Energy Services

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    Patterson-UTI Rig Count Count Slips by 1 Rig to 161 in Sept

    As we do every month (and have for more than two years), MDN tracks how many rigs oilfield services company Patterson-UTI Energy reports operating–as a proxy for rig count health in general and rig count health in the Marcellus/Utica in particular. Patterson recently bought out and merged in Seventy Seven Energy (see Patterson-UTI Energy Completes Merger with Seventy Seven Energy). The addition of SSE’s rigs served to rocket Patterson’s rig count number in April and May much higher (see Patterson-UTI Rig Count Continues to Rocket Skyward – 159 in May). With SSE now fully absorbed into Patterson, the rig count number settled down. In June, Patterson’s count went up by a single new rig in North America, to 160. The trend continued in July, with Patterson picking up another 2 active rigs for 162 in North America–the 14th month in a row. Patterson reported last month that in August the rig count held at 162–no new rigs were added (see Patterson-UTI Rig Count Holds at All-Time High of 162 in August). And what about September? It had to happen sooner or later–what goes up must come down. In September, Patterson’s rig count slipped by one, to an average of 161 operating rigs. Hey, it was a great ride that went from June 2016 to July 2017…
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    NEXUS Pipe Seeks to Begin Construction Oct 10; List of Contractors

    NEXUS Pipeline map – click for larger version

    Something just now coming to light. Last week NEXUS Pipeline sent a request to the Federal Energy Regulatory Commission (FERC) requesting that it be allowed to begin construction of the pipeline “on or before” Tuesday, October 10th. That’s next Tuesday, folks! NEXUS is a $2 billion, 255-mile interstate pipeline that will run from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada. NEXUS received final approval for the project from FERC in August, the first major pipeline to get approved following a newly restored quorum at FERC (see New FERC Quorum Votes Final Approval for NEXUS Pipeline). Two weeks ago one of the final remaining hurdles came down when the Ohio EPA granted a water permit for the project (see Ohio EPA Grants Water Permit to NEXUS Pipe, “Learned” from Rover). The project still faces court challenges (see CORNballs, Sierra Club Continue to Fight NEXUS Pipeline in Court), however, those challenges are long-shots. Given that all permits have been issued, last Thursday NEXUS sent FERC a request to begin construction (see the request below). As part of the request, the contractors that will build the pipeline were named. We’ve pulled those names into a handy list, for those looking for jobs and those who want to sell goods and services to the companies actually building the pipeline…
    Read More “NEXUS Pipe Seeks to Begin Construction Oct 10; List of Contractors”

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    PTT Global Signs Memorandum with Ohio re Belmont Ethane Cracker

    On Monday, Mr. Supattanapong Punmeechaow, president and CEO of PTT Global Chemical (Thailand’s largest petrochemical company) signed a Memorandum of Understanding (MOU) with JobsOhio regarding PTT’s proposed ethane cracker plant. The MOU pledges to “enhance the well-being and quality of life” for those living in the area near the proposed cracker plant. PTT announced in April 2015 they are interested in building a $5 billion ethane cracker plant complex in Belmont County, OH (see It’s Official: Belmont County Chosen as POSSIBLE Cracker Plant Site). Since that time, all of the signs have been positive. PTT has said a final investment decision will be forthcoming by the end of this year. The MOU signing ceremony on Monday is yet more evidence that this project will happen. The ceremony itself is kind of interesting. It was not held in Ohio–but in Washington, D.C. where a trade delegation from Thailand was visiting (Punmeechaow was part of the delegation). So John Minor, president of JobsOhio, traveled to D.C. for the signing ceremony, which was held in what we can only describe as a garage…
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    FERC Advances Plan to Reverse Part of TGP to Haul M-U NGLs to Gulf

