Energy Services

  • | | | |

    Baker Hughes, GE Release Roster of Coming Management Changes

    Yesterday MDN provided an update about the fast-approaching merger/buyout of Baker Hughes by GE Oil & Gas (see Europe Approves GE Takeover of Baker Hughes, Co Gets a New Name). We noted that it appears the new company, when launched, will have a new name: Bear Newco. However, would GE (and Baker Hughes) throw away the brand they’ve created over the past 100+ years in the Baker Hughes name? No, very doubtful. Which was more-or-less confirmed yesterday when Baker Hughes (and GE Oil & Gas) released the official leadership roster for the new company. We had already mentioned a few of the top names. This new list fleshes it all out–who will do what in the newly merged company, a company that will be bigger than current #2 in the world, Halliburton. The infographic (we call it a roster) of who will do what contains this name emblazoned across the top: “Baker Hughes, a GE Company.” The press release headline includes it too. So that’s what the new company name will be for branding/public purposes. Even though Bear Newco will be the company name filing paperwork with the government, the public-facing name will be Baker Hughes, a GE Company. Here’s the leadership roster for the new Baker Hughes (which doesn’t contain very much Baker Hughes)…
    Read More “Baker Hughes, GE Release Roster of Coming Management Changes”

  • | | | | | | |

    Antis Ask Army Corps of Engrs to Yank Rover Pipeline Blanket Approval

    Several radical environmental groups, including the Sierra Club, Michigan Residents Against the ET Rover Pipeline, and the Ohio-based nutters at FreshWater Accountability Project filed an official request with the U.S. Army Corps of Engineers to pull the Corps’ issuance of a “blanket” approval for the Rover Pipeline to use underground horizontal directional drilling (HDD) and instead require Rover to get a permit for each of the 45 bodies of water they intend to drill under with the technique. Which would, of course, bring the project to a halt–the intended outcome by the radicals. The groups are attempting to capitalize on several leaks experienced by Rover using HDD, including a 2 million gallon drilling mud spill in April that continues to generate headlines today (see OH EPA Says Diesel Fuel Found in Rover 2M Gal Drilling Mud Spill). So far the Corps is keeping mum, only acknowledging receipt of the request. Here’s a bit of news you won’t get in mainstream media: Rover continues to use HDD actively, every day, even now. Yes, HDD activity in a few locations (under waterways) has been halted, but HDD activity continues in 23 other locations. In addition to the news about the request by anti groups to the Corps, we’ve pulled the latest weekly construction report from Rover, embedded below… Read More “Antis Ask Army Corps of Engrs to Yank Rover Pipeline Blanket Approval”

  • |

    Williams Swaps $1.4B of Old Debt for New Debt, Lowers Interest Rate

    As we have noticed with many upstream (drilling) and midstream (pipeline) companies over the years, these companies often float new IOUs (or “notes”) to pay off old IOUs. Midstream giant Williams is one of the latest to do so. Last Wednesday, May 31, Williams announced they would float $1.45 billion in new notes, due payable in 2027. The reason? To pay off notes due in 2023. Yesterday Williams said they got the new notes all sold. The up side to swapping debt, in this case, is that the new notes pay an interest rate of 3.75%, whereas the notes they are paying off (due in 2023) have an interest rate of 4.875%. So Williams shaved more than a full point off the interest they are paying for their IOUs–a technique that will save the company big bucks…
    Read More “Williams Swaps $1.4B of Old Debt for New Debt, Lowers Interest Rate”

  • | | | | | | | |

    Is Virginia Governor Race a ‘Referendum on Pipelines’?

