ETP Says Much (Not All) of Rover Phase I Will Go Online in July
Last Friday MDN brought you the news that Energy Transfer is changing some of its previously planned underground horizontal directional drilling (HDD) to trenching in order to keep the 711-mile Rover Pipeline project that will run from PA, WV and eastern OH through OH into Michigan and eventually into Canada, on schedule (see Rover Pipeline Converts Some Horizontal Drilling to Trenches Instead). Phase I of the project is the section from eastern Ohio, Pennsylvania and West Virginia to the Midwest Hub in Defiance, OH, via what is called Rover’s “Mainline A” segment. That entire segment was supposed to be completed this month–July 2017. Ain’t gonna happen. However, Energy Transfer says a significant portion of Phase I–from Cadiz, OH to Defiance, OH–will be completed this month. That’s a pretty big portion of the Phase I project–essentially spanning the state from eastern OH to northwestern OH. If ET can pull it off, it will be an impressive feat, given delays imposed by the Federal Energy Regulatory Commission…
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Phase I of the 711-mile Rover Pipeline project that will run from PA, WV and eastern OH through OH into Michigan and eventually into Canada is supposed to be completed by July 2017, while Phase II is supposed to be done by November 2017. Will Phase I be done by the end of this month? We sure wouldn’t want to take that bet, but we suppose there’s still a slim chance. While building the $3.7 billion pipeline project, Energy Transfer (or more correctly its contractors) hit some snags, including spilling 2 million gallons of non-toxic drilling mud near the Tuscarawas River (see 
In February MDN reported that Marathon Petroleum had begun to build a 49-mile condensate pipeline, called HALI–the Harpster to Lima Pipeline (see 
Being a marketing guy, MDN editor Jim Willis knows that crystallizing a concept into a few key words is critical. You have to be able to convey your meaning in as few words as possible–and those words must be pregnant with meaning. Jim was lucky enough to name this blog/news site Marcellus Drilling News, which (mostly) conveys its purpose–to report on happenings in the Marcellus (later adding the Utica) region. A very smart person who’s given a lot of thought about our industry is Kathryn “Katie” Klaber. Katie owns her own consulting firm–The Klaber Group. But before that, she was founder and president of the Marcellus Shale Coalition (a well-named organization). Katie lives and works in Pittsburgh. In a recent article for the Pittsburgh Business Times, Katie ponders over Pittsburgh (and our industry’s) “identity crisis”–by which she means our lack of good branding. Sometimes our industry and region is referred to as “Appalachia.” But that term often connotes the mountains of West Virginia, spreading out into Kentucky. Sometimes we are referred to as the “Marcellus/Utica basin,” which gets a lot closer to meaningful, but connotes drilling and leaves out the downstream. And sometimes we’re called “the Northeast.” But folks in Ohio consider themselves Midwesterners, not northeasterners. Why is it important to lock down an accurate, pregnant-with-meaning description for our entire industry (upstream, midstream and downstream), and our geographic region? According to Katie, it comes down to two words: capital investment. We need to brand ourselves and do it sooner rather than later, if we want to grow business in our neck of the woods…
Last year MDN brought you the story of researchers who found microbes (bacteria) living nearly two miles down in Utica Shale wells. They dubbed one of the never-before-seen bacterial “lifeforms” in the well Frackibacter. We immediately labeled it a different name: Frackenstein (see 
Ohio is about to pass and adopt it’s latest biennial budget. Part of the budget bill includes language to exempt Ohio’s city and town parks from the state’s unitization (i.e. forced pooling) laws. In Ohio, if 65% of the landowners in a proposed unit have agreed to lease their land for oil or gas drilling, the other landowners in the unit can be forced to join the unit to allow drilling under (not on) their land. There are all sorts of requirements before forced pooling occurs, including a $10,000 fee paid by the driller, and a hearing to review efforts made to enroll said recalcitrant landowners. But in the end, it is possible to force landowners who don’t want drilling, to have it. The justification is that those who don’t want it are harming those who do want it by not agreeing to join the unit. Should the action of someone with a few acres deny benefits to all of his neighbors? We’re not saying we support the concept of forced pooling–just giving you our best interpretation of the arguments used to support it. We understand those arguments. We also understand the sanctity of private property. Until now, local towns and municipalities in Ohio were treated like any other landowner. But now, with the new budget, they will get a special exemption. Local municipalities cannot be forced to participate–unless they want to participate–in a drilling unit…
