Industrywide Issues

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    Judge Temporarily Stops ME2 Valve Station in West Goshen

    West Goshen Township, in the Philadelphia suburb of Chester County, has won a short-lived, temporary victory in their efforts to stop Sunoco Logistics’ Mariner East 2 NGL pipeline in its community. Last March MDN told you about the desperate last stand taken by liberal anti-pipeliners in West Goshen (see West Goshen’s Last Stand to Stop Mariner East 2 Pipeline). West Goshen signaled it would deny Sunoco a zoning permit for a valve on the pipeline. Sunoco politely, but firmly, told West Goshen the pipeline doesn’t need a permit from the town to install a valve because it’s a state-permitted project. Sunoco said it would move forward at the appropriate time with a valve installation. In early July, West Goshen tried again, by filing a 135-page petition with the state Public Utility Commission on Monday, asking the PUC for an emergency order to stop construction of the new valve station that Sunoco is set to begin work on any time (see West Goshen Pulls Legal Stunt in Attempt to Stop ME2 Pipeline). But the PUC responded “no thanks” (see PA PUC Rejects West Goshen Appeal, ME2 Building Valve Station). So West Goshen appealed it and now an administrative law judge has put a temporary halt on building a new valve station. The whole issue seems to revolve around which side of the road to build the valve station. West Goshen wants it built next to an existing, Mariner East 1 valve station, but Sunoco wants to build the new station across the street, citing safety concerns…
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    NGL Storage Facilities in Marcellus/Utica Good for the Environment

    Can proposed NGL storage facilities in the Marcellus/Utica benefit the environment? The answer is a resounding, YES! How? First you must understand what an NGL is, and why we have so much of it in the northeast. NGL stands for natural gas liquid. When you drill a hole in the ground to extract oil, or natural gas, you almost always get not only oil, but natural gas (and vice versa). In addition, you also get NGLs. They are all hydrocarbons with slightly different atomic configurations. NGLs include propane, butane, isobutane and ethane. Aside from natural gas (or oil), the most common hydrocarbon coming out of a well is ethane. Ethane, as it turns out, is quite useful. It can be “cracked” chemically and turned into ethylene, which is the raw feedstock for manufacturing plastics, among other things. We have at least one ethane cracker plant coming in our neck of the woods–Shell’s cracker plant in Beaver County, PA (near Pittsburgh). Another one is likely to get built by PTT Global Chemical–in Belmont County, OH. Other smaller plants that process ethane are also likely to get built. They all need a ready supply of ethane. Enter storage hubs–huge underground caverns to store NGLs until they can be used. Mountaineer NGL Storage is close to beginning work on such a facility (see More Clarity on Status of Mountaineer NGL Storage Facility in OH). However, a much larger, multi-state cooperative NGL storage project costing $10 billion to build is also actively under consideration (see WV, OH, PA, KY Should Cooperate on $10B NGL Storage Hub). In the meantime, what happens to all of the NGLs (like ethane) that are coming out of the ground now in the Marcellus/Utica? Some of it gets separated and sold, via pipeline, to markets in other countries or to the Gulf Coast. However, most of it is kept in the pipeline and mixed in with natural gas (methane), and ends up getting burned. In some cases ethane is “flared” or burned off. What a waste. If we capture and use that ethane for the plastics industry, it will remove it from being burned and ending up in the atmosphere. So yes, building NGL storage facilities can and will positively impact the environment…
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    IFO Predicts PA Impact Fees for 2017 Will Soar, Near Record High

