Industrywide Issues

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    NY DEC Com. Martens Says No NY Fracking Until 2015 Earliest

    litigationIn what is sure to be a bitter disappointment to New York’s landowners, Dept. of Environmental Conservation Commissioner Joe Martens said yesterday in testimony to lawmakers that he’s not going to issue any permits for shale drilling before 2015. Unless, of course, he’s forced to by a court (see Norse Energy Sues Gov. Cuomo to Force Release of Fracking Regs). Martens’ comments came as he gave testimony about the DEC’s budget for the next fiscal year, which begins on April 1st. Martens is not including anything in the DEC budget for shale drilling oversight and told lawmakers it would be “extremely unlikely” that permits would be issued before the end of March 2015, hence no need to bulk up his budget for it.

    Are we surprised? Not really. The decision of whether or not to allow fracking in New York has been a political and not a scientific one for a long time now–we’d say for years. Gov. Andrew Cuomo continues to push off the decision–not Health Commissioner Nirav Shah, not Joe Martens, but Cuomo. Shah and Martens are just foot soldiers that do their master’s bidding. This latest revelation of no fracking until 2015 further validates landowners’ resolve in pushing forward with lawsuits on various aspects of the drilling issue at various levels of the court system. It’s now obvious we will have to litigate for our freedoms–or loose them forever…
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    Williams CEO: Transco Pipeline will Double Capacity by 2017

    Williams President & CEO, Alan Armstrong, addressed the Hart Energy’s annual Marcellus-Utica Midstream Conference & Exhibition at the David L. Lawrence Convention Center in downtown Pittsburgh yesterday. He said several interesting things, but the one that caught our attention was this: Williams is going to spend $5 billion expand their Transco methane pipeline. Transco runs from the Gulf Coast to New York. Armstrong said they will be adding more mainline to the Transco–making it longer, by about 9%. Which doesn’t seem like much, but it will nearly double the capacity of the entire pipeline. That’s a big hairy deal with lots of implications: More gas can get to market for consumers (bringing down prices for consumers), more gas can be shipped from drillers (more revenue for drillers), and more Marcellus gas will make it’s way into northeastern markets (great for drillers and landowners).

    A summary of Armstrong’s speech:
    Read More “Williams CEO: Transco Pipeline will Double Capacity by 2017”

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    Former Mainstream Reporter Sees the Fracking Light

    Is there any hope that mainstream media reporters will ever tell the truth about the miracle of fracking? You may despair, but every now and again there’s hope. We spotted a column written in the more-or-less conservative Washington Times by a former reporter for the Associated Press, someone who also has worked for Newsweek, ABC News and “20/20”. That’s mainstream media cred if we’ve ever heard it! Not only that, but this reporter was once funded (in a professorship) by the rabidly anti-drilling Park Foundation. Fait accompli–a dyed in the wool mainstream media guy.

    And yet, this mainstream media guy was able to see through the lies of the anti-drillers and come to the conclusion that yes, fracking is indeed a miracle and does not destroy the environment. Hallelujah! A mainstreamer who saw the light. Maybe there is hope?…
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    New SW Ohio Electric Generating Plant to be Powered by Natgas

    Middletown, OH, located on the border of Butler and Warren counties in southwestern Ohio, is about to get a new $500 million natural gas-fired electric generating plant. That is, they will if NTE Energy’s plan is approved. The new plant will generate enough electricity to supply 400,000 homes. Although the story we found about the plant doesn’t say where the gas will come from, you can bet your bottom dollar it will be fueled by Utica and Marcellus Shale gas…
    Read More “New SW Ohio Electric Generating Plant to be Powered by Natgas”

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    OH Judge Says Filing Paperwork is Enough to Extend Lease

    Ohio landowners should be aware of an important court case just decided that says, in essence, filing paperwork is enough proof of a driller’s intent that a lease can be extended beyond the initial signing period. Several landowners in Jefferson County, OH signed a lease with Fortuna Energy in 2006 that was later sold to Chesapeake Energy (in 2010). The lease was for a 5-year period. Three days before the end of the lease Chesapeake filed a Declaration of Pooled Unit (DPU) with the Ohio Department of Natural Resources. That is, they told ODNR in essence “here’s a group of properties we intend to drill on soon” requesting permission to “pool” them together into a drilling unit. That simple act was enough proof, according to a U.S. District Court judge, to allow Chesapeake to extend the original lease beyond the original 5 years.

