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NAPE Takes Shape – Speakers Announced for April 10 Program

For anyone in the orbit of Pittsburgh, or for those already planning to attend, MDN editor Jim Willis will attend the North American Prospect Expo (NAPE) in Pittsburgh next week, April 10-12. This is the first time NAPE has come to Pittsburgh—the big annual event is held in Houston each year. The Pittsburgh event is called NAPE East and promises to be a great show. Please stop by the Shale Daily booth (# 205) and say hello to Jim!

Yesterday, NAPE released their lineup of “distinguished speakers and panelists” speaking during the Business Conference portion of the event, held on the first day, April 10 (see below). Here’s the press release about next week’s event and list of speakers for the first day:

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Winners Announced for Northeast Oil & Gas Awards 2012

Launched in 2012, Oil & Gas Awards has just held its first regional awards for the northeastern United States, the “Northeast Oil & Gas Awards” ceremony, held in Pittsburgh on March 14 at the Westin Convention Center. Outgoing PA DEP Secretary Michael Krancer was the guest of honor.

In all, 19 different awards were handed out in categories ranging from law firm of the year to drilling & well services company of the year (and many others). Here’s the complete list of winners, and more information about the awards:

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USGS Study: Marcellus Drilling Fragmenting Forests in PA

The U.S. Geological Survey earlier this week released a new report raising concerns about Marcellus Shale drilling in the Allegheny Plateau (pretty much the entire Marcellus region). The 38-page report (full copy embedded below) looks at two counties in particular: Susquehanna County in northeastern PA, and Allegheny County in southwestern PA.

Using a series of maps and data, the authors raise concerns that Marcellus drilling, along with drilling for gas in coalbed methane (a similar process), is leading to “forest fragmentation”—a situation where forested areas get “carved up” with roadways and drill pads that lead to limiting the geographic habitat area for some species of animals:

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PA Town First to Try Regulating Pipelines – Will Ordinance Stand?

On Monday, supervisors for Forward Township (Allegheny County), PA unanimously approved what is believed to be the first (and perhaps an illegal) zoning ordinance targeting and extensively regulating both gathering and transmission pipelines in the township. Sunoco is building a low-pressure liquid-gas transmission pipeline from a processing plant in Houston, Washington County that passes through about 275 properties in Forward to a distribution point in Delmont, Westmoreland County.

The town solicitor has said existing pipelines are not affected by the new ordinance. Problem is, interstate transmission lines are regulated by the federal government, and smaller gathering pipelines are regulated by the state. Pipelines are not regulated by municipalities. A lawyer at Babst Calland makes this observation on the ShaleEnergyLawBlog.com:

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Pittsburgh Driller & Gas Utility Co Want to Swap Assets

In a complex deal submitted to regulators last year, Marcellus driller and midstream company EQT Corp. and gas utility company Peoples Natural Gas want to do a swap. EQT proposes to trade/sell its natural gas utility division, called Equitable Gas, to Peoples, and in return EQT would get not only $720 million but also gas pipelines and storage facilities—called the Allegheny Valley Connector—from Peoples.

Once (if!) the deal is done, EQT will be totally focused on drilling and midstream and out of the utility market. EQT is currently shopping around prospective future capacity on the Allegheny Valley Connector to other drillers, to see what kind of interest they can generate:

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$50M Check in the Mail: Pittsburgh Airport Lease a Done Deal

The deal by CONSOL Energy to lease 9,000 acres owned by Pittsburgh International Airport for shale gas drilling is a done deal. Yesterday the Allegheny County Council voted to accept the deal. A few nut job protesters turned up in gas masks (as is their way). The vote was 9-4 in favor of the deal. Once County Executive Rich Fitzgerald signs it, the Airport Authority will receive a check for $50 million.

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CONSOL Increases Bonus Offer to Pgh Airport by 2.4 Times to $50M

MDN has been following the deal to lease 9,263 acres of Pittsburgh International Airport land for shale gas drilling. As you may recall, there were two bids submitted in December, one by CONSOL with an 18% royalty and signing bonus of $20.8 million, and one from EQT, also with an 18% royalty but a hefty $44 million signing bonus—more than twice that of CONSOL. Logic would dictate that EQT’s bid would be accepted. But it wasn’t. The Airport Authority chose to accept CONSOL’s bid, leading us to theorize that the “fix” was in (see Inside Job? Pittsburgh Airport Leases Land to CONSOL).

A few weeks later word came out that the Airport Authority was negotiating with CONSOL to get them to raise their signing bonus, which seemed strange to us. We’ve never heard of a government agency accepting a bid and then turning around and renegotiating it (see Pittsburgh Airport Wants More $ from CONSOL…After Accepting Bid). It appears that “further negotiation” was successful. The Airport Authority now reports they’ve approved a renegotiated deal with CONSOL with a $50 million signing bonus—nearly 2 1/2 times the original amount offered when the sealed bids were opened in December. Anyone else smell rotten fish?

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Permit for PA Frack Wastewater Plant Rescinded by DEP

A New Jersey company had plans (and a permit) to build a Marcellus Shale wastewater treatment plant in North Fayette, PA that would process between 1/2 and 1 million gallons of fracking wastewater per day. The plant would use the wastewater to produce road salt, sidewalk de-icer, roadway dust suppression liquids and other products. One small problem: there may be tiny trace amounts of arsenic, lead, mercury and other nasty compounds in the final products.