    Will Virginia in the south become what New York is in the north: a block to Marcellus/Utica gas leaving the region? Perhaps. At least, that’s what radical environmentalists are hoping is what happens. On June 13 Virginia will hold a primary. We recently wrote about its importance (see Fate of 2 Important Pipelines May Rest in Virginia Governor Race). Former Congressman Tom Perriello (far-left Democrat) says he’ll block both the $5 billion Atlantic Coast Pipeline and the $3.5 billion Mountain Valley Pipeline if he wins the primary and the general election. He may well win it. Antis are positioning this primary and the election as “a referendum on pipelines.” The brutal truth is that most people in the Old Dominion could care less about pipelines. It is only a small cadre of gentry-class horse farmers and radical anti-fossil fuelers who oppose the pipeline projects. But if you read local news, you wouldn’t know that. We’d like to say, “Hey, it doesn’t matter who wins, the law is the law and a governor can’t stop a federal pipeline project.” But then, we’re from New York where that is exactly what has happened! At least so far. Both the Constitution Pipeline (Williams) and the Northern Access Pipeline (National Fuel Gas Company) have been blocked by Democrat Gov. Andrew Cuomo for political reasons. Both pipelines have taken the state’s Dept. of Environmental Conservation to court, where it’s quite possible, even likely, the state will lose. However, nothing is 100% certain–and because of Cuomo’s actions, both pipelines are now years delayed. Our concern is that a major delay may happen in Virginia too, if the state elects someone like Perriello…
    Read More “Is Virginia Governor Race a ‘Referendum on Pipelines’?”

  • | | | | | | |

    OH EPA Says Diesel Fuel Found in Rover 2M Gal Drilling Mud Spill

    Rover is Energy Transfer’s $3.7 billion, 711-mile Marcellus/Utica natural gas pipeline that will run from PA, WV and eastern OH through OH into Michigan and eventually into Canada. On April 13, Rover workers experienced an “inadvertent return” of “horizontal directional drilling fluid”. That is, they sprung a leak and spilled nearly 2 million gallons of drilling fluid (see Rover Pipeline Accident Spills ~2M Gal. Drilling Mud in OH Swamp). The leak did not spill into the Tuscarawas River (thankfully), but into a swamp (i.e. “wetland”) next to the river. As we pointed out at the time, “Fortunately the primary component of said drilling fluid is nontoxic bentonite–the same ingredient used to make shampoo, deodorant, toothpaste and kitty litter.” On Friday, the Columbus Dispatch reported the Ohio Environmental Protection Agency (OEPA) investigating the spill has found the presence of diesel fuel in the spilled mud. Diesel fuel IS toxic–and its presence is not a good thing. Furthermore, OEPA Director Craig Butler, who has been combative against Energy Transfer and the Rover project, claims an anonymous source tipped them that diesel fuel was being added to the drilling mud. So OEPA tested the spilled mud, and mud not yet used, and found “very very low levels” of diesel fuel, whatever that means. The original “proposed” (i.e. not yet officially assessed) fine by the OEPA was $431,000. Then OEPA said it would up the fine to $714,000 after storm water runoff became an issue (see OEPA & Rover at Odds Over Storm Water Runoff, “Fine” Now $714K). With the diesel fuel “revelation,” OEPA is upping their proposed fine to $914,000. Pretty soon we expect it will sail on by a cool $1 million. OEPA has presented their findings to the Federal Energy Regulatory Commission (FERC), and the two remaining FERC commissioners have launched an investigation…
    Read More “OH EPA Says Diesel Fuel Found in Rover 2M Gal Drilling Mud Spill”

  • | | | | | |

    NFG’s Northern Access Pipeline Wins Eminent Domain Case…in NY!

