language in a draft resolution they’ve read that would allow frack wastewater to be hauled/disposed of inside their precious Delaware River Basin playground (see Governors from PA-NY-DE Vote to Ban Fracking in Dela. River Basin). The DRBC held a regular meeting yesterday, and the nutters showed up in force–behaving like the children-in-adult-bodies they are. There were, “About two dozen protestors, some of them with cloth gags in their mouths,” protesting at the meeting, calling on board members to not only ban fracking, but ban any kind of water use in the basin related to it. Here’s an account of what happened, and what lies ahead…
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  • Marcellus & Utica Shale Story Links: Thu, Nov 16, 2017

    The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: H&H pitches fracking to A-K Valley business leaders in SWPA; Mike Turzai pledges no severance tax if he’s elected gov; new CNG buses on the way in Altoona; Chinese investment in WV could include PE resin; is Tom Wolf just billionaire Tom Steyer’s bobblehead?; FERC Acting Chairman floats interim plan to “save” coal & nuke plants; more M&A on the way in o&g sector; ONGC likely to suspend shale exploration in India; and more!
    Read More “Marcellus & Utica Shale Story Links: Thu, Nov 16, 2017”