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SRBC Approves 233M Gal/Day of Water Use for 38 PA Shale Pads
The difference between the Susquehanna River Basin Commission (SRBC) and the Delaware River Basin Commission (DRBC) is stark. The former is well-run and rational, the latter is disorganized and irrational. At least with respect to fracking. Over the weekend, the SRBC published a notice in the Pennsylvania Bulletin to announce that during the month of January, the agency approved 38 requests for daily water use on shale well pads in the SRBC’s jurisdictional territory in Pennsylvania, totaling some 233.5 million gallons. Put another way, this is a handy list of where drilling will soon happen in northeastern PA.
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EQT Corporation, the largest natural gas producer in the U.S. (completely focused on the Marcellus/Utica), issued its fourth quarter and full year 2022 update yesterday. Both revenue and production fell slightly in 4Q22 over 4Q21 due to issues with third-party providers. Production for the entire year was just about even. However, because of the high price of natgas for most of 2022, EQT raked in $1.8 billion in net income last year versus losing $1.1 billion the year before.
Banpu is Thailand’s largest coal mining company. However, it is looking to reduce the amount of revenue it derives from coal from around 66% today to 50% by 2025. One of the ways Banpu is accomplishing that objective is by investing in American shale gas. Banpu partners with Kalnin Ventures and operates BKV Corporation (Banpu Kalnin Ventures), the American shale drilling arm of Banpu (96% owned by Banpu). Over the past seven years, BKV has become one of the top 20 gas-weighted natural gas producers in the U.S. Last year, Banpu filed plans with the Securities and Exchange Commission to launch an initial public offering for BKV (see 
New shale permits issued for Feb. 5-12 in the Marcellus/Utica increased nicely last week. There were 40 new permits issued in total last week, including 25 new permits for Pennsylvania, 11 new permits for Ohio, and four permits issued in West Virginia. The week before, there were only 26 new permits issued. Last week the top receiver of new permits was Seneca Resources, with six new permits for Tioga County, PA. Coterra Energy received five permits for Susquehanna County, PA. In Ohio, Encino Energy and Ascent Resources both received four new permits–in Carroll and Harrison counties, respectively.
We suppose you can file this story under the category of “damned if you do, and damned if you don’t.” We’re referring to hedging–the practice of locking in prices to sell gas you will produce in the future for a specific price now. Last year natural gas producers, including most (if not all) of Marcellus/Utica producers, were caught flat-footed when the price of natgas skyrocketed and their hedges were locked in for much lower prices. So as the hedges “rolled off,” many producers either elected not to hedge again, or hedged very little of their future production. And now prices have crashed again, meaning those producers are not protected and must sell most (if not all) of their production at very low market prices.
It hasn’t been a problem-free startup for the mighty Shell ethane cracker plant in Monaca (Beaver County), PA, now called the Shell Polymers Monaca facility. We’ve noted some of the more prominent issues as we’ve spotted them in the news. Things like the plant exceeding allowed air emissions (see 
Anti-drillers, with the assistance of biased “news” publications like the Pittsburgh Post-Gazette, continually make false accusations against the shale industry in the southwestern Pennsylvania area, alleging that fracking is the cause of rare forms of cancer in children (see 
ECA Marcellus Trust I, the royalty interest holder in some of the wells drilled and maintained by Greylock Energy in Greene County, PA, announced it would issue a payout (the equivalent of a dividend) to unitholders of 12.4 cents for 4Q22. That is down from the previous quarter when the Trust paid out 18 cents per unit. The company continues to hold back some profits ($135,000 in 4Q22) in order to build a cash reserve.
A pair of announcements yesterday gave us a little peek into the numbers Range Resources will release later this month as part of its quarterly update. In one update, Range (the very first driller to sink a Marcellus well back in 2004) reported averaging 2.2 billion cubic feet equivalent per day (Bcfe/d) for production in the Marcellus/Utica region during the fourth quarter of 2022. A separate announcement said Range’s proved reserves for all of 2022 hit 18.1 trillion cubic feet equivalent (Tcfe), up 2% over the prior year.
Last week, the oil and gas industry gathered in Houston for the 
National Fuel Gas Company (NFG), headquartered in Buffalo, NY, is the parent company for Marcellus/Utica driller Seneca Resources and the parent of midstream company Empire Pipeline. Last week NFG (and Seneca and Empire) issued its latest quarterly update. NFG operates on a weird fiscal year system. This latest update for NFG is its first quarter 2023 update, which would be everybody else’s fourth quarter update. Don’t get confused. So what did the update (and conference call) reveal about Seneca and Empire? Seneca’s M-U natural gas production was 90.6 Bcfe for the quarter (just shy of 1 Bcf/d), an increase of 9.2 Bcfe, or 11%, higher than the prior year, and 3% higher than fiscal 2022 fourth quarter.