$1.5T in Shale Projects “At Risk” Unless Drillers Lower Costs More
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…
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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 
Katie Klaber, principal of the Klaber Group consulting firm and former president of the Marcellus Shale Coalition, was hired to write a white paper/study for the Ben Franklin Shale Gas Innovation and Commercialization Center (SGICC) on the topic of how small Pennsylvania companies can be successful in delivering new products and services to the oil and gas industry. That is, how can your company plug into the supply chain? The white paper, titled “Technology Adoption in the Shale Energy Industry + the Role of SGICC” (full copy below) focuses mainly on technology companies–those with a new innovation. How do such companies get noticed? Get their first customer? Katie’s company surveyed 24 such companies that have worked with the SGICC to get noticed and get plugged in. She brings the lessons learned to this report. You might think, “Yeah, but I have a fencing company–nothing high tech about it. Would this report help me?” Yes, it would. There’s plenty of great marketing insights, an update on where things stand for the Marcellus/Utica specifically, and the oil and gas industry in general. We think this is a great report for any business that wants a better understanding of how to market to the upstream, midstream and downstream in the oil and gas industry…
So four anti-drillers are sitting at a bar…no wait–that’s another story. Four anti-drilling activists who teach at three different colleges–University of Florida, Florida State University, and North Carolina State University (none of them nowhere near the Marcellus/Utica Shale)–got together and concocted a sham study that used an ONLINE survey of 225 people (i.e. unscientific) in the Marcellus/Utica region who visit public parks. Based on the GIGO survey results, the researchers say one-third of Appalachian folks ain’t a goin’ to no park with frackin’ nearby, nosiree. Of course, it’s likely they wouldn’t even know whether or not there is fracking nearby since you typically can’t tell from more than a few hundred feet away where a well is being drilled. We wonder if the researchers also asked the same 225 if they would fly in to or out of an airport with fracking nearby? If that’s your criteria for whether or not to do something, whether there’s fracking nearby, you won’t be using Pittsburgh International Airport where some 47 wells are being drilled as we write this…
We shouldn’t be, but we’re stunned. We’ve discovered that anti-drillers are funding studies to discover how best to fool you. What words, phrases, stories and lies will resonate the best, and move low information types, to oppose fossil fuels. They study it and actually publish their findings (crow about it) for all the world to see! We’ve known for a long time that so-called peer reviewed research is nothing more than bought-and-paid-for propaganda (read this recent story in the New York Times: 
The New England Coalition for Affordable Energy, a pro-fossil fuel group backed by business groups and unions in throughout all six New England states, issued the results of a study they commissioned that asks the question, What will happen in New England if energy infrastructure, like natural gas pipelines, does not get built? The study, titled “The Economic Impacts of Failing to Build Energy Infrastructure in New England” (full copy below), finds the impacts–if these projects are not built–are dire: Electric ratepayers will pay $5.4 billion in higher electricity costs; 52,000 private sector jobs will be lost; household spending will go down a collective $12.5 billion; $9 billion of investment and 115,600 jobs that would have been created by such projects will never happen; and the list goes on. Here’s the announcement and summary of the findings, followed by a full copy of the study…
A hilarious “Boo! Scared Ya” report has just been issued by the brainiacs at Penn State that says Pennsylvanians are all going to fry by 2050 because of mythical man-made global warming. Never mind these are the same people who have made the same predictions going back 25 years (average temps haven’t gone up now for 18 years and counting). Never mind these are the same people who can’t predict the weather next week, let alone 35 years from now. We’re just supposed to believe them because they have letters after their names, supposedly indicating they’re smart. One person has fallen for this erroneous garbage: the PennFuture Secretary of the Dept. of Environmental Protection, John Quigley. Unfortunately Quigley has the power to make drillers’ lives miserable by enacting draconian regulations to control their activities because he believes in the fairy tale of global warming. That not only makes him stupid, it makes him dangerous…
Our favorite government agency, the U.S. Energy Information Administration (EIA), has just published an article in their Today in Energy online publication recapping what the August Drilling Productivity Report (DPR) showed: cumulative natural gas production from the country’s largest seven commercially active shale plays will decrease in September for the first time since the EIA began producing the DPR. As we already highlighted two weeks ago, the August DPR, which predicts production volumes for September, shows a decrease in production across all seven major shale plays, which includes both the Marcellus and the Utica (see 
The Ben Franklin Shale Gas Innovation & Commercialization Center (SGICC), affiliated with the Pennsylvania Department of Community and Economic with a mission to accelerate technology breakthroughs related to shale gas in PA, has just released an updated report on shale wastewater treatment and disposal in PA. The report, titled “Shale Gas Development – Summary of Shale Gas Wastewater Treatment and Disposal In Pennsylvania 2014” (full copy below) finds that drillers in PA produced about 1.8 billion gallons of gas and oil wastewater in 2014–a figure largely unchanged since 2011. The study also finds the shale industry in PA is recycling 91% of the wastewater it produces. Interestingly, the updated report shows “produced water” (or brine, naturally occurring water from the depths) volumes far exceeded volumes for “frac fluid” (or the fluid originally pumped into the well when drilling and fracking). That’s a reversal from the data evaluated in 2011 when frac fluid represented the bulk of the wastewater stream…