Pennsylvania

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    FERC Review of Risberg Pipeline in NE OH/NW PA Coming June 29

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    Last October MDN brought you details about the proposed $86 million Risberg Line pipeline project (see New 60-Mile Pipeline Proposed from NW Pa. to NE Ohio). The project will use approximately 32 miles of existing pipeline in an established Right of Way originating in the Meadville, PA area. Approximately 16 miles of new pipeline will be installed in Pennsylvania and approximately 12 miles of new pipeline will be installed in Ohio–meaning 28 miles of brand new “greenfield” pipeline needs to get built. Two school districts in Ohio where the pipeline will traverse agreed to reduce the amount of property tax the pipeline would need to pay by 75% over a 15-year period, a huge vote of confidence (see Update on Proposed 60-Mile Pipeline from NW Pa. to NE Ohio). We have an update on the project. On Tuesday, the Federal Energy Regulatory Commission (FERC) said it will issue an environmental assessment (EA) for the project on or by June 29th. Both the U.S. Army Corps of Engineers and the Pennsylvania Fish and Boat Commission are “cooperating agencies” and part of the EA review process. Following the EA, the clock will begin ticking and FERC will have until Sept. 27th to make a final decision about the project…
    Read More “FERC Review of Risberg Pipeline in NE OH/NW PA Coming June 29”

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    New Bills Limit PA DEP Permit Appeals, Reduce Enviro Judge Terms

    As we reported yesterday, Big Green radicals in Pennsylvania are grumpy that the PA House passed five bills meant to fix the dysfunctional PA Dept. of Environmental Protection (see PA House Passes 5 Bills to Fix Broken DEP, Environuts React). Conservative Republicans in the House continue to play offense (which we love). On Monday of this week, PA Sen. Camera Bartolotta (R-Washington) sent around a memo to fellow House members asking them to co-sponsor two new bills she plans introduce. The first bill will narrow the grounds on which a DEP-issued permit may be appealed. Antis love to file endless appeals of permits for drilling and pipelines, dragging out the process in hopes of eventually defeating a given project. The first bill will fix that. The second bill reduces the terms of sitting Environmental Hearing Board judges. If a judge has been on the bench for 10 or more years, their term will expire and they will not get a chance to continue. The second bill is aimed at draining the EHB swamp (pun intended). Both bills are common sense measures, and of course, Big Green radicals are already howling at the moon because of them…
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    Antis Weaponize PA Enviro Rights Amendment in Effort to Kill Shale

    AR-15 rifle

    The Pennsylvania Environmental Rights Amendment (ERA), passed by the good citizens of PA in 1971, is a poorly worded piece of legislation with good intentions, adopted in a hurry in response to a disaster. Like all legislation that’s hurried and adopted in response to disasters (natural or man-made), the ERA is deeply flawed. Antis are now using the ERA as a bludgeon–perhaps a better analogy is more like an AR-15 semi-automatic rifle–in their attempt to assassinate the Marcellus Shale industry. Unfortunately, they are having some success in the PA court system. The ERA laid dormant after its adoption until an awful PA Supreme Court decision in 2013 breathed new life into it for antis (see Ongoing Fallout from PA Supreme Court’s Wrong Act 13 Decision). Since that time, antis have sued drillers and pipeline companies a number of times, citing the ERA, and in some cases winning (see PA Anti Strategy: Weaponize Recent Court Ruling Against Shale Dev). Emboldened by these wins, “Article 1, Section 27” as the ERA is known, is being employed in more places, even (especially) outside the court room…
    Read More “Antis Weaponize PA Enviro Rights Amendment in Effort to Kill Shale”

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    PA House Passes 5 Bills to Fix Broken DEP, Environuts React

