Research

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    Study Says Each PA Well Creates $5-$10K+ in Road Damages

    A new study recently published in the peer reviewed Journal of Infrastructure Systems from a half dozen students and professors, some of them working for RAND Corporation, attempts to answer the question, How much road damage due to truck traffic happens in Pennsylvania–and how much does it cost? The study, titled “Estimating The Consumptive Use Costs of Shale Natural Gas Extraction on Pennsylvania Roadways” (full copy embedded below), was submitted for consideration a year ago–in March 2013. It was accepted by the Journal in November and finally published in their February 2014 issue.

    The folks doing the research are smart–members of the American Society of Civil Engineers–we don’t dispute their credentials. What did they find? Using estimates of how many truck trips it takes to drill a well from data collected by the New York Dept. of Environmental Conservation (yes, NY data where there is no shale drilling), the authors estimate that for more frequently traveled state and local roads in PA the damage amounts to an average of $5,000 to $10,000 per well drilled. If you include less-traveled rural roads, that number jumps to $13,000 to $23,000 per well average…
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    Report: Coming Economic Miracle in WV from Ethane Cracker Plant

    In February MDN told you about a newly released research report from Tom Witt, economist and former director of West Virginia University’s Bureau of Business and Economic Research and professor emeritus at WVU. Witt, now a private consultant, took a close look at realistic numbers for how many jobs and how much money the proposed Odebrecht ethane cracker and associated petrochemical plants will generate for WV and the region (see Economist Releases Report on WV Cracker Plant’s Economic Impact). The numbers are truly astonishing.

    In February we could not get our hands a copy of the study, which is titled “Building Value from Shale Gas: The Promise of Expanding Petrochemicals in West Virginia.” We now have a full copy and have embedded it below. We also have an editorial written by Witt and published a few days ago describing the study and his take on the coming economic miracle in WV from Odebrecht’s ethane cracker plant…
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    America’s Cities Big Winners from Cheap Marcellus Shale Gas

    Yesterday the U.S. Conference of Mayors released a new study from IHS that shows the positive impact inexpensive and abundant natural gas is having on the manufacturing sector. Titled “Impact of the Manufacturing Renaissance from Energy Intensive Sectors” (full copy embedded below), the report provides analysis and detailed data on the impact for jobs and the economy in 363 metro areas across the United States. Nine key sectors are analyzed, including: Basic organic chemicals; iron and steel mills; fabricated metals; machinery; nonmetallic minerals; resin, rubber and fiber; plastics and rubber; agricultural chemicals; and petroleum and coal products. According to the report, in 2011 and 2012, demand from the Marcellus and other growing shale plays for new pipelines and mining equipment ignited the nation’s steel, iron, fabricated metals, and machinery manufacturing industries. In U.S. metro areas, these sectors saw real sales and employment jump by 17% and 9.7%, respectively, during those years.

    Through 2020, the report projects energy intensive manufacturing employment will expand by more than 1% annually nationwide, with 72% of those jobs coming in metro areas. That is, America’s cities are the beneficiaries, both economically and in job growth, because of cheap natgas. Below are the key findings of the report, followed by a full copy…
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    New Research: US/Canada Need $30B/Year on Midstream Investment

    billions and billionsIn September 2013 MDN published Vol. 2 of the 2013 Marcellus and Utica Shale Databook series. In that volume we included a comprehensive list of 111 announced infrastructure (pipeline related) projects for the northeast. When we tallied it all up, the numbers were that projects in our neck of the woods will result in about $40 billion being spent over the next five years or so (see MDN’s 2013 Databook Vol 2 Finds Staggering $40B in NE Midstream Projects). The INGAA Foundation (Interstate Natural Gas Association of America) and ANGA (America’s Natural Gas Alliance) yesterday released a study they commissioned that tops our estimates–by a lot. The study is titled, “North America Midstream Infrastructure through 2035: Capitalizing on Our Energy Abundance” (full copy embedded below). Researched and prepared by ICF International, the new study shows that the U.S. and Canada together will need to spend $30 billion per year from now until 2035 on pipelines and related infrastructure just to keep pace with shale development.