    There’s lots of acronyms in that headline, so right up front let us restate the headline in clearer language: The Federal Energy Regulatory Commission (FERC) has just taken the next step to advance a project by Kinder Morgan to reverse a portion of the mighty Tennessee Gas Pipeline (TGP) to reverse its flow, to go from the northeast to the southwest, in order to haul Marcellus/Utica natural gas liquids (NGLs) to the Gulf Coast. Currently TGP hauls natural gas (not liquids) from the Gulf to the northeast. With a bumper crop of natural gas produced by the Marcellus/Utica, gas from the Gulf is no longer needed. Kinder Morgan, the owner/operator of TGP, first floated the idea to reverse 964 miles of their pipeline back in 2013 (see KM Plans to Convert Tennessee Gas Pipeline to Flow M-U NGLs South). The pipeline reversal is part of the broader $4 billion Utica Marcellus Texas Pipeline (UMTP) project. The first step in making the project a reality is to get FERC’s permission to “abandon” (stop using) the 964-mile segment, called Pipeline No. 1, from Louisiana to Ohio. TGP filed to get permission to abandon it in Feb. 2015. Last Friday FERC granted permission for TGP to abandon that segment of the pipeline. Plenty of people objected to the plan, including existing natural gas customers along the 964 miles who now get their gas from TGP. FERC investigated all claims and found the project will not negatively impact the environment, or the pocketbooks, of those who objected. The question now is, when will work begin to abandon that portion of the pipeline?…
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    Competition Heats Up Between W. Canadian & Marcellus/Utica Gas

    Last week MDN reported the Canadian National Energy Board (NEB) had approved of TransCanada’s plan to lowball the price to haul natural gas all the way from Alberta (in western Canada) to the Toronto Dawn Hub in eastern Canada (see Canadians Approve TransCanada Pipe Lowball Plan to Compete with M-U). TransCanada cooked up a deal last year to pipe natural gas from Canada’s West Coast to the East Coast in order to fend off cheap supplies of Marcellus/Utica gas that will flow into Canada when/if the NEXUS and Rover pipelines get built (see TransCanada Pipe Drops Price 42% to Compete with Marcellus/Utica). TransCanada dropped their pipeline price to lure drillers by (theoretically) making it less expensive to get gas from western Canada, some 2,400 miles away, than from the Marcellus, just 400 miles away. TransCanada’s pipeline theoretically can ship 3.5 billion cubic feet per day (Bcf/d) of natural gas from west to east. When Rover Pipeline is full online sometime in 2018, it will ship up to 3.25 Bcf/d of Marcellus/Utica gas to the Dawn Hub. If NEXUS Pipeline ever gets built, it too will one day flow gas all the way to the Dawn Hub–up to 1.5 Bcf/d. TransCanada is attempting to get there first. In this clash of the titans, between western Canadian gas and Marcellus/Utica gas, who wins? There will be a number of winners, including the drillers shipping the gas. And the pipeline companies shipping the gas. But perhaps the biggest winners will be Ontario residents who use natural gas. Their prices to buy and use gas are heading much lower…
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    Sierra Club in Court Oct 18 Against Cove Point, 2 More LNG Plants

    The deep pockets of the radical Big Green group, the Sierra Club, continue to vex the oil and gas industry. The Sierra Club is involved in so many lawsuits against our industry, you literally need a score card to keep track. Three of the cases the Clubbers have on deck come before the D.C. Circuit Court of Appeals in two weeks–on Oct. 18th. The three cases involve Federal Energy Regulatory Commission (FERC) approved LNG export projects. One of the three is Dominion’s Cove Point project, which is due to export its first shipment this month or next (see Cove Point to Begin LNG Exports in October or November!). The other two LNG projects in the Clubbers’ sights are both Cheniere Energy projects–Sabine Pass and Corpus Christi. Sabine Pass is currently the only LNG export plant in operation in the U.S. The Sierra Club lawsuit against all three projects challenges FERC’s approval of them, arguing the plants negatively affect the environment and will make Mom Earth sick. While no one expects these lawsuits to go anywhere, you never know, which is why it’s important to keep an eye on it…
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    Anarchists Brag About Vandalizing Mariner East 2 Constr Equipment

