EIA July DPR: Utica Only Play with Increased NatGas Production
Earlier this week MDN’s favorite government agency, the U.S. Energy Information Administration (EIA), issued our favorite monthly report–the Drilling Productivity Report (DPR). The DPR is the EIA’s best guess, based on expert data crunchers, as to how much each of the U.S.’s seven major shale plays will produce for both oil and natural gas in the coming month. The EIA projects natural gas production cumulatively across all shale plays will once again fall in August–the sixth consecutive month it will have fallen. However, unlike the July projection (see EIA June DPR: The Worm Turns for Utica NatGas Production), natgas production in the Utica will go up by a fraction. The projection last month was that July’s Utica production would, for the first time, go down. So it’s good to see a reversal in the Utica. The Marcellus, on the other hand, continues to bleed off production, although at a slower rate than it had been (down 51 million cubic feet per day–or MMcf/d–in last month’s report, down only 26 MMcf/d in this month’s report). Shale oil production is also forecast to drop once again in the next month. Here’s the lowdown from the EIA…
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The anti-frackers at the Johns Hopkins-Bloomberg School of Public Health are out with another bought-and-paid-for (by anti-drillers) “study” that implies the presence of fracking in Pennsylvania leads to causing or making worse asthma attacks. You may recall the same group of antis pushed out a study last October that supposedly shows fracking leads to premature births (see 
In the past we’ve been pretty critical of the Pennsylvania Independent Fiscal Office (IFO). It claims to provide revenue projections for use in the state budget process along with “impartial and timely analysis of fiscal, economic and budgetary issues to assist Commonwealth residents and the General Assembly in their evaluation of policy decisions.” It’s been our observation the IFO is populated with partisan Democrats. However, we have to acknowledge their prediction of impact fee revenue from 2015 was spot on. Earlier this year the IFO predicted that when the dust had settled, the impact fee would generate $185.5 million (see “Independent” Fiscal Office Says PA Impact Fee Revenue Drops 17%). When the state Public Utility Commission (PUC) finally reported the actual numbers, it turned out to be $188 million (see 
The amount of natural gas that gets produced, and the amount that actually gets traded (bought and sold) are two different numbers. Don’t try to figure out–just accept it on faith. The companies that buy and sell (i.e. trade) natural gas are required to file “Form 552” with the Federal Energy Regulatory Commission (FERC) once each year, to inform FERC of the volume of gas they’ve traded. Form 552 says right on it that its purpose is: “FERC Form No. 552 collects transactional information from natural gas market participants. The filing of this information is necessary to provide information regarding physical natural gas transactions that use an index and transactions that contribute to, or may contribute to gas price indices.” Cornerstone Research, an economic and financial consulting company, does a yearly deep dive into all of those Form 552 filings, producing a report of their findings (full copy of the report below). What did Cornerstone find from the 552 filings for 2015? The big news is that the volume of gas traded in 2015 went up 4% over 2014. It’s big news because the the volume of gas traded has gone down each year since 2011. Here’s what else they found…
A study funded entirely by the National Science Foundation (no Big Green money involved, no oil and gas money involved) has found that fracking operations in Colorado have not led to an increase in methane migration into groundwater supplies. The study, titled “Groundwater methane in relation to oil and gas development and shallow coal seams in the Denver-Julesburg Basin of Colorado” (full copy below) was published in the Proceedings of the National Academy of Sciences (PNAS) and is significant. The research examined methane levels going back 25 years, long before any horizontal fracking took place in the state. It focuses on an area of Colorado where there has been a great deal of drilling and fracking over the past 16 years. In looking at levels of dissolved methane in groundwater both before and after fracking began, the researchers found, “The rate [of groundwater methane] did not change after the introduction of horizontal drilling combined with high-volume hydraulic fracturing in 2010.” We predict you’ll hear crickets in mainstream media–with no coverage of this very important finding…
In November 2015 MDN brought you a list of 36 North America drillers that had, as of that time, declared bankruptcy (see 
Last week MDN reported that a previously trumpeted so-called research study of air quality near fracking sites in Ohio had been retracted (see 
In July 2012 MDN told you about a one-year study of air quality in and around Chartiers Township in Washington County, PA being conducted by the PA Dept. of Environmental Protection (see 
We’re starting to crack a smile of hope that drilling has once again picked up. Our first bit of evidence that the tide is turning came last week when we reported that Patterson-UTI Energy’s rig count had gone up by two in June (see 
Outplacement firm Challenger, Gray & Christmas is out with their Mid-Year Job Cut Report (full copy below). Overall, across all sectors, it seems that job cuts are slowing down–a good sign to be sure. But what about job cuts in the energy industry? The news there is mixed. While the pace of job cuts in the energy industry is slowing as the year progresses (a good sign), if you look at the raw numbers for the first six months of 2016 versus 2015, the news is not so good. For the first six months of 2015 the energy industry cut 60,500 jobs. For the same period in 2016, the number of jobs cut was 77,211, a 28% increase this year over last. Oy vey! Will the cuts never stop?…
The Canadian Energy Research Institute (CERI) recently released the “Canadian Natural Gas Market Review” (full copy of the 159-page report embedded below). The study looks at the future of Canada’s natural gas upstream (i.e. drilling) industry, taking into consideration the history of the industry, changing market dynamics due to the advancements in horizontal drilling and hydraulic fracturing technology, the recent drop in oil and natural gas prices, and policy developments (i.e. government interference). In the Executive Summary, which we include immediately below, you’ll read that the Canadians have a lot to say about the Marcellus Shale. Canada is importing more natgas than ever–because of cheap, abundant, clean-burning Marcellus Shale gas in the northeast. The report also comments on Canada’s chances of becoming a big exporter of gas via LNG. Canada can, theoretically, increase its own natgas production by 65% over the next 20 years–but only if a number of planned LNG export facilities go online to provide a market for all of that gas…
More money is on the way to the oil and gas sector–so says powerhouse consulting and accounting firm Ernst & Young. An EY survey, titled “Capitalizing on opportunities: Private equity investment in oil and gas” (full copy below) says there is close to $1 trillion in private equity waiting to be invested across all sectors. Some 43% of private equity investors say they are looking to spread some of that money in the oil and gas space. The question is, which region(s) of the world will see appreciable amounts of that investment?…