Oilfield Serv. Co. Relocating Office & 200 People from WV to PA

In early 2017, Baker Hughes (prior to GE buying them) spun off its North American shale fracking business (“pressure pumping”) into a new, standalone company called BJ Services (see 3 Parents Give Birth to New Fracking Co: BJ Services). The “new” company involved investments and assets contributed from both Goldman Sachs and CSL Capital Management, in addition to BH. BJ Services used to exist as a standalone company before it was purchased by, and merged into, Baker Hughes in 2009–for $5.5 billion. BJ remained its own separate division within BH, but then got spun out again, back into its own company. We know, a bit confusing. Here’s what you need to know. In March 2016, BH closed its BJ operation in Mill Hall (Clinton County), PA and moved it to Clarksburg (Harrison County), WV. Now the reverse is happening. BJ, the standalone company, announced it is closing the Clarksburg operation and relocating it back to Mill Hall, along with some 200 people…
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Marcellus-Fired Electric Plant in Clinton County, PA Gets DEP Approval

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Last July MDN brought you news about a new Marcellus-fired electric plant planned for Clinton County, PA (see New Marcellus-Fired Electric Plant Coming in Clinton County, PA). The $800 million Renovo Energy project (in Renovo, PA) will be a 950-megawatt dual fuel (natural gas and ultra-low sulfur diesel) combined cycle electric generating plant located in the Renovo Industrial Park. The official application for the project was filed with the PA Dept. of Environmental Protection (along with an application fee of $29,700) in August 2015. Yeah, it takes a looooong time to get these things approved. However, a key (perhaps THE key) permit needed by the PA DEP was issued over the weekend. The DEP approved Renovo’s application for an air quality permit for the project. An official working with Renovo says recent rumors that plans to build the plant are dead is false. He said construction may start by the end of this year, after a few more kinks are worked out…
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Ultra Petroleum Sells Its 72K Marcellus Acres to Alta Res. for $115M

Ultra Petroleum, based in Houston, TX, is an independent exploration and production (E&P) company mainly focused on drilling in the Green River Basin of Wyoming. Ultra also drills for oil in the Uinta Basin/Three Rivers area in Utah. In addition, Ultra maintains a “non-operated” (someone else does the drilling) position in the Pennsylvania Marcellus shale with leases on 72,000 net acres–no small amount. As recently as May of this year Ultra CEO Michael Watford signaled that the Marcellus acreage is not a drain on their budget, so they would just hold on to it and see what happens (see Ultra Petroleum 1Q17 – Holding on to 72K Marcellus Acres, for Now). What happened is the company saw an opportunity to cash in that acreage, and the wells producing on it, for $115 million in cold, hard cash that they can use elsewhere. Ultra announced a deal yesterday to sell all of their Marcellus acreage/wells, mostly located in Centre and Clinton counties in north-central PA, to Alta Resources. Alta is not a name we’ve seen a lot, but they were one of the first drillers we wrote about just after starting the MDN website back in 2009 (see Texas Billionaire George Mitchell is Betting on the Marcellus in PA). George Mitchell, widely recognized as the father of shale energy, was a partner in Alta and had glowing things to say about the Marcellus. Mitchell died in 2013. His legacy lives on. According to Alta’s website, the company has drilled or participated in more than a thousand wells–in Arkansas, Texas, Louisiana, Alabama, Pennsylvania and Alberta, Canada. The most recent news related to Alta in our area, prior to yesterday’s announcement, was their purchase of Anadarko’s Marcellus assets for $1.24 billion in December 2016 (see Anadarko Sells All Marcellus Assets for $1.24B to Alta Resources). Seems like December is the month to watch for an Alta purchase in the Marcellus!…
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Central PA Counties form Co-op to Expand NatGas Service Locally