    ICF’s numbers add up to $641 billion in 2012 dollars over 22 years. But get this: $70 billion of that $641 will be spent in the Marcellus, according to the study. Nationwide the new spending will generate more than 432,000 jobs, add approximately $885 billion to U.S. and Canadian economies, and bring in over $300 billion in federal, state/provincial and local taxes. Truly staggering numbers. Immediately below we have the quick hit, bulleted conclusions of the report, for the time-pressed, so you can scan it. Below that the press release announcing the new study–and finally, a full copy of the study with some great charts and graphs (be sure to check out their Henry Hub price forecast through 2035 on page 24)…
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    April EIA DPR: Marcellus Continues Reign as King of the Shale

    A periodic check-in of our favorite Energy Information Administration report, the Drilling Productivity Report (DPR), shows the Marcellus Shale continues to be the United States’ (and world’s!) leading shale play when it comes to production of natural gas. The April DPR, released two days ago, shows the Marcellus is forecast to increase production by an average 288 million cubic feet per day (Mmcf/d) in April over March. The increase, as always, comes from a mix of newly drilled wells coming online and previously drilled wells.

    Below we have analysis of the latest numbers, along with the full DPR for April, yesterday’s EIA Today in Energy update (which talks about the increasing efficiency of new wells in the Marcellus), and screen shots of two charts on the DPR home page, charts they don’t include in the PDF (for whatever reason, but should be)…
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    OOGA’s DeBrosse Report: Utica Drilling Ramps Up in 2013

    reportEach year the 3,200-member Ohio Oil and Gas Association (OOGA) issue the DeBrosse Memorial Report. The report is a high level look at where (and how much) drilling there has been in the state–and what they’re finding (methane, oil, NGLs). OOGA’s Peter MacKenzie presented the findings of the latest DeBrosse Report at last week’s OOGA Annual Winter Meeting in Columbus. According to MacKenzie, the data in this year’s report, “should get people’s attention,” saying it sure got his.

    OOGA supplied us with a copy of the report to share with MDN subscribers (full copy embedded below). It’s chock full of great maps and charts and statistics about oil and gas drilling in Ohio. The numbers (and maps) show the dramatic impact Utica Shale drilling has had. First up are some of the highlights as shared by the Akron Beacon Journal, followed by the full report…
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    Where Does YOUR Business Fit in the Marcellus/Utica Supply Chain? [FREE]

    puzzle piecesA little more than a year ago MDN editor Jim Willis developed a Supply Chain tutorial that was included in Vol. 3 of the 2012 Marcellus and Utica Shale Databook. The tutorial is Jim’s attempt at graphically charting how the upstream and midstream shale drilling business works, and more importantly, where various vendors/businesses plug in during that process. That is, where can your business sell its services to the industry. The shale drilling process is like an orchestra. The energy company (whom we call “the driller”) is the conductor, and all of the instruments in the orchestra that must play together at the right time, hitting the right notes, are typically businesses not owned by the driller. There is a lot of opportunity for local businesses to sell their products and services to the Marcellus and Utica Shale drilling industry. But many don’t know where to begin. That’s what the tutorial aims to address.

    Jim is today releasing the MDN Supply Chain tutorial as a stand alone report. See it and download it below, for free. It’s Jim’s way of giving the industry, and faithful MDN readers, a boost.

    NOTE: Jim is seriously considering a new series of workshops, either in person or online, to assist businesses with learning how to locate opportunities and sell to the Marcellus and Utica Shale industry. If such a concept sounds interesting you to, drop Jim an email at: jim@marcellusdrilling.com and let him know “I’m interested” and he’ll add you to an announcement list when/if he releases such a service. In the meantime, please download and enjoy Jim’s Supply Chain tutorial…
    Read More “Where Does YOUR Business Fit in the Marcellus/Utica Supply Chain? [FREE]”

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    Research Recommends Different Radioactivity Test for Wastewater

    A new study has just been accepted for publication in the peer reviewed journal Environmental Science & Technology Letters titled, “Matrix Complications in the Determination of Radium Levels in Hydraulic Fracturing Flowback Water from Marcellus Shale” (full copy embedded below). It is important to understand what this highly technical article does, and does not, say–and what it does, and does not mean. The article reports research by a professor of radiology (and his colleagues) at the University of Iowa into the different ways Marcellus Shale flowback wastewater can be tested to determine the level of radioactivity in the water. There is a concern that Pennsylvania and New York have specified a method of testing put forward by the federal EPA that is fine for drinking water, but not accurate when testing Marcellus Shale wastewater. The professor and his team have determined the EPA method of testing only shows 1% of the true amount of radioactivity in some water samples, whereas there are other, more reliable tests, that catch nearly all of the radioactivity.

