Energy Services

Energy Services | Industrywide Issues | M&A | Marathon Petroleum | MarkWest Energy

Marathon Increases Cash Dowry for MarkWest Buyout by 63%
November 12, 2015November 12, 2015

It was only four months ago that Marathon Petroleum (headquartered in Ohio, fourth largest refiner in the U.S.) announced a deal to buy MarkWest Energy, arguably the premier Marcellus/Utica midstream company (see Midstream Bombshell: MarkWest Sells Itself to Marathon Petroleum). It certainly seemed like the two were on the way to consummating the marriage by the end of this year (see Marathon 3Q15: Closing on MarkWest Merger “Later this Year”). Last week MarkWest told unitholders (think shareholders) it’s time to sign your proxy statements allowing representatives to “vote yes” to the deal (see MarkWest Tells Unitholders Time to Sign Proxy for Marathon Sale). A few days later MarkWest co-founder and former CEO John Fox launched a publicity campaign to announce his strong opposition to the deal (see Former MarkWest Energy CEO Urges Vote Against Marathon Buyout). This week Marathon announced it is increasing its dowry–a one-time cash payment it will make to MarkWest unitholders–from $675 million to $1.075 billion. That $400 million increase pushes the deal value/offer to $15.1 billion. We don’t think it’s a coincidence that last week Fox came out with guns blazing against this deal and this week the dowry went up 63%…
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Blue Ridge Mtn Res/Magnum Hunter | Energy Companies | Energy Services | GreenHunter Resources

MHR’s GreenHunter Schedules 3Q15 Conference Call Next Week
November 11, 2015November 11, 2015

Here’s something pretty innocuous, at least at first glance, but something we find interesting nonetheless. Yesterday GreenHunter Resources announced it will hold an operating results conference call next Monday, Nov. 16. There’s certainly not much that appears to be interesting about that. We see dozens (hundreds?) of such announcements each quarter. So what, about this one, caught our attention?…
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Energy Services | Equitrans/EQT Midstream

EQT Midstream Floats 5.7M Units, Hopes to Get $406M
November 11, 2015November 11, 2015

EQT Midstream, the fully-owned subsidiary of Marcellus (now mostly Utica) driller EQT, floated 5,650,000 common units (think shares of stock) yesterday. The company expects get around $406 million for the units. The details…
Read More “EQT Midstream Floats 5.7M Units, Hopes to Get $406M”
Baker Hughes | Energy Services

Baker Hughes – October Rig Counts Continue to Fall
November 10, 2015November 10, 2015

Oilfield services giant Baker Hughes released the latest rig count numbers last Friday. It’s not pretty. Worldwide the number of active drilling rigs for oil and gas plunged yet again–down to an average 1,111 active drilling rigs worldwide in October (down 29 from September). In the U.S., October’s average rig count was 791, down 57 from the 848 counted in September 2015, and down 1,134 from the 1,925 counted in October 2014. Rigs in Ohio went up by one in October, stayed the same in West Virginia, but tumbled in Pennsylvania, giving us a new low rig count for the northeast…
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Doddridge County | Energy Services | Industrywide Issues | Pipelines | Summit Midstream | West Virginia

Summit Midstream 3Q15: Current Owner ECP Looking to Sell
November 10, 2015November 10, 2015

Summit Midstream has a small but growing presence in the Marcellus/Utica region largely through purchasing pipeline systems from other companies, including Mountaineer Midstream, Summit’s Marcellus-area pipeline system in Doddridge County, WV. Yesterday the company issued its third quarter 2015 financial results. Of particular note: Summit is majority owned by Energy Capital Partners (ECP), a private equity firm (investment company). ECP is talking about selling their interest. That is, it’s sounding like Summit may soon see a change in ownership. Below is the update on that possible change, along with an update on Summit’s Mountaineer Midstream gathering system…
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Energy Services | Spectra Energy

Spectra Energy 3Q15: Pipeline Project Updates, $20B+ in Development
November 6, 2015November 6, 2015