Juniata County just became the fifth central Pennsylvania county to join the SEDA-COG Natural Gas Cooperative. SEDA-COG stands for Susquehanna Economic Development Association – Council of Governments. Collectively, SEDA-COG is a group of 11 central PA counties. The other four counties that belong to the Natural Gas Cooperative include Clinton, Centre, Mifflin, and Perry. So what’s the big deal about this group? In 2013 MDN reported that SEDA-COG was working on an initiative to bring natural gas to more residents and businesses in their collective 11-county region (see Central PA Counties Cooperate on Infrastructure for More Gas Use). That cooperative effort eventually, in early 2016, gave birth to the SEDA-COG Natural Gas Cooperative group. Between 2014-2016 SEDA-COG conducted two studies to identify key targeted investment areas for establishment or expansion of natural gas service in its 11 member counties. Earlier this year, they issued a final report (full copy below). The report outlines ways in which the counties can cooperate to bring new gas infrastructure (distribution pipelines) to the region–delivering gas to homes and businesses. It is local government at its best, putting their heads together to benefit the entire region. The great news is that these central PA counties either have local shale wells, or are situated close to abundant shale production in nearby counties. Now it’s just a matter of getting folks hooked up to the gas…
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Fed Court Exonerates Anadarko in PA Wrongful Death Lawsuit

In May 2012 a water truck driver delivering water to an Anadarko Marcellus Shale well pad in Clinton County, PA missed a turnoff for the road he was supposed to take, at 2:30 am in the morning. A couple of miles later he crashed and tragically died because the road he was on was not marked well and not conducive to the truck he was driving. There was a sign warning the driver not to go beyond a certain point. The driver had previously–that night–already delivered to the well pad and successfully turned onto the road he was supposed to take. Why did he miss it the second time? His widow maintains that even though he worked for a subcontractor, Anadarko was the company in charge and should have had a light illuminating the “No Anadarko Traffic Beyond This Point” sign. So she sued Anadarko, and the subcontractor, for wrongful death. Lower courts threw out the lawsuit but a federal appeals court reinstated a civil suit against Anadarko (see Fed Court Rules PA Wrongful Death Lawsuit Against Anadarko Proceeds). The federal court has just ruled. The judge found that Anadarko is not at fault in this tragic accident…
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New Marcellus-Fired Electric Plant Coming in Clinton County, PA

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It seems like Marcellus gas-fired electric generating plants are popping up faster than early summer dandelions around Pennsylvania. However, appearances can be deceiving. Decisions and plans to build these vitally important energy infrastructure projects aren’t made at the drop of a hat. They take years. For example, we spotted an article about the groundbreaking for a new natgas electric plant in Clinton County, PA that will take place next year, in 2018. The $800 million Renovo Energy project (in Renovo, PA) is a 950 megawatt dual fuel (natural gas and ultra-low sulfur diesel (ULSD)) combined cycle electric generating plant proposed for the Renovo Industrial Park. Clinton County is located in central PA, surrounded by prolific Marcellus-producing counties including Lycoming, Centre and Tioga. This recent article is the first we had heard of the plant. However, the plant was first announced in April 2015. The official application for the project was filed with the PA Dept. of Environmental Protection (along with an application fee of $29,700) in August 2015. Here is the information we could locate on this power plant, including the full application (with site plan), and a reference that plant will get its gas from the Dominion Transmission interstate pipeline…
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Gas-Related Water Well Survey Coming in Clinton County, PA

Letters are on their way to 283 Clinton County, PA property owners asking them to participate in a “free” (i.e. paid for by taxpayers) sampling of their well/drinking water supply. The U.S Geological Survey is conducting a study in the area in part to gauge the impact of nearby shale drilling on water supplies. What’s that? Is there ANY Marcellus drilling in Clinton County? As it turns out, there are a few wells–or at least there have been a handful of permits issued over the years, so we’re guessing some of those permits turned into drilled wells. Hey, we’re not complaining. Every time these types of studies are done they always come out the same way: shale drilling doesn’t impact water drinking water supplies. So have at it. We can always use yet one more study to prove what has already been proven…
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Baker Hughes Closes $40M Facility in Clinton County, PA

