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New Hearing Dates for Hilcorp’s Forced Pooling Request in PA

Last October MDN told you about Hilcorp’s request to force some Pennsylvania landowners in Lawrence County, PA to allow Hilcorp to drill under (not on) their property in the Utica Shale layer (see Hilcorp Uses PA Forced Pooling Law Against Lawrence Cty Landowner). After much tooing and froing, the PA courts told the Dept. of Environmental Protection (DEP) that the DEP would need to make the decision (see Ironic: PA Enviro Court Forcing DEP to Rule on Forced Pooling). The DEP set a public hearing for March 25 & 26 in Lawrence County, and then postponed it (see Hilcorp Forced Pooling Hearing Postponed, More Landowners Added).

We finally have final final final hearing dates from the DEP–May 7 & 8. Here’s the lowdown from the DEP, in which they say the hearings will be conducted “like a trial”…
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Hilcorp Forced Pooling Hearing Postponed, More Landowners Added

postponedMDN previously told you about Hilcorp’s lawsuit to force some hold-out landowners in Lawrence County, PA to allow drilling under their land–a concept called forced pooling. The PA Dept. of Environmental Protection (DEP) and the PA courts treated it like a hot potato. The courts finally told the DEP that they (the DEP) would need to decide the matter. So the DEP had set aside two days this week to conduct public hearings in New Castle (see Forced Pooling Circus (ie Hearing) Coming to Lawrence County, PA).

However, the circus/hearing scheduled for this week has been postponed. No new date has been announced. The DEP and Hilcorp both wanted the delay offering the explanation that they need more time, “to provide more complete notice to potentially affected people.” Apparently some landowners haven’t yet been served notice that they will be affected–forced–to be part of a Hilcorp drilling unit, and both Hilcorp and the DEP want them to know it before the public hearing commences. Seems like the forced pooling in Lawrence issue keeps getting better and better (not)…
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Hilcorp Awarded Permits to Drill 7 New Wells Near Earthquake Zone

Oh oh. It appears one hand does not know what the other is doing. Last week a new series of small earthquakes–barely able to be felt, but there all the same–rumbled through the Mahoning Valley–near Youngstown, OH. Because of injection well related earthquakes near Youngstown two years ago, residents are understandably jittery and wonder if the drilling industry is somehow at fault with this new outbreak. So the Ohio Dept. of Natural Resources (ODNR), out of what they call “an abundance of caution,” asked Hilcorp to stop all drilling and fracking activity in the area (see # of Youngstown Earthquakes go from 2 to 11 – Fracking to Blame?).

Hilcorp readily complied. We’ve discussed (endlessly) that fracking simply does not cause earthquakes–injection wells can and have caused earthquakes, when injecting fluid over an active fault. However, it’s best to play it safe in this situation. Two days after the earthquakes and Hilcorp’s cessation of drilling in Mahoning County, the Pennsylvania Dept. of Environmental Protection (DEP) awarded Hilcorp permits to drill seven new horizontal shale wells in Lawrence County, PA–about six miles from where they stopped drilling over the border in Ohio. Oops…
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# of Youngstown Earthquakes go from 2 to 11 – Fracking to Blame?

earthquakeTwo days ago MDN told you about a pair of earthquakes near Youngstown, OH (see 2 New Earthquakes Near Youngstown, OH – Fracking Connection?). That number has now grown. So far there have been a total of 11 measurable earthquakes ranging from 1.2 (not felt by humans) to 3.0 (barely felt by some humans). We suspect most people around Mahoning County didn’t feel anything, but that doesn’t stop mass hysteria when it’s announced that there have been a series of earthquakes and the only thing (supposedly) going on in the area is drilling and fracking.

As we previously pointed out, we are aware of one instance–in England–where fracking over an active fault caused an earthquake. So it can happen. But that’s one time out of 60,000+ horizontally, hydraulically fractured shale wells worldwide (maybe more than that now). Statistically it’s zero. We need to keep perspective in this situation. Initially the Ohio Dept. of Natural Resources (ODNR) said there are no active Class II injection wells in the area pumping waste fluids deep below the surface for disposal, and so the well being drilled and fracked by Hilcorp near the epicenter of the quake looks like the prime candidate as the cause. But one news story we’ve read (below) seems to cast doubt. There may be injection wells, which also have been known to cause earthquakes when injecting near a fault, operating in the area…
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Forced Pooling Circus (ie Hearing) Coming to Lawrence County, PA

The circus will come to town in New Castle (Lawrence County), PA on March 25 and 26. No, not Ringling Bros. and Barnum & Bailey, but something sure to be far more entertaining. There will be a PA Dept. of Environmental Protection hearing on Hilcorp’s request to force four landowners to allow drilling under their property. We first brought you this story last October (see Hilcorp Uses PA Forced Pooling Law Against Lawrence Cty Landowner). MDN has always held a dim view of forced pooling, so you can’t say we didn’t warn them. Hilcorp has brought this on themselves by invoking a 1961 PA law to sue the landowners to allow drilling.