    And so now the landowners are stuck waiting for Chesapeake to actually do something other than file paperwork. Good luck with that…
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    Utica Shale Transient Workers in Ohio Crosshairs

    Calling OH Gov. John “foreigner hunter” Kasich: Ohio is being invaded by foreigners! Time for a dragnet to kick them out!! We refer, tongue-in-cheek, to Kasich’s disdain for non-Ohioans moving to Ohio to work in the Utica Shale drilling industry–doing nasty, hard jobs that often require someone who’s skilled at doing them–like pipefitting and welding, and man-handling equipment at rig sites (called a roustabout). Ohioans can certainly be trained, but often it takes people who have done it to show them how.

    The Columbus Dispatch has taken a decidedly anti-drilling stance recently with a flurry of articles that attack the Utica Shale industry. Their latest article takes aim at “transient” workers–people Kasich calls foreigners. It’s jingoistic and repugnant–but then prejudice and ignorance always are. Here’s the Dispatch waxing eloquent on “transients”…
    Read More “Utica Shale Transient Workers in Ohio Crosshairs”

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    Summit Midstream Closes Deal to Buy 40% Stake in Ohio Gathering

    Last December MDN told you that Summit Midstream was buying out Gulfport Energy’s share of the Ohio Gathering pipeline and processing system (see Summit Midstream Buys Gulfport’s Interest in Ohio Gathering). As we said at the time, the deal appears complicated on paper with multiple names (like Blackhawk Midstream), but the bottom line was/is that Summit will be the 40% owner and MarkWest Energy will remain the 60% owner of the Ohio Gathering system.

    Yesterday, in an announcement by Summit that’s equally dense with details (likely written by lawyers), Summit announced they’ve closed the Ohio Gathering deal. That’s the sum total of this announcement–that the deal is now done:
    Read More “Summit Midstream Closes Deal to Buy 40% Stake in Ohio Gathering”

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    The Band is Back Together! Anti-Drillers to Visit Binghamton U

    The band is three-fourths back together. A group of radical anti-drilling organizations, including NYRAD (New York Residents Against Drilling), the League of [Liberal Democrat] Women Voters, NYPIRG, the Sierra Club and other lesser-known wacko organizations are sponsoring an “information” (i.e. propaganda) night at Binghamton University this Friday. And they’ve re-assembled most of the band, er, anti-drilling “experts” that visited Cornell University with their traveling road show/circus last October (see Latest Laughable NY Anti Tactic – Not Enough Gas, Just Move Along).

    Retired systems engineer for IBM and Lockheed Martin Jerry Acton will be there to induce death by PowerPoint. So too will retired Mobil Oil Executive Vice President Lou Allstadt (who’s already made his millions, so he doesn’t want any silly “farmers” to make money too, who the *$#@ do they think they are?). Oh, and Brian Brock, an anti-drilling retired geologist. Notice a theme here? All retired, all anti-drilling, with nothing to do. Road trip!…
    Read More “The Band is Back Together! Anti-Drillers to Visit Binghamton U”

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    Glow-in-the-Dark Bob Hagan: Shrill and Nutty

    Ever notice that when anti-drillers can’t seem to convince the public of their views, they get nuttier? They start spinning wild yarns, like all that fracking waste is radioactive and we’re going start glowing in the dark any day now. That’s the kind of wild tale being spun by Youngstown, OH Rep. Bob Hagan (Democrat).

