Williams Buys Caiman Eastern Midstream for $2.5 Billion
Williams announced yesterday that it will buy Caiman Energy subsidiary Caiman Eastern Midstream for $2.5 billion. Caiman Midstream has a major presence in the wet gas area of the Marcellus and Utica Shale play. The acquisition will give Williams a major pipeline gathering network in northern West Virginia, southwestern Pennsylvania and eastern Ohio, along with two processing facilities and a fractionator. Williams says by 2020 the Caiman system will be gathering more than 2 billion cubic feet per day of natural gas along with 300,000 barrels per day of natural gas liquids and condensate.
In addition to the acquisition, the Caiman Energy parent company will partner with Williams in a new joint venture to further develop new midstream infrastructure in the Utica Shale. From the Williams press release:
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Chesapeake Energy is partnering with M3 Midstream and EV Energy Partners to build a new $900 million natural gas processing complex with facilities in Ohio’s Harrison and Columbiana counties by the middle of next year. The facility will be the largest of its kind in eastern Ohio, providing a place for Chesapeake and other drillers to process natural gas and the all-important natural gas liquids. French energy giant Total, a 25 percent joint venture partner with Chesapeake in the Utica Shale, also has an option to participate in the project.
A preliminary report released by the Ohio Department of Natural Resources (ODNR) on Friday concludes that a dozen earthquakes in northeastern Ohio were “almost certainly” induced by injection of gas-drilling wastewater (a full copy of the report is embedded below). The evidence is overwhelming: The earthquakes did not begin until three months after the injection well went online; the quakes were all clustered around the well bore; and a new fault has been discovered in the bedrock where the wastewater was being injected. Taken together, the ODNR is as sure as it can get that the injection well was causing the earthquakes.
Details of Gov. John Kasich’s plan to raise taxes on the nascent shale drilling industry in Ohio (
This one is sure to disappoint landowners. In an Obamaesque move, conservative Republican Ohio Gov. John Kasich is set to propose a new tax on Utica and Marcellus shale gas drilling in order to reduce Ohio state income taxes.