The slowdown in Marcellus drilling continues–and it continues to take a big bite out of local jobs and local economies. The latest victim comes in Clinton County. Baker Hughes has closed its pressure pumping facility in Lamar Township in Clinton County. That $40 million facility was only opened in 2012. The company, which has laid off thousands of people over the past year or so, says those who worked at the Clinton facility “may be eligible for redeployment.” Here’s the sad news…
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Fed Court Rules PA Wrongful Death Lawsuit Against Anadarko Proceeds

court-gavel.jpgIn May 2012 a water truck driver delivering water to an Anadarko Marcellus Shale well pad in Clinton County, PA missed a turnoff for the road he was supposed to take, at 2:30 am in the morning. A couple of miles later he crashed and tragically died because the road he was on was not marked well and not conducive to the truck he was driving. There was a sign warning the driver not to go beyond a certain point. The driver had previously–that night–already delivered to the well pad and successfully turned onto the road he was supposed to take. Why did he miss it the second time? His widow maintains that even though he worked for a subcontractor, Anadarko was the company in charge and should have had a light illuminating the “No Anadarko Traffic Beyond This Point” sign. So she sued Anadarko, and the subcontractor, for wrongful death. Lower courts threw out the lawsuit but a federal appeals court has just reinstated a civil suit against Anadarko that will go to a jury…
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PA University First to Operate CNG-Powered Commuter Trolley

We certainly hope this portends a trend. Lock Haven University (Clinton County, PA) is the first PA institution of higher learning to have its very own compressed natural gas (CNG)-powered commuter trolley which is now scooting students hither and yon around town. Radically lower air emissions, way cheaper to operate–what’s not to like? All thanks to cheap, abundant, fracked Marcellus Shale gas.

Ding ding. All aboard!…
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Central PA Counties Cooperate on Infrastructure for More Gas Use

A new initiative in central Pennsylvania aims to make it easier for residents, businesses and drivers to take advantage of the abundant, cheap Marcellus Shale gas being produced all around them. The new initiative is being led by the SEDA Council of Governments (or SEDA-COG), a multi-county economic development agency in central PA.

The $160,000 project will identify areas where new infrastructure (pipelines, rail, filling stations, etc.) can be built to deliver natural gas for those hungry to begin using it…
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The Two (Drilling) Faces of PA Gov. Ed Rendell

Is Pennsylvania Gov. Ed Rendell pro- or anti-drilling? Darned if I can tell. In some ways he has encouraged and allowed drilling to flourish in PA under his watch, something PA landowners should be thankful for. But it seems he has to keep some in his own party appeased, so he often talks down drilling. In typical politician fashion, he talks out of both sides of his mouth. The latest example is today. One headline trumpets that Rendell has signed a deal with Anadarko for $120 million (Anadarko to pay Pennsylvania $120 mln for drilling – Reuters) to allow drilling on an additional 33K acres. But another headline says Rendell backs a stop to further leasing of PA public lands (Rendell backs halt to gas leasing in public lands – CBS/Channel 21), as if he’s champion of the anti-drillers. What gives?

Well, it’s the same Ed Rendell on the same day walking a tightrope. He did indeed sign a deal with Anadarko to lease land that is supposedly surrounded by other public land already leased for drilling and so, as the thinking goes, the newly leased land won’t be “disturbed” all that much since most of the drilling operations will be from adjacent land. But now that he’s got his fist-full of $120 million, he immediately announces he’s now on board with no further leasing (after today, of course). Methinks he’s not going to make either side happy—but then he’s not running for re-election. What a strange character, that Gov. Rendell.

Press release from Gov. Rendell’s office putting the master spin on today’s high-wire act:

Harrisburg – Governor Edward G. Rendell announced today that the Department of Conservation and Natural Resources has finalized a responsible natural gas lease agreement by which Pennsylvania will meet its need for revenue from drilling next year, while also fulfilling its obligation to protect Pennsylvania’s natural resources.

Under the agreement, Anadarko Petroleum Corp. has paid the commonwealth $120 million to access 32,896 acres that are surrounded by tracts of land for which drilling companies already hold lease agreements. Because these newly leased tracts can largely be accessed by gas operations on the adjacent tracts, the amount of new state forest surface area that must be disturbed is minimized.

Other than the agreement, the commonwealth will not have to make any additional state forest land available to reach its revenue goals for natural gas drilling in the 2010-11 fiscal year.