    A group of lawless anarchists–people calling themselves “anti-capitalists” from the Philadelphia area, have admitted in a blog post that they engaged in illegal, criminal (we’d call it eco-terrorist) activities against construction equipment being used in Media (Delaware County), PA for the Mariner East 2 Pipeline project. The criminals, from the anti-American group Philly Anti-Capitalist, said they filled the fuel tanks of a flatbed truck and several excavators with sand and sugar–meant to ruin the engines. They even outline how to inflict maximum damage to the engines by removing the fuel filters. These idiots justify their criminal actions by saying, “Human-caused ecological collapse and mass extinction are upon us.” In other words, they’re loony tunes. Crazy. Driven to commit criminal acts because they’ve been brainwashed into believing mankind is poisoning Mom Earth by extracting and using fossil fuels. And brainwashed against liberty and freedom as personified in the United States. They are serious (and dangerous) nutjobs. We sincerely hope the FBI, Homeland Security and other police organizations hunt them down and jail them for destroying private property…
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    Lancaster Police Get Ready to Arrest Atlantic Sunrise Protesters

    Police in Lancaster County, PA are trying to get out in front of what they expect may be a tense situation. Big Green groups along with local nutters in the Lancaster area have pledged so-called non-violent action to stop work on the now-fully permissioned Atlantic Sunrise Pipeline project. Atlantic Sunrise is a $3 billion, 198-mile natural gas pipeline project running through 10 Pennsylvania counties to connect Marcellus Shale natural gas from northeastern PA with the Williams’ Transco pipeline in southern Lancaster County. Lancaster Against Pipelines, headed up by Mark Clatterbuck (who participated in the ineffective protests against the Dakota Access Pipeline) and his wife Malinda. The clattering Clatterbucks have made threats that they and their “many” followers will enter private land and do whatever it takes–lock arms, chain themselves to something, etc.–to stop the backhoes and bulldozers. Several local town police departments, wanting to be prepared, sent a form letter/survey to residents where the pipeline will cross, to ask them (a) if they (the landowners) plan to allow antis onto their property, and (b) if they don’t plan to allow antis, will they consent to allowing the police to arrest antis on their property. Manor police Chief Todd Graeff says his department is neutral with respect to the pipeline–they just want to know where they have permission to enter and arrest people, and where they don’t. In West Hempfield “many” of the questionnaires have been signed and returned. Every single returned questionnaire gives the police permission to arrest antis on their property. Which is a VERY loud and clear signal to the troublemakers: You WILL get arrested and jailed for your shenanigans…
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    Green, OH Spends Big $ on 2 Appeals in Bid to Stop NEXUS Pipeline

    Back in May MDN told you about the antis running the City of Green, Ohio (see Green, OH Paying Lawyers $100K to Fund Stop NEXUS Crusade). Green City Council voted to use $100,000 of taxpayer money to hire a Cleveland law firm to file a lawsuit “aimed at stopping the pipeline from being built or stopping the project altogether.” Looks like the law firm is earning at least some of that considerable amount (total bill so far: $67,367). The strategy the lawyers have adopted and now implemented is to file two appeals–one with the Sixth Circuit Court of Appeals, the other with the Ohio Environmental Protection Agency’s appeals board. The Green antis hope one or both will throw up a roadblock to slow, and ultimately stop, the NEXUS Pipeline from getting built. NEXUS, a $2 billion, 255-mile interstate pipeline that will run from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada, was the first major pipeline project to get approved after the Federal Energy Regulatory Commission (FERC) once again had a quorum (see New FERC Quorum Votes Final Approval for NEXUS Pipeline). Less than two weeks ago the Ohio EPA issued a federal water permit for the project (see Ohio EPA Grants Water Permit to NEXUS Pipe, “Learned” from Rover). Green is asking OEPA to reconsider their action in issuing the permit. Here’s the latest in the ongoing war against fossil fuels…
    Read More “Green, OH Spends Big $ on 2 Appeals in Bid to Stop NEXUS Pipeline”

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    Atlantic Coast Pipe Not Stopping in NC; Expanding to SC, Beyond?

