FERC OKs 6 Dominion Compressor Station Upgrades in PA, MD, VA
It’s not often we miss reporting on a pipeline upgrade project in the Marcellus/Utica. This is one of those rare cases. Over a year ago Dominion Transmission, Inc. (DTI) filed an application with the Federal Energy Regulatory Commission (FERC) to upgrade six compressor stations along the DTI pipeline system in Pennsylvania, Maryland and Virginia. The upgraded compressors would allow DTI to pump an additional 155,000 dekatherms per day of natural gas, providing that gas to new and expanding natgas-fired electric generating plants. The project will cost $210 million. The new news for the project is that FERC approved it this week, granting DTI a certificate to move forward with the upgrades. Below is information about the project, and about FERC’s approval…
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Landmen, the people on the front lines interfacing between drillers and landowners, are facing tough times. With the slowdown in drilling has come a slowdown in leasing, or re-leasing. Landmen are the guys and gals who perform that duty–and many of them are now doing other jobs, waiting and hoping for the next upturn in the industry. Here’s the story and perspective of one landman who has been in the business for the last 37 years, through five different up and down cycles. Most recently he worked as a landman for Noble Energy–until he was laid off 1.5 years ago…
Is unconventional (i.e. shale) natural gas supply more responsive to price changes than conventional gas? A new research paper suggests that the answer is yes–specifically, almost three times as responsive, because shale gas wells are far more productive (2.7x more) than conventional gas wells. In “Trophy Hunting vs. Manufacturing Energy: The Price-Responsiveness of Shale Gas” (full copy below), researchers from Resources for the Future (RFF), a nonpartisan think tank devoted exclusively to natural resource and environmental issues, takes a look at how the “new way” of drilling multiple wells from a single pad, which is akin to a manufacturing process, is flattening out the supply curve. A flattened supply curve reduces price volatility–the wild up and down swings in the commodity price of natgas. While the focus of the paper is on how shale wells are leading to lower and more stable prices over the long term and does a deep dive into economic models, the paper also contains a good, basic primer on drilling a shale well. We found it a good read and wanted to share it with you…
A new report issued by the U.S. Chamber of Commerce addresses the question, “What If…Energy Production was Banned on Federal Lands and Waters?” (full copy below). The short answer to that question is, it would be an unmitigated disaster for this country. There is a movement underway by radical environmentalists with the catch phrase of “Keep It In The Ground”–meaning we should stop extracting oil and natural gas. It is an acutely ignorant position to take. The report says, “Instituting a ban on future federal-lands leasing and stopping the current production of these resources would increase energy prices for consumers by removing low-cost resources from the available supply stream. The impact would be immediate and severe to the U.S. economy, leading to the loss of hundreds of thousands of American jobs, and robbing the federal government and primarily eastern states of potentially billions of dollars in revenues in the form of lost royalties.” Keep It In The Ground boobs don’t own land and sip lattes at Starbucks in large cities with their radical friends. They don’t care about lost jobs and lost royalty revenue–because it doesn’t affect them. Opposing “nasty, dirty fossil fuels” makes them feel good about themselves. They are dangerously stupid. This report (read it below) illustrates just how catastrophic it would be to ban fossil fuel extraction on federal lands. The report finds that the U.S. economy would lose 400,000 jobs and $70 billion in annual GDP if we were to abandon energy development on public lands, as President Obama and presidential hopeful Hillary Clinton and the entire Democrat Party advocate…
It’s no secret that Marcellus and Utica drillers need new pipelines–and they need those pipelines urgently. Especially in Pennsylvania where lack of pipelines is keeping inventories high and prices for natural gas the lowest in the country. However, drillers must deal with reality as it is–today. Pipelines take time to build, and recent efforts to block pipelines are delaying important projects like the Constitution and PennEast pipeline projects. The good news is that some pipeline projects *are* being built in the northeast, some of which are almost done. Drillers like Range Resources are ramping up new drilling now, about six months in advance of when new pipelines are due to go online. That’s about how long it takes to put the pieces in motion. The other good news is that some drillers, like Cabot, are finding new markets that DON’T require new pipelines–like selling a tremendous volume of natgas to new gas-fired electric generating plants situated in close proximity to Cabot’s wells. Here’s an update on which drillers are picking up the pace with the prospect of new pipelines (or new nearby markets), and which drillers are waiting a little longer before they pick up the pace…
Imagine this: a backhoe sinks its bucket into the ground, scoops out some dirt, and the dirt is used to build a road. No big deal. Now imagine this, a very long drill goes down into the earth and digs out dirt. Because the dirt comes from deep down, some of it may be mixed with minerals not found near the surface, so a company processes the deep down dirt to remove any extra minerals, and the dirt is then essentially the same chemical composition as the dirt from near the surface–and it’s used to build a road. The dirt from deep down is called drill cuttings. Environmental Nazis repeat the magical incantation, “It’s been fracked!” and therefore they begin to hyperventilate that “fracked waste” is being used to build a road. Our example illustrates antis’ intellectual dishonesty about what drill cuttings are. When we spotted a story that a private hunting club in Lycoming County (Williamsport area) in PA will build a new road using processed drill cuttings, and the spin job done by the anti-drilling shills at the taxpayer-funded PBS StateImpact Pennsylvania, we had to laugh…
Listen up Ohio landowners and drillers: there are important new changes coming in the way oil and gas reserves are taxed, starting THIS YEAR. One such change: tax bills will now only be issued to producers (i.e. drillers) and NOT to royalty interest holders (i.e. landowners). Therefore drillers will be responsible to collecting taxes owed by landowners. The new changes will “significantly change how the ad valorem tax is collected” and because of the changes, it will be “very important” for drillers to accurately report production volumes to the Ohio Dept. of Natural Resources (ODNR). Here’s a rundown of the changes from the legal beagles at top energy law firm Vorys…
In June MDN reported on yet another new unlegislated law (called a “rule”) issued by the rogue federal Environmental Protection Agency (EPA) that bans the disposal of wastewater from oil and gas drilling via public wastewater/sewage treatment plants (see 
Recently a group of 12 Pennsylvania state representatives held a hearing in Armstrong County, PA on the topic of separate regulations for PA’s small conventional vs large shale drillers. You may recall that new drilling rules from the state Dept. of Environmental Protection (DEP) have been approved for shale drillers, called Article 78a, but not for conventional drillers, called Article 78 (see 
Last week MDN reported that Dennis Davin, Secretary of the Pennsylvania Department of Community and Economic Development (DCED) had gone on a roadshow to three counties that will be most affected by Shell’s ethane cracker plant planned for Beaver County (see 
In June MDN told you about an economic development group of business and government leaders from Ohio and West Virginia (the Mid-Ohio Valley) called Shale Crescent (see 
Chemists at the University of Texas at Arlington published a new study last week that indicates certain activities on top of the ground at shale drilling sites are the cause of nasty emissions–and not the fracking process itself. The study, “Point source attribution of ambient contamination events near unconventional oil and gas development” published last week in Science of the Total Environment, found “highly variable levels of ambient BTEX, or benzene, toluene, ethyl benzene, and xylene compounds, in and around fracking gas drilling sites in the Eagle Ford shale region in South Texas.” BTEX compounds are nasty, and in high concentrations can be carcinogenic (cancer causing) and have harmful effects on the nervous system. The good news is that recognizing where BTEX emissions are coming from can lead to fixes. Nobody, the industry included, wants to harm workers or nearby residents’ health. We reckon this study under the category of “real science” that leads to industry improvements…