    In March the Pennsylvania House State Government Committee debated and voted to approve a slate of five bills aimed at fixing not only the slowmo way the state Dept. of Environmental Protection (DEP) approves shale permits, but also roll back some of the egregious regulatory overreach that now exists in PA (see PA House Committee Approves 5 “Fix DEP” Bills – What’s Next?). The vote to report the bills out of committee was along party lines, with zero liberal Democrats voting in favor of fixing the DEP. In a move that has alarmed and angered Big Green and its supporters, all five bills were voted on by the full House yesterday–and all five passed! Once again, not a single Democrat voted to fix the DEP. What happens now?…
    Read More “PA House Passes 5 Bills to Fix Broken DEP, Environuts React”

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    Broken Record: Wolf, Dems & RINOs Float 4% Severance Tax

    Every year it’s the same thing from “America’s most liberal governor,” PA’s Gov. Tom Wolf: propose a severance tax on natural gas production, a tax in addition to the existing impact tax (which is already the equivalent of a severance tax), and demagogue the issue in hopes of shaming/pressuring/bullying Republicans into passing such a tax. When/if such a tax is passed, give every last dime of it to teachers unions in the Philadelphia area–the people who elected Wolf to office. That’s been Wolf’s modus operandi since he assumed office. And it has just happened again, for the fourth time. Wolf, along with two liberal Democrats and two Republicans in Name Only (RINOs, from the Philly area) gathered yesterday to announce new severance bills introduced in both the PA House and Senate that will slap a Marcellus-killing 4% tax on shale production, on top of the existing ~4% impact tax. Here we go again…
    Read More “Broken Record: Wolf, Dems & RINOs Float 4% Severance Tax”

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    PA Court Rules ME2 Pipe has Power of Eminent Domain, Period

    One of the ways anti-fossil fuel groups have tried to stop the Mariner East 2 Pipeline project is by tying it up in court. Various lawsuits have been filed going back years (see our list of lawsuit stories here). One litigant, a Big Green group headquartered in Philadelphia, the so-called Clean Air Council, has tried repeatedly to get the courts to deny ME2 the right to use eminent domain in cases where landowners refuse to cooperate (see Clean Air Council’s Strange War Against Mariner East Pipeline). CAC argued that ME2 is not a “public utility” and therefore not entitled to the use of eminent domain. That argument flamed out. They also argued since ME2 crosses a state boundary–into a small part of Ohio–it’s not an intrastate but interstate project and should be subject to the Federal Energy Regulatory Commission (FERC) instead of the PA state Public Utility Commission (PUC). That argument bombed too. CAC then argued ME2 is using a public taking for a private enterprise (not for the public good). Also tossed out. A court case that began in 2015 made its way to the PA Commonwealth Court and yesterday the Commonwealth Court finally shut down the CAC’s long-running lawsuit once and for all, denying their wild claims…
    Read More “PA Court Rules ME2 Pipe has Power of Eminent Domain, Period”

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    ATF Cuts Back on Agents Hunting for Perps Who Stole Dynamite

    As we previously reported, someone(s) stole a bunch of dynamite and the blasting caps (used to ignite the dynamite) on the weekend of April 14-15 from a locked storage trailer sitting at an Atlantic Sunrise Pipeline construction site in Lancaster County, PA (see Dynamite Stolen from Atlantic Sunrise Pipe Site in Lancaster County, PA). The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) immediately swung into action, offering $20,000 for information leading to an arrest and flooding the county with agents (see ATF Doubles Reward re Stolen Dynamite; 40 Agents in Lancaster Co.). Then last week, someone discovered some, perhaps all of the stolen dynamite (see Stolen Dynamite from Atlantic Sunrise Site Discovered in Creek). The ATF has still not found a suspect. They now believe the amount of dynamite recovered was all of it. Some 10 agents are left in the county, working their way through interviewing 900 workers who had access to the site…
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    Atlantic Sunrise Doles Out $264,300 in Grants to Schools, Towns