    Talk about mixed signals. In April, MDN brought you the sad (and angering) news that once again Gov. Andrew Cuomo has caved to political pressure and instructed the Dept. of Environmental Conservation (DEC) to deny stream crossing permits for National Fuel Gas Company’s (NFG) Northern Access Pipeline project (see Cuomo’s Corrupt NY DEC Blocks NFG Northern Access Pipeline Permit). Not long after, NFG filed a lawsuit against the DEC for their arbitrary, capricious and politically-motivated denial of the permits (see NFG Sues NY DEC in Fed Court re Northern Access Pipe Rejection). Meanwhile, another series of court cases has been working its way through NY’s court system–eminent domain cases against a few holdout landowners who refuse to allow the Northern Access Pipeline across their properties. Some 97% of all landowners along the proposed route have signed easements with NFG, but there’s always a few holdouts. Last Thursday one of those holdouts lost in New York Supreme Court in Cattaragus County. (Don’t be confused, in NY, “Supreme Court” is just one level up from county court. The state’s highest court is called the Court of Appeals.) Camp Duffield in Cattaraugus County lost its court case against NFG, and consequently is now being forced, by court order, to submit to the pipeline–when and if it gets built. And that’s the conundrum. The courts obviously recognize NFG’s right, under a FERC (Federal Energy Regulatory Commission) order to build the pipeline. But the Cuomo-corrupted DEC does not… Read More “NFG’s Northern Access Pipeline Wins Eminent Domain Case…in NY!”

  • | | | |

    Europe Approves GE Takeover of Baker Hughes, Co Gets a New Name

    Last October, MDN brought you the news that Baker Hughes, the world’s third largest oilfield services company, had struck a deal to combine/merge with/sell itself to GE’s oil and gas business (see Breaking: Who Needs Halliburton? Baker Hughes Merging with GE O&G). The deal, according to the Wall Street Journal, will result in a new company that will be 65.5% owned by GE and 37.5% owned by Baker Hughes shareholders. The deal, IF it gets approved by the Dept. of Justice, will create a company with $32 billion in revenues. Make no mistake, aside from all of the “partnership” talk, this is GE buying out Baker Hughes. The CEO of the new company will be Lorenzo Simonelli, chief executive of GE Oil & Gas. The board of directors for the new company will have 5 members appointed by GE and 4 members appointed by Baker Hughes. The deal, if it happens, would catapult the new Baker Hughes, which will have the name Bear Newco, past Halliburton to become the world’s second largest oilfield services company. Get this: The deal may even catapult the new company to become the world’s number one oilfield services company–eclipsing Schlumberger! As we said at the time: The question now is, will the Dept. of Justice approve the deal? Last year the Obama DOJ killed the proposed Baker Hughes merger with Halliburton (see Obama DOJ Kills Halliburton/Baker Hughes Merger, Deal “Terminated”). Perhaps in an early sign that the DOJ will approve this merger, the European Commission has given its blessing on the deal…
    Read More “Europe Approves GE Takeover of Baker Hughes, Co Gets a New Name”

  • | | | | | |

    Former Head of Fed Pipeline Agency Sticks Up for Rover re Leaks

    We’ve spilled plenty of digital ink covering the Rover Pipeline and its recent troubles with “inadvertent returns” (i.e. leaks) of non-toxic drilling mud, called bentonite (see Rover Pipeline Accident Spills ~2M Gal. Drilling Mud in OH Swamp). Rover and the Ohio Environmental Protection Agency (OEPA) have been in a spat over “numerous” leaks–with OEPA claiming they’ve levied a $431,000 fine on Rover, although it turns out the fine is not yet officially levied (see Turns Out OEPA & Columbus Dispatch Were Lying – Rover NOT Fined). The leak issue has led to FERC shutting down, for now, any further underground horizontal drilling to install pipeline (see FERC Slaps Rover Pipeline with Stop Drilling Order). On MDN, we have, admittedly, been pretty hard on Rover. Seems to us they are rushing too fast, leading to mistakes–mistakes the industry can’t afford to be seen making. Have we (and others) been too hard on Rover? We spotted an editorial by Ohio resident and the former head of the federal Pipeline and Hazardous Materials Safety Administration (PHMSA), the agency charged with oversight for developing and enforcing regulations for 2.6 million miles of pipeline transportation in the U.S., sticking up for Rover. Brigham McCown says accidents happen and that Rover, “responded to the situation promptly and by the book to control any potentially larger fallout.” Is he right? Is Rover being unfairly criticized for accidents that are bound to happen?… Read More “Former Head of Fed Pipeline Agency Sticks Up for Rover re Leaks”

  • | | |

    Cardinal Midstream Forms New Co. Targeting Utica, Other Plays

    6/2/17 Update: A previous version of this post was incorrect. MDN confused Cardinal Midstream with Cardinal Gas, which led us to create a confusing post. We apologize to both companies–and regret the mistake! Below is a corrected introduction.

