Who *Sold* the Most NatGas in the U.S. in 3Q18?

Who are the biggest natural gas sellers in the U.S.? You might be surprised to learn that the biggest *sellers* are not necessarily the biggest *producers* of natural gas. Oh, you might recognize some of the names of the top sellers (BP, Shell, ConocoPhillips). But others might be more of a mystery (Macquarie, Tenaska, Sequent, and J. Aron & Co.). Would it surprise you to learn that BP (i.e. British Petroleum) is the #1 seller of natgas in the U.S., and has been for years? Last quarter BP sold 21.01 billion cubic feet per day of natural gas here in the colonies. Each quarter NGI (Natural Gas Intelligence) runs the numbers and publishes the list of 25 top natural gas marketers in the U.S. They recently published the third quarter 2018 list, which shows that overall volumes are up from the same quarter a year ago, and that we are on track to have the highest growth in production for a single year since the new millennium began.
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“Growing” Opposition to Shell Ethane Cracker Pipe from One Source

In June, Shell said that they plan to build their Falcon ethane pipeline in 2019 (see Shell Says Falcon Ethane Pipeline to Get Built in 2019). The pipeline won’t actually flow ethane to the Shell cracker in Monaca (Beaver County), PA until 2020 at the earliest–because the cracker plant itself won’t go online until 2020 at the earliest. The 97-mile, two-legged Falcon Pipeline is interesting because Shell didn’t use eminent domain. Shell negotiated with every landowner and got them all to sign on the dotted line. Yet we’re now hearing from Pittsburgh media that there is “growing” opposition to the project. Unless you’re a landowner with the right to stop it, or the Sierra Club with billions in the bank to launch frivolous lawsuits, there is no stopping this project, “growing opposition” or not. When you dig into the news, you will find the “growing” opposition seems to be coming from a single source–the Ambridge Water Authority.
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Is Shell Pulling Out of Pennsylvania Marcellus?

Is Shell (or SWEPI, formerly known as Shell Western E&P Inc.) leaving its Pennsylvania Marcellus drilling program behind? You may recall we posted a story in June quoting Tonya Williams, general manager for Appalachia with Shell, as stating (during her talk at the DUG East event in Pittsburgh) that Shell plans to spend $150 million to drill wells on four pads in 2018, all of it in Tioga County (see Shell Focused on Single PA County, No New Drilling in Other Areas). Although Shell has wells and acreage in 10 Pennsylvania counties, Tioga is the focus for this year. Barley two months later, in early August, MDN received a note from a trusted reader saying that Shell is pulling out, ending its Marcellus program and sending their personnel to Texas. Frankly, we were skeptical.
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Accident Kills Rig Worker on Shell Well Pad in Tioga County, PA

Middlebury Township, Tioga County

This news is a couple of weeks old, but we’ve only just happened across it while researching another story. On the morning of October 27, Mark Jones, an employee of Deep Well Services, was working at a Shell rig site in Tioga County, PA when “a large piece of equipment fell on him, pinning him to the platform 65 feet in the air where he was standing.” The blunt force trauma, hitting him in the head, killed him. We are always saddened to read of such accidents. Here is the one and only story we could locate describing what happened:
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30-Story Quench Tower Set in Place for Shell Ethane Cracker

On Sunday, what will be the tallest and heaviest piece of equipment that’s part of the mighty $6 billion Shell ethane cracker in Monaca (Beaver County), PA was hoisted into place. It’s called a “quench tower” and it looks like a humongous silo. It’s 300-feet high, which translates into about 30 stories. One of the world’s largest cranes had to be reserved a year ago in order to do the lifting. It took all day, but by 3:30 pm, the quench tower was standing upright–yet another monument to the power of the Marcellus Shale.
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“Cracker Effect” – Shell Plant Will Create 7,400 Permanent Jobs

Ever hear of the “cracker effect”? No, we hadn’t either. Not until we read about a new study by a husband and wife team from Washington & Jefferson College. The pair studied the economic impact of cracker plants on surrounding communities–some 34 ethane crackers in 16 counties around the country. Most of the cracker plants are located along the Gulf Coast. The purpose of the study is to accurately forecast what will happen with Shell’s new $6 billion ethane cracker currently under construction in Beaver County, near Pittsburgh. What might the real, measurable economic effect be from Shell’s cracker? According to the authors, the Shell cracker will generate ~7,400 permanent, long-term jobs. Crackers not only create new jobs, they boost wages in cracker counties by nearly 13% over counties without crackers. But counties without a cracker plant benefit too. Counties bordering counties with a cracker plant see lower unemployment rates. No mystery there. While the authors alluded to some negatives from crackers, we were hard-pressed to find any! It sure looks like everything is coming up roses with the Shell cracker. The numbers prove it…
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7 Green Groups Attack Shell Ethane Pipeline “Exemptions”

