PA DEP Shuts Down ME2 Drilling in Lebanon, PA for 1 Gal Mud Spill
We chalk this one up as outrageous. The Pennsylvania Dept. of Environmental Protection (DEP) has just shut down further drilling for the Mariner East 2 Pipeline project at Snitz Creek in Lebanon County, PA–because of a “less than one gallon” spill of non-toxic drilling mud. Drilling mud is composed of bentonite–the same clay compound used in kitty litter, toothpaste and cosmetics. A spill of less than a gallon is NOTHING. It’s not even worth reporting. Yet Sunoco Logistics, the company drilling, was honest and reported the “inadvertent return” as it is called. And because Sunoco previously had another small spill at the same location, the DEP, bowing to pressure from radical environmental groups, has halted any further horizontal directional drilling (HDD) work at the Snitz Creek location. This is bizarre, but perhaps not unexpected. It all stems to a deal Sunoco made with the devil…
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This story necessarily gets into the weeds of pipeline construction. But so you have the essential story line up front, this is it: On Monday Energy Transfer asked the Federal Energy Regulatory Commission (FERC) for permission to dump something called annular pressure monitoring (APM) when drilling underground (horizontal directional drilling, or HDD) for the Rover Pipeline–and on Tuesday FERC granted that permission. Here’s the slightly longer explanation. Rover is a $3.7 billion, 711-mile natural gas pipeline that will run from PA, WV and eastern OH through OH into Michigan and eventually into Canada. Early on, Rover had early missteps when using HDD to insert pipeline under things like rivers and roads. The most serious episode occurred when Rover drilling spilled 2 million gallons of non-toxic drilling mud in a swamp near the Tuscarawas River (in Ohio) back in April (see 
NEXUS Pipeline has had to use the unpreferred last option and has taken landowners of 42 properties to court using eminent domain in order to secure easements so they can lay pipeline through those properties. NEXUS is a $2 billion, 255-mile interstate pipeline that will run from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada. NEXUS received final approval for the project from the Federal Energy Regulatory Commission (FERC) in August, the first major pipeline to get approved following a newly restored quorum at FERC (see 
Our heart stopped when we saw news from Crestwood Equity (used to be called Crestwood Midstream) yesterday that the company has sold its US Salt business on the shore of Seneca Lake near Watkins Glen to Kissner Group for $225 million. We thought, “Oh no! Crestwood has finally thrown in the towel on their Seneca Lake Propane Storage project!” But alas, our fears were unfounded. Background: In 2009 Inergy filed a request to convert a depleted salt cavern along the shore of Seneca Lake (in Schuyler County, NY, near Watkins Glen) into a propane/natural gas storage facility. Inergy was later bought by and merged into Crestwood Midstream, and Crestwood Midstream later renamed itself Crestwood Equity Partners. The New York Dept. of Environmental Conservation (DEC) has been sitting on its hands from the beginning, refusing to grant the necessary permits to allow the facility to open. Sound familiar? Same old delay and later deny strategy from our corrupt governor, Andrew Cuomo. As recently as May of this year, Crestwood remained committed to building the storage facility in depleted salt caverns originally drilled by US Salt, which is owned by Crestwood (see 
Yesterday MDN received an email from subscriber Sandy R. who lives in southwestern PA. Her land is leased to Range Resources, and she recently read that Range “now has their own pipelines to carry Marcellus gas to better paying markets.” In our response to Sandy, we mentioned that although producers sometimes buy a share of a pipeline, they rarely own pipelines outright. More often they sign long-term (10-20 year) agreements with large midstream companies to reserve capacity along pipelines. We went looking for which pipelines Range might have reserved capacity on that are near where Sandy lives, and found two things that caught our attention. One is a recent statement from Range bragging (our word) about a strategy they put in place 10 years ago to get enough pipeline capacity to move Marcellus gas out of the region to better paying markets. The second thing is we located a list of major northeast pipeline projects with the pipelines Range has reserved capacity along highlighted in yellow. Cool! So below is an article mentioning some of the pipelines Range says will be a game-changer for them in the near-term, followed by that list of pipelines they have reserved capacity along…
Texas-based Newpark Resources, a drilling fluids and specialty services company for the oil and gas industry, announced yesterday it is buying Well Service Group located in Robinson Township, near Pittsburgh, for $75 million. Well Service Group, a containment and well site service company, was founded in 2012 and has sold and serviced equipment for Newpark from the beginning. So it seems like a natural marriage. It is one company (Newpark) buying out one of its best distributors (Well Service Group). No word on potential layoffs due to the buyout, but we doubt there will be any. This is a relatively small deal as deals go in the oil patch…
The Federal Energy Regulatory Commission (FERC) has just escalated a much-needed war with the CORRUPT, Andrew Cuomo-directed Dept. of Environmental Conservation (DEC) in New York. We won’t recount the entire history, but the DEC had arbitrarily, after more than one year of review, ruled against issuing a federal water crossing permit for a tiny 7.8 mile pipeline Millennium needs to build from its main pipeline to an electric generating plant under construction in Orange County. The power plant is due to be completed in early 2018–and needs a fuel supply. In a monumental decision, FERC overruled NY DEC in September (see 
