Industrywide Issues

Industrywide Issues | NGLs | Regulation

ND Regulators Pass Rule Making Bakken Crude by Rail Safer
December 11, 2014December 10, 2014

For some time MDN has written and highlighted articles about Bakken Shale crude oil that gets to market largely on railroads. The short version of the story is this: Bakken crude contains a lot of NGLs (natural gas liquids), like ethane, butane, propane. The NGLs make the crude more ignitable and flammable if there’s an accident. And there’s always an accident–at some point in some place. A number of Bakken crude trains run through New York State and of course NY’s anti-drillers object (what don’t they object too?). We’ve heard lovely metaphors and analogies like “bombs on rails” and “death trains.” On Tuesday, the North Dakota Industrial Commission (NDIC) met and passed a controversial measure to fix the problem. Starting April 1st, oil companies will have to strip out most of the NGLs before the oil is loaded onto railcars. Of course that won’t appease anti-drillers, but it will make communities through which the trains pass safer than they are now…
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Air Quality | Industrywide Issues | Regulation

Clock Ticking for Comment on EPA Rule on Greenhouse Gas Reporting
December 11, 2014December 10, 2014

Two weeks ago MDN gave E&P and midstream companies a heads-up that another onerous new “rule” (i.e. law) is coming from the out-of-control Obama Environmental Protection Agency (EPA) that requires energy companies to file greenhouse gas emissions reports for just about everything–wellpads, pipelines, compressor stations (see EPA Issues New Rules for O&G Industry on GHG Emissions Reporting). A whole new level of reporting is coming at you. On Tuesday the EPA published their proposed rule change in the Federal Register (copy below)…
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Industrywide Issues | Ohio | Research | Statewide OH | Utica Shale

Benesch Shale Report 3Q14: Upstream, Midstream & Downstream
December 11, 2014December 10, 2014

Each quarter the Ohio law firm of Benesch Friedlander Coplan & Aronoff LLP produces an Ohio shale update. MDN often shares their updates–well worth your time to read. The latest edition, covering Utica Shale activity in the third quarter of 2014, is embedded below. This issue highlights infrastructure announcements, financial results for some of the Utica’s largest drillers, supply chain news and regulatory news. Take time to read this well-crafted summary (will only take you a few minutes)…
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Energy Companies | Energy Services | Industrywide Issues | M&A | New York | Pennsylvania | Pipelines | Regency Energy Partners | Statewide NY | Statewide PA | Talisman Energy

Talisman Considers Sale of Marcellus Midstream Assets to Regency
December 10, 2014December 10, 2014

Three weeks ago Talisman was rumored to be near a deal to sell its New York/Pennsylvania pipeline system to Regency Energy Partners. Talisman owns some 435 miles of gathering and transmission pipelines in NY/PA. However, the deal, which was supposedly imminent and rumored to be worth $1 billion, still hasn’t happened. Why? Could it be the revived talks by Repsol to buy Talisman (see Rumor Mill: Repsol Once Again Interested in Buying Talisman)? We don’t know. One thing we do know is that corporate raider Carl Icahn, who has his claws deeply into Talisman (as he does with Chesapeake Energy), is the puppet master pulling the strings and forcing the company to sell assets. Here’s the sitrep (situation report) as of a few weeks ago, according to sources talking to Bloomberg News…
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Energy Services | Industrywide Issues | MarkWest Energy | Pennsylvania | Pipelines | Regulation | Washington County

MarkWest Builds/Operates Compressor Station w/o Building Permit
December 10, 2014December 10, 2014

Hmmm. Here’s a story we don’t like to report, and fear there’s more to the story than we now know, but report it we must. MarkWest Energy, arguably the largest and most important midstream (pipelines & processing plants) company in the Marcellus and Utica Shale, was denied a building permit to construct a building to house several natural gas compressors in West Alexander (Donegal Township, Washington County), PA–but they went ahead and built it anyway, without the permit. The rogue compressor station is now up and running but has to use generators to supply power because the town won’t let them hook up electric since they’re still in violation of the building permit…
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Anadarko | Chesapeake Energy | Citrus | Energy Companies | Industrywide Issues | Jobs | Pennsylvania | Regulation | Statewide PA | Statewide WV | West Virginia

DOL Action: Several Marcellus Drillers Pay $4.5M in Back Wages
December 10, 2014December 10, 2014