    Cardinal Midstream II operates a pipeline gather/processing system in Tioga County, PA. The Tioga system gathers and processes gas from Utica Shale wells in the county (not Marcellus wells, at least not yet). Earlier this week Cardinal announced a new spin-off called Cardinal III, backed with money from EnCap Flatrock Midstream–the same company that has backed Cardinal’s other ventures. The new Cardinal III is getting a $250 million infusion from EnCap to “pursue midstream acquisitions and development opportunities in both conventional and unconventional resource plays across North America.” That means possibly more work in the Marcellus/Utica, but any/all other major plays are also up for grabs. Here’s the announcement… Read More “Cardinal Midstream Forms New Co. Targeting Utica, Other Plays”

  • | | | | |

    Rover Pipeline Says Part of Phase 1 Will be Delayed Nearly a Month

    Rover is Energy Transfer’s $3.7 billion, 711-mile Marcellus/Utica natural gas pipeline that will run from PA, WV and eastern OH through OH into Michigan and eventually into Canada. The Federal Energy Regulatory Commission (FERC), charged with overseeing interstate pipeline projects, granted final approval for the project in early February (see ET Rover Pipeline Gets Final Approval by FERC). Since then, the company has aggressively moved forward with construction. Energy Transfer has maintained, from the beginning, it will complete Phase 1 of the project in “July 2017” (usually quoted by Rover ET officials as July 1st), and the rest of the pipeline will be done in “November 2017” (Nov. 1st). Phase 1 will build the pipeline as far west as Defiance, OH. Phase 2 finishes the pipeline–all the way to the Dawn Hub in Canada. Some say the company has moved too quickly, resulting in accidents (see Rover Pipeline Accident Spills ~2M Gal. Drilling Mud in OH Swamp). Rover has put new procedures in place to prevent more accidents like the 2 million gallon drilling mud spill, asking FERC for permission to drill underground in two locations key to completing Phase 1 (see Rover Gets Serious About Mud Spills, Asks FERC for OK to Drill). Yesterday MDN brought you the news that FERC denied permission to begin new underground horizontal drilling (see FERC Responds to Rover Request to Begin Drilling in 2 Locations: NO). So that begs the question: Can Rover keep to its schedule? ET officials are now modifying the date for completion of Phase 1…
    Read More “Rover Pipeline Says Part of Phase 1 Will be Delayed Nearly a Month”

  • | | | |

    Sunoco LP CEO Mike Hennigan Defects to MPLX/MarkWest Energy

    Michael Hennigan

    Mike Hennigan was, until late last year, president and CEO of Sunoco Logistics Partners–builder of the Mariner East pipeline projects and operator of the Marcus Hook refinery near Philadelphia. Sunoco LP has (for years) been a subsidiary of Energy Transfer (ET). Last November, ET announced it was combining two subsidiaries together into one operation–Sunoco LP and Energy Transfer Partners (see ETE Merging Sunoco Logistics and Energy Transfer Partners). Although on paper Sunoco LP swallowed ETP, the new entity retained the ETP name and ETP’s top management. Exactly how Mike fit into the new arrangement we’re not sure. We know his title became president for crude, liquids and refined products. We’re guessing Mike’s new role wasn’t as satisfying as the old role, because he’s jumping ship. Mike is leaving ET and moving to Marathon Petroleum, to become president of subsidiary MPLX. You may recall that MPLX is Marathon’s pipeline subsidiary which, in late 2015, bought out and merged in MarkWest Energy–a huge Marcellus/Utica player in the midstream space (see MarkWest Energy Investors/Unitholders Approve Merger with Marathon). So, in a nutshell, Mike Hennigan is leaving Sunoco LP to become the new head of MarkWest Energy…
    Read More “Sunoco LP CEO Mike Hennigan Defects to MPLX/MarkWest Energy”

