Energy Services

Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | Litigation | Pennsylvania | Pipelines | Statewide PA | Transco | Williams

Dela. Riverkeeper Leidy Lawsuit Costing Williams $125K per Day
March 19, 2015March 19, 2015

The clock is ticking. As we told you on Monday, THE Delaware Riverkeeper–Maya van Rossum–is using her bags of money from the William Penn Foundation to try and stop the FERC-approved expansion of the Transco pipeline in northeastern Pennsylvania (see Dela. Riverkeeper Halts Transco Pipeline Upgrade with Lawsuit). The project, known as the Leidy Southeast expansion project, would add new pipeline next to existing pipeline–called looping. Williams (owner of the Transco) can only cut trees down along the path it needs to clear until April 1st. After that, they must wait until Nov. 1st to begin cutting again in order to avoid cutting down trees that may (or may not) become roosting spots for the endangered Indiana bat. van Rossum & company have gotten a sympathetic judge in D.C. to halt the tree cutting while he reviews her latest frivolous lawsuit. She’s trying to run the clock down. The D.C. Circuit Court of Appeals was supposed to rule earlier this week. They didn’t. Every day they delay is costing Williams $125,000. We sincerely hope Williams sends that bill to van Rossum once the tree cutting begins again…
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Alternative Energy | Dominion Energy | Energy Services | Industrywide Issues | Virginia

Grimm’s Fairy Tale: Big Tobacco + Big Oil Give Birth to….Solar?
March 19, 2015March 19, 2015

Here’s one weird and twisted bedtime story: Once upon a time there was a filthy Big Tobacco company. Big Tobacco hooked up with a wealthy (and equally filthy) Big Oil company and they had a baby. And the baby was…….solar panels?? Yep. Philip Morris, one of the largest cigarette manufacturers in the world has contracted with Dominion, one of the biggest utility/midstream companies in the Marcellus/Utica region, to install 8,000 solar panels at the Philip Morris facility in Chesterfield County, VA so they can make more cigs. It will be the largest solar installation to date in the state of Virginia. The only problem here is that the “bad guys” (Big Tobacco and Big Oil) are the heroes by installing solar instead of using natural gas. This is a real dilemma for the anti-drilling/anti-pipeline gang in the Old Dominion State. It may cause a brain hemorrhage…
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Energy Services | Industrywide Issues | Marathon Petroleum | NGLs | Ohio | Pipelines | Statewide OH | Utica Shale

Marathon Utica Wet Gas Pipeline Extends Open Season Extra 30 Days
March 18, 2015March 18, 2015

In December 2013 Marathon Petroleum, Ohio’s largest refiner, announced they would build a new Utica Shale pipeline, called Cornerstone (see Marathon Petroleum’s Newly Announced “Cornerstone” Utica Pipeline). Cornerstone will stretch nearly 50 miles from the MarkWest cryogenic processing plant in Cadiz, OH, heading northwest and connecting to M3’s fractionator plant in Scio and M3’s cryogenic processing plant in Leesville on its way to connecting with and terminating at Marathon’s refinery in Canton, OH. The pipeline will flow crude oil, condensate and natural gasoline. In February, Marathon launched an open season to sign up shippers for the new pipeline (see Marathon Announces Open Season on New Wet Gas Pipelines). The open season was due to end on March 13, but Marathon has extended it an extra month–a sign that there may not be as much interest as originally thought for this project (although Marathon says the extra time allows them to handle “significant interest” in the project)…
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Energy Services | Enterprise Products Partners

Enterprise Products Partners Just Raised $100M from Itself
March 18, 2015March 18, 2015

Enterprise Products Partners is a very big midstream company (pipelines and processing plants). They are the builder of the Appalachia-to-Texas Express (ATEX) ethane pipeline, which stretches from the Marcellus all the way to the Gulf Coast. Enterprise joins a list of companies doing creative things to bring cash through the door. On Monday, Enterprise announced that one division (or affiliate) of the company has purchased 3.2 million “units” (think shares of stock) in another division–bringing in $100 million that Enterprise will use “to fund a portion of its growth capital investments and for general company purposes.” That is, one set of investors just handed over $100 million to another set of investors in essentially the same company. Kind of mind-bender…
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Economic Impact | Energy Services | Industrywide Issues | Lancaster County | Lebanon County | Pennsylvania | Pipelines | Research | Statewide PA | Transco | Williams

