Pennsylvania

Energy Services | Industrywide Issues | Litigation | Pennsylvania | Pipelines | Sunoco Logistics | Washington County

Judge Hears Eminent Domain Case Against Mariner East 2
February 19, 2016February 19, 2016

Five Washington County, PA property owners had their day in court yesterday with their case against Sunoco Logistics Partners and the Mariner East 2 pipeline project. The attorney for the plaintiffs argued that Mariner East 2 is an interstate pipeline (begins in Ohio, crosses the northern panhandle of West Virginia and then crosses Pennsylvania from west to east) and therefore it does not fit the definition of a public utility under PA law. Public utilities in PA have the right to use eminent domain, which is what this case appears to be about–denying Sunoco the right to use eminent domain in cases where it cannot come to an agreement with the landowner. But as you’ll see below, we don’t think that’s what this case is REALLY about. Sunoco argued that the pipeline is both an interstate and intrastate pipeline with “numerous public benefits.” He hastened to add one of those benefits is a $1.9 billion investment that will result in a $4.2 billion economic impact on the state…
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Air Quality | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

More on Wolf/Quigley 4-Point Plan to Reduce Methane Emissions
February 19, 2016February 19, 2016

In January Pennsylvania Gov. Tom Wolf announced a 4-point plan to supposedly reduce the amount of methane leaking from various oil and gas related activities–like drilling, compressor stations, etc. (see PA Gov. Wolf’s Plan to Kill Drilling via Methane Emissions Regs). A few days later Wolf’s Secretary for the Dept. of Environmental Protection (DEP), John Quigley, further expounded on this manifestly poor idea (see Quigley Expounds on Methane Emissions Plan: Drillers to Get Hosed). The concern is that methane is a so-called greenhouse gas and that “fugitive” methane escapes into the atmosphere and will toast ole Mom Earth. Dumb as rocks–but there it is. To prevent old Mom Earth from toasting, Wolf and Quigley’s answer is the same as every liberal Democrat’s answer: more regulation. Last week the DEP revealed a little bit more about where they’re going with this…
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Allegheny County | Meetings | Pennsylvania

Attend the O&G Awards Northeast Industry Summit for FREE
February 19, 2016February 19, 2016

MDN is very excited to once again support the Oil & Gas Awards Northeast Industry Summit, happening on Wed. March 30 in downtown Pittsburgh. This year’s Summit will run from 8:00 am to 1:00 pm and is FREE to attend (register here). MDN editor Jim Willis helped craft the program for this year’s Summit, which will focus on operating in the current tough environment. Attend to hear from leading organizations like: U.S Chamber of Commerce, Stone Pier Capital, EdgeMarc Energy Holdings, Chevron Appalachia Business Unit, Eclipse Resources, Hodgson Russ, Blank Rome, U.S. Well Services, Columbia Pipeline Group, Civil Environmental Consultants, M3 Midstream, Themark Corporation, Shalewater Solutions, McCutcheon Enterprises, Select Energy Services, and Mustang Oilfield Services. Details below…
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Industrywide Issues | Pennsylvania | Research | Statewide PA | Taxation

“Independent” Fiscal Office Says PA Impact Fee Revenue Drops 17%
February 18, 2016February 18, 2016

The Pennsylvania Public Utility Commission (PUC) is the organization charged with assessing and collecting the state’s impact fee on Marcellus drillers–PA’s equivalent of a severance tax. But that doesn’t stop the the extremely partisan, Democrat-controlled, so-called “Independent” Fiscal Office, or IFO from trying to steal the PUC’s thunder when it comes to announcing revenue from the impact fee. Each year the Dems at the IFO release their estimates for how much revenue will be collected for the impact fee months ahead of the PUC. The IFO doesn’t disappoint this year. Yesterday the IFO released their estimates for the fees to be collected from 2015 drilling (full report below), and the IFO estimates revenues will go down by $38 million over 2014 revenue–to $185.5 million. That’s a 17% decrease, even though the number of wells drilled in 2015 versus 2014 went down 43%. And that’s IF the IFO’s numbers are accurate, which is questionable given their extreme bias…
Read More ““Independent” Fiscal Office Says PA Impact Fee Revenue Drops 17%”
Energy Services | FTS International | Industrywide Issues | Jobs | Pennsylvania | Washington County

FTS Intl Fires All Drivers & Mechanics in Sand Hauling Business
February 18, 2016February 18, 2016

On Tuesday MDN told you that FTS International, the largest private well-completion company in North America with offices and employees in the Marcellus/Utica, has laid off workers in Eighty Four and Venetia, both sites in Washington County, PA (see FTS International Lays off PA Workers – Won’t Say How Many). We now have a few more details on what is happening at FTS–and what’s happening is that FTS is in the process of selling their sand-hauling business, which is located in Eighty Four and Venetia. The company still won’t say how many people they’ve laid off, but an inside source told the Washington Observer-Reporter that 34 sand-truck drivers and seven “coordinators” were let go at Venetia last Friday. A company memo from FTS CEO Michael Doss says they laid off all of the truck drivers and mechanics involved in their sand hauling business. Here’s an update on FTS “adjusting head count,” as they euphemistically put it…
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Pennsylvania | Statewide PA