In a multi-year so-called “investigation” that cost more money that was “recovered,” the U.S. Dept. of Labor (DOL) announced yesterday they’ve forced Chesapeake Energy, Citrus Energy and Anadarko Petroleum (and perhaps others) to pay $4.5 million in back wages to some 5,300 oil and gas workers in Pennsylvania and West Virginia. The apparent “violation” is that these workers, working for subcontractors (not directly for the energy companies themselves), in some cases worked more than 40 hours in a given week but didn’t get time-and-a-half wages. We’re certainly not against playing by the rules, but it sure seems like utter folly to hype this as some sort of victory by Obama’s Labor Department–to work for more than two years and come up with a thimble-full of violations and carp and complain about how fractured the energy industry is–the same industry that, because of all those many subcontractors, has generated several hundred thousands new jobs in PA & WV that wouldn’t have been there otherwise. Here’s the press release by the DOL…
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CNG/LNG | Commodity Price | Industrywide Issues | Research

Bank of America: OPEC is Dead, Oil Goes to $50/Barrel, LNG Drops
December 10, 2014December 10, 2014

The price of oil, as certainly connected to shale drilling. Even the price of natural gas is influenced by what oil is doing (see our recent story Will Low Oil Prices Slow Northeast (Indeed All) Shale Drilling?). So it was with great interest we read that Bank of America analysts have declared that OPEC is effectively dead and that oil prices may make a run at $50 per barrel–and begin to swing wildly in the coming years. BoA also sees LNG prices dropping like rock…
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Hydraulic Fracturing | Industrywide Issues | Supply Chain

New Technology Makes Fracking Pumps More Reliable
December 10, 2014December 10, 2014

California company Energy Recovery Inc. earlier this week announced a new product, called VorTeq, that makes the pumps used in fracking operations more efficient, less likely to fail, and doubles the useful life for pump components most likely to fail. This new innovation makes fracking pumps more reliable, requiring less maintenance. How does it do it?…
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Industrywide Issues | Pennsylvania | Statewide PA | Taxation

PA Dems Want Gov-Elect Wolf to Follow Obama’s Lawless Example
December 10, 2014December 10, 2014

Obama was sworn to uphold the Constitution when he took office. It is the essence of our country–the rule of law by which we live. Obama trashes the Constitution with every executive order he issues, creating new laws (something delegated to the legislative branch under the Constitution) and even treading into the judicial side of things with an out-of-control Attorney General, Eric Holder. Obama’s infamous example of appointing himself judge, jury and executioner hasn’t been wasted on leftists elsewhere, including Pennsylvania. Democrats met in Harrisburg last week to lick their electoral wounds. The meeting was organized by the radically left PennFuture (further illustrating just how far off the left side of the chart Democrats have gone). At the meeting, Dem bigwigs said PA’s Gov.-elect, Tom Wolf, should follow Obama’s example and thumb his nose at the Republican legislature and just make up his own laws, especially when it comes to the environment and gas drilling…
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Hydraulic Fracturing | Industrywide Issues | Litigation | New York | Regulation | Statewide NY

New Wrinkle in NY: Towns Must Pass Zoning Laws to Allow Fracking
December 9, 2014December 9, 2014

Anti-drilling former “reporter” for the Binghamton Press & Sun-Bulletin, Tom Wilber, is back with an insightful article in the P&SB. Wilbur highlights an issue just now coming to light for residents in New York. Earlier this year the New York Court of Appeals (NY’s highest court) made a disastrous ruling that allows townships to ban fracking (see Shale Drilling in NY is Over – High Court Upholds Town Bans). The continuing sliver of hope for NY landowners is that Gov. Andrew “can’t make up his mind” Cuomo will make up his mind, lo these 6 years later, and allow fracking to take place. The thinking has been that the fight (for anti-drillers) will now focus on attempting to get town boards to enact a ban–something not likely to happen in places most likely to drill. Wilber’s article points out a big, fat problem with that thinking: the high court’s decision in July did a lot more than just allow towns to ban drilling. In light of the July decision, towns with zoning ordinances (almost all towns in NY) must specially allow drilling–or it can’t take place by default…
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Energy Companies | Industrywide Issues | Pipelines | Processing Plants | Rice Energy

Rice Energy Launches Midstream IPO – MDN Nails the Price
December 9, 2014December 9, 2014

A month ago MDN told you that Rice Energy would spin out a midstream (pipelines & processing plants) subsidiary (see Rice Energy Readies Midstream Subsidiary IPO – How Much?). At the time, we didn’t have a clue as to how much the company would want to raise, but based on a formula we devised (pretty simple, using the same ratio of Antero’s E&P IPO vs their midstream IPO) we came up with the number of $588.5 million for the Rice Midstream IPO. We said at the time we would be back to let you know how close we came with our “back of the envelope” prediction. Looks like it was pretty darned close. Like, scary close…
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Broome County | Chenango County | Delaware County | Energy Services | Industrywide Issues | Kinder Morgan | New York | Pipelines | Regulation | Schoharie County | Tennessee Gas Pipeline