Atlantic Sunrise Will Pump $1.6B into Economy, Create 8K Jobs
March 17, 2015March 17, 2015

Williams pushed out a new economic analysis of their Atlantic Sunrise pipeline project yesterday. The project, if built, will cost $2.1 billion and consist of compression and looping of the Transco Leidy Line in Pennsylvania along with a greenfield pipeline segment, called the Central Penn Line, connecting the northeastern Marcellus producing region to the Transco mainline near Station 195 in southeastern Pennsylvania. Additional existing Transco facilities are being added or modified to allow gas to flow bi-directionally. The preliminary project design includes 178 miles of new greenfield pipe (Central Penn North & Central Penn South), two pipeline loops totaling about 12 miles (Chapman Loop, Unity Loop), 2.5 miles of existing pipeline replacement, two new compressor facilities in PA, and other facility additions or modifications in five states (PA, MD, VA, NC, SC). There’s been some push back by small groups of anti-drillers in places like Lebanon County and Lancaster County (PA) where a phony Indian tribe claims the pipeline will run through ancient burial grounds (see Convicted Lancaster Protesters Taunt Williams After Court Date). Meanwhile, the adults at Williams continue to make progress. The analysis they released yesterday shows the Atlantic Sunrise project will pump $1.6 billion into the economies of the states where it’s built, and create 8,000 jobs…
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Blue Ridge Mtn Res/Magnum Hunter | Energy Companies | Energy Services | Eureka Midstream | Industrywide Issues | Pipelines

Eureka Hunter Pipeline Volume Continues to Expand, now 623 Mmcf/d
March 17, 2015March 17, 2015

Every few months Eureka Hunter, the midstream subsidiary of Magnum Hunter Resources, issues a press release to update investors on their progress toward filling their WV/OH pipeline system with natural gas. Eventually they hope to flow 1 billion cubic feet per day through the system. Last September Eureka reported they were up to an average 307 million cubic feet per day (see Magnum Hunter’s Pipeline System Boosts Volumes in OH/WV). In January they were up to 400 Mmcf/d and expecting to hit 500 Mmcf/d by the end of that month (see Eureka Hunter Nears 1/2 Billion Cubic Feet per Day in WV/OH). As of last Friday, Eureka has hit north of 623 Mmcf/d on their path to a billion cubic feet…
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Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | Litigation | Luzerne County | Pennsylvania | Pipelines | Regulation | Statewide PA | Transco | Williams

Dela. Riverkeeper Halts Transco Pipeline Upgrade with Lawsuit
March 16, 2015March 16, 2015

Someone needs to sue THE Delaware Riverkeeper (Maya van Rossum) the way that organization is suing legitimate and legal companies to block legitimate and legal activity in the Marcellus Shale. Delaware Riverkeeper apparently has endless bags of money, made available to them by the Park Foundation, Heinz Endowments and other anti-drilling “non-profit” groups, to file endless frivolous lawsuits. The latest is particularly insidious. Williams has just received approval from the Federal Energy Regulatory Commission (FERC) to build a few loops–extra lengths of pipeline immediately next to existing pipeline–for the Transco Pipeline in northeast PA and in NJ (see FERC Approves Williams Leidy Southeast Project in PA/NJ). Part of the requirement by FERC is that Williams cannot cut down trees between April and October–a full seven months–to avoid “harming” the endangered Indiana bat that may (or may not) roost in those trees…
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Belmont County | Energy Companies | Energy Services | Greene County (PA) | Ohio | Pennsylvania | Rice Energy | Rice Midstream | Washington County

Rice Energy Turns Profitable in 2014; Strong 2015 in View
March 13, 2015March 13, 2015

