Industrywide Issues

Energy Services | Industrywide Issues | Pipelines | Williams

Williams CEO Says Pipeline Opposition Equals More Coal Use
February 13, 2015February 13, 2015

In a recent interview, the CEO of Williams, Alan Armstrong, was quite candid: The problem slowing natural gas pipeline development is not the low price of oil and gas–it’s politics. Armstrong says he would prefer federal oversight, by FERC, shutting out “local voices” that muck up the works. We’re not sure we totally agree with that viewpoint. Freedom and liberty are messy things, but we understand his sentiment. Armstrong points out there’s no one “who’s in charge” when it comes to pipelines, and process which makes for endless debates and trying to reconcile innumerable opinions…
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Baker Hughes | Energy Services | Halliburton | Industrywide Issues | Jobs

Halliburton Laying Off Up to 6,400, Says Baker Hughes Not a Factor
February 13, 2015February 13, 2015

Halliburton, the county’s second largest oilfield services company, announced earlier this week they’re laying off some 6.5% to 8% of their 80,000 employees, which translates to 5,000 to 6,500 jobs. The company Halliburton is buying, Baker Hughes, announced in January they are laying off 11% of their workforce (see Baker Hughes Announces 7,000 Layoffs Due to Low Oil Price). Also in January, the country’s (and world’s) largest oilfield services company, Schlumberger, laid of 9,000 workers (see Schlumberger Firing 9,000 to Reduce Head Count, “Low Oil Prices”). To which we say, it’s getting ugly out there…
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Air Quality | Industrywide Issues | Regulation | Research

New Study: Most Natgas Processing Facilities Leak < 1% Methane
February 13, 2015February 13, 2015

The EPA is getting ready to drop draconian new regulations on the oil and gas industry claiming that methane is leaking out everywhere. A major field study led by Colorado State University and published this week in the peer reviewed journal Environmental Science & Technology examined 114 gathering facilities and 16 processing plants across 13 states looking for methane leaks. What did they find? The vast majority natural gas facilities had minuscule leak rates of less than 1%…
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Industrywide Issues | Pennsylvania | Statewide PA | Taxation

PA Gov Wolf Proposes Marcellus-Killing 7.5% Severance Tax
February 12, 2015February 12, 2015

Newly elected Pennsylvania Gov. Tom Wolf has turned out to be another tax and spend liberal. Surprise! If you’re a regular MDN reader, you’re not surprised. We warned you about this from day one. Wolf released his severance tax plan yesterday, and it’s even worse than what he talked about on the campaign trail. He’s proposing a 5% severance tax PLUS another 4.7 cents per thousand cubic feet of natural gas that flows from a well. PA’s House Majority Leader Dave Reed (Republican) says it works out to be roughly a 7.5% tax–one of the HIGHEST IN THE NATION. On top of low low gas prices and rigs beginning to idle and capital budgets slashed 30-50%. In other words, if this tax is passed, not only will it not bring in Wolf’s disingenuous promise of $1 billion “for the children” (i.e. teachers unions), it will KILL Marcellus drilling in the state–and that’s not a bluff. It’s now apparent that Wolf is a man completely out of his depth and not ready for a big job like governor…
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Industrywide Issues | Pennsylvania | Statewide PA | Taxation

PA Towns to Gov Wolf: Don’t Kill the Impact Fee with Your New Tax
February 12, 2015February 12, 2015

Yesterday Pennsylvania Gov. Tom Wolf (Democrat) proposed what amounts to a 7.5% severance tax on Marcellus and Utica Shale drilling in the state (see our lead story today). Wolf’s severance tax is being erroneously reported as a 5% severance tax PLUS 4.7 cents per thousand cubic feet of natural gas produced at the wellhead. When you work it out, it’s actually about 7.5%, NOT 5% as Wolf misleadingly implies. Coupled with PA’s high corporate income tax rate, the proposal, if passed, would put PA at the top of the list of states taxing the oil and gas industry, essentially killing future Marcellus Shale drilling in the state (not an idle threat). Some of those most opposed to this hare-brained plan are the townships where drilling actually happens–they stand to loose big-time because the impact fee money they get now will be traded away for a few table scraps. The impact fee will be converted into the severance tax–and given away to Philadelphia…
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Anti-Drilling/Fossil Fuel | Industrywide Issues | Pennsylvania | Statewide PA | Taxation

John Quigley’s Old Employer Likes High Wolf’s Marcellus-Killing Tax
February 12, 2015February 12, 2015

