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NFG’s Midstream Gathering Unit Achieves EO100 Responsible Gas Cert

In August 2022, Seneca Resources, a subsidiary and the drilling arm of National Fuel Gas Company, announced it had achieved an “A” certification grade under the MiQ Standard for Methane Emissions Performance (MiQ Standard), the highest available certification level MiQ awards, for all of the company’s 1+ billion cubic feet per day (Bcf/d) of natural gas production in the Marcellus/Utica (see MiQ Certifies 100% of Seneca Resources’ 1 Bcf/d of M-U Production). That designation means Seneca can claim it produces responsible gas and the molecules can be traded/bundled on the MiQ Digital Registry. NFG’s midstream (gathering pipeline) arm can now make the same claim using a different certification authority.
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SRBC Approves Water Permits for 34 Shale Well Pads in NE Pa.

In August, the Executive Director of the Susquehanna River Basin Commission (SRBC) approved 34 water-use permits for individual shale gas well drilling pads in Bradford, Lycoming, Sullivan, Susquehanna, and Tioga counties. We’re just learning of the action via an official notice published in the Sept. 23 edition of the Pennsylvania Bulletin. The approvals, which are NOT subject to public review according to SRBC regulations, are general water permits. Each site will be required to receive a specific water withdrawal approval at a later date.
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SRBC Approves 8 New Water Withdrawal Requests for Shale Drilling

The highly functional and responsible Susquehanna River Basin Commission (SRBC), unlike its completely dysfunctional and irresponsible cousin, the Delaware River Basin Commission (DRBC), continues to support the shale energy industry by approving water withdrawals for responsible and safe shale drilling. Last week, the SRBC approved 22 new water withdrawal requests within the basin, eight of which are for water used in drilling and fracking shale wells in Pennsylvania. The Marcellus/Utica shale drillers receiving a green light from SRBC included BKV (Banpu), Coterra Energy, EQT, Inflection Energy, Repsol (2 requests), Seneca Resources, and S.T.L. Resources.
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M-U Drilling Profits Hit Two-Year Low, Better Days Ahead?

Investors in shale oil and gas companies suffered for years with little or no returns for the money they invested. Five of eight large Marcellus/Utica drillers saw their share prices decrease by an astonishing 85% or more from 2008 to 2019 (see Former EQT CEO: Shale Revolution a “Disaster” for Investors). Just before the COVID pandemic hit, shale companies began to change and focus on less drilling and more profitability, which began to turn things around. Then Russia illegally (and unprovoked) invaded Ukraine, driving oil and gas prices to record highs (see How Did M-U Gas Drillers Spend Their 2022 Record Haul of Cash?). Over the past year (five quarters), prices for gas and largely for oil have once again crashed, and along with it, a crash in profits for drillers.
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22 New Shale Well Permits Issued for PA-OH-WV Sep 11 – 17

New shale permits issued for Sep 11 – 17 in the Marcellus/Utica rebounded. There were 22 new permits issued last week, up from 14 issued two weeks ago. But the increase came from an unlikely source. Last week’s permit tally included 9 new permits in Pennsylvania, 1 new permit in Ohio, and 12 new permits in West Virginia. WV is typically on the low end of permits, not the high end. The top permittee for the week was Antero Resources, which received 6 permits in WV. EQT was a close second with 5 permits in WV.
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Former Philly Mayor & Fla. Congressman (Dems) Join NatGas Group

Natural Allies for a Clean Energy Future is a 501(c)(4) advocacy group launched in August 2020 to promote natural gas as the best solution to support so-called renewable energy and the best solution to lower greenhouse gas emissions. The leftist rag, The Guardian, reported that Natural Allies for a Clean Energy Future has budgeted over $10 million for its advocacy efforts. The efforts include convincing younger, liberal, and non-white audiences that natural gas is clean and green. Is it working? Last year, the group recruited former U.S. Senator Mary Landrieu (Democrat from Louisiana) and earlier this year recruited former Congressman Tim Ryan (Democrat from Ohio) to sit on the group’s “leadership council.” Natural Allies has just recruited two more Democrats as reps–former Philadelphia Mayor Michael Nutter and former Florida Congressman Kendrick Meek (both African Americans). Is this Democrats-for-hire? Or do all four of these people really believe in a future with natural gas energy?
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27 New Shale Well Permits Issued for PA-OH-WV Aug 14 – 20

New shale permits issued for Aug 14 – 20 in the Marcellus/Utica finally turned around. There were 27 new permits issued last week, way up from the 10 issued the prior week. Last week’s permit tally included 21 new permits in Pennsylvania, 2 new permits in Ohio, and 4 new permits in West Virginia (after no permits in WV for three weeks in a row). The top permittee for the week, for the second week in a row, was Chesapeake Energy, receiving 6 permits–5 in Bradford County and 1 in Susquehanna County.
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10 New Shale Well Permits Issued for PA-OH-WV Aug 7 – 13