    In July, the Federal Energy Regulatory Commission (FERC) issued a favorable final environmental impact statement (EIS) for Dominion’s $5 billion, 594-mile Atlantic Coast Pipeline (ACP)–a natural gas pipeline that will stretch from West Virginia through Virginia and into North Carolina. At least, we *thought* the pipeline would end in North Carolina–at Lumberton. However, Dominion vice president and general manager for Southern pipeline operations, Dan Weekley, seems to have spilled the beans at an industry conference that Dominion has designs on extending Atlantic Coast beyond North Carolina–into South Carolina. He said “everybody knows” that Atlantic Coast is not going to stop in Lumberton, “despite” what current plans say. It was just two months ago that FERC issued a final, favorable environmental impact statement for the project–a project that terminates in NC (see Atlantic Coast Pipeline Gets Favorable Final EIS from FERC). We suspect somebody is in major hot water for revealing what may have been, until now, internal discussions–not meant for public dissemination…
    Read More “Atlantic Coast Pipe Not Stopping in NC; Expanding to SC, Beyond?”

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    Williams Reveals Eminent Domain Strategy for Atlantic Sunrise

    One of the interesting breakout sessions MDN editor Jim Willis attended at last week’s Shale Insight event in Pittsburgh was a panel of lawyers discussing recent rulings in the Marcellus/Utica related to eminent domain and royalties. Sitting with the lawyers was a non-lawyer panelist from Williams. Aaron Blair is right-of-way manager for Williams in the northeast. He managed securing easements for the Atlantic Sunrise Pipeline project, Williams’ $3 billion, 198-mile pipeline project running through 10 Pennsylvania counties to connect Marcellus Shale natural gas from northeastern PA with the Williams’ Transco pipeline in southern Lancaster County. The lawyers on the panel peppered Blair with questions about his strategy for securing rights. Blair’s strategy boils down to this: if/when you need to file for eminent domain, do so in federal, NOT Pennsylvania state court (and certainly not with appointed commissions). Blair finds federal judges know the law and stick to the law–and the case law with regard to eminent domain, whether you like it or not, is quite clear when it comes to pipelines. Atlantic Sunrise began with needing leases from about 950 landowners. In the end, just under 50 of them had to be settled with eminent domain proceedings in court. Here’s an overview of what Blair said on the panel…
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    Former Magnum Hunter Sells Remaining Stake in Eureka Midstream

    We love to connect the dots and reveal information (news) that others miss. Sometimes we get it wrong–but more often we get it right. Here’s another connect-the-dots story. Yesterday we brought you the news that a huge South Korean conglomerate, SK Group, had purchased itself a $100 million slice of ownership in Marcellus/Utica midstream company Eureka Midstream (see South Korean SK Group Buys a Piece of Eureka Midstream for $100M). Eureka Midstream was once a subsidiary of Magnum Hunter Resources. Magnum Hunter spun Eureka out into a standalone company prior to Magnum Hunter going through bankruptcy. Not long after Magnum Hunter exited bankruptcy, they changed their name to Blue Ridge Mountain Resources (see Magnum Hunter Changes Its Name, Leaves the Bankrupt Past Behind). The newly named company still owned a slice of Eureka, but Eureka was/is its own company, not controlled by Blue Ridge Mountain Resources. How big a slice does Blue Ridge own? We don’t know, but we’re guessing around $100 million worth, because yesterday Blue Ridge Mountain Resources coincidentally issued a press release to say it had sold the remaining shares of stock it owned in Eureka to “an undisclosed buyer.” Well isn’t that interesting. The day before SK Group bought a large slice of Eureka–for $100 million. Want to bet the “undisclosed buyer” is SK Group?…
    Read More “Former Magnum Hunter Sells Remaining Stake in Eureka Midstream”

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    Fed Judge Tosses Lancaster Nuns’ Freedom of Religion Lawsuit re ASP

    A group of Catholic nuns in Lancaster County called Adorers of the Blood of Christ have tried several strategies to derail the Williams Atlantic Sunrise Pipeline (ASP) project. One of stunts they have pulled, in league with a radical Big Green group, is to stick a few wooden park benches in the middle of a corn field that they own (leased to a local farmer), and call it a “chapel” (see Catholic Nuns Use Radicals to Build Chapel in Path of PA Pipeline). Which is why MDN dubbed them, Sisters of the Corn. The heck of it is that the good Sisters use natural gas to heat an old folks home they operate at the same address! Talk about religious hypocrisy. The Sisters used the chapel-in-the-corn as an excuse to sue the Federal Energy Regulatory Commission over their approval of Atlantic Sunrise on the grounds that running the pipeline through their corn field violates their religious freedom (see Lancaster Nuns Sue FERC to Stop Atlantic Sunrise Pipeline). Yesterday a federal judge in Reading, PA dismissed the frivolous lawsuit brought by the Sisters of the Corn…
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    Bad Blood: Rover Pipe CEO Sends Caustic Letter to Ohio EPA, FERC