    Pipeline companies are known for their largess in showering local schools, towns and nonprofit agencies with money for worthy causes. Among those who engage in this civic practice is Williams’ Atlantic Sunrise Pipeline project. Atlantic Sunrise is a $3 billion, 198-mile pipeline project running through 10 Pennsylvania counties to connect Marcellus Shale natural gas from northeastern PA with the Williams’ Transco pipeline in southern Lancaster County, PA. In 2015, the Atlantic Sunrise Community Grant Program was established to benefit community organizations in communities within the Atlantic Sunrise footprint. Since 2015, the Atlantic Sunrise has doled out more than $2 million across the 10-county project area in support of noteworthy projects. And they’ve just done it again. A total of 41 PA organizations have just received a total of $264,300 in contributions–more than a quarter of a million dollars! We have the full list below, along with information about how your organization can apply for the next round…
    Read More “Atlantic Sunrise Doles Out $264,300 in Grants to Schools, Towns”

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    Cabot O&G 1Q18: Important New Markets Opening Up Now

    Note: A previous version of this post incorrectly stated Cabot is pumping 3.75 Bcf/d of natural gas now. The correction is that according to the CEO, the company has the capability to pump that much as soon as all pipelines are in place and existing planned wells are online–likely in 2020. We regret the error!

    One of our favorite Marcellus drillers, Cabot Oil & Gas, provided their first quarter 2018 update on Friday. Cabot never disappoints! What did we learn from the update? For one thing, when all pipeline infrastructure is in place and all planned wells are drilled and online, the company will be pumping a massive 3.75 billion cubic feet per day (Bcf/d) of natural gas out of Susquehanna County, PA. Cabot is working with Williams to increase the capacity of their gathering system to support even more gas than 3.75 Bcf/d. It would not surprise us if Cabot becomes the first 4 Bcf/d Marcellus/Utica driller in the next few years. So Cabot has plenty of production. What about demand? Lots of production with little or no demand equals prices in the basement. There was good news on the demand front too. Cabot said there are two gas-fired electric plants starting up by June 1st–both of them powered with Cabot Marcellus gas. Add to that the now-operational Cove Point LNG export plant with Cabot’s contract to sell gas to Japan–and it equals a massive increase in demand for Cabot’s gas going into the second quarter. Later this year, in the second half sometime, Atlantic Sunrise will come online increasing Cabot’s flow to new markets even more. We’d call Cabot’s Friday 1Q18 update the “stars are finally in alignment” update for Cabot. Here are some more pickings from the update, along with a copy of the full update…
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    EQT Pays PA DCNR $874,200 to Lease Under Ten Mile Creek

    This is a story that continues to bug us. The state of Pennsylvania, specifically the Dept. of Conservation and Natural Resources (DCNR), is grabbing money that we think belongs to private landowners. The DCNR has been, for years, claimed that under a centuries-old law that the state of PA “owns” the property under “navigable” waterways–including rivers and streams (see PA DCNR Publishes Lease Agreements for Deals Under Rivers/Creeks). We understand the state claiming the Delaware River, and maybe the Susquehanna River, is a “navigable” body of water. The DCNR uses the “navigable waterway” excuse to sign leases with drillers under much smaller waterways than the Delaware and Susquehanna–siphoning money that would have gone to landowners. A landowner might own the land on both sides of, say, Ten Mile Creek, as we’re sure happens. However, the land under Ten Mile Creek does not technically belong to them. In fact, certain long portions of the land under Ten Mile Creek are now leased to EQT, and EQT paid handsomely for it. The company leased 218.55 acres under Ten Mile Creek in Greene and Washington counties (southwestern PA) for $874,200, which works out to be exactly $4,000 per acre! Not to mention a whopping 20% royalty! That’s money that (in our opinion) should go to the landowners who own the land along the creek, not to the state. Until landowners sue or the legislature acts, the state will continue to pick the pockets of landowners who own land along PA’s waterways…
    Read More “EQT Pays PA DCNR $874,200 to Lease Under Ten Mile Creek”

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    Cabot Says 2 NEPA Gas-Fired Plants Go Operational by June 1

