Industrywide Issues

Industrywide Issues | M&A | Research

Energy M&A Deals Hardest Hit in 2015, 6.8% Fewer Deals than 2014
January 20, 2016January 20, 2016

Mergermarket, a company that provides intelligence and news to people involved in big mergers and acquisitions (M&A) deals recently released its Energy, Mining & Utilities (EMU) Trend Report for 2015. It is a recap of M&A deals in the energy sector for last year. Among the findings: the energy sector was the hardest hit sector for M&A deals. There were 957 deals worth $547.7 billion last year, a 6.8% decrease from 2014. The report (full copy below) contains a lot of interesting information about the biggest M&A deals from last year, along with identifying the companies that worked on putting those deals together…
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Crude Oil | Industrywide Issues

Drill Our Way to Lower Gas Prices? Yes We Can!
January 20, 2016January 20, 2016

You remember when then-candidate Barack H. Obama kept saying “We can’t drill our way to lower gas prices”? He was wrong, as he so often is. The United States did exactly that–we drilled our way to low gasoline prices. Shale drilling (for oil) led to a world oil glut and the lowest prices not only for oil, but for its refined product gasoline, in years. Our friends at Energy in Depth pulled out clip after clip of the arrogant Obama categorically stating we can’t drill our way to low gas prices, added some funny music, and borrowed Obama’s own hackneyed “yes we can” language to make the point very loud and clear that Obama got it wrong. Take time to watch this short and hilarious video…
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Anti-Drilling/Fossil Fuel | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

PA Gov Wolf Targets O&G Industry (Again), Via Methane Emissions
January 19, 2016January 19, 2016

So-called climate change, meaning the climate is adversely changing because mankind’s activity, doesn’t exist–except in the minds of people who want to control every aspect of your life. They want to select the source of the energy you use, all in the name of protecting Mother Earth. They think they’re smarter and care more than you do. They want to KILL the use of fossil fuels–all fossil fuels, including clean-burning natural gas. All in the name of mythical “climate change.” The latest person to target the oil and gas industry for extinction is, yes, Pennsylvania Gov. Tom Wolf. Today he is scheduled to make a “major announcement” in which he is “expected to target methane emissions from the oil and gas industry.” The announcement has anti-fossil fuelers in a state of near-euphoria, as exhibited by the Democrat-controlled PBS StateImpact Pennsylvania…
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Accidents | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

Freak Show Coming to a PA Well Pad Near You with New DEP Alerts
January 19, 2016January 19, 2016

If you spill a couple of gallons of gasoline at your local convenience store gas station, somebody throws kitty litter on it and that’s the end of the story. But if you spill a couple of gallons of diesel fuel at a drill pad, it’s nearly a federal crime. In Pennsylvania, if there’s a spill of diesel fuel, frack water, etc., operators are supposed to report it to the Dept. of Environmental Protection (DEP) asap. New rules coming from the DEP this summer will make reporting those spills mandatory–within two hours of when the operator first becomes aware of it. And get this–that data will immediately go into a web database and shared with the world. The new system will even email people who want to receive such emails. Imagine this: Someone spills five gallons of diesel fuel and three hours later anti-drilling protesters are parading in front of the road leading to the drill pad, and local television cameras are there to document the entire freak show that ensues. And it happens again, and again, and again, and again. Thanks DEP! You’re so community-minded…
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Energy Services | Industrywide Issues | New York | Pipelines | Regulation | Statewide NY | Williams

NY AG Objects to Williams Tree Clearing for Constitution Pipeline
January 19, 2016January 19, 2016

This one was easy to predict. Last week we told you that Williams had asked, and received permission from the New York Dept. of Environmental Conservation (DEC), to begin clearing trees along the path of the Constitution Pipeline in upstate New York (see Williams Plans to Start Clearing Trees for Constitution Next Week). Anti-fossil fuelers went squealing like petulant three year-olds to their favorite “parent,” Attorney General Eric Schneiderman, asking daddy to stop Williams from killing trees. And so last Thursday Schneiderman filed an objection to the tree-clearing plan with the Federal Energy Regulatory Commission (FERC), to placate the petulant three year-olds that are his favorite constituents. The question now is, will FERC put a halt to the tree clearing, which must happen before April 1st when it becomes bat season and companies can no longer clear trees for fear of roosting Northern long-eared bats…
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Industrywide Issues | Ohio | Regulation | Washington County (OH) | Wastewater

Ohio Injection Wells Under ODNR Microscope
January 19, 2016January 19, 2016

Water Energy Services has completed the final part of a project that eliminates the need for trucks to climb Harmer Hill, hauling brine to an injection well located along Ohio Route 676 in Washington County, OH. Instead, brine is hauled to and deposited at a facility on Ohio Route 7, and from there the brine is pumped, via pipeline, to three injection wells at the top of Harmar Hill. Just to give you an idea of how closely regulated these injection wells (and the pumping station) are, inspectors from the Ohio Dept. of Natural Resources (ODNR) make 2-3 inspections PER WEEK of the facility. There’s seismic monitors for each of the three injection wells that constantly report their data directly to the state. Every load of brine brought to the facility is tracked and logged. This facility (and others like) are, quite literally, under the ODNR microscope, which should alleviate resident’s concerns…
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Energy Services | Ethane | Industrywide Issues | Kinder Morgan | Ohio | Pipelines | Regulation | Statewide OH