Seven radical green groups–Sierra Club, Clean Air Council (CAC), FracTracker Alliance, Earthworks, PennFuture, Breathe Project, Environmental Integrity Project–sent a protest letter last week to the Pennsylvania Dept. of Environmental Protection objecting to a request by Shell that its 97-mile Falcon Ethane Pipeline be granted certain air permit exemptions. Shell is asking the DEP to determine whether or not (hopefully not) any emissions coming from the pipeline would be “minor sources,” exempting the pipeline from certain permits. The rads are telling the DEP to deny that request, in an attempt to slow or even stop the project. With no ethane, Shell’s $6 billion cracker plant, currently under construction, can’t begin operation. Will the DEP do the right thing and ignore these nutters?…
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Cracker Boost: FERC Approves Shell Falcon Ethane Pipeline Rates

Getting permission to build a new pipeline from the Federal Energy Regulatory Commission (FERC) is one thing. An important thing. But beyond permission to build, you also need permission to charge a particular rate for those using the pipeline. Shell is currently building a $6 billion ethane cracker in Monaca, PA, near Pittsburgh, to chemically “crack” ethane from shale wells into ethylene–the raw building material of plastics. Shell is also building a 97-mile, two-legged pipeline system called the Falcon Ethane Pipeline (see Exclusive: Shell Leasing Land for 2 Pipelines to PA Cracker Plant). Shell ran an “open season” to lock up shippers–drillers who will provide ethane to the plant via the pipeline–in October 2016 (see Shell Launches Open Season for PA-WV-OH Falcon Ethane Pipeline). The open season worked. Of course it worked! Shell wouldn’t be spending $6 billion to build a plant that can’t get cheap ethane to it!! However, the whole project took another (important) step forward last week when FERC approved the rate structures for using the Falcon Pipeline…
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Small Group of Old Hippies Oppose Shell Ethane Pipeline

A small group boasting a big name, The Breathe Project, recently sent a letter to the Pennsylvania Dept. of Environmental Protection proclaiming their opposition to Shell’s planned Falcon Ethane Pipeline–a 97-mile pipeline system with two “legs” that will feed Shell’s mighty ethane cracker plant now under construction in Monaca, PA. Right. So the DEP and Shell should simply give up on the $6 billion ethane cracker, which can’t operate without ethane to feed it–ethane that will flow through this pipeline. Of course the group’s opposition is for show, maybe for fundraising, and certainly not serious. The funny thing for us was in viewing a picture of some of the members of the group, standing around clutching signs that say SHELL FALCON PIPELINE with a big circle/slash through it. The group, when you look at them, is the geriatric squad. Old folks. In our opinion, they look like old hippies–people who likely protested the Vietnam War in the 60s and have now found their new reason for living–to defeat a small ethane pipeline. On Thursday a tiny protest of the Falcon Pipeline (under two dozen people) caught the interest of the Pittsburgh Business Times on a slow news day…
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Shell Ethane Cracker Gets Reprieve from Trump Steel Quotas

Shell ethane cracker plant under construction in Monaca, PA – so many cranes you can’t count them!

RINO Pat Toomey can rest easy–there will be no delays in building the $6 billion Shell ethane cracker near Pittsburgh. The Trump Administration previously slapped a 25% tariff (i.e. tax) AND quotas on imported steel coming from countries dumping steel in our markets, driving out our own steel industry. Last week Trump lifted the quota from steel coming from certain countries, including Brazil. Shell is getting steel they need for the cracker from Brazil. Indeed, Shell’s Brazilian steel is already sitting in a U.S. port, undelivered due to the quota (a limit on how much can be imported). Now Shell’s steel can get shipped to Pittsburgh and used by the army of people working there. But get this: Shell will still have to pay the 25% tariff/extra charge for their Brazilian steel. Toomey, an early and persistent Trump critic (and a DC swamp dweller), one of PA’s two U.S. Senators, recently claimed Trump’s quotas/tariffs would result in layoffs and delays at the cracker (see Sen. Pat Toomey Claims Trump Tariffs Will Delay Shell Cracker). With that barrier now gone, Toomey will have to find something else to criticize about Trump. How about his hair?…
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Sen. Pat Toomey Claims Trump Tariffs Will Delay Shell Cracker

US Sen. Pat Toomey

Pennsylvania’s U.S. Senator Pat Toomey is a DC swamp dweller–let’s just be honest about it. He’s a Republican, largely in name only. He’s better than a Democrat–but not by much. Toomey is claiming that President Trump’s attempt to stop the flow of foreign steel dumping in our markets by using tariffs (dumping which hurts our own steel industry and isn’t anywhere close to being fair or free trade), will delay incoming material for the Shell ethane cracker plant in Beaver County and result in the layoff of “hundreds” of workers. A Shell spokesman neither confirms nor denies Toomey’s claims but uses doublespeak to sidestep the issue–meaning Shell likely asked Toomey to be the front guy in shaming the Trump Administration into granting waivers so they can get their cheap, imported steel. Toomey has been an early and repeat critic of Trump. Toomey opposed Trump’s tariffs from the beginning and is currently trying to get a new law passed stripping the President of his constitutional power to impose tariffs…
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PA Cracker Plant Stirs Up More Barging Business Along Ohio River