A cabal of three, rabid, radical so-called environmental groups are once again trying to obstruct the legally-permitted Mariner East 2 (ME2) natural gas liquids pipeline project in Pennsylvania. Clean Air Council, THE Delaware Riverkeeper and the Mountain Watershed Association filed a motion with the PA Environmental Hearing Board, a special court set up to hear appeals of decisions made by the Dept. of Environmental Protection, to revoke permits previously issued by the DEP for the ME2 project–WITHOUT holding a trial. The groups are attempting to rush through a decision to block work on the pipeline by claiming there are “facts” in the case “not in dispute” and that the judge can simply take the reigns of justice into his own hands and rule by fiat. The heart of their case is that DEP granted federal water crossing permits for ME2 for “exceptional value” swamps, er, a, wetlands–and ya know, that just ain’t right. Even the attorney for the odious (and odoriferous) Clean Air Council says the judge won’t rule on the motion for at least two months–which is about the time the pipeline will be done anyway. So we’re not quite sure what these rabid groups hope to accomplish with their latest stunt. Perhaps it’s yet another fundraiser? The holidays are fast approaching…
Yesterday midstream and utility giant Dominion Energy issued their third quarter 2017 update. During an analyst phone call, Dominion CEO Thomas Farrell shared some great news regarding both the Cove Point LNG export facility and Atlantic Coast Pipeline (ACP). Farrell said Cove Point will “begin generating LNG” in November, “conclude commissioning” in December and be fully operational by the end of this year. Fantastic! In response to a question by an analyst about Atlantic Coast Pipeline, Farrell said he expects water permits from West Virginia, North Carolina and Virginia will all be issued by the middle of December. Again, fantastic! These two projects are HUGE with respect to the future of the Marcellus/Utica region. Christmas has come early this year. 🙂 Below is yesterday’s 3Q17 update for Dominion, along with the latest slide deck and select comments pulled from the analyst phone call…
An extensive article in the Pittsburgh Business Times calls attention to the developing shortage of qualified construction workers in southwest Pennsylvania. So far the need for workers has been met, but it’s not hard to predict that as Shell ramps up its “vertical construction” (building the buildings to house the cracker) this fall, that shortages will happen–not only for Shell’s project, but for other expansion projects in the area as well. Shell is the anchor. There are dozens (perhaps hundreds) of other businesses that will launch, relocate or expand to take advantage of Shell’s forthcoming supply of cheap plastics. All of those projects will create thousands of jobs in the construction industry. Various colleges and unions have launched training programs to meet the need for electricians, carpenters, iron workers, steamfitters, insulators and sheet metal workers. Question is, will it be enough?…
Natural gas production in 2017 has taken off like a rocket ship. We began the year producing 71 billion cubic feet per day (Bcf/d) of natgas in the Lower 48 states. Today? We’re producing almost 76 Bcf/d! While there are several factors in why there is so much new production this year, there is clearly one main factor: the Marcellus/Utica. The ace analysts at RBN Energy have just posted an insightful look into where and how this extra gas is being produced–by using pipeline flow data. RBN concludes there is about 2 Bcf/d of extra gas in the northeast–over and above demand for the gas. That extra gas either has to find a storage facility, or find a way to a new market. Thing is, we’re not done growing production here in Appalachia. Below is an in-depth look at Marcellus/Utica natural gas production, production that’s breaking records…
Last week an exclusive (invitation-only) event was held in Hershey, PA. It was the second annual Executive Energy Seminar: Regional Energy Markets 10 Years After Marcellus Shale event. This year’s theme (or the name for this year’s event), was “Decade of Disruption: Marcellus Shale and Regional Energy Markets.” The event was organized by John Hanger, a former Pennsylvania state utility regulator and former Secretary of the PA Dept. of Environmental Protection under Ed “Fast Eddie” Rendell. Hanger also previously served as Secretary of Policy and Planning under current Gov. Tom Wolf. Hanger assembled an impressive group, including FERC Commissioner Rob Powelson, FERC Chairwoman Gladys Brown, current Secretary of PA DEP Pat McDonnell, and PJM Interconnection president Andrew Ott (among many others). RTO Insider scored an invite and reported on what was said. Below we have a few select portions of their coverage, of interest to the MDN audience…
In September, members of the New Jersey Pinelands Commission voted to approve a $130 million, 28-mile natural gas pipeline proposed by New Jersey Natural Gas (NJNG) to connect NJNG’s distribution system serving customers in Ocean, Burlington and Monmouth counties (in NJ) and the interstate pipeline system adjacent to the New Jersey Turnpike (see 
On Monday, experts said that closing the Indian Point nuclear plant on the Hudson River in New York will cause a loss of power to the local electric grid feeding New York City. However, they also said natural gas electric generation will fill the void left by the old and uneconomic nuke plant. That is, Marcellus Shale gas will save the day–yaaah! Entergy, the plant owner, is not all that thrilled that natural gas has won this round. An Entergy spokesman at the event could barely conceal his venom, warning gas is an “intermittent facility” with “consequences.” Oooooo. We’re scared. Of course it was nothing more than sour grapes that nukes can’t compete without massive increases for ratepayers to pay the owners of the nuke plants. We live in the U.S., not the U.S.S.R. We have free enterprise, capitalism, freedom and liberty–not a command-and-control economy. Entergy wasn’t the only one spouting nightmare scenarios when (not if) natural gas takes over. Antis don’t want low carbon, low cost natural gas either–because it’s an evil fossil fuel. Antis are looking for a solution, any solution, other than gas-fired power generation, to fill the void that will be left by Indian Point when it closes. Antis have even gotten behind a plan to dig up 333 miles of precious Mom Earth to lay a power cable from Canada through NY. To which we ask: What’s the difference in digging up the ground to lay a power cable or digging up the ground to lay a gas pipeline? Answer: None. Which points out antis’ rank hypocrisy on the issue of pipelines…
Sunoco Logistics has been slapped down in a ruling by the Pennsylvania Public Utility Service (PUC) with respect to a valve station, part of the Mariner East 2 (ME2) pipeline project. In March, MDN told you about an attempt by liberal anti-pipeliners in West Goshen (Chester County) to block the ME2 project (see