Energy Services

Energy Services | Industrywide Issues | NEXUS Pipeline | Ohio | Pipelines | Regulation | Statewide OH

FERC Expected to Approve NEXUS Today; Surveyors have Armed Guards
November 30, 2016November 30, 2016

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Word on the street is that the Federal Energy Regulatory Commission (FERC) will announce a decision today to approve the NEXUS Pipeline–a $2 billion, 255-mile interstate pipeline that will run from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada. It is a critically needed pipeline to move Utica and Marcellus Shale gas from an over-saturated market in the northeast to markets in the Midwest and Canada. If the decision doesn’t come today, it will come very soon. As MDN reported yesterday, the small city of Green, OH (population 26,000) has put NEXUS on notice that if its surveyors show up and landowners refuse access, those surveyors will be arrested if they “trespass” on the landowner’s property (see Green, OH Threatens NEXUS Surveyors with Arrest for Trespassing). Other news agencies are reporting that surveyors are about to show up with armed guards. Into this mess may come an approval for the project. If NEXUS gets approved, it will have the right to use federal eminent domain laws to build the pipeline, regardless of landowner desires. Does eminent domain also include surveying? One would think so since surveying is part of the construction process. Green’s bluster may amount to nothing if the project receives a final approval today. Below are several stories about surveying for NEXUS, as well as a look at the FERC commissioners who will make the final decision on NEXUS…
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Baker Hughes | Energy Services | Hydraulic Fracturing | Industrywide Issues

Baker Hughes, CSL & GS Form New US Fracking Co: BJ Services
November 30, 2016November 30, 2016

The world’s third largest oilfield services company, Baker Hughes, has struggled to stay afloat given the radical reduction in revenue they get for the services they offer. BH’s recent third quarter update showed the company lost $430 million, which is down from losing $912 million in 3Q15, a positive sign we suppose (see Baker Hughes 3Q16: Bleeding Slows, but Hefty Loss of $430M). Halliburton tried to buy BH last year, but earlier this year the Obama DOJ killed the proposed merger (see Obama DOJ Kills Halliburton/Baker Hughes Merger, Deal “Terminated”). Last month GE Oil & Gas launched its own takeover/merger with BH (see Breaking: Who Needs Halliburton? Baker Hughes Merging with GE O&G). In the midst of all that, BH is not sitting on its hands. Yesterday the company announced it will spin off its North American shale fracking business into a new company, BJ Services. The deal involves investments and assets contributed from both Goldman Sachs and CSL Capital Management. Here’s the lowdown on BH’s new “pressure pumping” (i.e. fracking) deal, and the real reason BH is doing it…
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Energy Services | Industrywide Issues | M&A | WGL Holdings

DC NatGas Utility WGL Considers Selling Itself to Spanish Company
November 30, 2016November 30, 2016

Word has leaked out that WGL Holdings, the umbrella company that owns Washington (DC) Gas Light Company and WGL Midstream, is considering selling itself to utility giant (and Spanish-based) Iberdrola. The deal, if it happens, has implications for the Marcellus. Earlier this month MDN reported that WGL Midstream, which already is a 7% owner in the Mountain Valley Pipeline project, had upped its ownership stake to 10% (see WGL Midstream Buys More of Mountain Valley Pipeline). WGL’s plan is to pipe more Marcellus/Utica gas to the Washington, DC area for sale to customers living in our nation’s capital. Would/could a change in ownership change that plan? It might…
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Energy Services | FMC Technologies | Industrywide Issues | M&A

Technip, FMC Believe Merger is in the Bag, Release Board Mbr List
November 30, 2016December 6, 2016

