Many Pennsylvania residents are in favor of shale gas drilling, but exporting the gas makes them mad.
Read More “PA Residents: Gas Drilling? Yes. Gas Exporting? No.”
Gas drilling opponents in North East Township (Erie County), PA have won a small victory in forcing one driller to leave the area. Lake Erie Energy Partners completed just one of 11 planned wells in the Township, but they will walk away and not complete the other 10 because of a proposed ban on hydraulic fracturing and because Township officials have reneged on a promise to the company.
MarkWest wants to build a Marcellus Shale gas compressor station in Cecil Township (Washington County), PA. They filed an application for a “special exception” to allow them to build the plant but were denied by the zoning board. On April 21, MarkWest filed an appeal in Washington County civil court to have the decision overturned. MarkWest said at the time it hopes to settle the matter “amiably” but was filing to “preserve its rights.” Part of the appeal states:
The Pennsylvania Public Utility Commission (PUC) has voted to grant Laser Northeast Gathering, a natural gas pipeline company, status as a public utility. The decision will grant Laser the power to condemn private property by eminent domain. That is, Laser will have the power to run pipelines under people’s property even if they don’t want it.
One of the issues facing energy companies who want to drill in the Marcellus Shale is how to get gas from the well to a processing facility, and from there to an interstate gas pipeline so it can make its way to market. Getting the gas from here to there requires pipelines. Without pipeline infrastructure, nothing happens.
One of the companies manufacturing pipelines for the Marcellus is V&M Star, based in Youngstown, Ohio. V&M Star, a subsidiary of France-based Vallourec & Mannesmann Tubes, is in the midst of a major expansion, building a new plant which will allow it to manufacture more pipelines for the Marcellus Shale.
Regulation and oversight of pipelines, including natural gas pipelines, comes under the umbrella of the U.S. Department of Transportation/Hazardous Materials Safety Administration. However, states are empowered to regulate and oversee public utilities, including pipelines that are deemed a public utility. But most natural gas gathering pipelines are not public utilities. Such is the case in Pennsylvania where pipelines are currently inspected by the U.S. DOT. That may be about to change.
A bill has just passed the PA House which establishes Pennsylvanian oversight of all natural gas pipelines in the state:
Momentum, a company that focuses on “midstream” oil and gas assets, has signed on Chesapeake Energy and Statoil as customers for a new Marcellus Shale natural gas pipeline they are constructing in northern WV and southwestern PA.
From the press release:
Read More “New Marcellus Shale Pipeline Coming to Southwestern PA, Northern WV”
You can drill and produce gas all day long from a Marcellus Shale well, but if you can’t get the gas from the well to a large interstate pipeline, it’s all for naught. Right now there are 150 natural gas wells that can’t go into production in Pennsylvania because smaller “transmission” pipelines are not getting built fast enough to meet demand. The reason? The U.S. federal government.
Read More “U.S. Government Drags Feet on Issuing Pipeline Permits in PA, 150 Wells Sit Waiting”
A new Marcellus Shale gas pipeline is coming to Preston County, WV which will ultimately mean more drilling in the region.
Read More “New Marcellus Shale Gas Pipeline Coming to Preston County, WV”
The Town of Windsor, located in Broome County, NY is about to get a new natural gas pipeline built that will connect gas wells across the border in PA (where drilling is happening) to the Millennium Pipeline which runs through Broome County. Yesterday the New York Public Service Commission (PSC) gave the green light for construction to begin*. The pipeline, being built by Laser Northeast Gathering Company, will be about 9.8 miles long on the New York side of the border, out of a total 33 miles.
Read More “PA Marcellus Gas Coming to Broome County, NY via New Gathering Pipeline”
MarkWest Energy announced that today they closed on the previously announced acquisition of EQT’s natural gas processing complex in Langley, Kentucky and an associated natural gas liquids (NGL) pipeline for $230 million.