Kinder Files with FERC, NED Pipeline Changes Path in NY & MA
December 9, 2014December 9, 2014

MDN has chronicled the sad state of Massachusetts and its obtuse opposition to the Kinder Morgan Northeast Energy Direct (NED) project, a pipeline that would make both their natural gas and electricity costs a lot cheaper. We told you Kinder planned to change the path of the pipeline to avoid about half of Massachusetts on its way from New York to the Boston area (see Kinder Morgan Changes Route for Pipeline from MA to NH). What you may not know is that MA doesn’t have sole ownership of obtuseness. New York wants in on some of that action too. NIMBYs in Columbia County, NY have been kicking up a fuss over the pipeline, so when Kinder filed their new preferred route yesterday (see updated map below), they altered the course and shifted it north from Columbia County to Rensselaer County, following an existing right-of-way owned by National Grid…
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Energy Services | Industrywide Issues | Iroquois Gas Transmission | New York | Pipelines | Schoharie County | Spectra Energy

Spectra Energy Alliance with Iroquois to Sell Marcellus Gas to NE
December 9, 2014December 9, 2014

In July Spectra Energy announced a pipeline project that would compete with Kinder Morgan’s plan to run a pipeline across Massachusetts to help alleviate natural gas bottlenecks in New England (see Spectra Energy to the Rescue! New England Pipeline Expansion). Spectra’s pipeline eventually got a name and a partner: The $3 billion project is called Access Northeast and the partner is Northeast Utilities (see Spectra Energy New England Pipeline Gets a Name & a Partner). Yesterday, Spectra announced not a new partner, but a new alliance with a competitor. Iroquois Gas Transmission has agreed to provide Marcellus Shale gas to Spectra’s Access Northeast pipleine. The two will connect at the Wright, NY Interconnect in Schoharie County…
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Air Quality | Industrywide Issues | Litigation | Pennsylvania | Regulation | Sand/Proppant | Wyoming County (PA)

Deuling Air Quality Studies for NEPA Frac Sand Transfer Station
December 9, 2014December 9, 2014

MDN has tracked the case of a proposed D&I Silica (owned by Hi-Crush Partners) frac sand transfer facility in Tunkhannock (Wyoming County), PA and some of the ins and outs along the way. D&I is ready to build the facility but lacks one important permit–from the county. So D&I has sued to get it (see NEPA Town Residents Resist Frack Sand Transfer Station). That lawsuit was settled in November and construction will now go forward. We recently brought you a report from a resident and long-time reader of MDN on the situation (see Revisiting Frac Sand Facility Controversy in Tunkhannock, PA). We have a new update: Both the county and the state Dept. of Environmental Protection (DEP) are proposing air quality studies to ensure nearby residents are not exposed to silica dust which acts a lot like asbestos particles and can, in the most extreme cases, can cause lung cancer. The question is, whose study will get done, or will taxpayers pay for both studies?…
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Energy Companies | Industrywide Issues | M&A | Talisman Energy

Rumor Mill: Repsol Once Again Interested in Buying Talisman
December 9, 2014December 9, 2014

In July MDN told you that Spanish oil company Repsol was seriously looking at buying some of, or even all of, Canadian company Talisman Energy (see Repsol Eyes Talisman Energy for “Assets” – Takeover Target?). Talisman is a major driller in the Marcellus Shale. Then, in the heat of August, came the word that those talks were off (see Talks for Repsol to Buy Some/All of Talisman Energy are “Frozen”). However, the rumor mill is buzzing again. Bloomberg is reporting the talks are back on and once again Repsol is looking at possibly a buyout of Talisman…
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Industrywide Issues | Research

Monthly DPR Shows Shale Oil & Gas Production Continue to Climb
December 9, 2014December 9, 2014

Our favorite government report from our favorite government agency was released yesterday–the Drilling Productivity Report from the U.S. Energy Information Administration (EIA). What does it show? EIA projects oil output from the top seven U.S. shale plays (the Marcellus and Utica being two of them) will increase from 5.2 to 5.3 million barrels per day by January 2015, and natural gas production will increase from 44.1 to 44.7 billion cubic feet per day by January 2015. Now, tell us again about that peak oil and peak gas. Below is the full report with MDN’s additions…
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