On Wednesday, Spectra Energy, a large midstream (pipeline) company released its third quarter 2015 update. The interesting part for us is an update on their various pipeline projects in the northeast–projects that will haul Marcellus and Utica Shale gas out of the region to other markets. It’s noteworthy that Spectra Energy made $243 million in 3Q15, down just a hair from 3Q14’s $254 million. Also noteworthy: the first segment of Spectra’s OPEN project (Ohio Pipeline Energy Work) was placed into service six weeks early. Here’s selected sections from Spectra’s 3Q15 update…
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Energy Companies | Energy Services | National Fuel | Seneca Resources

NFG Update: Seneca Paper Loss, Production Shut-in; New Pipes Done
November 6, 2015November 6, 2015

National Fuel Gas Company, parent of driller Seneca Resources and also an important midstream (pipeline) company, issued their quarter update yesterday. We always have to explain this. NFG counts their quarters different. Everyone else counts July through September as a calendar year third quarter. For NFG, it was their fourth quarter fiscal year. The company had a big $188 million loss for their 4Q15, vs a $57 million gain in 4Q14. However, like many others, NFG’s was a “paper loss” and not an actual money-out-the-pocket loss. The decrease is largely due to a $241 million writedown of the value of Seneca’s oil and natural gas reserves. Other news: Seneca’s production was down in 4Q15 because they decided to voluntarily shut-in 13 billion cubic feet (Bcf) of production they otherwise could have sold–due to the low price of natural gas they receive in the Marcellus. Seneca’s proved reserves (available to drill) went up 27% for fiscal year 2015. On the pipeline front, as of Nov. 1 NFG put the Westside Expansion & Modernization and Tuscarora Lateral projects into service, and they’re close to completing the Northern Access 2015 expansion project, a joint project with Tennessee Gas Pipeline’s Niagara Expansion. Here’s the full update with plenty of interesting news for the Marcellus/Utica…
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Energy Services | Williams

Williams/Atlantic Sunrise Pipeline Award $375K in Local Grants
November 6, 2015November 6, 2015

MDN brings you updates on pipeline companies that spread around money with very worthy organizations in an attempt to show them they “care” (and to encourage adoption of their pipeline). We previously told you that Williams and their Atlantic Sunrise pipeline project had doled out $2.5 million to 17 conservation organizations in June (see More Pipeline Payola: Williams Doles Out $2.5M in PA Grants). What we had missed was prior to that, the Atlantic Sunrise project had issued $350,000 in grants to 49 first responders and other organizations back in April (list below). What made us go looking was news that Williams made a second round of grants, this time $375,000 to 43 organizations, just this week. Here’s the list of who got what from Williams and the Atlantic Sunrise pipeline project…
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Energy Services | Patterson-UTI

Patterson-UTI Rig Counts Continue to Slide in October
November 6, 2015November 6, 2015

Since March MDN has been watching the active number of rigs operated by Patterson-UTI Energy as a proxy for whether or not we’ve “turned the corner” on falling rig counts in the Marcellus/Utica. Patterson is a major drilling contractor with operations in the Marcellus/Utica region. Month after the month it’s the same story: Patterson is operating less rigs in the U.S. than it was the month before. The numbers are now out for October. What do they show? We’ve hit a new low. Here’s a recap of the numbers rigs Patterson was operating in the U.S. over the past eight months: March – 142; April – 131; May – 122; June – 112; July – 111 (seemed like it was turning the corner! but it wasn’t); August – 106; September – 99; and now in October – 92. Kerplunk…
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Crestwood Midstream | Energy Services | Industrywide Issues | New York | NGLs | Regulation | Schuyler County