Yesterday Energy Transfer Partners, the builder of the Rover Pipeline, once again asked the Federal Energy Regulatory Commission (FERC) if they could pretty-please-with-a-cherry-on-top resume horizontal directional drilling (HDD) in a couple of key locations in Ohio, so they can finish phase one of the pipeline somewhere close to on-time. Rover is a $3.7 billion, 711-mile Marcellus/Utica natural gas pipeline that will run from PA, WV and eastern OH through OH into Michigan and eventually into Canada. It is a critical piece of sorely needed infrastructure for the Marcellus/Utica industry. As soon as ET received approval for the project in February, they began building it. But they hit a few snags along the way, including an “inadvertent return” (i.e. leak) of 2 million gallons of drilling mud in a swamp next to the Tuscarawas River (Stark County, OH). Following that leak and other leaks, FERC told Rover to stop any new underground drilling not already under way (see 
Here is a short list of radical environmental groups that are despicable and loathsome in every sense of the word: Sierra Club, Center for Biological Diversity, Earthworks, Freshwater Accountability Project, Friends for Environmental Justice, Indigenous Environmental Network, Indigenous Iowa, Keep Wayne WILD, Louisiana Bucket Brigade, Ohio River Citizens’ Alliance, and Oil Change International. They have dedicated themselves to stopping work on, and ultimately blocking, Energy Transfer’s (ET) $3.7 billion, 711-mile Marcellus/Utica Rover natural gas pipeline that will run from PA, WV and eastern OH through OH into Michigan and eventually into Canada. The problem, however, is that ET has given these groups an open door to pedal their anti-fossil fuel nonsense. Indeed, ET has given them an open door to block further progress on building Rover. How? By rushing construction that has led to a string of accidents and incidents, alienating the thin-skinned Ohio Environmental Protection Agency (OEPA) and a number of landowners. One of the accidents, perhaps the most prominent accident that’s been the focus for much of the radical’s efforts, was a 2 million gallon spill of drilling mud into a wetland near the Tuscarawas River back in April (see 
In March of this year, the Team Pennsylvania Foundation released a report called “Prospects to Enhance Pennsylvania’s Opportunities in Petrochemical Manufacturing” (see 
Here’s a case in Ohio that has the potential to impact Utica Shale, as well as conventional, leases. According to OOGA (the Ohio Oil and Gas Association) it has the potential to affect “the validity and viability of thousands of oil and gas leases across the state.” In brief, a conventional gas well was drilled on property in Washington County, OH in 1951. The landowner later agreed to exchange royalty payments for free, unlimited gas to her home. Leases can be terminated if they stop producing profitable amounts of oil and gas. Between 1977 and 1981 there was no commercial sale of gas from the well–but the landowner kept getting her free gas. Using that five-year period of time of no commercial output, the landowner filed paperwork to declare the lease has been terminated and reverts back to her, the landowner. The driller says she continued receiving her “royalty payments” (i.e. free gas) even though nothing was sold from the well–and that’s enough to keep the lease in effect. There appear to be strong arguments on both parts, and apparently this arrangement of receiving free gas in lieu of royalty payments is not uncommon in Ohio. So the Ohio Supreme Court will decide, having recently heard oral arguments…