Here’s the latest, including details on where the circus, er, hearing will be held…
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2 New Earthquakes Near Youngstown, OH – Fracking Connection?

A few years ago a now-shuttered injection well near Youngstown, OH was linked to a series of earthquakes in the area (see ODNR Finds Youngstown Injection Well Caused Earthquakes). The injection well was found to be located over an active fault–and when you inject a lot of liquid into a fault area, you get earthquakes.

When earthquakes happen in areas like Youngstown–an area that doesn’t usually see such activity–it’s cause for concern. Yesterday morning there were two more earthquakes big enough to be felt in the Mahoning Valley area. The first quake was a 3.0 on the Richter scale, and the second a 2.6. So, out of “an abundance of caution,” the Ohio Dept. of Natural Resources (ODNR) has asked the single drilling operation in the area–Hilcorp Energy–to suspend their drilling activity for now. There are no active injection wells in the area–only Hilcorp’s Utica Shale drilling operation of 7 wells on 2 well pads…
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Pennant Midstream Says Hickory Bend (OH) Cryo Plant Now Ready

Good news! Pennant Midstream announced yesterday that its Hickory Bend cryogenic processing plant in Mahoning County, OH is now live and online and ready to receive “wet gas” from the Utica Shale. You may recall Gov. John “foreigner hunter” Kasich dedicated the plant back in October (see OH Gov. Kasich Dedicates Hickory Bend Plant, No Foreigners Found). However, the $375 million plant was not quite ready at that point. It is now, and the gas will start flowing soon.

The even better news is that Pennant, a joint venture between Hilcorp Energy and NiSource, is preparing to build two more plants at the same location. Each plant can handle 200 million cubic feet of raw gas per day, separating it into methane and natural gas liquids (NGLs). The NGLs are then pipelined elsewhere for further processing. Here’s yesterday’s announcement:
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A Look Back (& Forward) at Marcellus Drilling in Lawrence County

As part of a year-end story review, the Elwood City Ledger (Lawrence County, PA) looks at how one of the smallest counties in the Marcellus Shale region has become a late-bloomer with a dozen new wells drilled in 2013. We hadn’t heard much about drilling in Lawrence County until recently. The news has all been about Hilcorp, and if our most recent story about Hilcorp is any indication, drilling in Lawrence will at least double, maybe triple in 2014 (see Hilcorp Goes Hogwild in Lawrence County – 11 Pads on the Way).

Here’s the “year in review” article from the Ledger that covers Marcellus drilling in Lawrence County, a year which (sadly) included a resolution passed by the Elwood City Council calling for a severance tax on shale drilling:
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Hilcorp Goes Hogwild in Lawrence County – 11 Pads on the Way

Marcellus/Utica driller Hilcorp continues to focus its efforts in Lawrence County, PA. In fact, you may say they’ve gone “hogwild” in Lawrence! The Lawrence County Planning Commission last week reviewed plans from Hilcorp for 11 (yes 11) well pad sites. Each pad has at least one well on it, and more likely 2-4 wells (perhaps more)–meaning Hilcorp plans to drill at least a couple dozen wells in the near future in Lawrence.

Here’s the details for where the 11 well pads are located:
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Ironic: PA Enviro Court Forcing DEP to Rule on Forced Pooling

A 51-year old forced pooling law in Pennsylvania that strangely does not apply to the Marcellus Shale layer, but does apply to the deeper Utica Shale layer, is being put to the test. In early October, MDN told you that Hilcorp had decided to take “the low road” and sue a landowner in Lawrence County, PA to force that landowner to allow his 14.6 acres to be drilled under using the old law (see Hilcorp Uses PA Forced Pooling Law Against Lawrence Cty Landowner).

The PA Dept. of Environmental Protection balked at invoking the old law to force the landowner and instead tossed this hot potato to the Environmental Hearing Board. The Hearing Board ruled this week that it doesn’t have jurisdiction and that the matter properly does belong back at the DEP. So what will the DEP do now?…
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New Condensate Pipeline Proposed from Ohio to Western Canada

Here’s a new one for the Marcellus/Utica region: Unity Pipeline Company (a joint venture between Harvest Pipeline, which is Hilcorp, Somerset Gas Transmission, and Crossroads Pipeline, which is NiSource) has just launched an open season (a time for drillers to sign up) for a condensate pipeline that will stretch from the Marcellus/Utica in Ohio across the state into Indiana, Michigan, and all the way to western Canada. Condensate, sometimes called natural gasoline, is a hydrocarbon produced from “raw natural gas” when the raw gas temperature is dropped to a certain point. Condensate in the northeast is mainly found in the wet gas areas of eastern Ohio, southwestern Pennsylvania and the northern panhandle of West Virginia.