New shale permits issued for Aug 7 – 13 in the Marcellus/Utica crashed for a second week in a row. There were 10 new permits issued last week, down 14 issued the previous week (half of the 29 issued three weeks ago). Last week’s permit tally included 10 new permits in Pennsylvania, no new permits in Ohio, and no new permits in West Virginia (third week in a row for WV). The top permittee for the week was Chesapeake Energy, receiving 6 permits–4 in Bradford County and 2 in Susquehanna County.
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Seneca Shifts Focus to Drilling Utica Wells in Northcentral PA

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. Yesterday, NFG issued its latest quarterly update. NFG operates on a weird fiscal year system. This latest update is for the company’s third quarter, which would be everybody else’s second quarter update. NFG said it plans to “further moderate” its Seneca drilling activity as it shifts to slower production growth in the “low single-digit” range.
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31 New Shale Well Permits Issued for PA-OH-WV Jul 17-23

New shale permits issued for Jul 17-23 in the Marcellus/Utica saw a nice increase. There were 31 new permits issued last week, up from the 23 issued the previous week. Last week’s permit tally included 13 new permits in Pennsylvania, 8 new permits in Ohio, and 10 new permits in West Virginia. The top permittee for the week was Coterra Energy, receiving 8 permits in Susquehanna County, PA. Coming in at a close second was Antero Resources, with 6 permits in Ritchie County, WV.
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How M-U Drillers Spent Discretionary (Extra) Cash Flow in 1Q23

For individuals, discretionary income is what’s left after you pay your taxes and fixed costs like housing, food, and clothing. For shale drillers, the equivalent to discretionary income is cash flow from operating activities (CFOA), which is the net income a company generates adjusted for non-cash expenses like depreciation and stock-based compensation, and for changes in working capital. Drillers can use their extra cash to grow production by spending more for drilling new wells (capital expenditures or capex). Or drillers can send some of the extra cash back to investors via share buybacks and dividends. How did Marcellus/Utica drillers spend their CFOA during the first quarter of 2023?
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Seneca, NNE, Begin Selling 1 Bcf/d of Certified NatGas on CG Hub

Two major Marcellus/Utica drillers–Seneca Resources and Northeast Natural Energy (NNE)–have joined the CG Hub, the world’s first commodities trading platform focused exclusively on certified natural gas and certified natural gas certificates. Seneca and Northeast now provide access to a combined 1+ billion cubic feet per day (Bcf/d) of certified natural gas to traders via the CG Hub.
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Who Bought and Who Sold the Most Shares of M-U Drillers in 1Q23

It’s possible to track which institutional investors (big investors like BlackRock) are buying or selling shares in various companies by reviewing Securities and Exchange Commission (SEC) Form 13F filings. S&P Global Market Intelligence performed a 13F review of which companies bought, and which sold (and how much) shares of stocks for shale gas drillers during the first quarter of 2023. The topmost active shale gas driller having its stock purchased by institutional investors was Comstock Resources, which drills exclusively in the Haynesville Shale. The reason Comstock came out on top, postulates S&P, is because the Haynesville is located close to the Gulf Coast and LNG export plants. However, it was the rest of the list that interested us.
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8 New Shale Well Permits Issued for PA-OH-WV May 22-28

New shale permits issued for May 22-28 in the Marcellus/Utica fell again for a second week. There were only 8 new permits issued, down from 12 new permits issued the previous week (and 26 the week before that). This is the latest indicator of a slowdown in gas drilling in our region–the first indicator being a sudden dropoff a few weeks back in the rig count (see U.S. Natural Gas Drilling Rig Count Craters, Down 10% in One Week). Last week’s permit tally included 6 new permits for Pennsylvania, no new permits for Ohio, and 2 new permits in West Virginia.
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Seneca Resources Deploying Aurion to Track & Report GHG Emissions

Seneca Resources Company, the Marcellus/Utica drilling arm of utility giant National Fuel Gas Company (headquartered in Williamsville, NY), has contracted with a company called Tachyus (headquartered in Houston, TX) to use its cloud-based greenhouse gas tracking and reporting service called Aurion. The purpose is, of course, to lower Seneca’s carbon and fugitive methane footprint–and to prove that is has lowered it.
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SRBC Water Withdrawal Restrictions Hit 42 PA Oil & Gas Operators

The weather has been fantastic for those of us living in the northeastern U.S. over the past few weeks. Clear blue skies (when they aren’t clouded with wildfire smoke from Canada), really warm temperatures, and absolutely no rain to spoil outdoor activities. Here in the Binghamton, NY area, we went from a surplus of rain and swollen rivers and lakes just a month ago to a rain deficit today. Lawns and fields and beginning to turn brown. Hey, we’re not complaining! But we do need some rain. The lack of rain in the Susquehanna River Basin has triggered water withdrawal restrictions for 42 oil and gas drillers and four other large water users (46 in all) by the Susquehanna River Basin Commission (SRBC). In many cases, the SRBC order is to “cease withdrawal.”
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