The legal beagles of top energy law firm Babst Calland recently released their seventh annual energy industry report called, “The 2017 Babst Calland Report – Upstream, Midstream and Downstream: Resurgence of the Appalachian Shale Industry; Legal and Regulatory Perspective for Producers and Midstream Operators.” This latest annual review chronicles the comeback of the Marcellus/Utica and what challenges lie ahead. In an MDN exclusive, we have the first seven pages of the 74-page report (see below), along with details on how you can request a full copy. Worth the read! Here’s an overview…
The TriState Infrastructure Council (TSIC) was founded in Pittsburgh in late 2016 to “serve a broad-based business community during the critical next few years by attracting and deploying investments in infrastructure projects in Ohio, Pennsylvania and West Virginia.” With infrastructure upgrades, the region will be able to realize economic growth resulting from petrochemical manufacturing and related industries in the Appalachian basin. One of the driving forces behind TSIC is a name you are likely familiar with: Kathryn Klaber. Katie Klaber founded and until a few years ago led the Marcellus Shale Coalition. She opted to focus on her consulting practice following the MSC and is now managing the TSIC. The TSIC organization was founded with a group of A-list companies located in the region. At this week’s Northeast U.S. Petrochemical Construction conference in Pittsburgh, Katie unveiled an exciting new project to map infrastructure in an 82-county region throughout the Ohio River Valley. The aim is to identify missing/key/critical infrastructure components and then work to set up public-private partnerships to get those components built. The TSIC is looking at “electric transmission and distribution, pipelines, natural gas and natural gas liquid storage capacity, reliable locks and dams, rail networks, roads and bridges, water and sewer, building sites, barge loading/unloading facilities, broadband, fiber optics, and air service, among others.” And yes, the Marcellus/Utica shale is the linchpin that holds it all together–makes it all possible–and the raison d’être for the TSIC. Here’s more on the new infrastructure database, the TSIC, and how they are giving the shale industry a big assist…
Rover Pipeline (i.e. Energy Transfer) has settled an ongoing dispute with the Ohio State Historic Preservation Office (a PRIVATE organization) to pay them $1.5 million in what MDN views as shakedown money. Which is far less than the “asking” price of $1.5 million PER YEAR over the next five years ($7.5 million total). The payment comes after Rover paid the same organization $2.3 million for knocking down a dilapidated old house that was under consideration to be added to the National Register of Historic Places. In addition to the $2.3 million paid for This Old House, the Ohio State Historic Preservation Office said they had worked out a deal with Rover to pay the organization $1.5 million as compensation for something they haven’t even done yet but presumably will do–disturbing other “historic sites” as the pipeline cuts across the state. Apparently the history buffs felt the agreement was for $1.5 million per year over the next five years. Rover said (in so many words), “in your dreams.” No way. So the matter was referred to the Federal Energy Regulatory Commission (FERC) for dispute resolution. Before FERC could render a decision, the history buffs settled with Rover for a one-time additional payment of $1.5 million (a $1.5M bird in the hand is worth more than a $7.5M bird in the bush). Here’s the background for this shakedown, and a copy of the signed agreement stipulating a one-time payment of $1.5 million to the PRIVATE Ohio State Historic Preservation Office…
Rover Pipeline, Energy Transfer’s $3.7 billion, 711-mile Marcellus/Utica natural gas pipeline that will run from PA, WV and eastern OH through OH into Michigan and eventually into Canada, will almost certainly not go online in July as originally planned–at least according to an article on The Street evaluating the project and its builder, Energy Transfer. At the heart of the delay is a series of spills that have occurred while drilling underground, horizontally, under rivers and creeks (and other structures) in which drilling mud has spilled. The largest such spill, to date, happened on April 13 when around 2 million gallons of drilling mud spilled close to the Tuscarawas River (see 
The Ohio Dept. of Natural Resources (ODNR) has just issued production numbers for the first quarter of 2017. The bad news is that oil production continued to slide in 1Q17, down 29% from the same quarter in 2016. However, that’s an improvement from 4Q16 when oil production was down 44% (see