In May, U.S.-based oilfield services company FMC Technologies announced they will merge with their much larger quasi-competitor, France-based Technip, in an all-stock deal that will create a new company called TechnipFMC worth $13 billion (see FMC Technologies & Technip to Merge, Create $13B Oilfield Giant). FMC had/has some operations in the Marcellus/Utica, hence the merger has implications for our region. The Obama Dept. of Justice approved the deal in June (see FMC Technologies/Technip Merger Approved by Obama DOJ/FTC). Apparently it’s A.O.K. for a French company to buy an American company, but when one American company (Halliburton) wanted to buy another (Baker Hughes), that wasn’t OK with the Obamadroids (see Obama DOJ Kills Halliburton/Baker Hughes Merger, Deal “Terminated”). But we digress. The European Union, like the Obama DOJ, has now given its blessing on the deal. The shareholders for the two companies will vote next week on the merger, to make it official. Apparently management for the two companies thinks the deal is already in the bag because they’ve released a list of board members for the newly combined company…
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Energy Services | Industrywide Issues | New York | Pipelines | Regulation | Statewide NY | Williams

FERC Slaps NY AG; No Re-Hearing on Constitution Pipe Tree Clearing
November 29, 2016November 29, 2016

It’s now apparent that the fix has been in from the beginning–that New York’s corrupt Gov. Andrew Cuomo, colluding with New York’s corrupt Attorney General, Eric Schneiderman, were on a mission to block the construction of the federally approved Constitution Pipeline, due to run from Susquehanna County, PA into Upstate New York (to Schoharie County). Before Cuomo decided to take the breathlessly lawsless act of blocking the pipeline by denying stream-crossing permits (being challenged in court), the Constitution asked for permission to begin clearing trees along the pipeline’s path. In January 2016, Schneiderman immediately objected (see NY AG Objects to Williams Tree Clearing for Constitution Pipeline). The Constitution never received permission and so did not clear any trees in New York State. Except–some trees did get cleared, by the landowners themselves. Landowners who wanted to realize the most money from trees that will eventually be cut were cutting the trees ON THEIR OWN, without the help, consent, assistance, or any form of aide from the Constitution. Schneiderman’s response? The Constitution should have known those stupid farmers would cut the trees and should have done something to stop it. So in May 2016, Schneiderman asked FERC to investigate the Constitution over the tree clearing matter, something called a “rehearing” (see NY Attorney General Asks FERC to Investigate Constitution Pipe and NY AG’s Allegation of Tree Cutting by Constitution Pipe a Fraud). FERC just got back to Schneiderman, and told him, NO…
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Energy Services | Industrywide Issues | Pipelines | Tallgrass Energy

REX Pipe Begins Flowing Extra 800 MMcf/d Marcellus/Utica Gas West
November 29, 2016November 29, 2016

The Rockies Express Pipeline (REX), originally built from Colorado and Wyoming to Monroe County, OH to bring natural gas from west to east, last year reversed the flow for a large and important section of the pipeline. On August 1, 2015 the section of REX from Monroe County, OH to Mexico, MO reversed the flow and began to carry 1.8 billion cubic feet per day (Bcf/d) of Utica and Marcellus Shale gas to the Midwest, including to the greater Chicago area. REX has been hard at work on plans to expand capacity even more by beefing up compressor stations along portions of the pipeline. Their efforts have paid off. REX previously filed a plan with FERC to add another 800 million cubic feet per day (MMcf/d) of capacity along the same portion of the reversed pipeline. Yesterday the Federal Energy Regulatory Commission (FERC) gave REX the go-ahead to start additional compressors added at three locations along the route…
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Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | NEXUS Pipeline | Ohio | Pipelines | Summit County

Green, OH Threatens NEXUS Surveyors with Arrest for Trespassing
November 29, 2016November 29, 2016

