Industrywide Issues

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    More on MSC/PIOGA and PA DEP Dueling Radiation Studies

    Last week MDN told you that two somewhat competitive drilling industry organizations in Pennsylvania–the Marcellus Shale Coalition (MSC) and the Pennsylvania Independent Oil and Gas Association (PIOGA)–announced they would launch their own study of the “does drilling create radioactive waste” issue (see MSC/PIOGA Team Up to Study Radiation in Shale Drilling). Since the PA Dept. of Environmental Protection is currently conducting a 12-14 month study of its own on that topic (see PA DEP Announces New Study of Radiation in Shale Drilling), we wondered why the MSC & PIOGA would launch their own study.

    Additional information has come to light. According to an interview with Acting (soon to be full) Sec. of the DEP, Chris Abruzzo, the DEP views radioactivity in drilling waste as the possible “next frontier” of the agency’s oversight of the industry. No wonder the industry is concerned. Also, back in August, the MSC & PIOGA jointly issued a lengthy document (copy embedded below) challenging the structure and scope of the DEP study. The view of the MSC/PIOGA seems to be the DEP study as outlined is flawed (our words) and therefore will produce flawed results. Hence, they’re launching their own study to “do it right” (our words). An update on this developing story…
    Read More “More on MSC/PIOGA and PA DEP Dueling Radiation Studies”

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    Property Values/Taxes in WV Counties with Drilling Go….Up!

    Landowners who lease their land, drillers and the industry that comes along to get the gas out of the ground and to market, and community members who get jobs at those companies doing the extracting/moving are not the only ones who benefit from the Marcellus and Utica Shale industry. The entire community benefits.

    A false allegation (i.e. lie) trotted out frequently by anti-drillers is that property values will tank and tax revenues will go down when drilling comes to town. A study of West Virginia property tax revenues shows just the opposite happens. The state overall–and those areas with the most shale drilling in particular–have seen property tax revenues increase rather dramatically since 2005 when drilling began. An analysis (objective proof) from the West Virginia Center on Budget and Policy that drilling is good for property values and property taxes:
    Read More “Property Values/Taxes in WV Counties with Drilling Go….Up!”

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    Eco-Nut Investor Groups Trot Out Faux Report on Fracking “Risks”

    Last week four anti-drilling groups, who also happen to have gobs of money (investor groups), issued an anti-drilling “report” and “scorecard” titled Disclosing the Facts: Transparency and Risk in Hydraulic Fracturing Operations. The so-called “report” supposedly shows drillers, many of them active in the Marcellus and Utica Shale, are not fully disclosing the nebulous “impacts” of fracking on communities near where they drill. The aim of the four organizations issuing the report–As You Sow, Boston Common Asset Management, Green Century Capital Management, and the Investor Environmental Health Network (IEHN)–is to get investors to stop investing in oil and gas companies and instead invest in their companies (i.e. mutual funds) because they back “renewable” and “sustainable” energy. Anyone else see a big, fat conflict of interest here?

    Of course mainstream media (like Bloomberg) dutifully and unquestioningly regurgitates the press release and so-called “report” from these anti-drillers as real news. Below is the press release and the “report” itself, in case you care. We bring it to you to show you a glittering example of what charlatan propaganda looks like…
    Read More “Eco-Nut Investor Groups Trot Out Faux Report on Fracking “Risks””

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    NY Dems’ Testy Response to Criticism of Andy’s Fracking Indecision

    T-shirt caution easily offendedThis is rich. The head of the Republican Party in New York State, Ed Cox, criticizes Democrat Gov. Andrew Cuomo over the issue of his impotency on the fracking issue (see Andrew Cuomo: Hamlet on the Shale), and the Democrats are so thin-skinned they immediately call for an investigation of Cox for “unethical or potentially illegal” actions. You can tell how vulnerable Andy and the Dems are on this issue by the way they misuse their power to try and obliterate all dissenting views.

