Pennsylvania

Pennsylvania | Statewide PA

PA Production in 2H14 Soars to New Record; 4 Tcf in 2014
February 18, 2015February 18, 2015

The Pennsylvania Dept. of Environmental Protection (DEP) published its semi-annual (every 6 months) production report yesterday for Marcellus/Utica Shale gas production. The big news is that once again PA has shattered another record. In the second half of 2014 PA produced 2 trillion cubic feet (Tcf) of natural gas, making it ~4 Tcf for the entire year. That works out to be around 16% of all gas used throughout the United States–coming from a single state. Chesapeake Energy produced the most gas in 2H14 (with 712 producing wells), followed by Cabot Oil & Gas (340 producing wells). Below we have some more stats and facts about PA’s production for 2014…
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Industrywide Issues | Pennsylvania | Regulation | Statewide PA | Taxation

PA Gov Wolf Turns Bully, Threatens Ban on Drilling Absent New Tax
February 18, 2015February 18, 2015

Somehow in the flurry of news last week when Pennsylvania Gov. Tom Wolf released his so-called proposal to tax the Marcellus Shale industry (see PA Gov Wolf Proposes Marcellus-Killing 7.5% Severance Tax), we missed the fact that Wolf threatened the entire Marcellus Shale industry with a ban on drilling if the industry doesn’t fall into line and support his tax. Sure sounds like good old Philly-style break-their-kneecaps talk from the kinder, gentler and oh-so-much-smarter than everyone else Tom Wolf. His precise words: “…the alternative is not really no tax, the alternative is no drilling, a ban as in the case of New York.” Our collective jaws hit the ground. How can anyone not see this man for what he is? For what he’s trying to do (end drilling)? Like an old-style mob boss–you pay him or you get hurt–and hurt real bad. Fortunately, some groups like the Pennsylvania Independent Oil and Gas Association (PIOGA) isn’t taking Wolf’s threat lying down. They’re in the mood to fight…
Read More “PA Gov Wolf Turns Bully, Threatens Ban on Drilling Absent New Tax”
Industrywide Issues | Pennsylvania | Regulation | Statewide PA

Why did PA DEP Acting Sec Quigley Mass Fire Gas Advisory Board?
February 18, 2015March 26, 2015

Even though he’s still only “acting” Secretary of the Dept. of Environmental Protection (DEP), John Quigley is cleaning house at the DEP–installing his own yes-men and women in important positions–and doing it just prior to issuing important new drilling regulations. For some time politicians and old-line mom and pop conventional (non-shale) drillers have been making a fuss that the rules that apply to shale drillers should not apply to non-shale drillers. Fair enough. There are some major differences. But the timing for creating a new Conventional Oil and Gas Advisory Committee in addition to the Oil and Gas Technical Advisory Board (OGTAB)–and mass firing the members of the OGTAB (as Quigley has done) seems darned peculiar in light of the fact they have to publish new drilling regulations this year or what has been a 3-year process will need to be restarted all over again…
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Electrical Generation | Industrywide Issues | Pennsylvania | Snyder County

Panda Power Building 3rd Marcellus-Fired Electric Plant in PA
February 18, 2015February 18, 2015

MDN has previously told you about Panda Power Funds, a private equity firm located in Dallas, TX that’s building two 829-megawatt electric generating plants in Pennsylvania (see Plugging in to Panda Power’s Electric Generation Supply Chain). Panda Liberty is located in Towanda, and Panda Patriot in Williamsport. Both will be fed by abundant, cheap and clean-burning Marcellus Shale gas. You can now add a third such project to the Panda portfolio. Yesterday Panda announced a joint venture with Sunbury Generation to build a whopping 1,000-megawatt plant on the site of a recently retired coal-fired plant near Shamokin Dam in Snyder County, PA…
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Energy Services | Industrywide Issues | Pennsylvania | Pipelines | Snyder County | UGI Energy Services

UGI Building 35-Mile Pipeline for Panda Power Electric Plant
February 18, 2015February 18, 2015