    Because not enough Ohioans are turning against Utica Shale drilling, it’s time to ratchet up the rhetoric and old Bob is ready to pour it on. Here’s his latest glow-in-the-dark warning…
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    PwC: Marcellus, Other Shale Play M&A Deals Heat Up in 2013

    According to one of the top accounting/consulting firms in the world, PricewaterhouseCoopers (PwC), mergers & acquisitions (M&A) activity in the oil and gas sector in the U.S. heated up in 2013 and “included a strong uptick in the last three months of the year.” Overall there were 182 total deals accounting for $115.9 billion in total deal value for 2013. Also according to PwC, shale was an important part of that–in particular the Marcellus Shale.

    PwC tracks M&A deals worth $50 million or more. During 4Q13, there were four such deals in the Marcellus, totaling $1.1 billion. The Utica had two deals in 4Q13 worth $263 million. For all of 2013, there were 79 shale deals (across all shale plays) that contributed $53.2 billion–that is, shale deals represented half of all oil & gas M&A deals during 2013. Here’s the announcement and analysis from PwC (sorry, we couldn’t score a copy of the full report, just the summary):
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    Blue Racer: Natrium Plant Back Online, New Customers, Adds Barging

    Big news from Blue Racer Midstream. Last September there was an explosion and a fire “isolated to a small area” at the Blue Racer Natrium processing and fractionation facility in Marshall County, WV (see Explosion/Fire at Blue Racer’s Natrium, WV Processing Plant). The fire knocked the plant offline for customers needing to process wet gas. At least two (perhaps more) customers found other sources to process their wet gas (see Blue Racer’s Natrium Plant to Remain Offline Until Jan 2014). According to a single sentence buried in a press release issued yesterday, the Blue Racer Natrium plant is finally, after five long months, back online. No date was given for when it resumed operations–presumably yesterday or over the weekend. The statement says, “The Natrium I processing unit has recently returned to service following a temporary shutdown that occurred after a fire damaged the unit.”

    No mention of how long it was offline (five months!) or the work done to get it back online. Probably the lawyers telling them to keep their mouth shut. Anyway, we’re happy to see it back up and running. In addition to that very big news (which was decidedly downplayed in the press release), Blue Racer also announced yesterday they’ve picked up several new customers for an expansion at the Natrium processing/fractionation plant (see who below). Finally, Blue Racer announced that in addition to the current rail, truck and pipeline they use to move NGLs (natural gas liquids) from the plant, they’re adding barging down the Ohio River. Notwithstanding the downplayed reopening of the Natrium plant, this is one of the most enlightening press releases from a midstream company we’ve seen in some time…
    Read More “Blue Racer: Natrium Plant Back Online, New Customers, Adds Barging”

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    Houston Investment Firm a True Believer in WV Cracker Plant

    A huge vote of confidence by an investment firm that the ethane cracker plant recently announced by Gov. Earl Ray Tomblin and planned for Parkersburg, WV will actually be built (see WV Announces Brazilian Company to Build Ethane Cracker Complex). Siltstone Capital, an investment and advisory firm with corporate offices in New York and Houston, bought the old Blue Cross and Blue Shield building in downtown Parkersburg–vacant since 2009–to set up offices for the company and to lease out space they don’t use themselves.

    Siltstone invests in companies in the energy sector: exploration and production, oil services, and midstream. If they weren’t totally convinced that the Odebrecht cracker plant would be built, you can be sure Siltstone would not have spent $475,000 on a vacant building in Parkersburg, WV (population 31,492)…
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    OH Company Doubles Jobs/Revenue by Targeting Utica Shale Drillers

    Dan Pottmeyer, president of Producers Service Corp located in Zanesville, OH, says his company is the only fracking company that’s “home-grown in Ohio.” (That’ll be good news for OH Gov. John “foreigner hunter” Kasich. He likes ’em home-grown.) Pottmeyer’s company used to send oilfield services crews into Ohio’s conventional oil and gas fields for low-volume fracking work. However, after purchasing new equipment and more than doubling the work force, Pottmeyer now sends his crews into the field to work on Utica Shale wells–competing with the likes of oilfield services titans like Halliburton and Baker Hughes. Although he doesn’t disclose figures for the privately-held company, Pottmeyer says revenue has more than doubled in the past couple of years.