    Democrat State Sen. Timothy Kennedy of Buffalo is the latest shill to rise up and defend his boy Andy, calling for an investigation of Cox…
    Read More “NY Dems’ Testy Response to Criticism of Andy’s Fracking Indecision”

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    MarkWest Hits 2.2 Bcf/d in Processing, 2 New Plants Go Live

    Marcellus midstream (pipelines and processing plants) heavyweight MarkWest Energy issued an operations update last week to trumpet the fact that two new cryogenic processing plants–to separate wet gas compounds from methane–have now started operations in the Marcellus/Utica. With the additional capacity of these new plants, MarkWest’s total processing capacity is now 2.2 billion cubic feet per day (Bcf/d) of natural gas processing in the Marcellus/Utica. It is an impressive number and will only grow in the months and years ahead.

    MarkWest announced they have begun operations at their fifth Majorsville (Marshall County), WV cryogenic processing plant and at their first Seneca (Noble County), OH cryogenic processing plant. Here’s the justifiably proud announcement from MarkWest on reaching the 2.2 Bcf/d milestone, on their way to 4 Bcf/d by the end of next year:
    Read More “MarkWest Hits 2.2 Bcf/d in Processing, 2 New Plants Go Live”

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    Cheat Sheet: Which Agencies Regulate OH Drilling/Pipelines

    Last week MDN told you of a new change in how natural gas gathering pipelines are regulated in Ohio. Until last week, the safety of gathering pipelines was fuzzy–really no one in charge of ensuring safety for gathering lines. That changed when the Public Utilities Commission of Ohio (PUCO) took over as lead agency for regulating that particular type of pipeline (see PUCO Now Regulates Gathering Pipelines in Ohio). But there are a few different kinds of pipelines and depending on which kind, a mish mash of federal and state (and even local) agencies are in charge of permitting and inspecting said pipelines.

    The reality of who regulates what when it comes to pipelines and other aspects of shale drilling is complex. PUCO decided it was a good idea to issue a press release/update to clear it all up. Apparently their office was flooded with requests for explanations, so they developed a handy chart to indicate who regulates what in Ohio’s shale drilling industry. It’s a very helpful update (and chart) for not only understanding who regulates pipelines in Ohio, but also who permits and regulates wells, compressor plants, processing plants–the whole enchilada…
    Read More “Cheat Sheet: Which Agencies Regulate OH Drilling/Pipelines”

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    Drilling-Related Manufacturer Brings 150 Jobs to Trumbull County

    Another huge positive economic impact from Marcellus/Utica Shale drilling is coming to eastern Ohio. Legacy Measurement Solutions Inc. of Addison, TX, a manufacturer of measurement equipment used in the oil and natural gas industry, is setting up a new 73,000 square foot plant in Trumbull County, OH early next year. The plant will “ramp up slowly” but will eventually employ 150 people. This is seriously good news for Brookfield, where the plant will be located, and Trumbull County in general.

    More jobs, more tax revenues–it’s an economic boomlet from just one company…
    Read More “Drilling-Related Manufacturer Brings 150 Jobs to Trumbull County”

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    MarkWest Open Season for “Little” Ethane Pipeline

    MarkWest Energy yesterday announced an open season for a “little” ethane pipeline in Pennsylvania. The little pipeline, which we now have a name for–MarkWest Liberty Ethane Pipeline–will run from Majorsville, PA to Houston, PA, about 30 miles. It is a pipeline to other pipelines. The MarkWest plant in Houston will provide access for the incoming ethane to be pipelined out of the area via the Mariner West pipeline (to Sarnia, Canada, going operational later this month), the Mariner East pipeline to the Marcus Hook refinery near Philadelphia (not ready until 2015), and the ATEX ethane pipeline to the Gulf Coast (ready sometime in 1Q14).

    The open season begins today and runs through Dec. 9th. The announcement from MarkWest, along an explanation from MDN about why this is important news:
    Read More “MarkWest Open Season for “Little” Ethane Pipeline”

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    MarkWest to Build 5th Cryo Plant in WV Courtesy Antero Resources

    MarkWest Energy continues its Marcellus/Utica infrastructure expansion. In an announcement yesterday, MarkWest said they will build a fifth (!) 200 million cubic feet per day cryogenic gas processing plant at its Sherwood (Doddridge County), WV facility. In the latest edition of the Marcellus and Utica Shale Databook (2013 Volume 2), MDN lists all of the projects announced by MarkWest and others (111 projects in all). This one is brand new and would be 112. MDN estimates this new cryogenic processing plant along with two others currently under construction at the Sherwood complex cost in the neighborhood of $200 million each to build.