PA’s 2015 Production Numbers Show Slight Gain, 4.18 Tcf for Year
February 18, 2016February 18, 2016

There were 653 more producing shale gas wells at the end of 2015 than there were at the end of 2014 in Pennsylvania. By year end 2015, some 6,618 producing wells were online and pumping. However, because the pace of drilling slowed down (older wells don’t produce as much as newer wells), and because drillers began “shutting in” some wells, overall production in PA from shale wells increased a minuscule 2.7% in 2015 over the year before. Still, overall production in PA was extremely impressive: 4.18 trillion cubic feet for the year. The top five producers remained the same in 2015 as 2014, but top producing counties shifted a bit…
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Beaver County | Energy Companies | Ethane | Industrywide Issues | Pennsylvania | Processing Plants | Shell

Shell Leases 76,000 Sq Ft Office Space Near Cracker Plant Site
February 17, 2016February 17, 2016

We believe there’s little doubt remaining that Shell will commit to building a $3 billion ethane cracker plant in Monaca (Beaver County), PA. The evidence continues to mount. Shell is spending big bucks on a variety of activities related the project, as we’ve previously indicated (see Shell Begins Hiring for Monaca, PA Ethane Cracker Plant). The latest evidence comes from the Pittsburgh Business Times who has an inside source telling them that Shell has cut a deal with Michael Baker International to lease a 76,000-square-foot building with a 400-car parking lot sitting on 100 acres near the proposed cracker site in Beaver County…
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Allegheny County | Anti-Drilling/Fossil Fuel | Education | Industrywide Issues | Pennsylvania

Pitt Brats “Demand” Endowment Divest from < 1% Fossil Investments
February 17, 2016February 17, 2016

This is how retarded (yes, we’re using the “r” word) students are at the University of Pittsburgh. We use the “r” word because something has retarded or stunted their intellectual growth. They are substandard–stupid–dumb. How else can you explain why spoiled rotten brats attending Pitt are “demanding” that the university divest their endowment from fossil fuels? The Pitt endowment is $3.6 BILLION. How much of that is invested in dirty, filthy, evil fossil fuel companies? $26 million. That’s 0.007 of the fund (seven tenths of one percent) invested in fossil fuels. It’s a rounding error. Fossil fuel insanity is rampant on the campus of Pitt. Stay away or you may catch it too!…
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Industrywide Issues | Pennsylvania | Statewide PA | Taxation

PA Newspaper Claims 25 House Repubicans Want Severance Tax
February 17, 2016February 17, 2016

The unofficial campaign staffer for PA Gov. Tom Wolf working at the Democrat-controlled Harrisburg Patriot-News is Candy Woodall. She calls herself a reporter but in reality she’s a propagandist. Woodall loves to bash the Marcellus industry. Her latest creative writing efforts (otherwise called “reporting”) is to say, essentially, “PA elected Republicans want a severance tax after all–they really wanted it last year, but they voted it down because they didn’t want higher income taxes. They really want to pass a tax on the Marcellus industry this year.” This is pure fiction/fantasy. Woodall claims there are 25 elected Republicans in the PA House who are ready to sign on to a severance tax proposal–yet she doesn’t list their names. Her main source appears to be Wolf’s policy secretary, John Hanger, who ran for governor on a platform of legalizing marijuana. In her latest fiction, Woodall and Hanger savage a truly great Pennsylvanian, House Speaker Mike Turzai, because of Turzai’s steadfast opposition to a tax that would assassinate the Marcellus industry. Woodall implies Turzai is in the pocket of the industry. Hey Candy–did you investigate whether pot growers donated money to Hanger’s campaign the way you “investigated” Marcellus drillers donating money to Turzai’s campaign? No, we didn’t think so…
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Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

PA Senate Democrat Candidates Want to Ban ALL Fracking
February 17, 2016February 17, 2016

Pay attention Pennsylvania voters. You didn’t listen to MDN the last time and elected the disastrous Tom Wolf as your governor–a decision you no doubt kick yourselves for each day. Yes, we told you so. Now listen up–you are facing a U.S. Senate race this November. Sitting Senator Pat Toomey (Republican) is in a tough race to retain his seat. There are (so far) three Democrats running in a primary to oppose Toomey. Two of the three candidates support an immediate ban on fracking–across the state. Everywhere. Both public AND private land (your land!). You CANNOT afford to elect Democrats who want to deny you your Constitutional property rights! PLEASE do not vote for these two extremists who want to ban fracking…
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Bradford County | Chief Oil & Gas | Energy Companies | EQT Corp | Lease & Royalty Payments | Pennsylvania | Sullivan County | Washington County

PA Game Commission Cuts $15.5M in Deals to Lease State Land for Drilling
February 16, 2016February 16, 2016