The city of Green in Summit County, OH has put NEXUS Pipeline on notice that if surveyors show up to survey in the city and if those surveyors don’t have permission from the landowner, or a judge’s order, those surveyors will be arrested and charged with trespassing. Apparently Green hasn’t gotten the memo that pipelines are the safest form of transportation on earth–period. NEXUS, as well as other pipeline projects, face a classic Catch-22 situation. In order to get the Federal Energy Regulatory Commission to grant a certificate to build the pipeline, the pipeline company must first conduct initial surveys to plan the route. With a certificate from FERC in hand, the pipeline then has the power of eminent domain to use on recalcitrant landowners to build the pipeline across their land. The open question is whether or not the pipelines can use eminent domain to conduct the survey ahead of a full FERC certificate. That’s the Catch-22. Surveying doesn’t do a single thing to a property, other than a few guys and gals running around for a short time looking through a transit and taking measurements. It’s a shame that landowners, in some cases, won’t even allow that. So Green has put NEXUS and the world on notice that the city and its residents don’t want to participate in the riches that come from shale. Fine. Let them eat dirt…
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Energy Services | Industrywide Issues | Lebanon County | Litigation | NGLs | Pennsylvania | Pipelines | Sunoco Logistics

PA County Judge Attacks Mariner East 2 Status as Public Utility
November 29, 2016November 29, 2016

Sunoco Logistics Partners, the builder of the Mariner pipeline projects, has fought a long and hard legal battle to be recognized as a public utility in Pennsylvania–especially with regard to the next big project in the lineup, the Mariner East 2 pipeline. ME2, as it’s called, is a $2.5 billion, 350-mile natural gas liquids (NGL) pipeline that will run from eastern Ohio through the state of Pennsylvania to the Marcus Hook refinery near Philadelphia. From the beginning anti-pipeline fanatics have tried to derail the project by claiming it is not a public utility (with the right of eminent domain) as defined by PA’s statutes. In July 2014 two administrative law judges working for the PA Public Utility Commission (PUC) said ME2 is not a public utility (see Setback for Mariner East NGL Pipe – Judges Say Not Public Utility). But a few months later, the Commissioners of the PUC overruled them and said yes, it is a public utility–always has been, always will be (see Major Milestone: PA PUC Rules Mariner East IS a Public Utility). However, the antis continued to challenge it in court. Finally, in July 2016, PA’s Commonwealth Court in hearing an appealed case ruled in favor of Sunoco, saying that ME2 is regulated by both the PUC and the Federal Energy Regulatory Commission (FERC), and it therefore has the right to use eminent domain (see Sunoco LP Wins Major Court Decision for Mariner East 2 Pipeline). However, a county judge in Lebanon, PA has just rendered a decision that once again attempts to question ME2’s classification as a public utility. The decision, and how it impacts ME2, is complicated…
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Dominion Energy | Economic Impact | Energy Services | Industrywide Issues | Pipelines | Statewide VA | Virginia

Virginia County Embraces Atlantic Coast Pipe as Business Magnet
November 29, 2016November 29, 2016

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So often mainstream media simply lies about public attitudes toward pipelines–attempting to paint a picture of mass opposition to filthy fossil fuels flowing through exploding pipelines. Nonsense. Let’s take Dominion’s $5 billion, 594-mile Atlantic Coast Pipeline (ACP) as an example–a natural gas pipeline that will stretch from West Virginia through Virginia and into North Carolina. In October a poll was released showing Virginians support ACP by a 2-to-1 margin (see Poll: Virginians Favor Atlantic Coast Pipeline by 2-to-1). Some forward-thinking counties in Virginia, like Buckingham County, are embracing ACP with open arms. Just last week we noted the very adult-like behavior of Buckingham County’s Planning Commission in approving a compressor station for ACP, with some 40 conditions attached (see VA County Planners Approve Atlantic Coast Pipeline Compressor Stn). Buckingham’s leaders are lauding ACP as an economic and jobs magnet. The county’s largest employer, Kyanite Mining Corp., has just signed an agreement with ACP to use natgas from the pipeline…
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CNG/LNG | Energy Services | Exporting | GE Oil & Gas | Industrywide Issues

GE Oil & Gas Invests $25 Million in LNG Co Tellurian
November 29, 2016November 29, 2016