4 Antis Opposing NY LPG Storage Facility Lose Big in Local Election
November 5, 2015November 5, 2015

Today’s lead story on MDN is about the defeat of two anti-drilling Martians in Tuesday’s election–but this story is a close second in importance. Since 2010 a debate has ragged in Schuyler County, NY over whether or not to allow then-Inergy, now-Crestwood Midstream, to convert a depleted salt cavern along the shore of Seneca Lake into underground storage for LPG–liquefied petroleum gas (i.e. propane). We’ve covered the story extensively on MDN over the years. The current status is that an administrative law judge is reviewing the plan, but ultimately the head of the state’s Dept. of Environmental Conservation (DEC) will grant a final decision on whether or not to allow the plan to move forward. Unfortunately the DEC is mired in politics–controlled by Gov. Andrew Cuomo who is in turned influenced by his lunatic left wingnuts. Over the years some of those wingnuts like Sandra Steingraber, so-called “scholar in residence” at Ithaca College (paid to do nothing but trot around lying about fracking), and Josh Fox of Gasland fame have protested and gotten themselves arrested at the facility during publicity stunts. Antis need a forum to vent and they can’t get themselves arrested every day (that gets old), so they turned to the local town board (Town of Reading) where the LPG plant would be located. Board meeting after board meeting they bleated and blatted about the facility–to the point the board has forbidden any more discussion of the issue. So the antis mounted a challenge to the local town supervisor, two town board seats and the town clerk. In Tuesday’s election, all four antis running for those seats went down to a HUGE defeat. Wasn’t even close. Which is noteworthy, and heartening, that in our beloved overtaxed, over-regulated, over-liberal New York State there are still clear-headed people who see through the lies and smears of the antis. Here’s the story of their defeat, and why Reading is so important in this debate…
Read More “4 Antis Opposing NY LPG Storage Facility Lose Big in Local Election”
Energy Services | Industrywide Issues | M&A | Marathon Petroleum | MarkWest Energy

Former MarkWest Energy CEO Urges Vote Against Marathon Buyout
November 5, 2015November 5, 2015

What’s this? All is not butterflies, unicorns and kisses in the Marathon Petroleum takeover of MarkWest Energy. It was only a little over three months ago that MarkWest announced it was selling itself to Marathon (see Midstream Bombshell: MarkWest Sells Itself to Marathon Petroleum). Since that time both companies have been in a hurry to get the deal done. Last week Marathon told investors the deal will be done by the end of this year (see Marathon 3Q15: Closing on MarkWest Merger “Later this Year”). And just last Friday MarkWest told unitholder (equivalent of stockholders) to hurry up and vote (see MarkWest Tells Unitholders Time to Sign Proxy for Marathon Sale). However, one of the biggest single shareholder in MarkWest, the co-founder of the company and former CEO, John Fox, is telling MarkWest in an open letter that they’re nuts for selling…
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Energy Services | Industrywide Issues | M&A | Marathon Petroleum | MarkWest Energy

MarkWest 3Q15: $49M Profit, Expansions Continue, Buyout on Track
November 5, 2015November 5, 2015

MarkWest Energy, which is selling itself to Marathon Petroleum (a move opposed by it’s co-founder, see today’s related story) issued their third quarter 2015 financial and operational update yesterday. On the financial side the company made quite a bit less money in 3Q15 than it did in 3Q14–$49.2 million vs $86 million–but the fact remains it made money. It didn’t lose money as so many other companies in the Marcellus/Utica region did during 3Q15. That’s a big success in our book! On the operational side, MarkWest started up the Sherwood IV processing plant in Doddridge County, WV during the last three months. There’s more expansion coming to the Sherwood facility later this year. MarkWest also signed a huge deal with Ascent Resources (formerly American Energy, Aubrey McClendon’s company) to build a dry gas gathering pipeline system on 100,000 acres of Utica Shale land in Belmont and Jefferson counties in Ohio. And yes, they also mention the Marathon buyout deal too…
Read More “MarkWest 3Q15: $49M Profit, Expansions Continue, Buyout on Track”
Anti-Drilling/Fossil Fuel | CNG/LNG | Crime | Dominion Energy | Energy Services | Exporting | Industrywide Issues | Maryland | Statewide MD