This is something you don’t see often these days: The Pennsylvania Game Commission is getting $15.5 million of revenue from new Marcellus leases with Chief Oil & Gas and EQT. The bulk of the money will come from a deal with Chief to lease 5,870 acres in Bradford and Sullivan counties. Terms of the lease? Chief is paying $2,500 per acre as a signing bonus and 20.55% in royalties when/if they drill and the gas and oil begin to flow. It just about floored us to see this deal! We though all deals were done until the price of gas goes up again. We’d not heard of any new deals being cut. As for EQT, they are paying the Game Commission $917,000 for the right to drill under a 306-acre parcel in Washington County, PA. Details on the per acre bonus and royalty for the EQT deal below…
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Industrywide Issues | Pennsylvania | Pipelines | Regulation | Statewide PA

PA Lawmaker Wants Turnpike to Allow Pipelines, Charge Ongoing Fee
February 16, 2016February 16, 2016

A RINO member of the Pennsylvania House (from the Philadelphia area) has introduced a new bill that he believes is totally brilliant. Rep. Scott Petri, R-Richboro, introduced a bill to give the PA turnpike commission authority to allow use of its right of way for natural gas pipelines–and charge a fee for it (of course). Rep. Petri, you may recall, LOVES severance taxes (see PA Republicans Commit Adultery with Severance Tax – Again). But a severance tax would generate small potatoes compared with a “fee” assessed on gas flowing through pipelines. Instead of calling his proposal to allow pipelines along turnpike corridors a tax, Petri calls it a fee. Same thing. He’s proposing that the turnpike commission (i.e. the State of Pennsylvania) should all natgas pipelines and receive an ongoing fee for the amount of gas flowing through the pipeline. When NOBODY rushes to sign up for such a plan (should it ever pass), the next step would be to force pipeline companies to use said corridors–banning pipelines from being built on private property. That’s our prediction…
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Energy Services | FTS International | Industrywide Issues | Jobs | Pennsylvania | Statewide PA

FTS International Lays off PA Workers – Won’t Say How Many
February 16, 2016February 16, 2016

More job causalities from the slowdown in Marcellus/Utica drilling to report. FTS International, the largest private well-completion company in North America with offices and employees in the Marcellus/Utica, has laid off workers. But they’re not saying how many. There were reports FTS had closed their offices in Eighty Four and Venetia–but FTS says that’s not true. Here’s what’s known (which isn’t much)…
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Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | Litigation | Pennsylvania | Pipelines | Statewide PA | Sunoco Logistics

Philly Judge Says Case Against Mariner East 2 Can Proceed
February 12, 2016February 12, 2016

A Philadelphia judge for the Court of Common Pleas (low-level court in PA) has ruled in favor of the anti-drilling Clean Air Council against Sunoco Logistics Partners and their Mariner East 2 pipeline. The ruling is nothing more than “this case has merits” (in the eyes of the judge) and can proceed. The case itself is challenging the right of Mariner East 2 to use eminent domain against landowners in building the new pipeline. The Clean Air Council’s argument is that since most of the natural gas liquids that will flow through the pipeline will get exported or otherwise not used in PA itself, that moves Mariner East from being a public utility with eminent domain power to an interstate pipeline more properly reviewed and permitted by federal authorities. It’s a delay tactic, because if Mariner East 2 were to come under the aegis of the Federal Energy Regulatory Commission and eventually permitted, they would also be entitled to use eminent domain. But a FERC review would take years. Which is what the Clean Air Council wants. Here’s the latest minor setback for Sunoco, whose eminent domain has been upheld in other PA courts and who is beginning to clear trees for the Mariner East 2 pipeline right now…
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Economic Impact | Greene County (PA) | Industrywide Issues | Jobs | Pennsylvania | Washington County

More Evidence of the Slowdown in the Marcellus
February 11, 2016February 11, 2016

We won’t continue to beat the drum indefinitely that “it’s bad out there.” Everyone knows it. However, we did honestly and truthfully report when the Marcellus industry was on the upswing and it seemed like everything was coming up roses. So we will now honestly and truthfully report when our beloved industry is on the downswing. We don’t sugarcoat it here at MDN. The latest bit of “it’s bad out there” evidence comes from Greene County, PA and Hot Rod’s House of Bar-B-Que where it used to be you couldn’t get a seat at lunchtime, but now it’s “walk right in, sit right down”…
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Industrywide Issues | Pennsylvania | Statewide PA | Taxation

More on Wolf’s New 6.5% Severance Tax – What Could of Been
February 11, 2016February 11, 2016

A quick update on the new, higher severance tax being proposed by Pennsylvania Gov. Tom Wolf in his second budget (the first budget never passed and the state has survived on continuing budget resolutions). We reported yesterday that the new 6.5% severance tax would be “on top of” the existing impact fee. That may have left a wrong impression. Yes, the impact fee, which is already high, would remain. But drillers would be able to deduct the impact fee from the 6.5% severance tax, lowering the severance tax for them. It still works out to a 6.5% rate–ON TOP OF corporate income taxes these companies pay. Meaning Wolf’s new severance tax would be one of the highest in the country, if you include corporate income taxes paid by drillers (income taxes that don’t exist in other oil & gas states). In addition to more comment on Wolf’s proposed severance tax, we also have some inside scuttlebutt about the severance tax and what could have been had Wolf not blown it last year…
Read More “More on Wolf’s New 6.5% Severance Tax – What Could of Been”