PA Natural Gas Production Hits Another All-Time High in 2Q18
Last Thursday the PA Independent Fiscal Office (IFO) released their latest quarterly Natural Gas Production Report for Apr-Jun 2018 (full copy below). It shows natgas production rose 9.9% compared to the same period last year–same as the increase in 1Q18 (see PA Natural Gas Production Hits New All-Time High in 1Q18). The report also shows the number of producing wells is up 10.4% from last year. Total natural gas production volume was 1,455.8 billion cubic feet (Bcf), and the number of producing wells in 2Q18 was 8,672 (of which 8,194 were shale wells). The biggest news is that once again 2Q18 saw the highest quarterly production of natural gas in the state–ever. This is the seventh quarter in a row there has been an increase in production. Two-thirds of the state’s natural gas production consistently comes from four counties: Susquehanna, Washington, Bradford and Greene. The #1 county for natgas production in 2Q18 was, as it was in each quarter of 2017 and in 1Q18, Susquehanna County, in the northeastern corner of the state. The #1 producing driller in Susquehanna County is Cabot Oil & Gas. Here’s the full 2Q18 natural gas production report from the IFO…
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In an act still befuddling for us, West Virginia Gov. Jim Justice fired Commerce Secretary Woody Thrasher in June (see 
The Marcellus and Utica Shale layers in Southwestern Pennsylvania, northern West Virginia and eastern Ohio produce a boatload of NGLs–natural gas liquids. One company had the foresight to plan a strategy to separate, transport and sell those NGLs. That company was MarkWest Energy, now known as MPLX following a purchase by/merger into Marathon Petroleum. MarkWest’s plan is firing on all cylinders. The experts at RBN Energy have analyzed MarkWest’s initial strategy, now largely complete, and their long-term strategy, still in the works, to give us a great snapshot of how NGLs are moving from our region to Midwestern and Canadian markets…
This another one of those high finance thangs we don’t fully understand. Dominion Energy spent $4 billion to build their Cove Point LNG export facility in Lusby, Maryland. Somehow and somewhere they got money to build it–investors perhaps, or maybe Dominion had some cash tucked away under the corporate mattress. Dominion wants to get some of that debt off its books, so it has just structured a three-year loan with 20 lenders for $3 billion, reducing the company’s “parent level debt”–as opposed to child or subsidiary level debt. What it all means, if we’re understanding it correctly, is that Dominion is moving debt from the parent company’s balance sheet to the Cove Point subsidiary company’s balance sheet. Prior to this, Cove Point “owed” the money to Dominion itself (all in the family), and now, instead, the Cove Point subsidiary will owe that money to lenders directly. That’s our take. Hopefully it won’t take long for Cove Point to pay off the debt…
Houston-based Schlumberger (pronounced Shlum-Bur-Zhay) is the world’s largest oilfield services company. They’re the company a majority of exploration and production companies (drillers) call when they want a new well drilled. The #2 company on speed dial for drilling new wells is Halliburton, and they’re not even close in size to #1 Schlumberger. Here in the U.S., the #3 company on speed dial for drilling is Baker Hughes, still (for now) owned by GE. We mention all that because most folks recognize the names Halliburton and Baker Hughes, yet are often not familiar with the hard-to-pronounce Schlumberger. Even so, Schlumberger has a big presence in the Marcellus/Utica region. In a gesture of “giving back,” the company has just made a VERY generous grant of $14 million of its own proprietary software used for modeling and assessing risk associated with drilling new wells, to Youngstown State University. Most major E&Ps use Schlumberger’s software, even if they don’t use Schlumberger itself to do the actual drilling. While at first glance the gift of software may seem self-serving, it’s not. This gift means that students will be trained on the latest and greatest software that they will need to know, coming right out of college. It helps the kids gain a valuable skill, making them more employable once they hit the workforce…
Events related (or of interest) to the Marcellus and Utica Shale, primarily pro-drilling events. To have your event included (or if you are aware of a worthy event you believe should be on this page), please send the details and/or a link to have it included to the calendar@marcellusdrilling.com email address.
The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading: Chambersburg project to extend natgas line costing $1.2M, “significant impact”; CNX, Hess complete deal to sell their joint OH Utica assets to Ascent; WVU researchers to study methane emissions from well pads; OH Supreme Court rules against NEXUS pipeline referendum; Cali commits fossil fuel suicide, unlivable by 2045; NAFTA 2.0 must promote natgas trade with Canada; Texas power couple behind many of the deals you read about; FERC speeds up process for 12 LNG export projects; China’s natgas imports soar; and more!