Shell Cracker Construction “in the Home Stretch” – Ready in 2022

It’s been a long road, but we’re nearing the end. Shell’s $6 billion ethane cracker plant, officially called the Pennsylvania Petrochemicals Complex (PPC), is close to being done. It’s likely the PPC, located in Beaver County, PA, will be up and running sometime next year. When it is, the market for Marcellus/Utica NGLs will profoundly change. PPC will use an average of 85,000 barrels per day of M-U ethane. Our ethane will no longer be a waste product that many drillers pay to get rid of, but rather a profitable product they sell.
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Court Approves Chesapeake Bankruptcy Plan to Dump $7B of Debt

Over the objections of a junior creditor group, a judge for the U.S. Bankruptcy Court in Houston said yesterday he will approve Chesapeake Energy’s bankruptcy plan to jettison $7 billion (out of $8.9 billion) worth of debt. Chesapeake will exit bankruptcy within the next 30 days and will continue to retain and drill on its Marcellus Shale assets in northeastern Pennsylvania.
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US Well Locks in Long-Term E-Fracking Contracts with Range, EQT

In a pair of announcements earlier this week, U.S. Well Services announced it has signed new long-term deals with both Range Resources and EQT to supply “electric fracking” services. We told you in February 2020 that Range had signed on with U.S. Well Services to continue using its electric fracking service (see Range Resources Converts to Electric Fracking with US Well Serv.). A couple of months later EQT signed up with U.S. Well too (see EQT Converting One-Third of Completions to US Well E-Fracking). What’s the difference between traditional fracking and electric or e-fracking?
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Weekly Shale Drilling Permits for PA, OH, WV: Jan 4-8

Once again all three M-U drilling states received permits last week. Pennsylvania scored 10 permits to drill new shale wells. Ohio received 2 permits for Utica wells. And West Virginia received no new permits to drill new shale wells.

NOTE: This post was updated on 1/14/21. We previously reported a set of 6 wells in WV in error–those wells received permits in 2020 and not 2021. Sorry! Thank you to a sharp MDN reader who flagged it for us.
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Extreme Makeover: EQT Edition

Oil & Gas Investor magazine recently sat down with Toby Rice, CEO of EQT Corporation, to discuss his (and his brother Derek’s) successful takeover of the company in July 2019. The lengthy article begins this way: “A year and a half after leading a mutiny of shareholders to take control of the nation’s largest natural gas producer, CEO Toby Rice is proud to reveal the completed remodel. And it’s even better than promised.”
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Beaver Community College Opens $5M Shell Cracker Training Facility

The Community College of Beaver County’s (CCBC) Shell Center for Process Technology, a $5 million state-of-the-art training facility, has just officially opened. While the Center was built to train employees to run the Shell ethane cracker plant, it’s also training people for a myriad of other opportunities too.
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PA Supreme Crt to Hear Big Green Challenge to Penn Twp Shale Wells

Where does Protect PT, an anti-fossil fuel Big Green group, get money to launch multiple lawsuits against shale drillers in Penn Township (Westmoreland County), PA? Last May we told you about a legal challenge by Protect PT attempting to ban fracking in the township–an effort that finally failed when the PA Supreme Court refused to hear the case (see Penn Twp Frack Ban Case Strikes Out at PA Supreme Court). Just when you thought it was all over and done, another Protect PT lawsuit challenging the right of Olympus Energy (formerly Huntley & Huntley) to drill a specific series of wells on a single pad has come along. Unfortunately, the PA Supremes *will* hear this case.
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Diversified Gas & Oil “Bullish” on Future of Gas & Oil in Ohio

Brad Gray, DGO

Diversified Gas & Oil (DGO) owns close to 8 million acres of leases with some 60,000 (mostly) conventional oil and gas wells. Their focus has been to acquire quality production and cash flow–regardless of the well or commodity type (gas or oil)–in the Appalachian Basin. They currently have over 400 Marcellus/Utica shale wells in their portfolio too. DGO’s executive vice president and COO, Brad Gray, published a column yesterday extolling the company’s love for the Buckeye State. Gray says DGO is “bullish” on the oil and gas industry in Ohio.
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Haynesville Shale Growing – Chief Competitor to Marcellus/Utica

The Marcellus/Utica is the #1 natural gas producing play in the country. Last month the M-U region produced 33.6 billion cubic feet per day (Bcf/d), according to the U.S. Energy Information Administration’s December Drilling Productivity Report (see DPR: Most Shale Plays, Incl. M-U, Continue Big Drop in Production). The second highest-producing region was the Permian, producing 16.9 Bcf/d. Third highest was the Haynesville at 11.3 Bcf/d. So why do we say the Haynesville is the chief competitor to M-U?
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M-U Drilling Co. Stocks Boomed in 2020, Positive Outlook 2021

As we entered 2020, the stock price for most Marcellus/Utica drillers was near or even at the lowest it had ever been (see Marcellus/Utica Drillers’ Stock Prices Near/At Historic Lows). Then the twin catastrophes of an oil price war (launched by Russia and Saudi Arabia) and a worldwide pandemic hit in March. As it turns out, the catastrophes ended up benefitting our shale drillers. Stock prices improved dramatically for a number of major gas drillers in the M-U after March.
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Southwestern, Equinor Win Post-Production Deduction Lawsuit in WV

Just coming to light (for us) is a decision issued by the U.S. Court of Appeals for the Fourth Circuit on Dec. 1, a ruling on post-production deductions by drillers when calculating gas royalties “at the wellhead” in West Virginia. The drillers, in this case, were Southwestern Energy and Equinor (formerly known as Statoil). The drillers won the right to claim certain post-production deductions.
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Weekly Shale Drilling Permits for PA, OH, WV: Dec 21-Jan 1

We’re catching up the permits issued over the past two weeks (prior to this week). Pennsylvania issued 11 permits during that time, and West Virginia issued 3 permits. Ohio issued no new shale drilling permits over the past two weeks.
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SWPA Olympus Well Becomes Longest Marcellus Onshore Lateral

A well in the Marcellus Shale in (of all places) Plum Borough in Allegheny County, PA (a suburb of Pittsburgh) has become the longest onshore lateral drilled in the Marcellus Shale. Olympus Energy (formerly Huntley & Huntley Exploration) has drilled and completed a well with a 20,060-foot lateral–3.8 miles long!

UPDATE: This post was revised from the original. See our note below.
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Weekly Shale Drilling Permits for PA, OH, WV: Dec 14-18

Last week Pennsylvania issued 25 new shale well drilling permits in both northeast and southwest PA, although most of the permits for SWPA. Ohio issued 4 new shale well permits, all of them to the same company (Encino Energy) and the same well pad (in Harrison County). West Virginia issued 6 new shale well permits, one in Lewis County and the rest in Tyler County.
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