OH & Other States Release Report on Injection Wells & Earthquakes
Countless times MDN has told you that in rare cases, injecting fracking wastewater into a deep, underground Class II injection well (for disposal) can cause earthquakes–if the injection well is located over a fault. When you inject fluids under high pressure into rock formations with a fault it can act like a lubricant, allowing the rocks to slip and slide–causing a low-level earthquake. It’s happened in Ohio. It’s happened (a lot) in Oklahoma. It’s happened in Texas. And in other states too. Thirteen oil and gas states joined together with the Interstate Oil and Gas Compact Commission (IOGCC) and Ground Water Protection Council (GWPC) to form the StatesFirst Initiative, a working group to pool their knowledge and try and figure out how, and under what conditions, injection wells cause earthquakes. Co-heading the initiative is Ohio’s Chief for the Division of Oil & Gas Resources Management (Ohio Dept. of Natural Resources), Rick Simmers. Rick and the working group have just released a 150-page Primer (copy below) to help regulatory agencies evaluate and develop good policies to mitigate and prevent earthquakes from injection wells…
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Analysts with global investment firm Jeffries are out with a forecast for natural gas production next year, in 2016. Jeffries says while natural gas production in the Marcellus/Utica will slow next year, they are the only two plays in the entire country that Jeffries says will still grow in production year over year. However, overall the U.S. will produce slightly less gas in 2016 than we will have in 2015–with production estimated to decline by 0.8% (less than a single percentage point)…
CoBank, a national cooperative bank serving vital industries across rural America, has just published a study titled “U.S. Natural Gas Outlook through 2020: Demand Is the New Captain of the Ship” in which they predict the United States will become a net exporter of natural gas in 2017. While we don’t have a copy of the full report, we do have a summary below listing the key points in the report, along with a video…
A new research paper has just been published that purports to evaluate potential “stressors” on streams from unconventional (i.e. shale) oil and gas drilling–including drilling in the Marcellus/Utica. The paper is titled “Stream Vulnerability to Widespread and Emergent Stressors: A Focus on Unconventional Oil and Gas” (full copy embedded below) and is written by a group of researchers from the University of Arkansas, University of Central Arkansas, University of Wyoming, Wilkes University, the U.S. Geological Survey and Waterborne Environmental Inc. In a cursory review the paper does indeed appear to be heavy on science and absent the usual political arguments. However, the one great negative for this paper is that it is published in the online “journal” PLOS ONE, a publication with very low academic standards and home to a number of previous “fracking will kill you” types of “research” papers (see 
The partisan (Democrat) West Virginia Center on Budget & Policy, which pretends to be nonpartisan and above the political fray but isn’t, has just published a so-called policy brief titled “A Win-Win Marcellus Shale Tax Incentive” (full copy below). The “brief” attempts to make the case for doubling or tripling the severance tax on natural gas liquids produced in WV (from 5% to 10% or 15%)–giving exemptions to the tax increase for those who keep the NGLs extracted in the state. The recommendation hopes to boost the attractiveness of petrochemical plants like the proposed Odebrecht cracker plant that would use ethane, the primary NGL extracted in WV, by making it more expensive to send WV’s ethane across the border, to say either Shell’s proposed cracker in PA or PTT Global’s proposed cracker in OH. The tone of the “report” is that WV has been raped and pillaged in the past–their precious coal stolen and carted away to other states–and WV can’t let that history repeat itself again. Better to shut down drilling rather than have any of it “exported” to other states. It is misguided and faulty thinking…
Two years ago MDN reported on a University of Michigan research project called the Hydraulic Fracturing in Michigan Integrated Assessment (see 
