PJM Threatens Gas-Fired Power Plants with $2B in Fines re Cold Snap
PJM is the largest electric grid operator in the U.S. It serves 65 million people in 13 states plus the District of Columbia (including PA, OH, and WV). PJM is coming under criticism for an almost-blackout during the recent Christmas cold snap. If not for certain gas-fired peaker plants, like that in the Little Town of Bethlehem, the lights would have gone out during a brutal cold snap (see Bethlehem Marcellus-Fired Power Plant Kept PA Lights on During Xmas). Some 23% of the electricity supplied to PJM was not available during the cold snap due to equipment failures and lack of supply (including natural gas frozen off at well pads). So PJM is “investigating” and threatening to assess up to $2 billion in fines on power producers who failed to supply electricity according to their contracts.
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Yesterday we told you that the Pennsylvania-blessed effort by Shell and Equinor to build (at taxpayers’ expense) a so-called hydrogen hub in PA has received the Dept. of Energy’s blessing (“encouragement”) to submit a full application (see 
We love this story because it’s driving the left NUTS! In December, we told you about Ohio House Bill (HB) 507 (subsequently passed), a bill that expands drilling in Ohio state parks AND officially designates natural gas as a “green” form of energy (see 
JobsOhio, a private nonprofit largely funded by liquor sales that the state allows the nonprofit to collect (in essence, it collects sales tax on liquor sales), pays Cleveland State University to research and issue a report every six months on Utica Shale investment. The latest semi-annual report (full copy below) covers shale investment in the Ohio Utica from July 2021 through December 2021. Here’s an astonishing statistic: With this latest report, total Utica Shale investment in the state of Ohio since 2011 is nearly $100 billion!
In 2020, EOG Resources, one of the largest oil and gas drillers in the U.S. (with international operations in Trinidad and China), sold *all* of its Marcellus assets, which were located in Bradford County, PA, to Tilden Resources for $130 million (see 
Since the so-called Biden infrastructure bill became law late last year with $8 billion earmarked for so-called clean hydrogen hubs to be funded around the country, we’ve made the strong and loud point that unless the Marcellus/Utica states of Pennsylvania, Ohio, and West Virginia join forces and submit a joint proposal to site one of the 6-10 regional hubs here, we risk losing out to other regional coalitions. It seems someone is finally listening. Until now, each M-U state has proffered its own plan/application for a hydrogen hub (see 
Two days ago, MDN told you about Ohio House Bill (HB) 507, a “poultry” bill that (at the last minute) was amended by the Ohio Senate to redesignate natural gas as a “green” energy source and also a measure expanding drilling on and under state-owned land (see 
There are advantages and disadvantages to being publicly or privately owned. In the oil and gas sector, most large companies are publicly owned–meaning they have a board of directors, and the “owners” hold shares of stock in the company, shares traded on public exchanges. In the Marcellus/Utica, most of the top drillers are publicly owned: Range Resources, Coterra Energy, CNX Resources, EQT Corporation, Antero Resources, Southwestern Energy, Repsol, National Fuel Gas Company (i.e. Seneca Resources), and Gulfport Energy. Several others are privately owned, including Ascent Resources (Ohio’s largest natural gas producer and the 8th largest natural gas producer in the U.S.), Greylock Energy (based in West Virginia), and Olympus Energy (which drills in the Pittsburgh suburbs).
The Plastics Industry Association (PLASTICS) has just published its “2022 Size and Impact Report” (Executive Summary below). In general, the report shows how the U.S. plastics industry, which is critical and necessary for modern existence, is growing. Manufacturing plants that use plastics once moved overseas and are now returning the U.S. Why? To take advantage of cheap plastics being produced here as a result of shale energy. Here’s something that surprised us about the report: Ohio is the #1 state in the entire country for the number of jobs in the plastics industry. Ohio beat out both California and Texas (the two most populous states in the country) in plastics employment. Wow!
When we first spotted an article by PBS titled “Why Ohio’s top oil and gas producing counties continue to lag in jobs,” we were intrigued. The “deck” of the article (the little subtext directly under the headline) says, “A decade into Ohio’s shale gas boom, seven Appalachian counties still have unemployment rates that exceed the state average. Experts and local sources suggested four reasons why fracking hasn’t closed the gap.” The implication is that fracking and the jobs it could and would create were oversold. Jobs from fracking are smoke without fire. Yet the article itself appears to prove just the opposite–that fracking HAS led to a dramatic increase in jobs in Ohio.
While tracking the active rig count week by week can give you a little sugar high, we think tracking the count month by month is more illustrative of where the count (and drilling activity) is heading. Baker Hughes is the grandaddy of rig counts, having tracked rigs since 1944. You need a rig to drill a new well, so counting active rigs gives you an idea of overall drilling activity. What do the rig counts look like for Pennsylvania, Ohio, and West Virginia over the past two years? Is drilling activity going up, or down, in our region? We have the answer.
We have chronicled a number of companies that buy royalty and/or mineral rights from landowners in the Marcellus/Utica over the years (see our previous stories about royalty mineral rights sales 
Ascent Resources, originally founded as American Energy Partners by gas legend Aubrey McClendon, is a privately-held company that focuses 100% on the Ohio Utica Shale. Ascent is Ohio’s largest natural gas producer (352,000 leased acres) and the 8th largest natural gas producer in the U.S. The company issued its third quarter update yesterday. Ascent averaged production of 2.34 Bcfe/d for the quarter, up significantly from the 1.98 Bcfe/d it averaged in 3Q21 (18% increase). Production was also up from the 1.97 Bcfe/d produced last quarter, 2Q22 (19% increase). Nearly all of Ascent’s production (94%) was natural gas, while the rest was oil and NGLs.