Industrywide Issues

Accidents | Energy Services | Industrywide Issues | Litigation | MarkWest Energy | Pennsylvania | Washington County

MarkWest Sues Enerflex Over Compressor Station Fire in Western PA
February 5, 2013February 5, 2013

Midstream powerhouse MarkWest filed a lawsuit on Monday in Washington County, PA seeking $1.1 million from Enerflex Energy Systems, manufacturer of equipment for compressor plants. MarkWest says Enerflex sold them defective equipment that led to a fire, and a lot of damage, in their compressor facility in Avella, PA last year:

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Energy Companies | Hydraulic Fracturing | Industrywide Issues | Litigation | Pennsylvania | Range Resources Corp | Regulation | Washington County

Robinson Twp, PA Drags Feet on Approving New Permits to Drill
February 4, 2013February 4, 2013

Why are drilling permits from Range Resources not being approved in Robinson Township (Washington County), PA? You may recall that Robinson is one of seven towns in PA that sued the State of Pennsylvania over Act 13, a new shale drilling law passed in February 2012. Robinson and the other towns object to a provision in Act 13 that replaces the right of local towns to enact zoning restrictions on oil and gas drilling and instead replace local rules with a uniform set of zoning rules from the state (see Lawsuit Filed: PA Towns Sue State over Marcellus Act 13 Law).

Robinson and the other towns went to court over the provision and won their case in the lower courts. The decision was appealed by the state all the way to the PA Supreme Court where a everyone eagerly awaits a decision (see PA Supreme Court Hears Testimony on Act 13 Zoning).

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Hydraulic Fracturing | Industrywide Issues | Regulation

Obama Energy Sec. Steven Chu Resigns
February 4, 2013February 4, 2013

The third shoe has finally dropped (if that’s even a legitimate metaphor!). Obama’s Secretary of Energy, Steven Chu, has resigned. You may recall MDN reported early on that the three Obama cabinet members who most directly affect shale drilling—Chu, EPA chief Lisa Jackson and Dept. of Interior Sec. Ken Salazar were all rumored to be departing a second Obama term (see 3 Top Officials Rumored to be Leaving Obama Administration).

Of the three, Chu was the one rumormongers were most sure about. Yet Jackson was the first to go, and Salazar the second. On Friday, Chu announced he too would depart. His tenure at Energy has been marked by crony capitalism with the government handing out big big money to politically-connected Obama donors—Solyndra being the most famous example. It’s “so long and don’t let the door hit you on the way out” to Sec. Chu…

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Hydraulic Fracturing | Industrywide Issues | New York | Regulation | Statewide NY

Home Stretch for NY Fracking Generates New Ad Campaign
February 4, 2013February 4, 2013

In what may be the final stretch of four and a half long years to win approval for New York State to begin using the miracle of hydraulic fracturing as has Pennsylvania, Ohio, West Virginia, Texas, Louisiana, Wyoming, Oklahoma, Colorado and so many other states, the New York State Petroleum Council (NYSPC) has launched a new ad campaign aimed at one person: Gov. Andrew Cuomo. Listen and watch the new commercials below.

Last Friday the NYSPC issued this press announcement about the new ad campaign:

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Air Quality | Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Research | Statewide PA

2 New Studies of Marcellus Drilling’s Impact on PA Air Quality
February 4, 2013February 4, 2013

Marcellus Shale drilling in Pennsylvania was responsible for just a small fraction of PA’s air pollution in 2011 according to newly released data (the first full year of data we have) from the Dept. of Environmental Protection, and from a private study by Rand Corporation (see below). How much did it contribute? PA’s shale gas industry was responsible for about 4% of total air pollution emitted by all industrial facilities in 2011.

Although the overall numbers are low, that’s not to say there aren’t concerns or things to improve…

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Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Statewide PA

PA Wants Drillers to Use Acid Mine Water in Fracking – Will They?
February 4, 2013February 4, 2013

Pennsylvania has a big problem with water seeping from abandoned coal mines—the water mixes with minerals from the mine and is highly acidic. Some 300 million gallons of it flow—every day—into Pennsylvania’s waterways, killing off fish and plant life in 4,000 miles of rivers and streams. The PA Dept. of Environmental Protection (DEP) recently launched a plan to encourage shale drillers in the state to use “mine influenced water” (MIW) for drilling and fracking operations. It kills two birds with one stone: it helps to get rid of MIW and it gives drillers a steady source of water for fracking (see PA DEP Finalizes Procedure for Using Acid Mine Water in Fracking).

Just one problem: Drillers are scared to death of “if you touch it, you own it for evermore.” That is, drillers are rightly concerned about liability in this day and age of litigate everything. Who wants to get sued for doing the right thing? What can PA do to reassure drillers to give MIW a shot?

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Industrywide Issues | Pennsylvania | Regulation | Statewide PA

PA Legislation Would Release Untapped Acreage for New Lease
February 4, 2013February 4, 2013

Help may be on the way for Pennsylvania landowners who have leased their land, but not all of their land is part of a “production unit.” PA State Sen. Gene Yaw has introduced legislation what would release the land not in production so it could, theoretically, be leased again, or leased to someone else.

This update from one of our favorite blogs, ShaleEnergyLawBlog:

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Economic Impact | Industrywide Issues

80,000 Locations Left to Go for Marcellus Drilling
February 4, 2013February 4, 2013

Speaking at the Marcellus-Utica Midstream conference last week in Pittsburgh, ITG Investment Research analyst Manuj Nikhanj said their research shows there are an astounding 80,000 locations still drillable in the Marcellus Shale, and that the Marcellus is “absolutely massive” and dwarfs the next biggest shale play. How long will it take to full drill the Marcellus? “Decades.”

