Weekly Shale Drilling Permits for PA, OH, WV: May 17-23
All three M-U states received permits to drill new shale wells last week, but the numbers were all down. Pennsylvania issued just 8 permits with 6 in the northeastern part of the state and 2 in the southwestern region. Ohio issued four permits, all for the same driller on the same well pad in the same county. And West Virginia issued just one new permit for last week.
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At some point in the distant past (during our lifetime) swamps got renamed to “wetlands.” Don’t you just love how the left euphemizes everything? Chesapeake Energy is a bad actor when it comes to shafting landowners out of royalties, we’ll grant you that. However, the company must now pay Pennsylvania and the federal government (DOJ and EPA) a combined $1.9 million for “failure to identify and protect wetlands at 76 oil and gas well sites in Pennsylvania.” In other words, failure to protect swamps.
We’ve written plenty about Shell’s mighty ethane cracker plant project happening in Beaver County, PA. It is one of the biggest construction projects currently underway in the entire country. When the COVID-19 pandemic hit one year ago, the construction site closed down, going from 8,000 workers to a skeleton crew of 300. The way Shell handled the closure, and handled the subsequent reopening, is worth understanding and studying.
In February 2020, Pennsylvania Dept. of Environmental Protection (DEP) Secretary Pat McDonnell sent a letter to the federal Pipeline and Hazardous Materials Safety Administration (PHMSA). McDonnell’s letter alleges Shell’s 97-mile, two-legged Falcon pipeline system that will carry ethane to the mighty Shell cracker plant now under construction in Beaver County, PA, “may have been constructed with defective corrosion coating protection.” It’s an explosive charge just coming to light now, more than a year later.
Some two and a half years after Energy Transfer’s (ET) Revolution Pipeline entered service in western Pennsylvania and exploded following a landslide, the pipeline finally returned to service yesterday. The Pennsylvania Dept. of Environmental Protection (DEP) issued a press release to say it had extracted another $125,000 from ET and has allowed the pipeline to resume service.
It’s been a long road, but we’re nearing the end. Shell’s $6 billion ethane cracker plant, officially called the Pennsylvania Petrochemicals Complex (PPC), is close to being done. It’s likely the PPC, located in Beaver County, PA, will be up and running sometime next year. When it is, the market for Marcellus/Utica NGLs will profoundly change. PPC will use an average of 85,000 barrels per day of M-U ethane. Our ethane will no longer be a waste product that many drillers pay to get rid of, but rather a profitable product they sell.
The Community College of Beaver County’s (CCBC) Shell Center for Process Technology, a $5 million state-of-the-art training facility, has just officially opened. While the Center was built to train employees to run the Shell ethane cracker plant, it’s also training people for a myriad of other opportunities too.
In line with a rise of COVID-19 cases in the general population throughout the state of Pennsylvania (and elsewhere), workers at the Shell ethane cracker site in Monaca, PA (near Pittsburgh) have seen a big jump in active coronavirus cases. As of yesterday, the number of active cases stood at 39. Wednesday the number was 31. Shell says most if not all of the cases are coming from offsite and onsite transmission among the 7,000 active workers is not a factor in the rising number.