MDN spotted an interesting report released yesterday by the U.S. Dept. of Commerce’s Bureau of Economic Analysis. The report evaluates the change in GDP by metropolitan areas across the county. What the heck is GDP? It is gross domestic product (GDP), one of the primary indicators used to gauge the health of a region’s economy. GDP represents the total dollar value of all goods and services produced over a specific time period. Think of it as the size of the economy in a given metropolitan (or state or country) region. What is interesting about the report to MDN is that it mentions shale energy and the Marcellus in particular as one reasons why certain areas of the country expanded. When you look at the map (below) we want you to note two things: (1) Most of the metro areas/regions in upstate NY are shrinking, rapidly; and (2) those areas in northeast and southwest PA, eastern OH and northern WV that have Marcellus/Utica drilling are expanding, rapidly. It is no accident. The Marcellus/Utica is a huge economic engine…
Global research firm Wood Mackenzie recently published a brief analysis of LNG export facilities asking the question, Where are all the LNG project postponements? According to Wood researchers, the outlook for global LNG demand is looking increasingly subdued–particularly in China. The number of LNG projects proposed to make a Final Investment Decision (FID) in 2015 and 2016 has not reduced significantly. If all or close to all of the projects on the books make a FID to move forward, there would be an unsustainable glut of new LNG supplies–without a corresponding amount of demand around the globe. Wood Mackenzie’s conclusion? Companies will soon wake up to the fact that there won’t be enough demand and we will see “a raft of project postponements” in the next 6-18 months…
In another sobering bit of analysis by global research firm Wood Mackenzie, the company tells drillers that while their hammering of the supply chain (like oilfield services companies) to reduce prices by 20-30% will help, it will only result in an overall 10-15% savings. If drillers want to keep their drilling projects “viable” (i.e. profitable), “additional measures” will be needed to manage costs. Wood Mackenzie researchers have a few suggestions for how drillers can continue lowering costs to the point their projects are, once again, turning a profit in a low oil and gas price world. If they don’t lower costs more, there’s a mind-blowing $1.5 trillion worth of shale projects that are “at risk” of not happening…
The September edition of our favorite government report, the U.S. Energy Information Administration’s (EIA) Drilling Productivity Report (DPR), shows an interesting change from the August report. In August, the EIA predicted that for the coming month (September) every single major shale play of the seven plays they track, including the Marcellus and Utica, would see a decline in the amount of natural gas produced (see 
A single professor from Duke University who lives by the motto “publish or perish” is out with yet another “study” published in a so-called peer reviewed journal. From time to time Avner Vengosh, professor of geochemistry and water quality at Duke University’s Nicholas School of the Environment, pops up to smear the Marcellus Shale. He was in league with the Izaak Walton League to attempt to tie Marcellus drilling to water contamination in Ten Mile Creek (see 
The R Street Institute is a non-profit, non-partisan, public policy research organization (i.e. “think tank”) headquartered in Washington, DC with satellite offices in Florida, Texas, California, Alabama, and Ohio. After conducting an extensive review of existing published studies, R Street has found that while every form of energy has its negatives, including fracking, on the whole fracking for shale energy’s benefits far outweigh its negatives. Their findings are published in a new report titled “The Green Side of Fracking” (full copy below)…
Kinder Morgan has just released a study that they commissioned (paid for), but researched by the independent ICF International. The study, titled “New England Energy Market Outlook: Demand for Natural Gas Capacity and Impact of the Northeast Energy Direct Project” (full copy below), finds that New Englanders would have saved $3.7 billion in wholesale electricity costs during the 2013-2014 ‘Polar Vortex’ winter had the proposed Northeast Energy Direct Project (NED) been in service at the time. The study also finds the additional gas capacity that NED would provide will generate $2.1 billion to $2.8 billion in annual savings going forward for New England electric consumers, under normal weather conditions. Plus there are many other benefits (aside from cost savings) from building NED, including lower air pollution throughout New England…
Oilfield service giant Baker Hughes released their venerable monthly rotary rig count report today for August 2015. The numbers worldwide improved–the international rig count for August was 1,137, up 19 from the 1,118 counted in July. Looking specifically at the U.S., onshore (mostly shale) rig counts climbed from 835 in July to 849 in August, up 14. It does indeed seem as if we’ve turned a corner. This is the second month in a row that U.S. land-based rigs increased month over month (see