Kinder Morgan Ready to Move Forward with UTOPIA East Pipeline
January 19, 2016January 19, 2016

In April 2015 MDN told you that the Federal Energy Regulatory Commission (FERC) will not be involved with approving or overseeing construction for Kinder Morgan’s UTOPIA (Utica To Ontario Pipeline Access) ethane pipeline (see FERC Will Not Oversee UTOPIA NGL Pipeline Project in Ohio). Why not? Because UTOPIA, a 12-inch ethane pipeline running 240 miles will only be built in Ohio–it won’t cross state lines. It will, however, connect to another pipeline that crosses Michigan and enters Canada where the ethane (and some propane) will feed a NOVA Chemical cracker plant in Windsor, Ontario. Because it’s all within Ohio, the lead agency for approval and oversight for UTOPIA will be the U.S. Army Corps of Engineers, with an assist from the Ohio Dept. of Natural Resources (ODNR), the Ohio Environmental Protection Agency and the U.S. Fish and Wildlife Service. Kinder is saying they are ready to move forward with the UTOPIA project and will file for the necessary permits from state and federal authorities “within the next few months”…
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Energy Services | Energy Transfer Partners | Industrywide Issues | M&A | Williams

Williams Board “Unanimously” Committed to Selling to ETE
January 19, 2016January 19, 2016

Apparently somebody has been whispering nasty rumors that Williams isn’t really all that committed to completing a sale of themselves to Energy Transfer Equity (ETE). After six months of wooing Williams, ETE got tired of being rebuffed and went public with their bid to buy out Williams, one of the northeast’s biggest midstream companies (see Energy Transfer Makes “Indecent Proposal” to Buy Williams for $48B). In the end Williams caved and decided to sell, but they did it too late. By the time they accepted ETE’s offer in September, the market (and stock prices) in the oil/gas sector had already started a downward spiral, and Williams ended up getting $10 billion less than originally proposed (see Williams Accepts ETE’s “Indecent Proposal” – Price Went Down $10B). It’s now January and the deal is still not closed. And apparently somebody has either been telling tales out of school, or simply spreading nasty rumors, because the entire board of Williams voted, unanimously, to tell the world they really do want to sell. Really. Williams felt compelled to issue a press release stating as much…
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Accidents | Energy Companies | Industrywide Issues | Litigation | Lycoming County | Pennsylvania | XTO

XTO Sues DOJ for Documents Needed in PA Trial over 2010 Spill
January 19, 2016January 19, 2016

Last Thursday XTO Energy sued the U.S. Department of Justice to obtain documents that XTO says may help clear its good name in the vicious (we’d say illegal) criminal lawsuit against it over an accidental spill that happened in Lycoming County, PA in 2010. The DOJ investigated and found XTO did not act criminally and the case was settled. Then, more than three years later, PA’s new Attorney General, Kathleen Kane (now under criminal indictment herself and about to be removed from office) decided she would charge XTO with crimes against the environment–for an accident (see PA AG Abuses Her Authority, Files Criminal Charges Against XTO). Since the feds had already investigated and found no wrongdoing, XTO would like their documents to use in defending themselves in a lawsuit that’s about to begin (see XTO Criminal Trial for Accident Spill in PA Delayed Until 2016). But the feds are dragging their feet and making fishy excuses, like they don’t have enough secretaries to find and copy all of the documents requested. XTO has had to sue the DOJ to force them to go find the documents…
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Commodity Price | Industrywide Issues

Just How Low Will Price of Oil & Gas Go?
January 19, 2016January 19, 2016

Just how low will oil and natural gas prices go? A good question, on everyone’s mind. End of day yesterday the price of WTI (West Texas Intermediate) crude oil traded at $29.42, with some analysts predicting it may be headed to $20/barrel. Ouch. Such prices were unthinkable even six months ago! What about natural gas? Yesterday the benchmark Henry Hub saw gas trading at $2.10 per thousand cubic feet (Mcf). Will it go below $2/Mcf? In the middle of winter?? What is the absolute bottom these commodities will trade at? A reporter at the Canton Repository shares the latest thinking/rumors on where the price of oil and gas will go in 2016…
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Anti-Drilling/Fossil Fuel | Athens County | Industrywide Issues | Ohio | Regulation | Washington County (OH)

Small Progress with Drilling in Ohio’s Wayne National Forest
January 15, 2016January 15, 2016