    The purpose of the research–the “import” or “bottom line”–is that environmental regulatory agencies are using the wrong test when it comes to analyzing frack wastewater. What this research shows is that a different test is needed. However, what the research does NOT show is that the level of radioactivity found is dangerous to handle or dangerous to dispose of, either by recycling or by injection well. The only way some (not all) wastewater would be dangerous is by releasing it back into rivers and streams without proper treatment–something PA banned nearly three years ago under then-DEP Sec. Michael Krancer (see PA DEP, Marcellus Shale Coalition Admit Drilling Wastewater Likely Contaminating Drinking Water)…
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    Bentek Estimates Feb Natgas Production Up 1% from 2013

    Platts’ Bentek Energy service released their estimates of U.S. national natural gas production for February 2014 yesterday. They estimate production was up 0.6 billion cubic feet per day (Bcf/d), or about 1% from the same level a year ago. The U.S. Energy Information Administration (EIA) doesn’t release their February estimates until the end of April. Bentek uses pipeline receipts to calculate their numbers, which are generally pretty reliable.

    Here’s more about Bentek’s prediction and insights into natgas production in February:
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    NatGas in PA Water Wells w/Marcellus Fingerprint NOT Shale Gas

    peer reviewA newly published peer reviewed study in the February Bulletin of the American Association of Petroleum Geologists (AAPG) offers new research that we believe comes close to, if not fully, exonerating Cabot Oil & Gas over the now infamous case of methane migration into water wells in a small area of Dimock, PA. The new study has no connection to Cabot. It is written by three experts and uses (gasp) actual science–you know, in the field data? The data comes from “more than 2,300 gas and water samples collected from 234 gas wells and 67 private groundwater-supply wells” in northeastern PA and is the largest such data set ever analyzed. What did the authors find? Shallow (near the surface) methane with the same identical chemical “fingerprint” as deeper Marcellus Shale gas is naturally occurring in large quantities in northeastern PA. That is, the shallow methane under the microscope looks exactly like the methane found more than a mile below the ground, but it isn’t gas from the Marcellus because the methane near the surface that looks just like Marcellus gas, with the same chemical “fingerprint,” was lurking in water wells long before there was any shale drilling in the area.

    This is truly huge news, but don’t expect mainstream media outlets to cover the story because a) they like Josh Fox and prefer to prop up his fictional movie called Gasland, b) the issue requires readers to actually think and use the left brain to grapple with issues of science, c) this new, real research utterly refutes the pathetic “research” published by Duke University in two different papers that took the lazy way out and tried to hang Dimock’s stray gas methane on Cabot, and d) it doesn’t fit the “drilling is evil” narrative the mainstream media prefers to push…
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    Morningstar Report on Marcellus Pegs Production & More Thru 2015

    The brains at investment research service Morningstar the February 2014 issue of their Energy Observer publication. The title of that issue? “Shale Shock—How the Marcellus Shale Transformed the Domestic Natural Gas Landscape and What It Means for Supply in the Years Ahead” (see a full copy embedded below). This is one seriously excellent analysis report–one that we highly recommend. Included in the report is narrative and charts that discuss the challenges forecasters have and continue to face when attempting to predict where shale gas production is headed. Also in the report is Morningstar’s best thinking on how much natural gas the Marcellus will produce as we exit 2015 (low-ball scenario, around 14 trillion cubic feet, rosy scenario, nearly 20 Tcf).

    The authors address the interplay of supply and demand and provide forecasts for demand. They also compare the Marcellus to other major plays to see how it stacks up. Full of charts and graphs and clear explanations, this report is a keeper. Below is Morningstar’s press release announcing the report, followed by a copy of the report itself…
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    Biggest Producer of “Fugitive” Methane is… Cows?!

    None other than the federal Environmental Protection Agency (EPA) says that in 2012 the single largest producer of so-called fugitive methane (CH4) that escapes into the atmosphere was not from landfills, like it used to be. It also was not from oil and gas drilling, as is falsely claimed by anti-drillers. Nope. The biggest producer of methane that steals away into the nighttime sky like a thief, rising to toast us all into marshmallows, is none other than cow burps. Which will of course send the global warming nutters into a tissy, demanding that farmers afix a breathalyzer over the mouths of cows to monitor and capture all of that fugitive, evil methane. Watch out farmers–the nutters are coming for you!

