Industrywide Issues

Barbour County | Crestwood Midstream | Energy Companies | Energy Services | Industrywide Issues | Mountaineer Keystone | Pipelines | Preston County | Randolph County | Taylor County | West Virginia

Crestwood to Build New Marcellus Pipeline in NE WV
December 14, 2011December 14, 2011

Houston-based Crestwood Midstream yesterday announced they will construct a new 16” inch Marcellus gathering pipeline that will run 42 miles through Preston, Taylor and Barbour counties in northeast West Virginia, connecting to Columbia Gas Transmission’s WB Pipeline in Randolph County, WV. By connecting to the WB Pipeline the new gathering pipeline will have access to the Washington, DC and Baltimore markets.

The new pipeline will be completed by this time next year and already has a long term “anchor” contract with Mountaineer Keystone, a Pittsburgh-based drilling company that will commence their horizontal drilling program in the area in the middle of 2012.

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Earthquakes | Hydraulic Fracturing | Industrywide Issues

Does Fracking Cause Earthquakes? Formula Calcs Quake Size
December 13, 2011December 13, 2011

Does fracking cause earthquakes? MDN has covered various stories in the past on this topic. It seems likely that injection wells (not hydraulic fracturing, but the wastewater from fracking being injected deeply in disposal wells) in some locations have been tied to earthquakes in some areas. Notably, when injection wells in Arkansas stopped pumping pressurized liquids into the wells, earthquakes in the area all but stopped (see this MDN story). It certainly seems there is a cause and effect situation.

But what about fracking a single well? Is there a danger that fracking can cause earthquakes? Arthur McGarr, a geologist at the US Geological Survey in Menlo Park, California has worked out a formula for predicting how large an earthquake can result from pumping/injecting fluids underground, including fracking fluids. He recently presented his formula at the annual meeting of the American Geophysical Union in San Francisco, CA. McGarr subsequently spoke to the journal Nature about his formula:

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Commodity Price | Industrywide Issues

Natural Gas Rig Numbers Down, Oil Rig Numbers Up in U.S.
December 13, 2011March 24, 2012

Kent Moors, writing on the Seeking Alpha website, comments on his observation from Baker Hughes well rig data for the U.S. that the number of rigs used to drill for natural gas has gone down over the same period last year, but that the number of rigs drilling for oil has skyrocketed.

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EMG | Energy Services | Industrywide Issues | MarkWest Energy | Pipelines | Processing Plants

MarkWest Pays $1.8B to Buy Out JV Partner in Liberty Midstream
December 13, 2011December 13, 2011

MarkWest Energy announced yesterday it will pay $1 billion in cash and 19.95 million new Class B MarkWest units (worth an estimated $750 million to $850 million) to buy out joint venture partner Energy and Minerals Group’s (EMG) 49 percent interest in MarkWest Liberty Midstream. The Liberty Midstream joint venture was formed in May 2009 to focus on construction and operation of midstream services in support of Marcellus shale gas production, including pipelines to gather natural gas, facilities to process it, and transportation to get it to market.

Although MarkWest is buying out EMG’s interest in the Liberty joint venture, the two companies will create a new Utica Shale midstream joint venture in eastern Ohio in 2012 as part of the deal.

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Economic Impact | Fayette County | Industrywide Issues | Kanawha County | West Virginia

Surprise Announcement of Ethane Cracker Plant in WV
December 12, 2011December 12, 2011

In a surprise move, two West Virginians have announced their intention to build an ethane cracker plant in the state. Former state Supreme Court Justice Richard Neely and Ryan Cunningham, owner of Charleston-based Cunningham Energy have formed a partnership with a few others and will try to get the necessary permits and financing to build an ethane cracker plant on a 1,500-acre plot near Montgomery, WV.

Two large energy companies, Shell and an unidentified company, have said they will make announcements in January of 2012 on where they will build ethane cracker plants. West Virginia was hopeful that Shell or the other company would select their state. But Neely and Cunningham don’t want to leave it to chance—so they plan to move forward.

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Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

PA Town Supervisors Still Not Happy with Proposed Legislation
December 12, 2011December 12, 2011

The Pennsylvania State Association of Township Supervisors (PSATS) originally opposed PA House Bill 1950 and Senate Bill 1100, the two primary bills before the General Assembly that deal with the issue of natural gas development that are now very close to reconciliation and a signature from Gov. Tom Corbett. PSATS’ primary objection is that the bills would strip away most, if not all, municipal authority to regulate gas drilling in their own communities. Recent amendments to the bills have made them “more reasonable” and more palatable to PSATS, but they are still not good enough to garner an endorsement.

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Bradford Drilling | Energy Companies | Industrywide Issues | Litigation | New York | Norse Energy | Statewide NY

Bradford Drilling Sues Partner Norse Energy for No Drilling
December 12, 2011December 12, 2011

Norse Energy Corp, the U.S. subsidiary of the Norwegian energy company, owns leases for 180,000 net acres in New York State, 130,000 of those acres being in the Marcellus and Utica Shale plays. Norse bet the farm on New York allowing shale gas drilling long before now, and they lost (NY is still months, if not years away from allowing shale gas drilling). Norse has put their New York acreage on the auction block, looking for another company to buy it.