He also had some interesting analysis on the question of what natural gas price is breakeven for drillers to make a profit:

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Beaver County | Economic Impact | Energy Companies | Ethane | Industrywide Issues | Pennsylvania | Processing Plants | Shell | Statewide PA

Gov Tom Corbett: Shell Cracker Plant in PA Not “Off the Rails”
February 1, 2013February 1, 2013

Shell was supposed to purchase land in Monaca (Beaver County), PA to build a new $2 billion ethane cracker plant (a multi-year project) by Dec. 31, 2012, but instead Shell and the owner of the site signed a six-month extension to (according to a Shell spokesperson) give Shell more time to assess the site’s suitability and time to crunch the numbers to provide Shell “confirmation that the project is economically robust and competitive” (see Shell Ethane Cracker in PA Still Not a Done Deal).

The six-month delay has led to rumors that the deal for Monaca may be in doubt. Wednesday after a speech at the Marcellus Midstream Conference in Pittsburgh, PA Gov. Tom Corbett said contrary to those pesky rumors, Shell is not checking out other states to build the ethane cracker plant and that the delay in purchasing the land is due to lawyers “dotting I’s and crossing T’s.” Here’s how it played out:

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Economic Impact | Industrywide Issues | Marshall County | Ohio County | Supply Chain | West Virginia

Strange/Interesting Things Companies Sell to the Shale Industry
February 1, 2013February 1, 2013

It never ceases to amaze MDN the kinds of businesses that benefit from Marcellus and Utica Shale drilling. Here’s yet another one we bet you didn’t know about: The West Virginia manufacturer sells a 6,000-pound “cattle stop” to the Marcellus and Utica drilling industry.

Er, what is a cattle stop, and who does this manufacturer sell them to? Read on…

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Commodity Price | Industrywide Issues

What’s the Break-Even Price of Marcellus NatGas for Drillers?
February 1, 2013February 6, 2013

Another stellar column from Seeking Alpha blogger and energy analyst Richard Zeits—this one delving into the thorny topic of, “At what natural gas commodity price is it profitable for a driller to continue drilling?” In particular, at what price in the Marcellus Shale.

His column begins this way:

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Chesapeake Energy | Energy Companies | Industrywide Issues | Litigation | Ohio | Statewide OH

Chesapeake Wins Permit Case Before OH Supreme Court
February 1, 2013February 1, 2013

Chesapeake Energy has won an important appeal before the Ohio Supreme Court that ruled the Ohio Oil and Gas Commission did not have jurisdiction to hear an appeals case from a landowner over a permit issued to Chesapeake from the OH Division of Oil and Gas Resources Management to drill on the property. It was a case of the wrong agency sitting in judgment—the wrong “referee” if you will:

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Economic Impact | Hydraulic Fracturing | Industrywide Issues | Ohio | Stark County | Utica Shale

Stark County, OH Labor & Business on Same Page: Frack Here
February 1, 2013February 1, 2013

When was the last time local governments, labor unions, businesses, chambers of commerce and construction contractors were all on the same page? Yeah, we can’t remember that time either. Except it’s here—now. And it’s happening in Stark County, Ohio were all of those groups have come together to kick off a new initiative they call Choose Stark—an outreach to encourage Utica Shale drilling and fracking in Stark County.

We say that’s pretty cool and a lesson for other regions to consider:

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Air Quality | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

PA DEP Finalizes Air Pollution Rules for Drillers & Compressors
February 1, 2013February 1, 2013

The Pennsylvania Dept. of Environmental Protection (DEP) yesterday announced final revisions to the “general permit” (GP-5) that governs air emissions for pipeline compressor stations and for drill sites. The new allowable limits, endorsed by the PA drilling industry, are “75 to 90 percent stricter than current limits” and go beyond federal rules according to the DEP.

The new DEP rules will allow the industry to install and use more engines at compressor stations and on the drill pad (engines powered by the natural gas being produced) to encourage the overall reduction in pollution. Here’s the announcement from the DEP:

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Industrywide Issues | Litigation | Regulation

Law Firm Launches Study of Legal Trends in Shale Development
February 1, 2013February 1, 2013

Yeah, we know it’s a press release from a law firm (we see them every day!). But this one, MDN reckons, is noteworthy. The 12th largest oil and gas law firm in the country, Steptoe & Johnson (with offices about everywhere in the Marcellus & Utica Shale), is conducting a study of legal trends for businesses working to develop the Marcellus, Utica and other shale plays. The results are due to be released in April and should be interesting.

Here’s the details about the new study (and how you can participate) from Steptoe & Johnson:

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Accidents | Columbia Pipeline Group | Energy Services | Industrywide Issues | NiSource | Pennsylvania | Pipelines | Regulation | Statewide PA | Statewide WV | West Virginia

Feds Eye Regulating PA Marcellus Gathering Pipelines
January 30, 2013January 30, 2013

In early December, the Columbia Gas Transmission pipeline (owned by Nisource) exploded near Sissonville, WV—10 miles north of Charleston (see Columbia NatGas Pipeline Explodes Near Charleston, WV). The repercussions are still being felt. WV Sen. Jay Rockefeller held a Senate “field hearing” about pipeline safety on Monday in Charleston, WV. The first person to testify was Sissonville resident Sue Bonham who thought the world was literally be blowing up. The fire that burned in Sissonville near her home for more than an hour was so hot it burned the asphalt on I-77 into cinders.

So it’s no surprise that the federal government would start nosing around non-federally regulated (smaller) pipelines. Apparently they’ve set their sites on local gathering lines in the PA Marcellus:

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