Energy Companies | Energy Services | EQT Corp | Equitrans/EQT Midstream | Industrywide Issues | Litigation | Pipelines
Arbitrator Rules EQT Does NOT Have Right to Buy Hammerhead Pipe
Equitrans Midstream, owner of the 303-mile Mountain Valley Pipeline (MVP) and a related gathering pipeline called Hammerhead designed to feed 1.6 Bcf/d (billion cubic feet per day) of Marcellus/Utica gas into MVP, says an arbitration panel ruled in its favor in a dispute with EQT Corp. over the delayed startup of Hammerhead. According to an 8-K filing, Equitrans said the three-member arbitration panel ruled that the in-service delay beyond October 1, 2020, for Hammerhead was caused by a force majeure, so EQT has no early termination right under the Hammerhead gathering agreement or related right to purchase the Hammerhead project.
Read More “Arbitrator Rules EQT Does NOT Have Right to Buy Hammerhead Pipe”
Last week Pennsylvania issued 21 permits to drill new shale wells. Most of the permits went to two well pads, one in Butler County drilled by PennEnergy Resources and the other in Tioga County drilled by Repsol. Ohio issued six new permits, three to Encino Energy, two to Utica Resource Operating, and one to Ascent Resources. West Virginia, for the second week in a row, issued just one new permit. Last week’s WV permit went to Tug Hill Operating in Marshall County.
The Gas and Oil Association of West Virginia (GO-WV) released a new report yesterday called “Gas Facts” (full copy below). The report chronicles the impact oil and gas has had on the Mountain State over the past five years. According to Charlie Burd, GO-WV executive director, “Natural gas is the state’s top-paying sector, supporting more than 82,000 jobs and contributing roughly $5.2 billion in wages each year. Clean, abundant natural gas will continue to drive economic growth and opportunities for generations of West Virginians.” It’s an interesting report. One thing in the report caught our eye immediately: Two “top 10” lists for gas and oil production. We’re suckers for a good top 10 list…
Hedging, in the case of natural gas produced by big drillers like EQT Corporation, is when the company presells the production it will make (in the future) under contract at a specific price. Typically companies like EQT will hedge production for up to a year, sometimes more, in advance. It’s a way of protecting revenue from production in case prices sink below a certain level. The problem with hedging is you are locked in when the price goes up and stays up, like the price for natgas has done over the past several months. According to Bloomberg, EQT’s hedges could cost the company “more than $5 billion through the end of next year.” Ouch. CEO Toby Rice openly admits the company guessed wrong on its hedges.
Small investors have a golden opportunity. Oil and gas companies (drillers in particular) are more profitable than ever, yet many large investors are avoiding and will not invest in them. Why? Because they’re idiots? Well, yes, that’s one reason. But the root cause is they have been cowed by loud-mouthed environmental extremists. Threatened by them. Oil and gas companies are still here, still providing a critical service to the world, and still need investors. That’s a great opportunity for small investors–like you.
EQT CEO Toby Rice laid the blame for the developing world energy crisis, particularly Europe’s lack of access to natural gas, at the feet of radical environmentalists. If not for the radicals and their constant frivolous lawsuits blocking pipelines and LNG export facilities, such infrastructure would already have been built and would be providing abundant, cheap, clean-burning Marcellus/Utica natural gas to other regions of the U.S. and to Europe.
Last week MDN was (as far as we can tell) the first to bring you news of a new lawsuit filed in Allegheny County Court of Common Pleas against EQT alleging the company had not made required royalty payments to at least two residents, and likely many more residents (see 
Yet another entrant in what is becoming a crowded field of programs aimed at reducing methane leaks from natural gas systems. A coalition of major U.S. natural gas operators, including Devon Energy, EQT, Sempra, Southern Company, and Williams, have signed on to something called the Veritas project, created by research firm GTI. How will Veritas reduce methane emissions and how is it different from Project Canary and other similar programs?
A healthy number of permits were issued to drill new shale wells across the Marcellus/Utica region last week. Pennsylvania issued 19 new permits in both southwest and northeast PA. Ohio issued 8 new permits, all of them to a single driller (Ascent Resources) for two well pads in two different counties. West Virginia issued 9 new permits–all but 2 of them were issued to Antero Resources in Tyler County.
In early 2019, EQT, the largest natural gas producer in the U.S. (and in the Marcellus/Utica) settled a class action lawsuit in West Virginia with landowners and rights owners ending EQT’s practice of post-production deductions from royalty checks (see