Panda Power announced yesterday that they will build a new 1,000-megawatt electric generating plant powered by Marcellus Shale gas in Snyder County, PA (see today’s companion story). In order to get Marcellus gas to the plant site, a 35-mile pipeline is needed. Enter UGI, one of Pennsylvania’s largest utility companies with a midstream subsidiary that builds pipelines. UGI has committed $160 million to build the 20-inch pipeline needed to supply the plant…
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Industrywide Issues | Lease & Royalty Payments | Pennsylvania | Regulation | Statewide PA

PA DCNR Program Leases Under Rivers/Creeks for Marcellus Drilling
February 17, 2015February 17, 2015

Well now THIS is just not supposed to happen. The pure-as-the-wind-driven-snow PA Gov. Tom Wolf’s Dept. of Conservation and Natural Resources (DCNR) is stepping up its program of leasing underneath rivers, creeks and mud puddles for Marcellus and Utica Shale drilling–much to the consternation of anti-drilling groups like PennFuture (whose immediate past president, Cindy Dunn, is about to become Secretary of DCNR). When DCNR collected for river and stream leases under Republican Gov. Tom Corbett, the Democrat media machine reported it as a clandestine and secretive activity (see PA’s “Secret” Deal to Lease Land Under Rivers & Streams (Gasp!)). It actually has been quite public–MDN told you about this program all the way back in 2012 when it was launched (see PA DCNR Wants Money for Drilling Under Public Streams/Rivers). Our concern was/remains that the state of Pennsylvania may be claiming money for land that belongs to private landowners–denying private landowners of lease bonuses and royalties. Below we have the lease terms dictated by DCNR, a map of the (almost innumerable) waterways PA claims they own, a list of the names for those waterways, and the criteria DCNR uses in determining whether or not a waterway is owned by the state…
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Industrywide Issues | Lease & Royalty Payments | Pennsylvania | Statewide PA | Taxation

PA Dept of Revenue Still Takes Bite from Royalties, Just Smaller
February 17, 2015February 17, 2015

Last month we shared with Pennsylvania landowners who receive royalty checks the distressing news that the PA Dept. of Revenue is attempting to deny them deductions for certain production costs (see The Tax Man Returneth — for PA Landowners with Royalties). It appeared that the DOR was ramping up an aggressive campaign to drill landowners for money, sending out semi-threatening letters. Accountants told landowners to sit tight and see how this shakes out. Turns out that was good advice. DOR is now backing down on their previous aggressive claims. Oh they still want a pound or so of flesh–they still claim not all deductions are allowed that have been taken–but they are being more reasonable…
Read More “PA Dept of Revenue Still Takes Bite from Royalties, Just Smaller”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Landfills | Pennsylvania | Regulation | Statewide PA | Wastewater

PA Dem Congressman “Steps Up” Frack Waste Witch Hunt
February 17, 2015February 17, 2015

Pennsylvania Congressman Matt Cartwright, an anti-drilling Democrat from northeast PA, began a bash-shale-drilling meme late last year (see PA Dem Congressman Demands Info from DEP on Frack Waste and PA Dem Congressman Cartwright Continues to Bash DEP). Cartwright wants to violate the U.S. Constitution and remove individual states rights to regulate oil and gas drilling and instead concentrate that power in Washington, D.C. where people like the arrogant Cartwright can control it via fiat. Cartwright is at it again. He’s “stepped up” his so-called investigation into shale waste disposal. The AP recently visited with Cartwright to take dictation…
Read More “PA Dem Congressman “Steps Up” Frack Waste Witch Hunt”
Coterra Energy (Cabot O&G) | Energy Companies | Industrywide Issues | Pennsylvania | Regulation | Susquehanna County

Cabot O&G Clipped $50K by SRBC for Lack of Water Permit
February 16, 2015February 16, 2015