    Since 2012, Pennsylvania has collected the equivalent of a severance tax from Marcellus Shale drillers via something called an impact fee. Same concept as a severance tax. You drill a well, gas comes out, you pay a tax. Except with an impact fee you pay whether or not anything comes out of the ground, meaning an impact fee is superior to a severance tax, which is based on how much comes out of the ground. The impact fee quickly started to generate hundreds of millions of dollars a year in extra revenue for Pennsylvania–60% of which goes back to the communities where drilling happens (which Philadelphia politicians hate), and 40% of which goes to the black hole of Harrisburg for redistribution (which Philadelphia politicians love). Drilling began to slow in 2014, and crashed in 2015/2016, with low low commodity prices for natgas. The impact fee doled out this year is based on revenues raised last year, in 2016, during the worst part of the downturn. So it’s no surprise that impact fees collected and distributed this year, in 2017 have been the lowest since the impact fee began (see PA PUC Impact Fee Report: Revenue Down Again in 2016). The PA Independent Fiscal Office (IFO) does a pretty good job of guesstimating how much impact fee revenue will get generated in the coming year, based on activity this year. The IFO just released an impact fee update (full copy below) with an outlook for 2017. The IFO predicts next year’s impact fee will generate around $222 million in revenue, which is very close to the highest amount generated thus far. Wow! What a swing in the pendulum–from lowest to near highest in one year…
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    “Frack” No Longer a Naughty Word, Loses its Sex Appeal

    For years anti-drillers have used the word “frack” and “fracking” as a pejorative, to try and smear the oil and gas industry. The word is shortened from “hydraulic fracturing” and meant to connote a “naughty” word of similar sound. The supremely untalented Julian Lennon (son of Beatle legend John Lennon) and his stepmom, Yoko Ono, went on Jimmy Fallon’s show a few years ago to sing a song called “Don’t Frack My Mother” (watch it below). That’s the mentality of anti-drillers. The word “frack” is short, sounds like something dirty, and is useful for protest signs, bumper stickers, and songs. Never mind that fracking is only one small part of the success in extracting shale oil and gas. The larger, arguably more important technological breakthrough is horizontal drilling. But it’s hard to shorten “horizontal drilling” into a bumper sticker slogan that sounds dirty. So back in 2013 we offered to enhance the fracking phrase (see MDN Proposes a New Phrase for Anti-Drillers to Use). We told antis they should shorten “horizontal drilling” to “horz,” and then they could coin the phrase, “fracking horz.” We thought it was kind of funny, but it never seemed to catch on. Sorry antis, but you’ve now waited too long. It seems that the power of using the term “frack” and “fracking” has now passed. Usage has become common and is no longer thought of as a naughty word like it once was. Antis have missed the boat, yet again…
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    Atlantic Sunrise Pipe Rally: ‘Time to Kick Politicians in the Ass’

    Last Thursday some 450-500 supporters, oil and gas industry workers and politicians gathered at the Shadowbrook Golf Course in Wyoming County, PA to express support for Williams’ $3 billion, 198-mile Atlantic Sunrise Pipeline project, most of which will get built in northeast Pennsylvania. The event was organized and sponsored by Cabot Oil & Gas, one of the major beneficiaries of the pipeline, and Williams, which will build and operate the pipeline. The overall purpose of the event was to give a metaphorical kick in the rear-end of Gov. Tom Wolf and his Dept. of Environmental Protection (DEP), which appears to be intentionally dragging its feet with granting stream crossing permits–about the only thing left before the backhoes fire up and start digging. The event, held from noon to 2pm, began with lunch–barbecue pulled pork and chicken–followed by a series of short speeches by political leaders from the region. With people gathered at tables, and some standing, a half dozen speakers stood on a giant flatbed trailer underneath what has to be the biggest American flag MDN editor Jim Willis has ever seen, hoisted and held between two large cranes (see the pic). The upshot of the speeches can best be summarized in a single statement delivered by Alan Hall, Chairman of the neighboring Susquehanna County Board of Commissioners, when he said: “It’s time to kick the politicians in the ass and get this [pipeline] done.” There were some other great one-liners too…
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    Atlantic Coast Pipeline Gets Favorable Final EIS from FERC