Rice Energy, a “pure play” energy company focused on drilling in the Utica and Marcellus, issued their full year and fourth quarter 2014 update yesterday. Wow, what an update! Rice had a big year in 2014. The parent company, focused on drilling, went public. They also launched an IPO for their midstream (pipelines) subsidiary. Compared to 2013 which saw a loss on the books, 2014 reversed it. In 2014, Rice’s profit was $218.5 million (out of $390.9 million). That’s an increase over a 2013 loss of $35.8 million (out of $88.7 million in revenue). In 2014, Rice produced 97.7 billion cubic feet (Bcf) of natural gas, up from 23 Bcf in 2013. Aside from the company growing and hitting its stride, what was different about 2014? Last year Rice concentrated on the Utica Shale…
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Energy Companies | Energy Services | EQT Corp | Equitrans/EQT Midstream

EQT Midstream Swims Against the Tide, Issues Units Instead of Notes
March 13, 2015March 13, 2015

As we’ve commented a number of times, we don’t pretend to understand all of this high finance stuff when it comes to oil and gas companies and how they decide to fund future development. Sometimes they sell shares of stock. Sometimes they sell “units”–which are the equivalent of shares of stock for companies organized as a master limited partnership (or MLP). Sometimes they borrow money in a revolving loan (line of credit). And sometimes they float notes, what we tongue-in-cheek call IOUs. Lately there have been a rash of companies, many of them midstream (pipelines and processing plants) floating notes to get more cash through the door. We spotted one that’s different (different always stands out). EQT Midstream, a subsidiary of driller EQT but a company (on paper) that’s independent, just announced they’re issuing 8.25 million new units (i.e. like shares of stock), with an option of issuing an additional 1.2 million units. Issuing units (or shares of stock) is equity financing–selling ownership in the company, whereas notes and lines of credit is debt financing. Which is better? Ask a CFO. We have a built-in bias to avoid debt, but that’s just us…
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Energy Companies | Energy Services | Industrywide Issues | Litigation | Minuteman Environmental Services | Pennsylvania | Regulation | Statewide PA | XTO

PA Grand Jury Finds Anti-Drilling AG Kathleen Kane Lied Under Oath
March 13, 2015March 13, 2015

Kathleen Kane, the anti-drilling Attorney General of Pennsylvania–lied under oath–according to a PA grand jury. That’s called perjury and it’s a crime. She should be removed from office immediately but she’s fighting the charge using Lanny Davis–the same lawyer who kept Bill Clinton in office after he lied under oath. She’s hoping lightening will strike twice and Davis will be able to restore her damaged-beyond-repair credibility as the state’s top law enforcement officer, even though she herself has committed high crimes against the state. Why do we care? Because she’s lied in at least two other cases that affect the Marcellus Shale industry: XTO Energy (see PA AG Abuses Her Authority, Files Criminal Charges Against XTO) and Minuteman Environmental Services (see Minuteman Sues AG Kane’s Office for $20M + Punitive Damages). She’s vicious and relentless when it comes to smearing the Marcellus industry and she needs to go because of her own crimes…
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Chesapeake Energy | Energy Companies | Energy Services | GASFRAC | Hydraulic Fracturing | Industrywide Issues | Ohio | Tuscarawas County | Utica Shale

Chesapeake Tries Waterless Fracking at OH Utica Shale Well
March 12, 2015March 12, 2015

Something we consider pretty big news: Chesapeake Energy is running an experiment with waterless fracking. They’ve contracted with Canadian waterless fracking company GASFRAC to attempt what is the second (that we’re aware of) waterless frack job on a Utica Shale well–in Tuscarawas County, OH. The first waterless frack job done by GASFRAC was for EV Energy Partners on a Utica well also in Tuscarawas County (see Details on GASFRAC’s Waterless Frack Test in OH Utica). We consider it a good sign that Chessy thinks its worth a few million bucks to try it out for themselves. Chessy stresses this is still very preliminary…
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CNG/LNG | Electrical Generation | Energy Services | Industrywide Issues | Kinder Morgan | Pipelines | Spectra Energy | Tennessee Gas Pipeline

