Monroeville Back from Edge of Insanity, Allows Some Fracking
Common sense has broken out in Monroeville. Either that, or fear of litigation. Either way, Monroeville (Allegheny County, PA) has rolled back an overly-restrictive zoning ordinance meant to hassle Huntley & Huntley’s plans to drill wells in the township–the very same township where H&H has its headquarters. Last October, Monroeville Council passed a temporary ban on oil and gas well drilling everywhere except for those areas marked M-2 industrial zoning–a big change (see Monroeville, PA Hostile to Shale, Bans Drilling in Most Places). Previously, drilling permits were “conditional use” in Monroeville, meaning each permit was evaluated on its own merits, regardless of which zoning district it was located in. By limiting drilling to M-2, Council severely limited drilling in the municipality–but at least drilling was still allowed. Then in January, Monroeville Council advertised their new zoning ordinance to FURTHER RESTRICT any kind of oil and gas activity–not just drilling, but pipelines, compressor plants, etc.–to a 150-acre parcel located next to the city dump (see Monroeville Pushes Ban on NatGas Activity, Incl. Drilling & Plants). It would be, in essence, a total ban on shale drilling activity throughout the township. Two weeks ago Monroeville Council voted (unanimously) to withdraw the proposed new ordinance, which means the zoning ordinance from last October limiting drilling to M-2 remains the law. Still not good, but better than a total ban…
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In March 2017 (one year ago), Williams filed a full, official application for the Northeast Supply Enhancement project (see 
It takes a loooooong time to get a wastewater injection well approved and then up and running in Pennsylvania. Maybe that’s way there are less than a dozen of them in the entire state. In February 2014, the federal Environmental Protection Agency (EPA) gave a “final” approval to Windfall Oil and Gas to drill a wastewater injection well near Dubois (Clearfield County), PA (see 
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Last Thursday the Federal Energy Regulatory Commission (FERC) held an open meeting during which the commissioners “took significant action” to address the Trump tax cut legislation enacted last December. FERC wants to be sure the tax cuts coming to electric companies and pipeline companies are passed on to consumers and pipeline shippers. We are still trying to make sense of it all and frankly, we still don’t fully understand it. What we can tell you about what FERC did last week is this: The agency proposed new solutions to eliminate “tax loopholes” for natural gas pipelines. Closing these so-called loopholes will eliminate certain tax benefits for MLPs–master limited partnerships. A good many pipeline companies (most) are organized as MLPs, which allows tax advantages to flow to investors. With certain tax benefits for MLP unitholders on the chopping block, all of a sudden some (most?) MLPs don’t look like such a hot investment anymore, at least on paper. Which has caused pipeline companies, many of them with operations in the Marcellus/Utica, to issue a flurry of public announcements to say “FERC’s actions won’t impact us all that much.” The stock market certainly didn’t share that sentiment with shares (called “units”) in MLPs taking a hit since FERC’s announcement. Below is a collection of stories–bits of stories–that we’ve pieced together in an attempt to shed light on what is happening, and how it may change the pipeline business in the future…
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We have to confess this story is a bit complex to understand. We will take a stab at making the complex understandable. Blue Racer Midstream has a subsidiary called Blue Racer NGL Pipelines LLC. The subsidiary operates the G-150 pipeline system, which provides batched propane and butane service. G-150 currently, located in West Virginia, connects a Natrium, WV processing plant to the TE Products Pipeline Co. (TEPPCO). The G-150 pipeline will also have a connection to the Mariner East 2 Pipeline when it goes into service, theoretically in June of this year. Currently the G-150 is flowing about 6,300 barrels per day of product through it–only 20% of its capacity. When the connection with ME2 is up and running, Blue Racer says it can handle 30,000 bbl/d through the G-150. However, Blue Racer itself signed up for most of the capacity (27,000 bbl/d). Blue Racer recently asked the Federal Energy Regulatory Commission (FERC) to allow it to have two different rate structures–a lower rate for “committed” shippers (Blue Racer itself with its 27,000 bbl/d) and a higher rate for uncommitted shippers. FERC rejected the request pointing out that existing shippers with contracts–namely Chesapeake Energy–would be left out in the cold in favor of Blue Racer moving its own volumes at lower prices. Yes, it’s complicated. Bottom line, Blue Racer can’t do what it wants and has to go back to the drawing board…
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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 50 gallon spill of non-toxic drilling mud. This isn’t the first time the DEP has stopped underground horizontal directional drilling (HDD) work at Snitz Creek. Last November they did the same thing for a piddly 1 gallon spill (see