    Cryogenic plants separate natural gas liquids (NGLs, or “wet gas”) from methane (“dry gas”). Why a fifth plant at the same facility? It’s being built at the request of Antero Resources. MarkWest signed a deal with Antero to provide them with wet gas processing capacity at the plant. MarkWest says the new plant will be built and online by third quarter of 2014. When it goes online, the total processing capacity at the Sherwood complex will be 1 billion cubic feet of natural gas per day–a really astonishing number. Here’s the MarkWest announcement:
    Read More “MarkWest to Build 5th Cryo Plant in WV Courtesy Antero Resources”

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    PA DEP Sec. Abruzzo Announces Winners of $3M in CNG Grants

    Part of the Pennsylvania Act 13 law, passed in early 2012, is a provision called an “impact fee” collected from Marcellus drillers (ultimately from landowners, because fees and taxes are always passed down the line). The first year the fee was collected it brought in over $200 million. The so-called fee is really 60% fee and 40% tax, as we’ve written about many times before. Why? Because 60% of the money collected stays in the communities impacted by drilling–for use with first responders, roads, etc. The other 40% is what MDN calls “walking around money”–money that’s spent by politicians in Harrisburg to curry favor with voters (i.e. vote buying). A lot of that money goes to southeastern PA (Philly area) where there is no drilling–but such was the sleazy political price to be paid in order to pass the legislation. Yes it stinks–but it is what it is.

    If there’s any good use for a teeny tiny sliver of the 40% walking around money, it happened yesterday in Scranton, PA, where the PA Dept. of Environmental Protection (DEP) Sec. Chris Abruzzo was on hand at the Cabot Oil & Gas’ “CNG Celebration” event at Johnson College (see our companion story today about the event). Abruzzo was there to announce the list of grant winners who will share in $3 million of Act 13 money to purchase, refit or supply filling stations for vehicles to run on compressed natural gas (CNG). By handing out this seed money, Gov. Tom Corbett hopes to encourage more companies and organizations to switch to cheaper and much less polluting natural gas as a power source. Below is the DEP announcement and list of winners of this year’s grant. The DEP will be back next year with even more money to award. They start accepting applications on Saturday…
    Read More “PA DEP Sec. Abruzzo Announces Winners of $3M in CNG Grants”

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    Cabot’s Big CNG Celebration at Johnson College in Scranton, PA

    Yesterday Cabot Oil & Gas held a “CNG Celebration” at Johnson College in Scranton, PA. Unfortunately MDN could not be on hand to help celebrate. However, we do have a couple of stories to bring you from that event.

    The purpose of the event was several-fold: announce Johnson College’s curriculum expansion with new courses in compressed natural gas (CNG) technology and eventually a certification (with financial and technical assistance from Cabot); PA DEP Sec. Chris Abruzzo was on hand to announce $3 million in grants to businesses and organizations to purchase or retrofit vehicles to run CNG (see our companion story today); welcome the Marcellus Shale Coalition’s new executive director, David Spigelmyer; and show off some impressive big trucks and other vehicles running CNG. “Celebration” is an appropriate word that about covers it!…
    Read More “Cabot’s Big CNG Celebration at Johnson College in Scranton, PA”

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    Gulfport Signed Up to Ship Ethane to Shell Cracker, If…

    Gulfport wants to send the ethane it produces in Ohio’s Utica Shale to Shell’s ethane cracker plant, if that plant ever gets built. Gulfport announced on their 3Q13 analyst call yesterday that they are one of the companies who signed on during Shell’s cracker plant open season, pledging to provide ethane for the new cracker plant. Problem is, the prospects that the plant will actually get built are increasingly in doubt (see Rumor Mill: PA Ethane Cracker Plant on Shell Chopping Block?). Even so, we guess it’s a good plan to be first in line when/if that plant opens.