Seems like GE Oil & Gas is putting its fingers in every U.S. o&g pie it can. In October GE announced it would pursue Baker Hughes for a merger/buyout (see Breaking: Who Needs Halliburton? Baker Hughes Merging with GE O&G). Now it’s investing $25 million (chump change for GE) in Tellurian Investments. Tellurian, you may recall, was founded and is run by Charif Souki, the fired co-founder of Cheniere Energy. Souki was bounced out of LNG company Cheniere by evil corporate raider Carl Ichan (see Corp Raider Carl Icahn Admits He Fired Cheniere CEO Charif Souki). So Souki started Tellurian which in turn is on a mission to build Driftwood LNG to compete with his old company Cheniere (see Fired Cheniere Energy CEO Charif Souki’s Revenge: Driftwood LNG). GE’s investment will help advance the Driftwood project. Sadly, there are no heros in this story. Souki disgraced himself when he went on CNBC and said he would consider renouncing his U.S. citizenship if Donald Trump won the presidency (see Will Charif Souki Renounce His American Citizenship?). Like a host of spineless Hollywood types who threatened to leave if The Donald won, Souki has yet to man up and actually do it. We’re still waiting…
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Crude Oil | Energy Services | Industrywide Issues | Pennsylvania | Philadelphia Energy Solutions | Regulation | Statewide PA

PA Gov Wolf Kills Plan for PES Refinery Expansion in Philadelphia
November 28, 2016November 28, 2016

Philadelphia Energy Solutions (PES) has been on a mission to expand their operation at the Southport Marine site in Philadelphia by leasing an additional 200 acres to build a terminal for shale oil imports and exports. Believe it or not, a plan to lease the extra space has been going on for more than two years (see Marcellus Caught in Crossfire of Philly Port Leasing Controversy). That’s how long it takes to grease all of the corrupt Democrat hands in Philly to get anything done. Those corrupt hands have now been greased–by none other than Gov. Tom Wolf–and PES is now out in the cold, with their plan canceled by a $300 million bribe, er a, “investment” by Gov. Wolf and the good citizens of PA. Wolf’s plan is to turn that 200 acres into a big parking lot to park incoming cars arriving by container ships from Japan. Uh, Mr. Wolf, what happens when those cars start to be manufactured right here at home under President Trump? Oops, nobody thought to ask that question…
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Dominion Energy | Energy Services | Industrywide Issues | Pipelines | Regulation

FERC Quizzes Atlantic Coast Pipe About “Tribal Communications”
November 28, 2016November 28, 2016

Are those war drums we hear beating? Perhaps! If you are involved in the oil and gas industry in just about any capacity, it’s hard to miss the story of the Dakota Access Pipeline (DAPL) and the paid criminal protesters who are trying to stop it (see Dakota Access Pipeline Protesters Turn Violent; Coming Here Next?). Supposedly the Standing Rock Sioux Tribe is opposed to DAPL because it will cross ancient burial grounds. While we don’t know if that’s true or not, we do know one fact not reported in mainstream media: the pipeline does not cross one inch of tribal lands. The project is almost done being built, with a small section remaining. Tensions are escalating as Big Green groups are paying “protesters” to trespass on private and public land in an effort to stop construction. The U.S. Army Corps of Engineers, in charge of authorizing the project as it crosses public land in the area, has badly bungled their role (see Army Corps of Engineers Turns Political in Dakota Access Fight). The lessons of DAPL and the Army Corps’ bungling are not lost on other government agencies, like the Federal Energy Regulatory Commission (FERC). 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–is now coming under scrutiny by FERC for any impacts it may have on Indian (whoops, “Native American”) land it may cross. FERC has put out a call for a copy of all “tribal communications” the ACP project has had, no doubt in an effort to avoid another DAPL situation here…
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Energy Services | Energy Transfer Partners | Industrywide Issues | Michigan | Pipelines | Statewide MI