Condensate is used to dilute (mix with) crude oil so the oil can more easily be pumped through pipelines. There’s plenty of condensate available in the Marcellus/Utica, and plenty of need in western Canada where they pump a lot of oil. It makes sense to get all that condensate from point A to point B–and that’s what the proposed Unity Pipeline aims to do. Here is the announcement from Unity about their plan to build a 380-mile “diluent” pipeline, a project they hope to have up and running by the middle of 2015…
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OH Gov. Kasich Dedicates Hickory Bend Plant, No Foreigners Found

Ohio Gov. John Kasich was on hand yesterday for a ceremonial ribbon cutting for the Hickory Bend cryogenic processing plant in Mahoning County, OH. Pennant Midstream, a joint venture of NiSource and Hilcorp’s Harvest Pipeline subsidiary, dedicated the plant by inviting Kasich and a number of state and local officials. The Hickory Bend processing plant separates natural gas liquids (NGLs or “wet gas”) from methane (or “dry gas”). It has been up and running since summer, however, it won’t begin shipping separated NGLs to the M3 Momentum fractionation plant in Kensington until December. Hickory Bend is also a network of 55 miles of wet gas gathering pipelines in the region.

Gov. Kasich had plenty to say as he dedicated the plant. In typical fashion he was there sniffing out “foreigners” and was happy to pronounce he didn’t find any. (For an example of Kasich’s obsession with “foreigners”–i.e. out of state workers–see OH Gov. Kasich Goes Foreigner-Hunting in Strasburg.) Kasich also dissed Pennsylvania in his comments. A handful of protesters were on hand for the ceremony, bleating about methane migration, but they were far enough away that nobody heard them…
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Progress for Arrowhead NGL Transload Facility in Wellsville, OH

Progress for the Arrowhead Utica Pipeline transloading facility being built on property leased by Arrowhead Utica (a subsidiary of Utica driller Hilcorp) from the Columbiana County Port Authority in Wellsville, OH. The transloading facility is a $20-$40 million project that will bring natural gas liquids (NGLs) to the facility to be loaded on rail, truck and barge.

On Monday, the Port Authority approved easements and rights of way to Arrowhead and Sunoco Pipeline to install and maintain pipelines near the Wellsville facility…
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OH Hickory Bend Processing Plant Dedication in Oct, Online in Dec

NiSource and Hilcorp Energy are building a natural gas processing plant in Springfield Township (Mahoning County), OH as part of a joint venture called Pennant Midstream. The Hickory Bend Processing Plant, as it’s called, will be dedicated on Oct. 28, although it won’t actually be up and running until sometime in December. The Hickory Bend project includes not only the processing plant (the first of a potential three processing plants), it also includes some 55 miles of wet gas gathering pipelines in eastern OH.

The initial investment in Hickory Bend by NiSource and Hilcorp is $375 million, but by the time it’s all done and dusted (in several years’ time with more processing plants), it could easily top $1 billion…
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Hilcorp Uses PA Forced Pooling Law Against Lawrence Cty Landowner

frowny faceThis is not the kind of story we enjoy sharing with you. Hilcorp, a major driller in the Utica and Marcellus Shale, has decided to take what we consider “the low road” and is using a 1961 Pennsylvania law to sue a landowner to allow them to drill under their property. It’s called “forced pooling,” “compulsory integration,” and a variety of other terms. MDN does not support it. Our argument is simple: My neighbor should not have the right to tell me I can’t drill on and under my land, and I should not have the right to force it on my neighbor if they don’t want it. We believe it’s the only defensible position in the drilling debate.

Regardless, Hilcorp has moved forward with a legal action against a landowner in Lawrence County, PA who owns just 14.6 acres in a drilling unit leased by Hilcorp–and that 14.6 acres apparently prevents Hilcorp from drilling. So off to court they go…
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NiSource & M3 Do a Deal to Process/Sell NGLs in Eastern Ohio

An important announcement yesterday for drillers (and landowners) in the northern portion of the Ohio Utica Shale play: Pennant Midstream announced they are building a 38-mile natural gas liquids (NGL) pipeline from the Pennant-owned Hickory Bend cryogenic processing plant (in Mahoning County, OH) to the Utica East Ohio Midstream-owned Kensington cryogenic processing plant (in Columbiana County, OH). Pennant says initially they will ship 90,000 barrels per day through the new pipeline.

Why is Pennant with its own processing plant sending NGLs to another (competitor’s) processing plant? Good question…
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