    Last week MDN brought you the news that Ohio EPA’s director, Craig Butler, has kind of tipped over into the deep end with his rantings and ravings about Rover Pipeline (see Ohio EPA’s Craig Butler Goes Nuts, Demands $2.3M from Rover Pipe). Butler held a conference call with the media where he made wild allegations. What seems to have precipitated Butler’s media bender is a decision by the Federal Energy Regulatory Commission (FERC) earlier in the week to allow Energy Transfer, builder of Rover, to resume horizontal directional drilling (HDD) in most Ohio locations, after banning it for several months (see FERC Lifts Rover Horizontal Drilling Ban, Pipeline Work Resumes). ET has responded to Butler’s tirade with a hard-hitting (we’d call it caustic) response. In a letter to Butler, carbon copied to FERC, Rover President & CEO Matthew Ramsey essentially says Butler and the OEPA is trying to cover its own mistakes in not requiring storm water permits for most of the project’s life–then coming along after the fact saying Rover didn’t apply for those permits (when OEPA never required them in the first place). Ramsey also said Butler “refuses to recognize the law” that FERC, and not OEPA, is in charge of this project. It gets better. Ramsey says he is “mystified by what you are trying to achieve” by requiring something (said storme water permits) Rover is now voluntarily doing–permits that OEPA itself has approved! This letter really takes the gloves off and (our words) calls Butler a lunatic. Read it for yourself and see what you think…
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    Broome Virtual Pipe Project in Limbo, Fenton Board Refuses to Act

    In early September, a Broome County, NY judge ruled that the Town of Fenton (Binghamton area) Planning Board did not take a hard enough look at environmental and traffic issues related to their approval of NG Advantage’s plan to construct a facility in the town to compress and load natural gas onto tractor trailers for delivery to regional customers who desperately need the gas–what is called a “virtual pipeline” (see Judge Rules Against Broome Virtual Pipe, NG Advantage to Try Again). The lawsuit was brought by a local school district, which a Freedom of Information Act request reveals is paying approximately $40,000 in legal fees to high-priced lawyers to win the case, stopping the project (we hope Chenango Valley School District taxpapers appreciate their taxes going up to pay for it, and less money available in the budget to “educate” their precious children). NG must now resubmit the project for approval. On Tuesday night, NG did just that–re-applying to the Fenton Town Planning Board. A meeting was held at the local fire hall where some 250 people showed up. The crowd contained those both for and against the project. Unfortunately two of the seven Planning Board members were not present–possibly having resigned due to extreme pressure from bullying antis. So then there were five. Three of the five voted to become the lead agency to review the project, which is the first step in the process. However, three of seven is not a majority. Which puts the project in limbo, not able to go forward. What happens next?…
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    South Korean SK Group Buys a Piece of Eureka Midstream for $100M

    Eureka Midstream, which was once called Eureka Hunter (a subsidiary of Magnum Hunter Resources) popped back up on the radar screen earlier this month (see M-U Pipeline Co. Eureka Midstream Expands Line of Credit to $400M). Eureka, which operates exclusively in the Marcellus/Utica with ~200 miles of local gathering pipelines, announced it had expanded its line of credit from $225 million to $400 million, with an “accordion” option to further expand it to $500 million. Eureka’s former parent Magnum Hunter spun the company off into a standalone company last year, so Eureka did not get dragged through bankruptcy along with Magnum Hunter (see Magnum Hunter Emerges from Bankruptcy with CEO Gary Evans Gone). The newest news is that South Korean SK Holdings, the holding company of SK Group (one of the largest conglomerates in South Korea) has bought itself a piece of Eureka for $100 million…
    Read More “South Korean SK Group Buys a Piece of Eureka Midstream for $100M”