    The Producers Service Corp story is a good story–an important story–of how local businesses can figure out how to plug in to the Marcellus and Utica Shale supply chain. Which is why we love to bring you stories like this one…
    Read More “OH Company Doubles Jobs/Revenue by Targeting Utica Shale Drillers”

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    Williams Changes Up Leadership for Northeast Gathering Operation

    A reshuffling of leadership for Williams’ operations in the northeast Marcellus/Utica region. Previously, Frank Billings ran the show for the Northeast Gathering & Processing operating area. Billings has been reassigned/promoted to corporate HQ. Taking over for Billings as head of Northeast Gathering is Jim Scheel. What does it all mean? We don’t know–so we’re left to read between the lines.

    It seems from the statements by Williams’ CEO Alan Armstrong that Billings blazed the trail and got things rolling in the northeast, and now the northeast region has turned into more of an ongoing, operational kind of thing–and Scheel is an operations guy, good at focusing on the details of turning the northeast area into a well-oiled machine. At least that’s our read. What do you think? Here’s the announcement…
    Read More “Williams Changes Up Leadership for Northeast Gathering Operation”

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    Blue State Blues: 6 New England States Want New Natgas Pipeline

    Wonders never cease. The governors of six New England states (5 Democrat governors, 1 Republican governor) have sent a letter, or more properly the heads of their state utility commissions have sent a letter, to ISO New England (the regional cooperative transmission organization), requesting that a new natural gas pipeline be built to get more Marcellus Shale gas into New England. Oh, and they want to charge electric customers to get it built. Why? Not enough pipeline capacity now. Electric generating plants are using more and more natural gas to produce electricity. Not enough supply of natural gas in New England means those generators are paying nosebleed rates to produce electricity, and consequently electric rate payers are paying out the nose to cover the cost. Eventually those rate payers will toss their overlords out of office is something isn’t done–so by golly they’re doing something.

    Even the fossil-fuel hating, tree hugging anti-frackers in New England have hit the brick wall of reality: so-called renewable sources of electricity can’t and won’t (for the foreseeable future) provide enough electricity to meet our needs. The remarkable request letter (embedded below) doesn’t specify how or where the pipeline should go, just that they need it and they need it in place by winter of 2017. Of course, that doesn’t stop some of the nuttier anti-drilling organizations from opposing the idea…
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    EPA Chief McCarthy Tells NRDC States Have Lead Role in Fracking

    Generally, Gina McCarthy, administrator of the federal Environmental Protection Agency, is ready to poke her nose into fracking whenever and wherever she wants. Apparently she doesn’t want to–at least for now. McCarthy has dialed back her fervor on regulating fracking and (lately) has been deferential to state regulators. That doesn’t sit well with unreasonable so-called environmentalist groups like the National Resources Defense Council (NRDC). In responding to a letter from the NRDC, McCarthy said, to her credit, that the states have the key/lead role in investigating concerns about fracking and potential pollution. That went over like a lead balloon at the NRDC.

    The NRDC, and other so-called environmentalist groups, want all oil and gas regulation under the thumb of the feds. They don’t like having to deal with that messy thing called the U.S. Constitution which says oil and gas regulation comes under the purview of the individual states. Statists don’t like that particular inconvenient truth and were hoping an Obama acolyte like McCarthy would be more statist in her approach, assuming authority not granted her under the Constitution. For now (thankfully) the EPA under McCarthy is stepping back from a more active role. At least until their “study” of fracking is completed sometime this year…
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