    Click for larger version

    Last Friday the Federal Energy Regulatory Commission issued a favorable final environmental impact statement (EIS) for Dominion’s $5 billion, 594-mile Atlantic Coast Pipeline (ACP)–a natural gas pipeline that will stretch from West Virginia through Virginia and into North Carolina. The final EIS found that although some of the proposed pipeline will create adverse environmental conditions, those things can be minimized or avoided. According to Dominion, the favorable EIS clears the path for a final approval–once FERC has a quorum available to vote. The EIS also covers a second-but-related project to ACP, the Supply Header Project (SHP). SHP is a $500 million project of approximately 38 miles of natural gas pipeline and modified existing compression facilities in West Virginia and Pennsylvania. The project will provide natural gas supplies to various customers, including the ACP, allowing the transport of natural gas from supply areas in OH, PA and WV to underserved market areas in Virginia and North Carolina. Below is a copy of the EIS, along with descriptions of what will get built for both ACP and SHP…
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    PA DEP Fines ME2 Pipe $87,600 for Single Violation, More Coming?

    Apparently under pressure from environmentalist wackos, last Friday the Pennsylvania Dept. of Environmental Protection (DEP) issued a statement that says, in essence, we’re on the back of Sunoco Logistics over problems with construction the Mariner East 2 Pipeline. Gov. Wolf and DEP Secretary McDonnell both felt it necessary to voice their “concerns” over some of the episodes that have happened with construction the twin Mariner East 2 NGL pipelines that will stretch from eastern OH to the Philadelphia area. According to the announcement, the DEP has so far issued 4 “Notices of Violation” and 1 “Consent Order and Agreement” with a fine of $87,600 for “inadvertent returns” (what we call leaks) of drilling mud and water at an underground horizontal directional drilling (HDD) location in Cumberland County, PA. To the best of our knowledge, this is the first we’ve heard of that spill. It was actually a series of spills (or leaks) over a number of different days. All told, some 160,000 gallons of drilling fluids came out of the ground at that location. In addition, the DEP released a table outlining 49 incidents–some just a few gallons, others several hundred (or several thousand) gallons of drilling fluid leaks. We have the list of 49 problem areas below, the details on the Cumberland County leaks, and the DEP announcement…
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    Rover, OH Landowners Head to Court re Pumping Water from Trenches

    In May MDN brought you the news that the Ohio Environmental Protection Agency (OEPA) was going after Rover Pipeline for failing to properly plan storm water management which resulted in heavy storm water runoff into farmers’ fields where Rover is digging trenches (see OEPA & Rover at Odds Over Storm Water Runoff, “Fine” Now $714K). OEPA was already sore with Rover over drilling mud spills, and this just added to the strained relationship. OEPA assessed a fine of $283,000. Some 246 landowners, many of them farmers, want compensation for Rover causing “long-term” damage to their fields when the company pumped out the trenches, onto their fields. So the landowners banded together and sued Rover in U.S. District Court. Everyone was in court last week…
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    CORNballs Accuse FERC of Illegally Approving NEXUS Pipeline in OH

    The CORNballs of Ohio continue to try and shut down the $2 billion, 255-mile NEXUS interstate natural gas pipeline that will run from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada. CORN stands for Coalition to Reroute NEXUS. CORNballs is what we affectionately call the group–as a way of pointing out their nutty true purpose–to try and shut the NEXUS project down. Period. Their aim has nothing to do with “rerouting” and everything to do with shutting it down. In May 2017, the CORNballs revealed their true colors when they filed a lawsuit in federal court in Akron, OH (see CORNballs Strike Again, File Lawsuit to Stop NEXUS Pipeline). Last week, lawyers for the CORNballs were back in court with a filing that claims the Federal Energy Regulatory Commission (FERC) acted illegally during the approval process. Good luck with proving that in court. NEXUS filed a motion to dismiss this frivolous case, based on the fact the federal court in Akron doesn’t have jurisdiction. The Natural Gas Act of 1938 gives “exclusive review” of FERC-related cases to the federal court of appeals in Washington, D.C. There goes another CORNball…
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    Clean Air Council’s Strange War Against Mariner East Pipeline