MDN has several stories today about the newly proposed 7.5% severance tax on Marcellus Shale drilling proffered by newly-elected Pennsylvania Gov. Tom Wolf. If you want to know whether or not this severance tax will work to undermine, and even stop, Marcellus Shale drilling, all you have to do is look at the comments of anti-drilling groups in the state–like the comments of the radical PennFuture. You may recall that Wolf’s nominee to head the Dept. of Environmental Protection, John Quigley, used to work for PennFuture (what does that tell you about the future of drilling in the state?). According to the new “acting” CEO and head of PennFuture, this severance tax will help to end Marcellus Shale drilling in the state…
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CNG/LNG | Exporting | Industrywide Issues | Pipelines

Repsol Accelerates Plan for Canadian LNG Exports Fed by Marcellus
February 12, 2015February 12, 2015

Spanish oil giant Repsol loves North American shale. In December, Repsol purchased the troubled Canadian company Talisman Energy for $8 per share (see Spanish Respol Buys Marcellus E&P Talisman Energy for $8/Share). That deal is awaiting regulatory approval before it becomes official. Repsol is also contemplating building an LNG (liquefied natural gas) export facility along the coast of Saint John, Newfoundland. Those plans, according to new filings with Canada’s National Energy Board, have been accelerated. Part (much?) of the gas that will feed the Saint John LNG operation will come from, yes, the Marcellus and Utica Shale…
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Economic Impact | Industrywide Issues | Marshall County | Property Value | West Virginia

Marshall County Property Values Rise Yearly Thx to Marcellus
February 12, 2015February 12, 2015

In contravention to the erroneous claim by anti-drillers that property values go down when drilling comes to town, Marshall County, WV continues to prove it’s just the opposite. Last year at this time MDN told you that the property values in Marshall County for 2013 had collectively risen an astonishing $605 million–in just one year (see When Drilling Comes to Town, Property Values Go…UP, Not Down). What about property values in 2014? They broke the record, again. Values are up a collective $631 million!…
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Industrywide Issues | Research

EIA’s Feb Drilling Productivity Report: Marcellus/Utica Up Again
February 12, 2015February 12, 2015

Our favorite monthly report from our favorite government agency was released a few days ago. The U.S. Energy Information Administration (EIA) produces the monthly Drilling Productivity Report (DPR), which looks at production from both new (drilled in the last month) and legacy (drilled more than a month ago) wells along with overall production numbers for the seven top commercially active shale plays in the U.S. In a consistently recurring theme, all seven plays showed an increase in natural gas production from February to what they predict will be the numbers in March. The Marcellus stands head and shoulders above all other shale plays in producing what they say will be 16.7 billion cubic feet per day in March, up from 16.5 Bcf/d in February. The Utica is also forecast to increase–from 1.86 Bcf/d of natgas production in February to 1.93 Bcf/d in March. Below is the full February 2015 DPR report along with two charts not included in the full report…
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Industrywide Issues | Jobs | Pennsylvania | Statewide PA

Growing Jobs: Marcellus/Utica PR Agency Opens Branch Office in TX
February 12, 2015February 12, 2015

Used to be that companies working in and for the oil and gas industry–located in states like Texas and Oklahoma–would set up branch operations in states like Pennsylvania, Ohio and West Virginia to take advantage of the Marcellus and Utica Shale. These days, however, the trend is sometimes reversed. Bravo Group is a public relations firm based in Harrisburg, PA with a long list of clients in the oil and gas industry. Yesterday Bravo announced they’re opening a branch office in Texas. We love it when northeast shale drilling starts to export jobs to “foreign” places (as OH Gov. John Kasich calls them) like Texas…
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About MDN | Allegheny County | Education | Industrywide Issues | MDN Resources | Meetings | Pennsylvania

Exclusive for MDN Readers: Attend Pittsburgh O&G Industry Summit FREE
February 11, 2015March 2, 2015

Last March, MDN participated in the Oil & Gas Awards regional event in Pittsburgh (see Oil & Gas Awards “Northeast Conference for Excellence” Now on MDN). It was a blast meeting and talking with members of the industry. Like last year, we are once again participating in the event this March in Pittsburgh. MDN editor Jim Willis is moderating a couple of the panel discussions during the day-time conference, which is dubbed the Northeast Industry Summit. We have two pieces of big news for MDN readers: 1) The U.S. Chamber of Commerce is sponsoring and participating this year, and 2) Jim wants MDN readers to attend, so he’s arranged with the O&G Awards crew to offer MDN readers a FREE pass to the Summit, which will save you $199. Here’s how to register…
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Industrywide Issues | Pennsylvania | Regulation | Statewide PA