Michigan Chemistry Council Fully Supports Rover Pipeline
November 28, 2016November 28, 2016

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So often we only hear about those who oppose safe pipelines (because it flows “fossil fuels”)–and not from those who support pipelines. There is one industry that knows the importance of new pipelines. Indeed, their livelihood depends on those pipelines. That industry? Chemicals. Natural gas in its various hydrocarbon forms (methane, ethane, butane, propane, pentane, isobutane) is used to make just about everything you touch throughout the day. From shoes to clothes to packaging to tires to shingles to carpets to paint…without fossil fuels there would be no modern-day life. We would be living in the Stone Ages, dying early deaths and never traveling more than a few miles from where we live. Those in the chemical manufacturing industry understand and support the vital role of pipelines in delivering the raw material they use to create our modern way of life. The Michigan Chemistry Council recently contributed the following editorial in support the Rover pipeline project–a $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…
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Energy Services | Industrywide Issues | M&A | Marathon Petroleum | MarkWest Energy

Corp Raider Pressures Marathon to Split Itself into 3 Companies
November 22, 2016November 22, 2016

Not even a year go–in December of last year–one of the biggest and brightest stars in the midstream firmament for the Marcellus/Utica, MarkWest Energy, sold itself to Marathon Petroleum (see MarkWest Energy Investors/Unitholders Approve Merger with Marathon). We wondered at the wisdom of such a move, but who are we? What’s done is done. Ironically, an “activist investor” hedge fund (i.e. corporate raider) by the name of Elliott Management yesterday disclosed to the world that they have taken a 4% stake in Marathon. Corporate raiders target companies they can bully by buying enough shares to force those companies to fire people and sell assets. It “unlocks value for shareholders” you see–meaning it will boost the per share price of the raider’s stock so they can turn around and sell that stock and line their already-fat pockets. Disgusting. True to form, Elliott is targeting Marathon. They sent a letter to the Marathon board with the “suggestion” that the company split itself (after buying MarkWest less than a year ago) into three separate companies (retail, refining, midstream) in an effort to “unlock $14 – $19 billion for shareholders.” Unfortunately there are at least two other raiders lurking in the background with small stakes in Marathon who may join Elliott to pressure Marathon…
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Energy Services | Energy Transfer Partners | Industrywide Issues | M&A | Sunoco Logistics

ETE Merging Sunoco Logistics and Energy Transfer Partners
November 22, 2016November 22, 2016

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Energy Transfer Equity (ETE) is a big and (on paper) complex company with a number of subsidiaries. Roughly speaking, ETE is the mother ship/parent, and under it are two subsidiaries–Regency Energy Partners and Energy Transfer Partners (ETP)–the company building the Dakota Access Pipeline. Under Energy Transfer Partners are other divisions and subsidiaries–notably Sunoco Logistics Partners, which is the builder of the Mariner pipeline projects. (Click on the org chart to view how the company is arranged.) Yesterday ETE announced that Sunoco LP is swallowing up ETP in a ~$20 billion, stock-swap deal. The confusing part is that although Sunoco LP is buying ETP, the new company will be called ETP and will be run by ETP’s current management…
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Columbia Pipeline Group | Energy Services | TC Energy/TransCanada

TransCanada Raising Money Hand Over Fist to Pay for Columbia Pipe
November 22, 2016November 22, 2016

In early November Canadian midstream giant TransCanada announced they were going on a fundraising bender to get money to pay for their recent $10 billion acquisition of Columbia Pipeline (see TransCanada Raising Big $ to Complete Buyout of Columbia Pipeline). At the time, TransCanada announced the company would float another $3.2 billion (Canadian) in new stock and sell off their electric power assets in New England (mostly hydropower) for $3.7 billion (U.S.). In just the past couple of weeks, the company has floated new common stock, raising $3.5 billion (Canadian), and preferred stock, raising an additional $1 billion (Canadian). Here’s the latest on how to raise money fast to buy a big pipeline company…
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