PA DEP Fines Regency/PVR $306K for Sloppy Pipeline Work in 2012/13

pay fines here signIt’s old news, but is just now hitting the public domain. PVR Midstream, which is now part of Regency Energy Partners (see Marcellus/Utica Midstreamer PVR Bought by Regency Energy for $5.6B), did some sloppy installation work with pipelines in Lycoming and Tioga counties in Pennsylvania in 2012 & 2013. So says the PA Dept. of Environmental Protection (DEP). According to the DEP, PVR had multiple violations of the Clean Streams Law, Dam Safety and Encroachment Act and state regulations while building two pipelines. PVR, at the time of the citations, quickly corrected everything wrong. Regency, the new owner of PVR, had to pay the fine. Oh, the fine (paid in August by Regency) was $306,570. Ouch…
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OGA 2: Panel Discussion – Marcellus/Utica Midstream Update

Panel I: Marcellus/Utica Midstream Update – 2014 and Beyond

  • Discussing how much infrastructure is actually needed in the Marcellus/Utica region and the current balance between supply and demand?
  • Targeting methods for managing pricing variation, overcoming takeaway chokepoints in areas with depressed prices
  • Detailing NGL takeaway issues and the cost/benefit analysis for pipeline expansion
  • Addressing the impact of ethane crackers on the Marcellus/Utica midstream
  • Assessing midstream investment in the northeast, looking ahead to the major projects for 2014
  • Offering insight to the challenge of sourcing skilled labor with understanding of the midstream sector, highlighting the impact of the midstream sector on the Northeast labor market
  • Comparing the differences/unique requirements between wet gas & dry gas gathering infrastructure

Moderator: Michael L. Krancer, Energy, Petrochemical and Natural Resources Practice Group Leader, Blank Rome LLP
Speakers: Brent Breon, Vice President Business Development, Blue Racer Midstream
Tony Blando, Vice President Marketing, NiSource Midstream Services, Columbia Pipeline Group
Aubrey Harper, Vice President Business Development, IPS Engineering / EPC
Brett Nixon, Director of Business Development, PVR Partners
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PVR Partners Marcellus Pipeline Flows Increase 60% in 1 Year

Midstream company PVR Partners issued an update yesterday to brag about their Marcellus operations–and well they should. Average throughput on the PVR “Eastern Midstream Systems” increased 60%, from 1.1 billion cubic feet per day average in December 2012 to 1.8 Bcf/d in December 2013. They also completed a total of 101 well connections in 2013 for the Eastern Midstream area.

PVR’s Eastern Midstream includes operations in Lycoming, Wyoming, Bradford and Greene counties in Pennsylvania, and Preston County in West Virginia. Here’s the full PVR update with more details:
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PVR Partners 3Q13: Earnings & Flow Rates Way Up

Seems there is no end of good news for midstream companies operating in the Marcellus/Utica region. Midstreamer PVR Partners released their 3Q13 financial and operations update today–’tis the season for quarterly reports. Among PVR’s highlights: Earnings are up a very healthy 31% for 3Q13 vs. 3Q12; they’re pumping an average 1.8 billion cubic feet per day of natural gas now vs. 1 Bcf/d a year ago; and PVR’s northeastern midstream segment is humming along.

No wonder Regency Energy announced two weeks ago they’re buying PVR Partners (see Marcellus/Utica Midstreamer PVR Bought by Regency Energy for $5.6B). Here is the penultimate quarterly report issued by PVR:
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Marcellus/Utica Midstreamer PVR Bought by Regency Energy for $5.6B

bigger fish smaller fishPVR Partners, formerly known as Penn Virginia Resource Partners, will now just be formerly. Period. PVR is a major midstream company (pipelines and processing plants) with big operations in the PA Marcellus Shale after buying Chief Gathering last year (see PVR Buys Chief Gathering/Marcellus Pipelines for $1B). They also announced last year that they would spend $380 million to expand pipelines in NE PA (see PVR Announces $380 Million Investment in NE PA Marcellus), and very recently PVR announced a deal with Hess to build a pipeline system in eastern OH (see PVR Partners to Build $150M Utica Shale Pipeline System for Hess).