    MDN friend Bob Downing from the Akron Beacon Journal chronicles a few more choice tidbits from the Gulfport 3Q13 analyst call yesterday, including Gulfport’s ethane yearnings, some smart strategies Gulfport is employing to sell their dry gas and wet gas, how pipeline locations influence their drilling decisions, and an inside look at how much it costs Gulfport to drill a single Utica Shale well…
    Read More “Gulfport Signed Up to Ship Ethane to Shell Cracker, If…”

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    New Condensate Pipeline Proposed from Ohio to Western Canada

    Here’s a new one for the Marcellus/Utica region: Unity Pipeline Company (a joint venture between Harvest Pipeline, which is Hilcorp, Somerset Gas Transmission, and Crossroads Pipeline, which is NiSource) has just launched an open season (a time for drillers to sign up) for a condensate pipeline that will stretch from the Marcellus/Utica in Ohio across the state into Indiana, Michigan, and all the way to western Canada. Condensate, sometimes called natural gasoline, is a hydrocarbon produced from “raw natural gas” when the raw gas temperature is dropped to a certain point. Condensate in the northeast is mainly found in the wet gas areas of eastern Ohio, southwestern Pennsylvania and the northern panhandle of West Virginia.

    Condensate is used to dilute (mix with) crude oil so the oil can more easily be pumped through pipelines. There’s plenty of condensate available in the Marcellus/Utica, and plenty of need in western Canada where they pump a lot of oil. It makes sense to get all that condensate from point A to point B–and that’s what the proposed Unity Pipeline aims to do. Here is the announcement from Unity about their plan to build a 380-mile “diluent” pipeline, a project they hope to have up and running by the middle of 2015…
    Read More “New Condensate Pipeline Proposed from Ohio to Western Canada”

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    PA Judge Forces Range, Contractors to Provide Chemical List

    Three families who live near a drill site/frack wastewater impoundment (“pond”) in Cecil Township, PA have a long-running (since May 2012) lawsuit against Range Resources claiming Range’s drilling and wastewater impoundment has contaminated their well water. The Pennsylvania Dept. of Environmental Protection (DEP) investigated and found no contamination. Even the federal EPA looked at it last year and never filed any violation notices–meaning they didn’t find anything either (see EPA Investigating Range Drill Site in Western PA).

    However, the families maintain they have been harmed by toxic chemicals used during drilling, and so a judge has ordered Range and all of their subcontractors to provide a list of every conceivable chemical compound used at the site since 2009–right down to the kind of oil used in the engines of vehicles visiting the site–and she’s giving them 30 days to do it…
    Read More “PA Judge Forces Range, Contractors to Provide Chemical List”

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    Andrew Cuomo: Hamlet on the Shale

    New York GOP Chairman Ed Cox makes a trip to Buffalo today to deliver the keynote address at the Independent Oil & Gas Association of New York’s annual conference. The title of his speech is, appropriately: “Andrew Cuomo: Hamlet on the Shale.” The title has echoes of his father, former governor of New York Mario Cuomo, who was known as Hamlet on the Hudson for his inability to make decisions on important issues. Apparently the apples does not fall far from the tree. Andy can’t make up his mind either–the mark of a weak leader.

    Cox debuted a number of the points he will make in his speech last week in a New York Post column by Fred Dicker:
    Read More “Andrew Cuomo: Hamlet on the Shale”

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    Economic Suicide Avoided in 2 OH Cities but Oberlin Pulls Trigger

    A happy note about yesterday’s elections in Ohio. Two communities where a so-called “community bill of rights” (anti-drilling ban flying under a different name) was on the ballot was voted down. In Youngstown (Mahoning County) this was the second time anti-drillers have tried to convince voters to commit economic suicide, but fortunately they didn’t (see Economic Suicide Attempt #2: Youngstown to Vote Again on Frack Ban). The voters in Bowling Green (Wood County) also decided to vote down a ban–even though there is no recoverable Utica Shale under Bowling Green. Freedom is always a smart choice–good decision Bowling Green.

    However, voters in a third OH community, Oberlin (Lorain County), where there likely is recoverable Utica Shale gas, sadly decided to pull the trigger and commit economic suicide…
    Read More “Economic Suicide Avoided in 2 OH Cities but Oberlin Pulls Trigger”