Read More “MarkWest Continues Ramp Up in the Marcellus with Purchase of Natural Gas Processing Plant and NGL Pipeline”
Since February of this year, Mayor Calvin Tillman from DISH, Texas has visited—several times—the Marcellus Shale regions of New York and Pennsylvania, sponsored by groups like Shaleshock and other anti-drilling organizations. Mayor Tillman claims that his small town in Texas, north of the Dallas-Fort Worth metroplex area, has been contaminated by shale gas drilling. DISH is located in the Barnett Shale deposit. Some of the drilled gas wells are within the city limits, and others sit just outside of town. MDN attended one of Mayor Tillman’s presentations back in February and you can read about my impressions here. It’s a fair statement that Mayor Tillman has been a popular speaker for those opposed to drilling in the Marcellus Shale, drawing sizable crowds.
One of the claims made by Mayor Tillman in his talks is that either local gas wells, or the compressor plants used to pressurize shale gas for area pipelines, or both is polluting DISH and its citizens. DISH is unusual in that there are 11 large pipelines in the DISH area, far more than normally found in a single location (the most in one area for shale gas that MDN is aware of). Odors are coming from the compressor plants, so it’s certainly not a stretch to think that if you can smell it, it may be polluting or causing harm. That was Mayor Tillman’s suspicion, so he used city funds to conduct environmental testing in the DISH area, and separately another organization performed a health “survey” of current and former DISH residents (for free). Problem is, both the environmental testing and the health survey were flawed in their methodologies, which casts doubt on the findings. So the Texas Department of State Health Services stepped in to do a scientific health study using blood and tissue samples.
Agency officials collected biological samples from 28 Dish residents in late January to see whether levels of volatile organic compounds (VOCs) in their blood were higher than those in the broader population. “We were looking to see whether a single contaminant or a handful of contaminants were notably elevated in many or all of the people we tested,” said Dr. Carrie Bradford, the toxicologist who led the investigation.*
And what was the conclusion of the Department of State Health?
Texas health officials found no connection between pollution from a natural gas compressor station in Dish, Texas and levels of toxins in the blood of people living nearby.*
The new report from the Department of State Health Services says levels of benzene and other contaminants was no higher in Dish residents than in the nation’s population in general.**
MDN wonders if the now less than credible Mayor Tillman will still be such a large draw when he comes calling again?
*Elimra Star-Gazette (May 26) – Texas gas study finds no pattern of elevated toxins near compressor
**Dallas Fort Worth – Channel 33 News (May 12) – DISH Report: No evidence gas well hurting residents of Dish, Texas
As MDN has previously reported (see this story), MarkWest Energy operates more than 100 gas compressor facilities, including two in Mount Pleasant Township in Washington County, PA—the location of the very first horizontally drilled Marcellus Shale gas well. There has been tension between area residents and MarkWest about the facilities over issues of noise, lights and odors coming from the facilities. A few months ago MarkWest made application to expand the facilities but the Mt. Pleasant Township Zoning board has just turned them down:
The board denied a request from Mark West Liberty Midstream to expand its Fulton and Stewart compressing stations.
The company had made the request to add two engines at each site and expand the steel structures. The company processes gas for Range Resources.*
MDN doubts this will be the end of this story. There is an ongoing debate about just who has authority to regulate pipelines and compressor facilities, and the matter is far from settled. Does regulation for these types of facilities lie with local governments? Or is it a “utility” that is/should be regulated by the state rather than local authorities? Stay tuned.
*Washington Observer-Reporter (May 12) – Board nixes expansion for gas compressing stations in Mt. Pleasant Township
National Fuel has struck a deal with Statoil and East Resources and is expanding two pipelines to handle Pennsylvania Marcellus Shale gas, sending it to markets in Canada and the Northeastern U.S. The announcement says National Fuel will build 16 miles of new pipeline from Corning, NY to Tioga County, PA, and construct a new interconnection with the Tennessee Gas Pipeline in Ontario County, NY, among other improvements.