Yesterday Texas-based Regency Energy Partners and PVR announced that Regency will buy out PVR for $5.6 billion. Regency, also a midstream company, owns some assets in the Marcellus/Utica, but most of their operations are in the Southwest and West, so this purchase gives them a major presence in the rapidly-expanding midstream sector of the Marcellus/Utica. After the buyout is completed, the PVR name will be no more…
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PVR Partners to Build $150M Utica Shale Pipeline System for Hess

Midstream company PVR Partners has been selected by Hess to construct 45 miles of gathering pipelines in eastern Ohio’s Utica Shale region. In an announcement issued today, PVR said the new pipelines will be built to cover Belmont, Jefferson and Harrison Counties where Hess holds a substantial acreage position. The new pipeline project will end up costing somewhere in the neighborhood of $125-$150 million and will be completed in 2015.

The PVR announcement:
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PA DEP Slaps PVR Gathering with $150K Fine for Illegal Discharges

PVR Marcellus Gas Gathering, a PA-based midstream company, was fined $150,000 this week by the PA Dept. of Environmental Protection for four episodes of “discharge violations” that happened while PVR was constructing the Coal Mountain pipeline in Lycoming County, PA in 2011. The DEP slapped them hard because, says the DEP, the company kept repeating the same violation–discharging bentonite (impure clay) into a local creek. PVR Marcellus Gas Gathering is a subsidiary of PVR Partners (formerly Penn Virginia Resource Partners).

The DEP announcement:
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New PVR Marcellus Pipeline Comes Online in Northeast PA

The newest Marcellus Shale pipeline became operational today. PVR Partners made an announcement that their Wyoming Pipeline, a 30-mile pipeline running from northern Wyoming County, PA south to Luzerne County where it connects to the Transco interstate pipeline, is now operational. The new pipeline has a 750 million cubic feet per day capacity (MMcfd), of which 255 MMcfd (so far) has been spoken for by producers.

From the announcement:

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PVR Sells Pipeline in East Texas, Concentrating on Marcellus

Penn Virginia Resource Partners (PVR), a midstream company, yesterday announced it’s selling off a small natural gas gathering system and processing plant in east Texas to DCP Midstream Partners for $63 million. The reason? To concentrate more on the Marcellus Shale region (and to focus more on PVR’s other area of focus—the panhandle of Texas and Oklahoma).

From the PVR press release:

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PVR Announces $380 Million Investment in NE PA Marcellus

kick it up a notchPenn Virginia Resource Partners (PVR) is kicking up its commitment to the Marcellus Shale in northeastern PA a notch. Yesterday they announced they would invest $380 million on Marcellus Shale pipeline projects including a new extension to its natural gas pipeline in Lycoming County, PA. The announcement also reveals that they have commitments from Shell, Southwestern, Range and Inflection for the extra capacity and services. Yesterday PVR completed a previously announced deal to acquire Chief Gathering.

From the PVR press release:

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New Water Pipeline Reduces Water Truck Trips in PA

Aqua America and Penn Virginia Resource Partners (PVR) issued a press release yesterday to call attention to a recently completed private pipeline project in the Marcellus Shale in north-central PA. What’s new and different about this pipeline is what it carries: water. The newly completed pipeline supplies water to drilling sites without the need for water trucks—and that’s the “angle” Aqua America and PVR are pushing. They tout the fact that already, in less than a month of operation, the pipeline has eliminated more than 2,000 water truck trips.

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PVR Buys Chief Gathering/Marcellus Pipelines for $1B

Calling it a “transformational transaction” for the company, Penn Virginia Resource Partners (PVR) today announced they are buying Chief Gathering for $1 billion in cash and stock. Chief Gathering is a midstream pipeline company with assets (pipelines) located mostly in northeastern Pennsylvania in the Marcellus Shale. The deal includes existing pipeline agreements with drilling heavyweights like Chesapeake, Anadarko, Statoil, Exxon Mobil and others. PVR CEO William Shea says the new combined pipeline operation for PVR will represent 75 percent of its business by the end of next year (it’s currently 40-45 percent of their business).

From the PVR press release:

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PVR Buys Rail-Trail Right-of-Way for Pipeline in PA

A possible new Marcellus Shale pipeline is in the works in Susquehanna County, PA (northeast region of the state). Yesterday, Penn Virginia Resource Partners (PVR) announced they signed a deal granting them a right-of-way along a the Rail-Trail from Union Dale, PA to the New York State border. The plan is to connect wells in Susquehanna County to the Tennessee Pipeline in Union Dale.

PVR is a coal and natural gas midstream company with 4,200 miles of natural gas gathering pipelines and seven natural gas processing plants. The amount to be paid for the right-of-way was not disclosed.

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