There’s been some progress on the now nearly 10-year delay in drilling in the Wayne National Forest (WNF) in Ohio. WNF is the only national forest in Ohio and portions of it are found in Athens, Gallia, Hocking, Jackson, Monroe, Morgan, Noble, Lawrence, Perry, Scioto, Vinton, and Washington counties. WNF is a “patchwork” of public land scattered among private land. Some 60% of the mineral rights below WNF are privately owned. Those mineral rights owners have been denied the use of their property rights going on a decade. It’s a travesty. The federal Bureau of Land Management (BLM) controls drilling on federally-protected lands like WNF. Last November the BLM held a series of hearings about finally beginning to drill in WNF. The hearing held in Marietta (Washington County) was civil and orderly, with landowners respectfully asking questions and getting answers (see Overwhelming Support for Wayne Natl Forest Drilling @ BLM Mtg). The hearing held in Athens, OH, a hotbed of lefty lunatics, got out of control when they didn’t have a microphone to throw up on (see Anti-Frackers Out of Control at Athens Mtg on Wayne Natl Forest). Athens antis can breathe easy. The BLM has decided to wait on pursuing drilling in the “Athens Unit” until 2017. However, the BLM is taking the next step in the “Marietta Unit” now…
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Commodity Price | Crude Oil | Industrywide Issues

US Gasoline Prices Lowest Since 2009 – Thx to Fracking
January 15, 2016January 15, 2016

The average price for gasoline in the United States is now $1.99 per gallon. That’s the lowest price it’s been since 2009, the year Barack Hussein Obama was coronated as our dictator-in-chief. After Obama took office the price of gasoline steadily went up, until 2012. Since that time (Obama’s second term) the price of gas has remained steady and, recently, has dropped. Why? The miracle of fracking and horizontal drilling. Because of a new abundance of crude oil being produced in the United State, which caused Saudi Arabia to pump oil like there’s no tomorrow to defend their own market share, the world is now awash in oil, driving the price down. Gasoline is refined from crude oil, so eventually the price of gasoline followed the price of oil down. And it’s all because of fracking and the private sector–nothing to do with the government policies or Our Dear Leader…
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Industrywide Issues | Pennsylvania | Statewide PA | Taxation

PA Gov Wolf’s Pathological Need for a Severance Tax
January 15, 2016January 15, 2016

We suspect that Pennsylvania Gov. Tom Wolf may suffer from OCD–obsessive compulsive disorder. What else could explain the fact that even though PA doesn’t have a completed 2015 budget, he’s about to introduce a 2016 budget that once again calls for a severance tax on oil and gas–when the industry in his state has gone nearly dormant because of low prices? Shale drillers are struggling to stay solvent and to keep drilling at least a few new wells. And Wolf is, once again, insisting on a severance tax, that will essentially stop all drilling. Perhaps a better word for it is pathological…
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Industrywide Issues | Research

Wood Mackenzie Says Cuts in Drilling Projects “Brutal”
January 15, 2016January 15, 2016

Global research firm Wood Mackenzie has just released an update to their July analysis on the continuing impact of low oil and gas prices on upstream (drilling) projects. The new analysis finds that in the last six months of 2015 an additional 22 major projects and seven billion barrels of oil equivalent (boe) of commercial reserves have been put on hold, on top of the 46 developments and 20 billion boe of reserves identified previously. The “good news,” if you can call it that, is that deepwater projects have been hit the hardest, more so than shale projects. One Wood analyst calls the impact of lower oil prices “brutal” for new projects. He says, “What began in late-2014 as a haircut to discretionary spend on exploration and pre-development projects has become a full surgical operation to cut out all non-essential operational and capital expenditure”…
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Commodity Price | Crude Oil | Industrywide Issues

Will Oil Hit $60 by Year’s End? Shale Giant Harold Hamm Says Yes
January 15, 2016January 15, 2016

The price of natural gas is somewhat tied to the price of oil. They don’t track exactly together, but we think it’s a fair statement to say as goes the price of oil so goes natgas. One of the pioneers of drilling for oil and gas in shale deposits is Harold Hamm, CEO of Continental Resources. What Hamm thinks and says about the price of oil is of keen interest to everyone. He is, perhaps, the closest thing to an oracle our industry has. Hamm was interviewed on Wednesday and asked where he thinks the price of oil is headed in 2016. This is what he said…
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Anti-Drilling/Fossil Fuel | Fayette County | Industrywide Issues | Regulation | Wastewater | West Virginia

WV County Officially Bans Injection Wells; Children Brainwashed
January 14, 2016January 14, 2016

As we reported in December, two left-wing Democrats in Fayette County, WV voted, in a first reading of a new ordinance, to ban all injection wells in the county (see 2 Democrat Commissioners Ban Injection Wells in Fayette County, WV). The full commission (three members instead of two) took a final vote Tuesday night and passed the measure, making it “the law” in Fayette County (until it’s found illegal by a court). The interesting part in reading about this turn of events is how some of the left loony toons parents have brainwashed their own children into becoming socialist/communists. One little girl gave “an impassioned plea” to encourage passing the ordinance, and then ignorantly accused people from the oil and gas industry of causing the death of “our grandparents, family and friends for you to have private jets.” Talk about colossal stupidity on parade. We call it brainwashing…
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