    Lackawanna Energy Center – concept drawing

    Tucked away in the comments made by Cabot Oil & Gas CEO Dan Dinges on an investor conference call last Friday, MDN picked up on what we consider big news: Both the Moxie Freedom (Luzerne County, Wilkes-Barre area) and Lackawanna Energy Center (Lackawanna County, Scranton area) Marcellus-fired power plants are about to go fully operational–sometime in May (by June 1). Both plants will exclusively use Marcellus gas extracted by Cabot in Susquehanna County, PA. For nearly a year the plan had been for Moxie Freedom to be built and online in May of this year, so that announcement isn’t so much a surprise as it is welcomed news (see NEPA Moxie Freedom Power Plant on Track for May 2018 Launch). However, in March we reported Lackawanna was going through a “short” commissioning stage and would be firing up at any time (see Gas-Fired Power Plant Near Scranton Nears Startup; Yellow Smoke). The Lackawanna project has faced fierce local resistance. A group of Democrats got themselves elected to the local town board in Jessup, taking office in January, trying their best to block startup of the Lackawanna project by employing a Big Green lawyer (who works for Riverkeeper) at a cost to taxpayers of $225/hour. Looks like it was wasted money as Dinges says Lackawanna will be operational, with large volumes of Cabot gas flowing to it, within weeks…
    Read More “Cabot Says 2 NEPA Gas-Fired Plants Go Operational by June 1”

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    Philly Dem Senator Tries to Shut Down ME2 Pipe Construction

    PA State Senator Andy Dinniman

    A Chester County, PA (Philadelphia area) Democrat State Senator by the name of Andy Dinniman (who we think looks like Tony Soprano) continues his mission to stop the Mariner East 2 (ME2) project. This is nothing new for Dinniman. He’s been agitating and lobbying and demanding and pouting for over a year in his quest to shut down ME2 (see our Dinniman stories here). According to a press release from Dinniman issued last Thursday, the Senator has filed “a formal legal complaint and a petition for interim emergency relief with the Pennsylvania Public Utility Commission (PUC) to prohibit construction of the Mariner East 2 (ME2) and Mariner East 2X (ME2X) pipelines in West Whiteland Township.” Dinniman claims Sunoco Logistics Partners (builder of ME2) has 20 days to respond to the complaint. No doubt Sunoco will respond, and there’s little doubt the PUC will not do anything about Dinniman’s request…
    Read More “Philly Dem Senator Tries to Shut Down ME2 Pipe Construction”

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    XTO Plan to Drill Wells at Former Golf Course Delayed by Zoning Bd

    In February MDN told you that XTO Energy, the shale drilling arm of Exxon Mobil, has plans to begin drilling five new shale wells in Armstrong County, PA on a former golf course (see XTO Plans 5 Shale Wells at Former Golf Course in Armstrong County). XTO presented a plan in February to build a drill pad on what used to the seventh green at the former Phoenix at Buffalo Valley Golf Course in Freeport, PA. The plan calls for drilling 4 Marcellus wells and 1 Utica well on the pad. Some 20 residents showed up for the February meeting. Not a single one spoke out against the plan. Nor did any of the Freeport officials. Last night the Freeport Zoning Board met, ostensibly to vote on XTO’s plan. However, the officials delayed the vote, claiming “there was just too much information to digest.” No date is yet set for another meeting to consider XTO’s “too much information” proposal…
    Read More “XTO Plan to Drill Wells at Former Golf Course Delayed by Zoning Bd”

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    PA PUC Asks Sunoco to Drill Holes, Pour Concrete to Firm Up ME1

