WV O&G Pushes Hard for Forced Pooling Law, Landowners Push Back
Last week MDN brought you news of a new forced pooling bill under consideration in this year’s West Virginia legislative session (see WV Makes a New Push for Forced Pooling Using New WVU Study). Forced pooling is one of those rare issues where drillers and landowners are typically on opposite sides of the debate. The WV drilling industry continues to press hard for this new bill, while landowner groups continue to push back just as hard against it.
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Last Saturday Pennsylvania Gov. Tom Wolf’s office published, via the Pennsylvania Bulletin, a list of agency-by-agency regulations currently in development with an estimated schedule for future actions. In the list is the all-important (to the oil and gas industry) Dept. of Environmental Protection (DEP). It’s been our observation when the government in general, and DEP in particular, changes a regulation, it typically makes it more onerous (and expensive) to comply with. Some of the upcoming changes to DEP regulations happening this year we’ve already warned you about. Others are new to us.
It’s kind of funny to watch how leftists react when something doesn’t go their way. Tell someone on the left “no” or “wait” or “you’ll have to pay for that” and they melt like snowflakes. Sometimes they pitch the equivalent of a temper tantrum. That was our thought as we read about a leftist Democrat politician from New Jersey, Lisa McCormick, and her reaction to the Biden administration filing a brief that supports the PennEast Pipeline in U.S. Supreme Court.
The U.S. oil rig count pushed to an 11-month high in the week ended March 10, led by a continued recovery in the Permian basin, according to Enverus. The number of active net oil rigs rose by five over the past week to 371, the highest since the week ended April 15 of last year. However, gas-focused rigs decreased. Bummer. The Marcellus in the dry gas northeastern PA region lost two rigs and the Utica in Ohio lost 1 rig. Another gas-focused play, the Haynesville in Louisiana, lost 1 rig.
Wow, look how far the Pennsylvania Dept. of Environmental Protection (DEP) has fallen under Gov. Tom Wolf and his subservient lackey Pat McDonnell. The DEP yesterday announced the release of “equity principles to guide investments through Regional Greenhouse Gas Initiative.” Translation: Here’s how we’re going to waste (i.e. “invest”) all of the $2.36 billion we’ll raise through the RGGI carbon tax, and here’s how we’ll “help” those we’re screwing with the carbon tax. Of course, those who will pay this insane tax include each and every resident and business in PA that uses electricity. In other words, everyone. You’ll ALL get soaked with this new tax. Observe what Wolf has done to your gasoline taxes in PA and apply that to electricity–that’s what’s coming your way if RGGI is implemented.
Good news. The expert forecasters at the U.S. Energy Information Administration (EIA) have had another look at their predictions for how much natural gas and electricity we will use here in the U.S. and decided to boost their projections for 2021 and 2022. Electric use will grow, EIA says, by 2.1% in 2021 over 2020. As for natural gas, EIA says average daily marketed gas production will increase by 610 million cubic feet per day (MMcf/d) in 2021 to 98.95 billion cubic feet (Bcf/d). EIA is now predicting natgas production in 2022 will increase by 1.7 Bcf/d to 100.63 Bcf/d. We’re pretty sure that would be a new, all-time record high.
Three Democrat U.S. Senators are (once again) targeting natural gas for extinction. The new (but in reality old) way they’re attempting it is by floating a bill that would (if passed) assess an insanely high new tax on “methane emissions” from the oil and gas industry. The stated purpose is to “encourage” oil and gas companies to clamp down on methane emissions (something already happening without the “help” of these idiots, see 
What a sad state of affairs. The very governmental agency charged with ensuring large corporations maintain honesty in their dealings with investors, the Securities and Exchange Commission (SEC), has devolved into a hack witch-hunting organization bent on locating and punishing those who disagree with a certain political view–the view that somehow mankind is causing catastrophic global warming. If corporations publicly utter anything outside the prescribed Communist diktat about global warming, the SEC will now come down on them like a ton of bricks. How sad and tragic.
In early February MDN told you that it was likely the Biden administration, although anti-drilling and anti-pipeline, would have no choice but to support an active case before the U.S. Supreme Court dealing with eminent domain for the PennEast Pipeline project (see 
As sure as the seasons change and our long winter is finally turning into spring with the first crocuses popping up through the soil, you can count on another sign of spring: a forced pooling bill will pop up in the 60-day West Virginia legislative session. And so it has. The WV legislature is currently considering two bills, Senate Bill (SB) 538 and House Bill (HB) 2853, called “unitization bills” which is just another word for forced pooling. This time West Virginia University is providing support for forced pooling in the form of a new study claiming forced pooling will “jump-start” a new era of natural gas development.
West Virginia House Bill (HB) 2581 is rapidly advancing through various committees. The bill changes how the State Tax Department values producing oil and gas wells for property tax purposes. It also creates a new appeals process for all property taxes in WV. Provisions in the bill allow expenses from “lifting, processing, transportation and other industry activities” to be subtracted from a well’s income. Question: Do these new post-production deductions also apply to royalties?
In early February, Northern Oil and Gas, Inc., a company that invests in non-operated oil and gas assets (they let others do the drilling), announced it had purchased 64,000 net acres producing ~120 MMcfe/d (million cubic feet equivalent per day) in the Marcellus/Utica from Reliance Industries Limited (see 
Chesapeake Energy has screwed over landowners in northeastern Pennsylvania (and elsewhere) for years. Under the provisions of a “settlement” just brokered by PA’s shale-hating Attorney General, Josh Shapiro, Chesapeake will get away with settling the royalty case for pennies on the dollar. The average landowner will get just over $300 from this “settlement.” What a cruel joke. This is all about headlines and showmanship for Shapiro who hopes to run for governor next year. Don’t fall for his “I’m the savior of landowners” schtick. He just sold landowners down the river in return for a headline his campaign can use.