    The “most serious remaining legal challenge” to Sunoco Logistics’ Mariner East 2 Pipeline project is a challenge by the odious Big Green group, the Clean Air Council, based in Philadelphia. CAC claims in a court case in Common Pleas Court in Philly that ME2 violates the federal and state constitutions. The case takes up constitutional claims that have “not yet been addressed in other litigation.” It dawned on us when reading an account of the case and who says what about whether or not Sunoco has the right to use eminent domain and whether or not ME2 is a public utility, is why does the CAC even care? Why are they the ones bringing the lawsuit? After all, pipelines don’t pollute the air! Well, technically that’s not 100% true–pipeline compressor stations do emit some air pollution, depending on how they are powered (diesel engines). But at the end of the day, pipelines pollute the air far less than other forms of transportation, like trucks and trains. How does CAC even have “standing” to bring such a lawsuit? Of course the fact that CAC is litigating is a tip-off that there is Big Green money behind the effort–and CAC is just a tool being used in a wider collusion (conspiracy?) to stop the pipeline…
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    Chesapeake Tries to Wiggle Out of PA Royalty Lawsuit on Technicality

    In December 2015, Pennsylvania’s felony-indicted Attorney General, Kathleen Kane (now gone), brought a lawsuit against Chesapeake Energy, Anadarko and Williams accusing them of, among other things, royalty fraud (see PA Atty General Sues Chesapeake Energy, Williams for Royalty Fraud). In May 2016, MDN reported that Chesapeake and Anadarko had filed to dismiss Kane’s complaints against them, accusing Kane of attempting to litigate federal antitrust claims in state court (see Chesapeake, Anadarko Try to Wiggle Out of PA Royalty Lawsuit). In June 2016 Kane’s office fired back by filing a motion to keep the case in state, not federal, court. In August, U.S. Middle District Judge Christopher C. Conner granted Kane’s motion–the case stays in the state court system (see Lawsuit Against Chesapeake, Anadarko Heads Back to PA Court). We now have a new AG (thank God), but it’s the same case and once again Chesapeake and Anadarko are trying to get the lawsuit tossed–this time by saying the law that the AG claims was violated has to do with consumer protection–for people who buy things. Chessy & Anadarko argue landowners aren’t buying anything, they’re selling (minerals), so the law doesn’t protect them from predatory leasing practices. The Bradford County judge in charge of the case is considering their latest argument to wiggle out of the lawsuit, based on a technicality…
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    New Frack Wastewater Well on the Way in Allegheny County, PA

    The Federal Environmental Protection Agency (EPA), which is the agency in charge of approving oil and gas wastewater injection wells, will hold a hearing next Wednesday in Plum, PA (Allegheny County, near Pittsburgh) on whether or not to approve an application and plan from Penneco Environmental Solutions (division of Penneco Oil Co.) to convert a plugged gas well into a brine (wastewater) injection well. Typically when a hearing like this is held, it’s an indicator that the EPA will approve the project. However, just because the EPA approves it doesn’t mean it’s a done deal. After an EPA approval, the application then goes to the PA State Dept. of Environmental Protection where it goes through another round of reviews–and likely more public hearings. The stuff getting disposed of, which we generically call wastewater, is technically called brine, because of it’s salty/mineral-ly composition. Brine is naturally occurring water from the depths that comes out of oil and gas wells for years after they are drilled. Because of the high concentration of minerals in the water, it either must go through a rigorous recycling process, or get disposed of via an injection well. OH has more than a hundred such wells. WV has a few dozen. PA has less than a dozen, due to the geology needed. Every new injection well in PA is a big deal, including this one…
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    New Penn State Frack Wastewater “Study” Beats a Dead Horse