Does New England Really Need a New Natgas Pipeline?
March 12, 2015March 12, 2015

Don’t look now, but we actually read a pretty fair and balanced report on pipelines to New England…published by PBS! We predict a reporter who will soon be out of a job. The article (which we quote from below) frames up the arguments against and for new natural gas pipelines coming to New England this way: Those against say electric generation that requires natgas really only demands an extra supply in the dead of winter–typically 30-45 days. Because of that heightened demand, it drives electric prices through the roof because the plants have to buy the gas on the spot market. The rest of the year that kind of intense demand is not there–meaning you’ll spend billions on pipelines to solve a 30-45 day problem. And the rest of the year? Some of that gas will go to Canada and likely get exported. Better to use the existing LNG terminal in Boston and import (!) liquefied natural gas, instead of using cheap, abundant Marcellus gas from a few hundred miles away, and use more LNG at electric generation plants. Those who favor building the pipelines see it differently…
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Energy Services | Industrywide Issues | Millennium Pipeline | New York | Pipelines | Statewide NY

NY’s Millennium Pipeline Launches Open Season to Expand
March 12, 2015March 12, 2015

The Millennium Pipeline–a natural gas pipeline running through upstate New York’s Southern Tier area from Corning, NY to Rockland County, NY–announced a new open season yesterday. The open season will sign up new customers from now until the end of the month, March 31. The Millennium, which is jointly owned by NiSource, National Grid and DTE Energy, plans to expand facilities along the line, increasing capacity. That usually means they will install some new loops, or additional pipelines right next to the existing pipeline, along with upgrades to compressor plants. The purpose? Deliver more clean-burning natural gas to customers throughout the northeast…
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Energy Companies | Energy Services | EQT Corp | Industrywide Issues | Pipelines | WGL Holdings

Mountain Valley Pipeline Picks Up 2 New Investors/Partners
March 12, 2015March 12, 2015

Yesterday we told you that some landowners in West Virginia are not happy with what they call threatening letters coming from the Mountain Valley Pipeline (see WV Landowners Say They’re Bullied by Mountain Valley Pipeline). MVP is a 330-mile pipeline from Wetzel County, WV to the Transco Pipeline in Pittsylvania County, VA. It’s a joint venture between EQT and NextEra US Gas Assets. At least it was a jv between the two until yesterday when MVP announced two more partners/investors: WGL Midstream and Vega Midstream. Who’s on top? EQT owns 55% (and manages) the jv, NextEra owns 35%, WGL will own 7% and Vega 3%. Here’s the announcement from yesterday…
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Energy Companies | Energy Services | EQT Corp | Equitrans/EQT Midstream | Industrywide Issues | Pipelines | Statewide WV | West Virginia

EQT Sells WV Pipeline Gathering System to Itself for $1B
March 11, 2015March 11, 2015

We’re always somewhat amused by these stories. Sometimes a company will spin off a division into its own company–a subsidiary–and later transfer or “sell” certain assets to the subsidiary. On paper the subsidiary is its own company with its own set of investors, its own board, and its own management. But the primary investor with controlling interest remains the mother company. For all practical purposes, the subsidiary IS the same company as the mother company. Midstream companies tend to do this with some regularity. Back in 2012 we noted that Kinder Morgan did it (see Kinder Morgan Sells Tennessee Pipeline to Itself). This week it’s EQT–selling its Northern West Virginia Marcellus Gathering System, along with a “preferred interest” in another EQT subsidiary, for $1.05 billion to the company’s pipeline subsidiary, EQT Midstream Partners…
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Energy Services | Energy Transfer Partners | Industrywide Issues | M&A | Regency Energy Partners

ETP Buyout of Regency Energy Has a Date: April 28
March 11, 2015March 11, 2015

In January MDN brought you the big news that Energy Transfer Partners (ETP) is buying/merging with Regency Energy Partners (see Energy Transfer Partners Buys Regency Energy for $25B). Both companies have meaningful operations in the Marcellus/Utica region. These mergers & acquisitions, as you know, take time. Both companies have been busy and Regency reported earlier this week they have a date to make it all final: April 28. On that date, Regency will hold a special meeting at their company headquarters in Dallas, TX to vote on the deal…
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