  • | | | | | |

    Antis Score Small Victory Against ME2 Pipeline re Eminent Domain

    The radical Philadelphia-based Clean Air Council (CAC) has scored a very small, but notable, victory in it’s battle to block Sunoco Logistic Partners’ from building the Mariner East 2 Pipeline project. Last Thursday a judge with the Philadelphia Court of Common Pleas allowed a case filed by CAC to proceed. The case claims that Sunoco cannot use eminent domain powers granted by the State of Pennsylvania to force its way through properties where the landowner refuses to cooperate, because (CAC claims) the pipeline is technically not an intrastate pipeline (only located in PA), but is instead an interstate pipeline (crossing the border into Ohio). The judge said the case has enough merit that it can go to trial. We call it a small victory because Common Pleas court is the lowest trial court in the state. There are several layers higher where appealed cases are decided. This is more of a statement than a serious threat. But let’s play “what if.” What if CAC wins, and on appeal, wins again?…
    Read More “Antis Score Small Victory Against ME2 Pipeline re Eminent Domain”

  • | | | | | | | |

    FERC Responds to Rover Request to Begin Drilling in 2 Locations: NO

    It was full speed ahead for Energy Transfer’s Rover Pipeline construction project in Ohio–until a series of drilling mud spills hit, including one that dumped some 2 million gallons of bentonite mud into a wetland near the Tuscarawas River in Stark County, OH (see Rover Pipeline Accident Spills ~2M Gal. Drilling Mud in OH Swamp). Not long after the Federal Energy Regulatory Commission (FERC) slapped Rover with a “stop horizontal drilling” order (see FERC Slaps Rover Pipeline with Stop Drilling Order). Let’s put that into context. Most of the pipeline getting laid for Rover is in trenches–not from underground horizontal drilling. There are some places along the route when you can’t dig a trench–like crossing a creek or river, or major highway. In those cases, you drill horizontally underground, underneath the object. When drilling, bentonite mud is used to keep the drill bit cool. Sometimes the mud pumped underground finds its way back out again via cracks in the rock. It is those accidents that FERC (and the Ohio EPA) find a little too frequent and voluminous for their liking. So FERC told ET to stop any new underground drilling. Less than a week after FERC ordered ET to stop drilling, ET filed a request with FERC to begin drilling in two locations key to finishing the first leg of the pipeline–locations where the equipment is already in place, and the erosion controls already set up: Captina Creek in Belmont County, OH, where Rover wants to complete the Clarington lateral, and Middle Island Creek in Tyler County, WV, where Rover wants to complete the Sherwood lateral (see Rover Gets Serious About Mud Spills, Asks FERC for OK to Drill). FERC responded to ET’s request to drill in those locations last Thursday: NO…
    Read More “FERC Responds to Rover Request to Begin Drilling in 2 Locations: NO”

  • | | | | | | |

    PA DEP to Hold 4 Public Hearings for Atlantic Sunrise Pipe in June

    Seems like forever we’ve been waiting for the Pennsylvania Dept. of Environmental Protection (DEP) to issue the final permits needed for the Williams Atlantic Sunrise Pipeline project to begin construction. Atlantic Sunrise is a $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 Federal Energy Regulatory Commission (FERC) gave its final seal of approval for the project in February (see Atlantic Sunrise Pipeline Gets Final Approval by FERC). But like NY, PA is holding up the project. The DEP has not, so far, granted necessary permits to allow construction to begin–those permits being Chapter 102 (earth disturbance) and Chapter 105 (waterway and wetland encroachment). Williams embarked on a public relations campaign to enlist support across the state to pressure PA Gov. Tom Wolf and the DEP to grant the permits so construction can (finally) begin. The Wolf DEP is holding up this project and the 8,000 jobs it will create during construction. Williams delivered a petition to Gov. Wolf with the signatures of 3,000 people supporting the project earlier this month (see PA Roars Its Approval of Atlantic Sunrise Pipeline with Petition, Comments). Perhaps that did the trick. Last Thursday the DEP announced four public hearings in June (otherwise known as circus freak shows, where antis parade in front of microphones and behave like asses). The DEP will also accept public comments until June 26. After that, we will hopefully get a swift round of issued permits and the backhoes will start digging… Read More “PA DEP to Hold 4 Public Hearings for Atlantic Sunrise Pipe in June”