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Mud Spill at Drilling Site in Central PA Due to Human Error

There was a mud spillage at a drilling site on Friday, April 2nd in Pennsylvania. The site is located on state-owned land—the Sproul State Forest in north-central Pennsylvania. The drilling was being done by Anadarko. According to reports:

An estimated 8,000 to 12,000 gallons of mud used by Anadarko E&P Company Inc. for drilling operations overflowed at the well site due to human error, said Daniel Spandoni, spokesman for the Department of Environmental Protection in Williamsport.

While about half of the mud spilled over the boundary of the well pad, it didn’t spread far enough to contaminate any surface waters, ground water or wetlands in the area, Spandoni said. A contractor began cleanup work Friday night. DEP officials have taken mud samples to determine a proper disposal method.

The mud is used as a cooling agent in drilling operations. Since the mud that spilled is synthetic-based, it doesn’t contain any diesel fluids as some other agents do, said Spandoni.*

*Hazelton Standard Speaker (Apr 2) – Mud spill at drilling site contained

Ultra Petroleum Expands Marcellus Leases to 486,000 Acres and 110 Active Wells in 2010

Ultra Petroleum News Release (Feb 12)
Ultra Petroleum Reports Strong Financial and Operating Results and Record Production for 2009

A portion of the release relating to its operations in the Marcellus in PA is extracted below:

During 2009, Ultra drilled 37 gross (22.5 net) wells in Pennsylvania. The company’s first production in the Marcellus program began in July 2009, and by year-end 13 wells were producing. Initial production (IP) rates for the producing wells average 7,500 Mcf per day with an average lateral length of just over 3,800 feet. Preliminary estimated ultimate recoveries affirm Ultra’s 3.75 Bcfe type-curve, with some preliminary EURs exceeding 6.0 Bcfe. The cost to drill and complete a horizontal Marcellus well during 2009 was $3.5 million.

The company’s four pipeline interconnects to major interstate pipelines remain well ahead of the drilling campaign. By mid-year, this interconnect capacity is expected to exceed 560 MMcf per day.

The company began 2009 with 288,000 gross (152,000 net) acres in the Marcellus. Through a combination of land acquisitions, trades and swaps, Ultra increased its holdings to 326,000 gross (169,000 net) acres by year-end. On December 21, 2009, Ultra announced that it had signed a purchase and sale agreement to acquire approximately 160,000 gross (80,000 net) acres in the Marcellus Shale. Upon closing of the acquisition in late February 2010, the company will hold approximately 486,000 gross (249,000 net) acres. With the acquisition, the company’s core position in Tioga, Bradford, Lycoming, and Potter counties in north-central Pennsylvania will expand to include the adjacent counties of Clinton and Centre.

In 2009, we initiated our horizontal Marcellus activity with above expectation results. Accordingly, we believe that we have substantially de-risked our Marcellus acreage due to these results. Well performance is improving along with our returns. Of the horizontal wells that we have completed so far, IP rates have ranged from over 3,400 Mcf per day to 10,400 Mcf per day, including two wells that are producing over 7,500 Mcf per day after 30 days. Examining our early wells, the first six have 30-day production averaging over 3,000 Mcf per day with the next seven wells averaging over 5,700 Mcf per day. In 2010, our Marcellus development program will expand with a drilling program exceeding 110 wells.

Waste Water Treatment Plants the Next Battleground in the Drilling Debate

Harrisburg Patriot-News (Nov 18):
Twelve Marcellus Shale gas drilling wastewater treatment plants proposed in northern Pennsylvania

Water treatment plants are the next battleground in the drilling debate. There is increasing opposition to the licensing of treatment plants, not only because of the chemicals used, but the truck traffic involved. From this article out of Harrisburg:

The state Department of Environmental Protection is reviewing permit applications associated with at least 12 different proposals to build treatment plants for chemical-tainted wastewater from natural gas drilling operations in northern Pennsylvania.

Ten of the plants are proposed in DEP’s 14-county north-central region, which is centered on Lycoming and Clinton counties.

Also from this article, a few stats of interest:

Through October, 120 of the 1,592 Marcellus Shale well drilling permits issued by DEP this year were for sites in Susquehanna County.

And this:

DEP issued 1,592 Marcellus Shale gas well drilling permits in the first 10 months of 2009. More than one-third of them were in the 14-county north-central region.