    Here’s the story of those impolite cows and their burping, farting ways…
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    Economist Releases Report on WV Cracker Plant’s Economic Impact

    West Virginia’s coming ethane cracker plant continues to generate positive economic news. Yesterday the former director of West Virginia University’s Bureau of Business and Economic Research and professor emeritus at WVU, Tom Witt, released a study he conducted on behalf of Braskem America (i.e. Odebrecht, the company building the cracker). The new study details specifics for how many jobs and how much money the proposed cracker and associated petrochemical plants will generate. And it’s truly astonishing.

    Here’s an overview of the economic miracle about to hit WV (and beyond)…
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    Survey Says! OU Survey of Local OH Officials on Utica’s Impacts

    Two days ago the Ohio University Voinovich School of Leadership and Public Affairs released the findings of its much anticipated Ohio Shale Development Community Impact Survey. During summer of 2013, the Voinovich School distributed more than 500 surveys to local elected officials across 17 counties experiencing the majority of shale activity and development in Ohio. The survey assesses the impact of shale development within 17 counties in eastern Ohio, with a focus on population, housing, public safety, infrastructure, environment, local employment, area business activity, and economic development. Some 200 of those surveys were returned and the data tabulated.

    What did the survey find? Ohio’s local elected officials say Utica Shale drilling has caused an marked increase in jobs and the occupancy rate at hotels. But Utica drilling has also caused some pollution issues and a big increase in the demand for water supplies. This is a very interesting study (full copy embedded below)…
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    Another Day, Another “Study” Saying Marcellus Kills Nature

    We sometimes wonder: Do some humans suffer from species guilt? Why do some people seem to believe that the human animal–the crowning achievement of all of God’s (or evolution, depending on your view of origins) animals–is actually an infestation on Mother Earth? There is a direct correlation between man’s development and use of energy, and man’s advancement. We live longer, are healthier, and enjoy more “stuff” than ever–largely because of energy: electricity, oil, natural gas and coal. Everything from your phone to your computer to the clothes you wear and the shoes on your feet, even what you eat–all of it is derived from and delivered by abundant energy sources. And yet, some humans want to turn the clock back–they want less energy. It’s like they have a death wish for the human species, or perhaps they are self-loathing. It’s simply irrational and unfathomable.

    Those are the thoughts we had after reading about the latest release of a “study” that takes a look at how drilling in the biggest and best shale play–the Marcellus–maybe, might, possibly, could, theoretically lead to the destruction of wildlife habitat and freshwater ecosystems. But why stop there? Let’s throw in wind power too! Wind power also screws up wildlife habitats. And so this latest “research” study, titled Shale Gas, Wind and Water: Assessing the Potential Cumulative Impacts of Energy Development on Ecosystem Services within the Marcellus Play (copy embedded below, authored by the anti-drilling Nature Conservancy and published in a “peer-reviewed” journal), seeks not to eliminate Marcellus drilling (because that train has already left the station), but instead encourages Soviet-style central planning by government bureaucrats to minimize the effects of all this willy nilly drilling that’s goin’ on out they’a…
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    Penn State Figures Out How to Convert Garbage into Proppants

    Shale drilling uses a special kind of sand called silica. It uses a LOT of silica, which is mostly mined in the Midwest, in places like Wisconsin. Sand is called a “proppant” in the industry because it “props open” tiny little holes in fracked shale rock to allow the natural gas (or oil or NGLs) to slip out and up the borehole. There are alternatives to silica as a proppant material–but not many are economic to use. What if you could turn industrial and domestic waste materials into a viable alternative source of raw materials for proppants? That is, what if you could turn garbage into the equivalent of sand? That would be so cool, getting rid of industrial waste on the one hand, creating a cheap source of proppants on the other.

    Turning garbage into proppants is exactly what the brains at Penn State have now figured out how to do. Below is the announcement from Penn State that a pair of their materials scientists have published a new paper in a scientific journal (copy of the paper embedded below). The announcement and paper trumpet the discovery that there is a better way to create cheap proppants for shale drilling, and it was discovered right here in Marcellus Shale country…
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