Timing is everything. If you start drilling a hole too early, it will cost you. In this case, $50,000. That’s the amount Cabot Oil & Gas has offered to pay the Susquehanna River Basin Commission (SRBC) for their eager-beaver error in drilling a hole on a new well pad in Susquehanna County, PA before they had the necessary approval from the SRBC. No, the SRBC doesn’t suddenly issue permits to drill–that’s the job of the DEP (Dept. of Environmental Protection). However, the SRBC does issue permits for the water that’s needed to drill, and it was that permit Cabot didn’t have in hand when they started to drill late last year. The SRBC says it’s not a big deal and that Cabot is normally “very compliant.” That is, it was a mistake and not intentional. There was no environmental harm as a result. However, for Cabot, it was a costly mistake…
Read More “Cabot O&G Clipped $50K by SRBC for Lack of Water Permit”
Pennsylvania | Statewide PA

Shale Gas News Radio – Feb 14, 2015 [Audio]
February 16, 2015February 16, 2015

Every Saturday the one-hour Shale Gas News show airs on Scranton, PA’s 94.3 FM “The Talker” radio station. The show is co-hosted by Kevin Lynn of Linde Corporation and Bill desRosiers from Cabot Oil & Gas. MDN brings you the latest program show notes and recordings for Shale Gas News each week (well worth your time to listen). Here’s the latest program, recorded on Saturday, Feb 14…
Read More “Shale Gas News Radio – Feb 14, 2015 [Audio]”
Energy Companies | JKLM Energy | Lease & Royalty Payments | Pennsylvania | Potter County | Utica Shale

Potter County, PA Hospital Leases Land to JKLM for Utica Drilling
February 13, 2015September 28, 2015

UPDATE: A sharp MDN reader tipped us with more of the details on this deal. The Cole property is 742.9 acres (located in the Townships of Eulalia and Sweden, and in the Borough of Coudersport); the lease signing bonus payment is reportedly $2,200 per acre, which makes the up-front payment to Cole Memorial a whopping $1,634,380; and the royalty is rumored to be 15%. Thanks to our great reader!

Cole Memorial Hospital in Coudersport (Potter County), PA has reportedly signed a lease with JKLM Energy to allow shale drilling on a “substantial amount” of hospital-owned property. What we don’t know about the deal is more than we do know. We don’t know how many acres. We don’t know how much the signing bonus was for. And we don’t know what royalty was agreed to. How’s that for good reporting? What we do know is that they signed a lease, JKLM has “ties” to Buffalo “Marcellus” Bills owner Terry Pegula. JKLM is potentially interested in the Utica layer and they will only be allowed to drill on non-hospital campus property…
Read More “Potter County, PA Hospital Leases Land to JKLM for Utica Drilling”
Bucks County | Industrywide Issues | Pennsylvania | Taxation

Latest Tax Marcellus Bill from Rep Tina Davis: Effective Rate of 11%
February 13, 2015February 13, 2015

It’s another day, must be time for another liberal Pennsylvania Democrat to propose taxing the the Marcellus industry into oblivion, and right on cue PA Rep. Tina Davis (Bucks County, near Philadelphia) has introduced one. Her plan goes well beyond the plan offered earlier this week by PA Gov. Tom Wolf. Wolf’s plan is for a 7.5% tax, that taken with the existing state corporate income tax pushes an effective severance tax rate to well over 10%. That’s not enough for the tax ravenous Tina Davis: She not only wants a 5.2% severance tax with 4.6 cents per Mcf (effective rate of maybe 8% total), she wants to keep the current impact fee, which is another 3% (not the 1.9% claimed), creating an effective rate of somewhere around 11%. Let’s just save the Dems some time: Tax the Marcellus industry 99% and let those money-grubbing corporations keep 1%. That’s what PA Dems really want. What’s that? You say not all money earned by corporations (and citizens) belongs to the government? You silly goose. Of course it all belongs to the state…
Read More “Latest Tax Marcellus Bill from Rep Tina Davis: Effective Rate of 11%”
Carbon County | Energy Services | Industrywide Issues | Luzerne County | PennEast Pipeline | Pennsylvania | Pipelines | Regulation