  • | | | |

    NJ DEP Keeps Badmouthing PennEast Pipeline

    PennEast Pipeline route through NJ

    PennEast Pipeline is caught between a rock and a hard place in New Jersey, and the NJ Dept. of Environmental Protection (NJDEP) isn’t lifting a finger to help. In April, MDN told you NJDEP has temporarily rejected PennEast Pipeline’s Freshwater Wetlands Individual Permit and Water Quality Certificate application, submitted April 6 (see NJ DEP Temporarily Rejects PennEast Request for Wetland Permits). NJDEP said in their response that PennEast has not provided enough detail about the project–leaving out key pieces of information for two-thirds of the pipeline’s 37-mile trek through NJ. NJDEP says they want the application refiled within 30 days, and if PennEast doesn’t give them what they want within 60 days, the DEP will consider the application “withdrawn.” Here’s the Catch-22: In order to get the details needed via surveys, PennEast needs access to property. But many NJ landowners have been convinced by groups like the odious Sierra Club to deny permission. So PennEast can’t do their surveys to get the details needed for the the NJDEP. Since it’s a federally approved project, NJDEP certainly won’t issue eminent domain to allow PennEast access to survey. For that, PennEast must wait on FERC. It’s rumored that FERC will grant eminent domain sometime this summer for PennEast to allow them the right to access NJ (and PA) properties of holdout landowners. Antis are elated and breathlessly say PennEast will be delayed for months, maybe years (doing things like multi-year surveys on plants). PennEast continues to say the NJDEP’s responses are routine and being handled. Who’s right?…
    Read More “NJ DEP Keeps Badmouthing PennEast Pipeline”

  • | | | | | |

    Fate of 2 Important Pipelines May Rest in Virginia Governor Race

    Election matters, and elections for governor really matter–at least with respect to shale drilling and pipelines. Here in New York State, where MDN is written, we are ruled by a corrupt autocrat by the name of Andrew Cuomo. Single-handed Cuomo has decided to ban fracking and block new shale gas pipelines (see After 6+ Years, Andrew Cuomo Bans Fracking in New York; NY Gov. Cuomo Refuses to Grant Permits for Constitution Pipeline; and Cuomo’s Corrupt NY DEC Blocks NFG Northern Access Pipeline Permit). So when a Democrat candidate in Virginia to be the next governor vows to block pipelines there, we don’t take it as just electioneering. These people are serious–and dangerous. Our court systems have failed to reign in Democrat autocrats who rule by fiat. It’s up to the people to ensure they don’t get elected. On June 13 Virginia will hold a primary in their gubernatorial race. Since a Democrat has won the governor’s mansion in nine out of the last ten elections, it pays to pay attention to the two leading Dem candidates for governor in Virginia. One of them, former Congressman Tom Perriello, says he’ll block both the $5 billion Atlantic Coast Pipeline through his state, and the $3.5 billion Mountain Valley Pipeline. His opponent, the sitting Lieutenant Governor Ralph Northam, doesn’t outright oppose the projects but instead says they will be put under an extreme review by the Virginia Department of Environmental Quality (DEQ). Just one problem with that: The DEQ says FERC is the one who will monitor and review the project, not the DEQ. In other words, what Northam has been promising is just another empty political promise (surprised?). With a close race, will this late-breaking news from the DEQ tip the balance in favor of the radical Perriello?… Read More “Fate of 2 Important Pipelines May Rest in Virginia Governor Race”