From the National Fuel press release:
WILLIAMSVILLE, N.Y.–(BUSINESS WIRE)–National Fuel Gas Supply Corporation (“Supply”) and Empire Pipeline, Inc. (“Empire”), the companies that comprise the Pipeline and Storage segment of National Fuel Gas Company (NYSE: NFG) (“National Fuel”), have reached major milestones on two pipeline expansion projects that are the first in the industry designed to receive natural gas produced from the Marcellus Shale and transport it to key markets of Canada and the Northeast U.S. Supply has entered into a binding precedent agreement with Statoil Natural Gas LLC (“Statoil”) for 100 percent of the capacity on Supply’s “Northern Access” expansion project. Empire also has a binding precedent agreement in place with anchor shipper East Resources, Inc. (“East”) for Empire’s “Tioga County Extension” project, and is concluding negotiations for additional capacity with a second shipper. The precedent agreements provide for Statoil and East to sign, after satisfaction of conditions, firm transportation service agreements under which Supply and Empire will transport natural gas for Statoil and East.
Kinder Morgan, a pipeline and energy storage company, will build a new 250-mile pipeline from Pennsylvania to the Cochin Pipeline in Michigan to move Marcellus Shale gas to processing facilities and markets in the Midwestern U.S. and Canada.
From the Kinder Morgan press release:
HOUSTON, April 20, 2010 – Kinder Morgan Energy Partners, L.P. today announced plans to modify and expand the existing Cochin Pipeline system to provide a solution for transporting natural gas liquids (NGL) from the Marcellus Shale Basin to fractionation plants and chemical markets near Sarnia, Ontario, and Chicago, Ill.
Kinder Morgan plans to build approximately 250 miles of NGL pipeline from the Marcellus Shale Basin in southern Pennsylvania to the Cochin interconnect at Riga, Mich. From Riga, Kinder Morgan anticipates that product will be transported through the existing Cochin Pipeline system to Windsor, Ontario, and then through the Windsor-Sarnia Pipeline to Sarnia. Kinder Morgan also plans to reverse the eastern leg of its Cochin pipeline in order to move NGLs from Riga to the Chicago area, where it expects to build an additional pipeline to connect to existing fractionation facilities and chemical plants.
“Our proposed pipeline and key existing infrastructure offers NGL producers the quickest and most efficient solution to get their product to the market,” said Don Lindley, vice president of business development for Kinder Morgan’s Products Pipeline group.
The pipeline will be designed to transport mixed NGLs (Y-grade), as well as purity NGLs such as ethane, and will have an initial throughput capacity of 75,000 barrels per day and can be expanded to handle up to 175,000 barrels per day.
The recent decision by Canada’s National Energy Board directing the reconnection of the Cochin Pipeline to the Windsor-Sarnia Pipeline will enable Cochin Pipeline shippers to have access to the Sarnia chemical complex. Kinder Morgan anticipates offering transportation from Marcellus to Sarnia for under 14 cents per gallon.
Kinder Morgan expects to move forward with an open season in the second quarter of 2010.
Kinder Morgan Press Release (Apr 20) – Kinder Morgan Offers Quick and Efficient Solution to Move Marcellus NGLs to Market
According to speakers at today’s Marcellus Midstream Conference and Exhibition in Pittsburgh, infrastructure will be play a key role, and if not ramped up quickly, may create problems for drillers in the Pennsylvania Marcellus Shale.
“The opportunity for Marcellus Shale production growth can be overwhelmed by a lack of infrastructure,” said Scott Soler, managing director of Houston-based private equity firm Quantum Energy Partners.
Soler said an estimated $10 billion must be spent on pipelines, processing and storage facilities within five years to keep up with projected production.*
Bentek Energy, also presenting at the conference, said the industry has announced or already begun more than 30 pipeline projects, including new pipelines or expansion of existing pipelines.
MDN recently reported on new processing, fractionation and storage facilities announced by both Dominion and MarkWest. Infrastructure will play a key role in drilling in the Marcellus for years to come.
*Pittsburg Tribune-Review (Apr 21) – Marcellus Shale infrastructure inadequate, energy exec says