PA NatGas Production 2Q16 – DUCs Shrink, Production Grows
In the past we’ve been pretty critical of the Pennsylvania Independent Fiscal Office (IFO). It claims to provide revenue projections for use in the state budget process along with “impartial and timely analysis of fiscal, economic and budgetary issues to assist Commonwealth residents and the General Assembly in their evaluation of policy decisions.” It’s been our observation the IFO is populated with partisan Democrats. However, we have to acknowledge lately their analysis work, at least with regard to the Marcellus industry, has been pretty accurate (see PA Independent Fiscal Office Predicts Impact Fee Revenue for 2016). The IFO has just released another report–this one analyzing the first six months of monthly Marcellus gas production data issued by the state Dept. of Environmental Protection (DEP), comparing it with previous months and years (full copy of the IFO report embedded below). What’s obvious from the numbers is this: PA’s shale drillers are in the process of completing previously drilled but uncompleted wells (called DUCs), drawing down the number of DUCs available. The conclusion is inescapable: More drilling of new wells is on the way in PA in 2016…
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A great article in Investor’s Business Daily explores the link between shale gas and the “explosive expansion” of the U.S. petrochemical industry. Part of the petchem supply chain is finding a cheap source of ethylene, the raw material used in making all sorts of plastics products. Manufacturers get ethylene from ethane cracker plants. The article discusses that link, and the reasons why Shell chose to locate their new multi-billion dollar ethane cracker plant near Pittsburgh. As you can guess, economics play a major role in such a decision. Here are the specific economics that convinced Shell that PA is a good bet…
Imagine this: a backhoe sinks its bucket into the ground, scoops out some dirt, and the dirt is used to build a road. No big deal. Now imagine this, a very long drill goes down into the earth and digs out dirt. Because the dirt comes from deep down, some of it may be mixed with minerals not found near the surface, so a company processes the deep down dirt to remove any extra minerals, and the dirt is then essentially the same chemical composition as the dirt from near the surface–and it’s used to build a road. The dirt from deep down is called drill cuttings. Environmental Nazis repeat the magical incantation, “It’s been fracked!” and therefore they begin to hyperventilate that “fracked waste” is being used to build a road. Our example illustrates antis’ intellectual dishonesty about what drill cuttings are. When we spotted a story that a private hunting club in Lycoming County (Williamsport area) in PA will build a new road using processed drill cuttings, and the spin job done by the anti-drilling shills at the taxpayer-funded PBS StateImpact Pennsylvania, we had to laugh…
In June MDN reported on yet another new unlegislated law (called a “rule”) issued by the rogue federal Environmental Protection Agency (EPA) that bans the disposal of wastewater from oil and gas drilling via public wastewater/sewage treatment plants (see 
Recently a group of 12 Pennsylvania state representatives held a hearing in Armstrong County, PA on the topic of separate regulations for PA’s small conventional vs large shale drillers. You may recall that new drilling rules from the state Dept. of Environmental Protection (DEP) have been approved for shale drillers, called Article 78a, but not for conventional drillers, called Article 78 (see 
Last week MDN reported that Dennis Davin, Secretary of the Pennsylvania Department of Community and Economic Development (DCED) had gone on a roadshow to three counties that will be most affected by Shell’s ethane cracker plant planned for Beaver County (see 
The Donald is coming to Steel City to talk to frackers. Last Friday the Marcellus Shale Coalition, organizers and operators of the top notch Shale Insight conference and trade show held each year, announced that they had extended an invitation to both Donald Trump and Hillary Clinton to speak at this year’s event being held in Pittsburgh on September 21 & 22. The Donald said “yes” and Hillary said “no.” The Donald supports fossil fuels and their safe extraction and what they can do for America’s energy security. Hillary doesn’t. Need we say more? Oh, one more thing: MDN is happy to announce we will have a booth at this year’s Shale Insight. More on that in future posts. For now, here’s the exciting news that The Donald will address attendees at Shale Insight in less than a month…