More Silly Antics from Antis at FERC PennEast Pipeline Hearing
February 13, 2015February 13, 2015

We’ve been to a number of Federal Energy Regulatory Commission (FERC) scoping hearings, as well as hearings by the New York Dept. of Environmental Conservation. Whether it’s a hearing on pipelines, compressor stations or shale drilling, anti-fossil fuel nutters always show up and it seems as if they read from the same script every time. The latest example of that comes from Carbon County, PA where the silly antics of antis was on full display once again, this time at a FERC hearing on the PennEast Pipeline. Example: One anti-pipeline nutter used part of her 3 minutes of talk time to read the lyrics from a Disney movie (boggles the mind)…
Read More “More Silly Antics from Antis at FERC PennEast Pipeline Hearing”
Industrywide Issues | Pennsylvania | Statewide PA | Taxation

PA Gov Wolf Proposes Marcellus-Killing 7.5% Severance Tax
February 12, 2015February 12, 2015

Newly elected Pennsylvania Gov. Tom Wolf has turned out to be another tax and spend liberal. Surprise! If you’re a regular MDN reader, you’re not surprised. We warned you about this from day one. Wolf released his severance tax plan yesterday, and it’s even worse than what he talked about on the campaign trail. He’s proposing a 5% severance tax PLUS another 4.7 cents per thousand cubic feet of natural gas that flows from a well. PA’s House Majority Leader Dave Reed (Republican) says it works out to be roughly a 7.5% tax–one of the HIGHEST IN THE NATION. On top of low low gas prices and rigs beginning to idle and capital budgets slashed 30-50%. In other words, if this tax is passed, not only will it not bring in Wolf’s disingenuous promise of $1 billion “for the children” (i.e. teachers unions), it will KILL Marcellus drilling in the state–and that’s not a bluff. It’s now apparent that Wolf is a man completely out of his depth and not ready for a big job like governor…
Read More “PA Gov Wolf Proposes Marcellus-Killing 7.5% Severance Tax”
Industrywide Issues | Pennsylvania | Statewide PA | Taxation

PA Towns to Gov Wolf: Don’t Kill the Impact Fee with Your New Tax
February 12, 2015February 12, 2015

Yesterday Pennsylvania Gov. Tom Wolf (Democrat) proposed what amounts to a 7.5% severance tax on Marcellus and Utica Shale drilling in the state (see our lead story today). Wolf’s severance tax is being erroneously reported as a 5% severance tax PLUS 4.7 cents per thousand cubic feet of natural gas produced at the wellhead. When you work it out, it’s actually about 7.5%, NOT 5% as Wolf misleadingly implies. Coupled with PA’s high corporate income tax rate, the proposal, if passed, would put PA at the top of the list of states taxing the oil and gas industry, essentially killing future Marcellus Shale drilling in the state (not an idle threat). Some of those most opposed to this hare-brained plan are the townships where drilling actually happens–they stand to loose big-time because the impact fee money they get now will be traded away for a few table scraps. The impact fee will be converted into the severance tax–and given away to Philadelphia…
Read More “PA Towns to Gov Wolf: Don’t Kill the Impact Fee with Your New Tax”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Pennsylvania | Statewide PA | Taxation

John Quigley’s Old Employer Likes High Wolf’s Marcellus-Killing Tax
February 12, 2015February 12, 2015

MDN has several stories today about the newly proposed 7.5% severance tax on Marcellus Shale drilling proffered by newly-elected Pennsylvania Gov. Tom Wolf. If you want to know whether or not this severance tax will work to undermine, and even stop, Marcellus Shale drilling, all you have to do is look at the comments of anti-drilling groups in the state–like the comments of the radical PennFuture. You may recall that Wolf’s nominee to head the Dept. of Environmental Protection, John Quigley, used to work for PennFuture (what does that tell you about the future of drilling in the state?). According to the new “acting” CEO and head of PennFuture, this severance tax will help to end Marcellus Shale drilling in the state…
Read More “John Quigley’s Old Employer Likes High Wolf’s Marcellus-Killing Tax”