It’s fun to see all of the many, varied businesses impacted by the shale industry and by “downstream” projects like the mighty $6 billion Shell ethane cracker, currently being constructed in Monaca (Beaver County), PA. One of the reasons for selecting the Monaca site for a cracker is it’s location along the Ohio River, with access to barges. A majority of the components and materials being used to build the cracker are being shipped in by barge. That single project (the Shell cracker) has had and is having a huge economic impact throughout Beaver County and the entire region–especially on the barge industry. After the cracker is complete, output from the plant (plastic pellets) will likely not be shipped by barge, but by rail and truck. However, the cracker will attract a number of new manufacturing facilities to the region, locating there to use the plastic pellets coming from the cracker. Those plants manufacture a variety of products–and many of those products will be shipped by barge. The Pittsburgh region is experiencing a barge shipping renaissance, thanks to the Marcellus/Utica and thanks to the Shell cracker…
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Shell to Remediate PA Swamp in Return for Falcon Pipe Permit

Shell is proposing to remediate a swamp in Mercer County as a way to “offset” the “impacts” of building an ethane pipeline to feed it’s mighty cracker plant under construction in Beaver County. Oops. Sorry. Instead of calling it a swamp, the PC term is “wetland.” Shell will make a swampy portion of Neshannock Creek in Mercer County swampier, in return for permission to build the Falcon ethane pipeline elsewhere. Apparently it’s not the first time Shell has proposed such a swap. Shell is in the middle of remediating a swamp in Washington County in return for “local impacts” (i.e. “damage” to the environment) they’re causing by building the cracker plant itself. This is not an uncommon practice–across the country. We happen to think it’s silly. Either a project is worthwhile–worth “damaging” some of our precious environment, because of the greater good it will bring–or not. Playing this game of “I’ll spoil this area here, so I’ll un-spoil that area over there” is senseless, in our humble opinion. But hey, if that’s the game we must play to get it built…
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Shell Cracker to the Rescue – Saving the Erie, PA Plastics Industry

The benefits of the mighty Shell ethane cracker now under construction in Beaver County, PA just keep multiplying. In April MDN brought you news that Penn State Behrend (in Erie County) had been tapped by the PA Dept. of Community and Economic Development (DCED) to be the “lead partner” with a $250,000 grant for developing business and market opportunities for the state related to the cracker (see Penn State to Help Create New Biz Opportunities from Shell Cracker). Erie County, where Behrend is located, is certainly not next door to the cracker. It’s two hours away! There are several other Penn State campuses closer to the cracker. So why was Behrend selected? In a word, plastics. “The strength of Erie’s plastics industry and the success of Penn State Behrend’s School of Engineering, which offers one of only six accredited U.S. plastics undergraduate programs, makes Erie of particular interest to DCED.” A new article says that the cracker will not only preserve the 4,300 plastics-related jobs in and around Erie, there’s reason to believe the plastics industry in Erie will “grow larger and stronger” because of the two-hours-away cracker. Again we ask the question, Why? Answer: Because buying plastics pellets from the Shell cracker two hours away is a whole lot cheaper (due to shipping costs) than buying plastics pellets from the Gulf Coast, as happens now. One would be justified in saying, Shell cracker to the rescue!…
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PA DEP Notifies Shell of “Technical Deficiencies” with Ethane Pipe

Shell delivered some good news at last week’s Northeast U.S. Petrochemical conference in Pittsburgh: The Falcon ethane pipeline will get built next year (see Shell Says Falcon Ethane Pipeline to Get Built in 2019). The pipeline won’t actually flow ethane to the Shell cracker in Monaca until 2020 at the earliest, because the cracker plant itself won’t go online until 2020 at the earliest. The 97-mile consists of “two legs,” with about half of the pipeline located in PA, the other half in OH. The Pennsylvania Dept. of Environmental Protection (DEP) conducted three public hearings on the project earlier this year, in preparation for issuing permits. Antis came out in force and behaved badly, as they typically do (see More of the Same at Final DEP Hearing for Shell Ethane Pipeline). No matter. The pipeline will get built. But not without jumping some hurdles first. On June 1, the DEP issued three letters identifying what it calls “serious technical deficiencies” in Shell’s pipeline plan, for townships in three different counties along the pipeline’s PA route. Shell maintains this type of notification is “common” in the permitting process, and is committed to working with the DEP to address any issues of concern…
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Shell Focused on Single PA County, No New Drilling in Other Areas

Some big news about Shell’s plans for drilling and fracking in the Marcellus/Utica region came from this week’s DUG East conference in Pittsburgh. The Shell head of unconventional drilling in PA told conference goers that Shell’s shale drilling is currently focused on one county: Tioga County, PA. Shell has leases on 250,000 acres in Tioga and plans to spend $150 million to drill wells on four pads in 2018. That’s the focus for this year. According to MDN’s recently published Marcellus & Utica Shale Upstream Almanac, Shell also has assets (producing wells) in Bradford, Butler, Crawford, Elk, Forest, Lawrence, Lycoming, McKean, Mercer, and Potter counties–all in PA. The Shell rep said the company also owns leases in eastern Ohio, in the Utica, but there’s no current plans to drill in Ohio. Instead, they remain laser focused on PA–specifically Tioga County…
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