PA Drilling Regs in Process Since 2012 Delayed by PA Gov Wolf
February 11, 2015February 11, 2015

The 2012 Act 13 law did a great deal to update oil and gas drilling regulations, something Gov. Ed Rendell failed to do when he was in office. But it didn’t do the whole job. Part of the law left it up to the five-member Oil and Gas Technical Advisory Board, part of the PA Dept. of Environmental Protection, to codify all sorts of new regulations to make drilling better and safer. Remember, this started in 2012 (which tells you how slowly government moves). The original proposal had 23 pages of changes and new rules, which later blossomed to 73 pages (see 1984 PA Oil & Gas Act Rewrite Delayed but Still Coming). In 2013, the DEP took the draft regulations on “road show” seeking public comment, which they extended into early 2014 (see PA DEP Extends Roadshow for Public Comment on New Drilling Rules). The last we heard, the new regs were supposed to be released in very early 2015 (see DEP Sec. Abruzzo Says Budget Bill Means Delay in New Drilling Regs). Scratch that now. A draft of the final final final final rules was supposed to be discussed on Jan. 22, two days after the coronation of Gov. Tom Wolf, but that was canceled to give Wolf and presumably John Quigley, Wolf’s nominee to head the DEP, time to rewrite them yet again…
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Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | Kinder Morgan | Pipelines | Regulation | Tennessee Gas Pipeline

Anti Groups Beat Export Drum in Opposing MA Pipeline
February 11, 2015February 11, 2015

Anti-fossil fuelers continue to try and make the case that the Federal Energy Regulatory Commission should not allow Kinder Morgan to build an extension to the Tennessee Gas Pipeline through Massachusetts, called the Northeast Energy Direct project. Their favorite tactic is to find an issue that they believe will resonate with the general population and push for all it’s worth on that issue–with the gleeful help of mainstream (or “drive-by”) media. The latest wedge issue they’re harping on is that natural gas flowing through the pipe will get exported–implying that none of the gas flowing through the pipeline will benefit New Englanders. We previously dealt with the complex issues behind exporting (see Canadian LNG Exports, New England Pipelines & the Marcellus). Will some of the gas flowing through the TGP pipeline get exported to Canada and liquefied into LNG and exported across the ocean? No doubt. Will most of it get exported? No…
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Crawford County | Energy Services | Industrywide Issues | Jobs | Pennsylvania | Supply Chain | Universal Well

Universal Well Services Closes PA Facility, Lays Off Some Workers
February 11, 2015February 11, 2015

It wasn’t so long ago that MDN told you about the “feel good” story of Universal Well Services, a Meadville (Crawford County), PA company specializing in pressure-pumping wells, cementing well pads and other well services (see Marcellus Supply Chain Success Story: Universal Well Services). Universal is a subsidiary of Patterson-UGI Energy, Inc.–a large oilfield services company. The company had grown from 200 to more than 1,000 employees in 10 years. But that was before the price of oil and gas went into the basement. Now they’re laying off employees…
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Columbiana County | Industrywide Issues | Ohio | Pipelines

Man Bites Dog: No Protesters at NEXUS Gas Pipeline Event?!
February 11, 2015February 11, 2015

The reporting on a story about a pipeline open house is so unusual, we thought you would like to hear about it. It seems that representatives from the proposed $2 billion NEXUS Gas Pipeline, a pipeline beginning in Columbiana County, OH, then crossing through 11 Ohio counties and 3 Michigan counties in total, held an open house to discuss the project last night in Hanoverton (Columbiana County), OH. The unusual “man bites dog” news? No nutty protesters, and those who attended, the people whose land it may cross, “welcome” the project! This is not your typical news reporting folks. Somebody in anti-drilling land is falling down on the job–they should have had at least one nutjob anti-fossil fuel protester outside for the cameras…
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Industrywide Issues | Regulation

Widespread Use of Drones in Northeast Drilling May Start This Year
February 11, 2015February 11, 2015

Question: What do you call a model airplane or model helicopter with a camera attached to it? Answer: A drone. We always find is fascinating to hear talk about “drones” in the news because it conjures an image of unmanned but nearly full-sized airplanes flying over Afghanistan looking for baddies like Osama. When if finds a baddie, the remote pilot flies that sucker with a bomb strapped to it into the ground, killing the target. Somewhere along the way “model airplane” got renamed “drone”–we suspect intentionally, to give you that mental imagery. Anywho…the Marcellus and Utica Shale industry would like to use “drones” to monitor pipelines and scout out locations for future drill pads, but the Federal Aviation Administration currently blocks most such activity. That may change this year…
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