The Pennsylvania Dept. of Environmental Protection granted Integrated Water Technologies a permit last August to build the plant and sell the salts and liquids manufactured from wastewater for use throughout the state. However, anti-drilling group PennFuture appealed the permit and now the DEP is backpedaling and “quietly” rescinded the permit by publishing a notice in the Pennsylvania Bulletin on Saturday. Will the plant still be built?

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Pittsburgh Airport to Hold Public Hearing on Lease Deal

Since the middle of December MDN has been squawking about the Pittsburgh Airport’s decision to accept the (much) lower bid from CONSOL Energy to drill on 900 acres of airport-owned property (see Inside Job? Pittsburgh Airport Leases Land to CONSOL). Apparently others squawked too because a more recent story reported the airport is negotiating with CONSOL to double the bonus payment they just accepted (see Pittsburgh Airport Wants More $ from CONSOL…After Accepting Bid).

We expect board members from the Allegheny County Council—the people in charge of the airport and approving the deal—are about to get an earful at a public hearing about the deal being held on Feb. 7. Here’s the details for that hearing:

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Pittsburgh Airport Wants More $ from CONSOL…After Accepting Bid

The story of the Pittsburgh International Airport’s acceptance of a bid from natural gas driller CONSOL Energy to drill on and under airport property, a bid that would provide less than half the money that a bid from EQT would have provided, continues to get curiouser and curiouser (see Inside Job? Pittsburgh Airport Leases Land to CONSOL for background and MDN’s original comments).

Apparently MDN isn’t, as we had thought, the only one who noticed this deal smells to high heaven. The latest news: PIA is negotiating with CONSOL to get them to raise the signing bonus, which is now rumored to be somewhere in the neighborhood of “$35 million to $40 million.” That’s certainly better, but still not has high as EQT’s offer of a $44 million bonus payment.

And what’s with “negotiating” after a bid has been accepted? A bid is a bid—you accept or reject it, especially if a public agency is involved. You don’t accept an offer and then promptly start negotiating to change it! Something is still very “off” about all of this…

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Man Bites Dog: Pittsburgh Law Firm Opens Operation in Houston

In the news business, no one wants to run a story along the lines of “dog bites man”—that’s not news. But when the story is “man bites dog,” that’s news. This is one of those stories. Hardly a week goes by that MDN does not read about a law office expanding it’s practice somewhere in the Marcellus or Utica Shale region, many times it’s a branch office of a large Houston, TX law firm opening up in the Marcellus region. Such announcements are (let us be honest) self-serving advertisements to try and get business. Nothing wrong with that! But it’s not something MDN readers will be interested in reading about.

This time, however, a law office expansion is news. Why? Because it’s not a big Houston energy law firm setting up shop in Pittsburgh, but the other way around. For MDN, the story points out how the Marcellus Shale has changed the energy game in the U.S. and is, ever so gradually, shifting the center of power in the energy universe from Houston to Pittsburgh…

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Pittsburgh Cab Company Doubles Fleet of NatGas Vehicles

The next time you stand on the curb and holler “TAXI!” in Steel City you may just get a ride in a natural gas-powered vehicle. One cab company in Pittsburgh is doubling the number of natgas cabs in its fleet, saving its drivers more than a generous tip when it comes to fuel savings:

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Pittsburgh Airport Leases Land to CONSOL

the fix is in We have to wonder, was the fix in at the Pittsburgh Airport? MDN told you two weeks ago about the opening for two bids to drill on and under property owned by the Allgheny County Airport Authority (see this MDN story). EQT offered more than twice the per-acre signing bonus of CONSOL Energy. EQT’s bid to drill on 9,263 acres was $44 million!

On Friday, the Airport Authority announced that after two weeks of “very, very careful review” it has accepted CONSOL’s bid of $20.8 million as the representing the “best value.” Huh?

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Pittsburgh Airport Offered $44M Shale Drilling Lease Offer

100bullsThe Pittsburgh International Airport is about to get a huge cash infusion from the shale drilling industry—and it’s not from more passengers passing through the terminal (although that’s happening too). The airport previously floated a request for bids to allow drilling on and under its 9,263 acres. Wednesday morning they opened bids from two drillers: CONSOL Energy and EQT. One bid offered twice the lease payment per acre of the other bid.

Here’s the bid details (and a Marcellus and Utica Shale Databook lease offer map to provide context):

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Moon Twp, PA Votes to Ban Fracking in 75% of the Town

The Moon Township Board of Supervisors (Allegheny County, PA) voted last night to ban fracking in areas zoned for residential, commercial or educational uses. The vote revises Moon’s existing zoning ordinance to comply with the new Act 13 law which stipulates local municipalities cannot completely ban fracking.

Since no permits to drill have been applied for nor granted (yet) in Moon, the newly revised ordinance means landowners who previously signed leases and live in one of the banned districts will never be allowed to drill. A map showing where drilling is allowed indicates drilling will only be allowed in perhaps 25% of the town (see map below).

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