In the meantime, one of Norse’s drilling partners is suing them for lack of drilling according to their agreement. That agreement had nothing to do with shale gas, but instead was drilling in the Herkimer formation, a limestone-type layer in central New York. Norse seems to indicate they may restart Herkimer drilling at some point. From the Norse press release:

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Hydraulic Fracturing | Industrywide Issues

Pavillion, WY – Smoking Gun that Proves Fracking is Unsafe?
December 9, 2011December 9, 2011

On Thursday, the federal Environmental Protection Agency (EPA) released draft findings of its investigation into groundwater contamination in the small town of Pavillion, Wyoming (a copy of the EPA draft report is embedded below). The EPA says that water in the town contains chemicals consistent with chemicals used in hydraulic fracturing. Fracking has been used in a number of nearby gas wells. Needless to say, major media outlets like the AP, and anti-drilling environmentalists, are breathlessly calling this the “smoking gun” and declaring that fracking really does cause groundwater contamination after all (ban it now!). Not so fast…

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Accidents | Coterra Energy (Cabot O&G) | Energy Companies | Hydraulic Fracturing | Industrywide Issues | Litigation | Pennsylvania | Susquehanna County

Dueling Press Conferences in Dimock PA
December 7, 2011December 7, 2011

In the ongoing press event that is Dimock, PA, yesterday Gasland creator Josh Fox and actor Mark Rufalo, among others, gathered in Dimock to keep up the pressure and to continue to demagogue what has really happened in Dimock. See MDN’s previous coverage for background. A brief summary of events leading up to yesterday’s dueling press conferences:

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Economic Impact | Energy Companies | Industrywide Issues | Shell

Shell’s Major Shift to Natural Gas, US Gas-to-Liquids Plant?
December 7, 2011December 7, 2011

Shell is moving into natural gas in a major way. In fact, natural gas will eclipse crude oil for Shell sometime next year by being more than 50 percent of Shell’s global production. Shell has committed to spending $2 billion to build an ethane cracker plant in the Marcellus region of the U.S., and now they are talking about building a gas-to-liquids plant. Shell invested an astonishing $19 billion in a gas-to-liquids plant in Qatar. Imagine that investment coming to the U.S.! Such is the transformative power of shale gas.

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Industrywide Issues | Jobs | West Virginia | Wetzel County

Out-of-State Gas Workers Mean Continued High Unemployment
December 7, 2011December 7, 2011

One of the criticisms of the Marcellus shale gas drilling industry is that although it brings with it an economic boom, including many jobs, sometimes those jobs are taken by out-of-state workers and not local workers. Drillers will say there are not enough skilled local workers to fill the positions. Labor leaders and local economic development officials will say, “Train them and there will be!”

According to Dave Efaw, secretary-treasurer of the West Virginia State Building and Construction Trades Council, local drillers need to step up to the plate and start hiring more local workers:

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Economic Impact | Energy Companies | Ethane | Industrywide Issues | Shell | Statewide WV | West Virginia

Shell, One Other Company Close to Cracker Plant Announcement
December 7, 2011December 7, 2011

According to officials in West Virginia, who are super-serious about attracting at least one ethane cracker plant to their state, Shell and one other company will announce site selections for their plants in January of 2012. West Virginia fully intends that at least one of those two plants will be inside their borders, and they are pulling out all of the stops to ensure it happens. In fact, according to WV Gov. Earl Ray Tomblin’s chief of staff, it’s the newly-elected governor’s “No. 1 goal.”

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Hydraulic Fracturing | Industrywide Issues

Has Fracking Killed the Renewable Energy Movement?
December 6, 2011December 6, 2011

It is no surprise that those who rabidly oppose shale gas drilling in general, and hydraulic fracturing in particular, do so for one primary reason: it threatens renewable energy. In fact, MDN would go so far as to say hydraulic fracturing has single-handedly destroyed the renewable energy movement, and the greenies have brought out the long knives in response.

A column by Dan Nestlerode on StateCollege.com calls attention to just how fundamental, and dramatic, a shift has taken place in the last few years, a shift that spells the end of the green/renewable energy movement.

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Economic Impact | Industrywide Issues | Jobs

New Study Shows Economic Boom from Shale Gas in U.S.
December 6, 2011December 6, 2011

A new study just released shows that natural gas drilling and production will add 900,000 jobs and $1,000 to annual household budgets across the country, on average, by 2015. And shale gas production will go from adding $76 billion to U.S. gross domestic product (GDP) now, to $118 billion by 2015.

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Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

PA Legislature Deals with Bonding to Decommission Gas Wells
December 6, 2011December 6, 2011

The Pennsylvania legislature has been working on new laws to tighten regulation of the Marcellus Shale drilling industry. Since January 2011, both the PA Senate and House are now controlled by Republicans, as well as the governorship, giving new Marcellus legislation a good chance of passing. The new laws are a result of, and based on, the findings of an advisory committee appointed by Gov. Tom Corbett earlier this year (see this MDN story).

Both the PA Senate and House have passed slightly different versions of legislation and those versions are now being reconciled in committee to work out the differences so a bill can be sent to Gov. Corbett for signing. One of the outstanding issues to be reconciled is how much of a bond should drillers pay to decommission a well.

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Accidents | Hydraulic Fracturing | Industrywide Issues | Litigation | Pennsylvania | Susquehanna County

EPA Tells Dimock Families Their Water is Safe to Use
December 5, 2011December 5, 2011

A new email from the federal Environmental Protection Agency says the water wells for 19 affected families in Dimock, PA have tested fine and do not pose a threat to those families. Yet, some of those families are still grabbing headlines by playing the victim, claiming their water is undrinkable. Who to believe?

The Dimock situation is difficult to understand, being shrouded in so many layers of publicity stunts it’s hard to know what the real story is. As near as MDN can tell, in a nutshell:

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