    Not long after Michael Krancer was appointed Secretary of the Pennsylvania Dept. of Environmental Protection in 2011, he “requested” (which was more order than request) that municipal sewage treatment plants still accepting and processing Marcellus drilling wastewater stop the practice. At the time there were 15 plants accepting Marcellus wastewater. Under pressure from Krancer, they ended the practice in May 2011 (see PA DEP, Marcellus Shale Coalition Admit Drilling Wastewater Likely Contaminating Drinking Water). His prescience was rewarded. A year later there were far lower bromide levels in PA rivers (see Marcellus Wastewater Ban Leads to Lower Bromide in PA Rivers). That’s how things should work: the state looks after its own environment. But that means less power for the power-mad bureaucrats in Washington, DC. Right on cue, before Obama was ejected from office next January 2017, his out-of-control EPA issued rules that do what Krancer did without a new law back in 2011. The EPA has issued a new regulation (i.e. unlegislated law) that declares no municipal sewage treatment plant in any state (not just PA) can accept and process shale wastewater (see EPA Bans Disposal of Frack Wastewater at Public Sewer Plants). Researchers at Penn State thought it would be fun to study this issue that no longer exists–disposing frack wastewater via municipal sewage treatment plants. They found evidence of “lasting environmental damage” in Conemaugh River Lake, claiming the damage came from Marcellus Shale wastewater treated at two centralized waste treatment (CWT) facilities years ago. Uh, OK. We already knew that. We already stopped it. But mainstream fake news is now treating this new “study” as some sort of revelation, implying one can never recycle frack wastewater again without grave consequences. More nonsense…
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    WV Chemical Trade Group Hints Many New Downstream Projects Coming

    We spotted an editorial in the Charleston (WV) Gazette-Mail written by Kevin DiGregorio, executive director of the nonprofit Chemical Alliance Zone (CAZ). According to the CAZ website, the organization “works with partners across West Virginia to boost and maintain investments and jobs in the chemical industry and related industries, including natural gas, manufacturing, and technology in general. We create, initiate, and facilitate business opportunities, leading to opportunities for you, your business or organization, and the State of West Virginia.” In other words, Mr. DiGregorio and the CAZ are at the nexus of many deals to bring petrochemical businesses to the Mountain State. So if anyone should know what may be “up the sleeve” and soon to be revealed, it’s Mr. DiGregorio. He hinted at it in his column. Writing that everyone has heard about the potential for a Braskem ethane cracker plant in Parkersburg (a project that appears to still be alive), Mr. DiGregoorio then says, “What you haven’t heard are all of the other potential (and confidential) projects that many of us are working on that might lead to new facilities and high-paying STEM (science, technology, engineering, mathematics) jobs that take advantage of methane and NGLs (ethane, propane, butane) to make various chemicals and plastics.” Wow! He seems to be saying there are a lot of projects in the works for WV in the downstream–those businesses that use the output from the shale industry…
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    Research: Shale Dev in PA Leads to Spread of Invasive Plants

    While we wrote about a Penn State research study today that appears legitimate, but seven years too late (see New Penn State Frack Wastewater “Study” Beats a Dead Horse), there is another recently published Penn State study that is also legit that is not yet a huge issue, but certainly has potential to be a big deal. Penn State’s College of Agricultural Sciences has found that invasive, non-native plants are making significant inroads with shale gas development in Pennsylvania, with negative consequences for PA forests. How so? The invasive, non-native plants are hitching a ride on gravel and equipment used to create roadways in forested areas, and once those plants take root, they crowd out local, native plants. The study, titled “Unconventional gas development facilitates plant invasions” and published in the Journal of Environmental Management, concludes that more monitoring and early detection can help put a lid on the problem…
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    Supporters, Antis Turn Out for 2 NC Public Hearings on AC Pipeline

    This past week, the North Carolina Dept. of Environmental Quality (DEQ) held two public hearings on Dominion’s proposed $5 billion, 594-mile natural gas pipeline that will stretch from West Virginia through Virginia and into North Carolina. One hearing was in Fayetteville, the other in Rocky Mount. Both had more people opposed to the project than for it, although the Fayetteville hearing saw a strong showing of people in favor of the project. The Fayetteville public hearing was held Tuesday, and Rocky Mount on Thursday. Here’s the coverage we could find of the two hearings…
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