Cove Point Protesters Disrupt Monday Night Football Game on TV
November 4, 2015November 4, 2015

The crazies have done it again. Did you happen to watch Monday Night Football this past Monday? It was the Indianapolis Colts playing the Carolina Panthers at the Bank of America stadium in Charlotte, NC. During the game, protesters of the Dominion Cove Point LNG plant “dramatically” rappelled from an upper deck and unfurled a banner that said “BoA: Dump Dominion”. Note that the teams are from North Carolina and Indiana, nothing to do with Maryland where the Cove Point plant is. The only tie-in is the stadium is named after Bank of America and BoA has some financial/commercial connection to Dominion. In fact, 99.9% of the people in the stadium or watching by television didn’t even know what was meant by the banner! The protesters not only endangered themselves, they endangered the people underneath them. What if the protesters had fallen? No, we’re not concerned for the nutjobs if they had Darwined themselves and dropped like a rock. We’re concerned about the people underneath them. What if the banner had fallen on people? What if a shoe had flown off one of these nutters and hit a baby on the head? The protesters finally came down and were promptly arrested for their crime…
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Chautauqua County | Electrical Generation | Energy Services | Industrywide Issues | Litigation | New York | NRG Energy | Regulation

Dunkirk, NY Coal-Fired Electric Plant Closing in January 2016
November 4, 2015November 4, 2015

As MDN previously reported, a coal-fired electric generating plant near Buffalo (in Dunkirk) was slated to be converted to burn natural gas–a win/win for everyone (see Dunkirk, NY Electric Plant Saved – Converting from Coal to NatGas). Oh sure, radical environmentalists like the Sierra Club opposed it, but that’s to be expected. Crazy people do crazy things. Everything seemed to be fine until a competitor hauled NRG, the plant’s owner, into court to dispute the change from coal to natgas. Sounds equally crazy that a competitor can stop the change, but NRG says fighting the case will take years, so they’re just going to close the plant down (see Lawsuit Prevents NY Power Plant from Converting to NatGas, Closing). Sadly, last week the New York State Independent System Operator (NYISO) gave its blessing to NRG to close down the Dunkirk plant. This is an economic nuclear bomb for that community. The Town of Dunkirk gets 40% of its tax revenue from the plant. What will they do now?…
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Columbia Pipeline Group | Energy Services | Industrywide Issues | Pipelines

Columbia Pipeline 3Q15: Update on Numerous Pipeline Projects
November 4, 2015November 4, 2015

Yesterday Columbia Pipeline Group (CPG) issued its very first, fully independent quarterly update and financial report since being separated from NiSource into its own 100% independent company. Income was up year over year. The CPG update includes a section devoted to the status of pipeline projects they’re working on. It’s a considerable list of important (for the Marcellus/Utica) projects, including: East Side Expansion, Mountaineer XPress, Gulf XPress, Leach XPress, Rayne XPress, WB XPress, Washington County (PA) Gathering project, Big Pine Expansion project and the Pennant Joint Venture. Here’s the update…
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CONE Midstream | Energy Services | Industrywide Issues | Pipelines

CONE Midstream 3Q15: Continued Pipe Expansion in West Virginia
November 4, 2015November 4, 2015

CONE Midstream is a joint venture between CONSOL Energy (the CO in CONE) and Noble Energy (the NE in CONE), formed in August 2014 (see CONSOL & Noble Energy Form New Marcellus Midstream Company). Yesterday CONE issued their third quarter 2015 update. While CONE touted their exponential growth in the volume of gas flowing through their system earlier this year (see CONE Midstream’s Strong Beginning, Hits 500 Mmcf/d 6 Mos Early), there was no mention of current or predicted future flow volumes in the update, nor in the investors conference call. Although there was one vague reference that we found. The 3Q15 update (below) provides the financials for the company and does mention where they have been spending money to expand their system–mainly in West Virginia. Here’s the low down…
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