    For more than a year, Marcellus/Utica ethane and propane have been flowing through the converted Mariner East 1 (ME1) pipeline safely, hauling the two natural gas liquids (NGLs) from southwest PA all the way to the Marcus Hook refinery near Philadelphia. The primary shipper using ME1 has been Range Resources, although other companies like CNX Resources use it too. However, ME1 was suddenly switched off on March 3 by order of the Pennsylvania Public Utility Commission (PUC) after a sinkhole opened up under the pipeline in Chester County, exposing some of the bare steel to the open air (see PA PUC Shuts Down Mariner 1 Pipeline Due to Mariner 2 Sinkhole). Sunoco Logistics Partners, the owner of ME1, is building a new set of pipelines called Mariner East 2 (ME2) close to the existing ME1. Construction work in the area on ME2 led to the sinkhole that exposed ME1. The PUC shut down ME1 until further notice, requiring Sunoco to conduct a study of the area and provide the PUC with evidence to reassure them that ME1 is OK and will not leak or explode. Sunoco conducted the study, provided its results, and told the PUC it’s time to restart ME1–but the PUC is dragging its feet (see Sunoco Says ME1 Ready to Restart, but PUC is Dragging its Feet). The new news is that the PUC recently told Sunoco that before ME1 can restart, the company must first drill 10 new holes in the area of the sinkholes and pour in concrete (“grout”) in an effort to ensure ME1 doesn’t move around and break open…
    Read More “PA PUC Asks Sunoco to Drill Holes, Pour Concrete to Firm Up ME1”

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    Some PA Drillers Threaten to Spoil it for All via Royalty Shenanigans

    We’ve written a number of posts over the years about the ongoing, sometimes quiet sometimes not, civil war between Pennsylvania landowners and some (not all) drillers who use inflated post-production deductions to pad their own bottom lines, leaving landowners with peanuts–sometimes with no royalties at all (see Deep Dive: PA Royalties Civil War Between Landowners & Drillers). If we can oversimplify and summarize this complex issue, landowners maintain that a 1979 PA law guarantees landowners a 12.5% royalty regardless of expenses involved in extracting the gas, and drillers say no, landowners must abide by the contracts they’ve signed and if those contracts allow post-production costs to be deducted before calculating a royalty, the rate may go lower than 12.5%–sometimes to zero and below. PA landowners have, for the past six plus years, lobbied for legislation to clarify and protect a 12.5% minimum royalty. Today we have a guest post from the landowner point-of-view. Thad Stevens is a Gaines, PA resident and real estate developer. Thad has negotiated more than 50 oil and gas leases. He sits on the Dept. of Environmental Protection Citizen Advisory Council and is a director with the National Association of Royalty Owners PA chapter. We consider Thad a friend. He’s smart and he’s passionate about the the ongoing issue that some companies take inflated post-production deductions leaving PA landowners with little or nothing. Thad writes that some of PA’s gas drillers are displaying real arrogance in their attitudes toward the very people they need the most–landowners…
    Read More “Some PA Drillers Threaten to Spoil it for All via Royalty Shenanigans”

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    ME2 Pipe Work in Chester County Shut Down (Again) Following Leaks

    Hypersensitive: excessively or abnormally sensitive. That’s the word we would use to describe what’s happening in Chester County, PA–a suburb of Philadelphia–with regard to underground horizontal directional drilling work (HDD) being performed by Sunoco Logisitics Partners on the Mariner East 2 pipeline project. The company keeps having “inadvertent returns”–which we call leaks. Drilling mud (bentonite) used to cool the drill bit goes down the hole, and sometimes it pops back up on the surface in a different place from where it went down. Since the drilling mud is non-toxic clay and water (same stuff used to make kitty litter, toothpaste and lipstick), it’s no big deal. Unless there’s thousands of gallons of it turning up in a creek where it can smother fish and aquatic life. There’s cracks in the ground near the surface and sometimes the mud leaks out of those cracks. Sunoco must track leaks of down to less than one gallon. Antis look at the numbers and make wild claims that the pipeline has leaked “over 100 times” since drilling began. While technically true, many of those leaks are nothingburgers–not worth tracking or talking about (a few gallons at most). However, some of the leaks are big and yes, those do need talking about. Over the past week or so another four leaks have occurred in Chester County, totaling 8,000 gallons. Fortunately none of it ended up in a creek. Because of the leaks, the state Dept. of Environmental Protection (DEP) has, once again, shut down any further HDD work in Chester County…
    Read More “ME2 Pipe Work in Chester County Shut Down (Again) Following Leaks”