Pennsylvania

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    East Resources Donates $50K to Tioga County, PA 4-H in Goodwill Gesture

    East Resources, an independent oil and gas drilling company with a big stake in Tioga County, Pennsylvania, has just donated $50,000 to the Tioga County 4-H.

    East Resources, Inc. today signed an agreement with Penn State’s Cooperative Extension Service to create a new 4-H endowment fund for Tioga County. East created the endowment with an initial principal investment of $50,000. The fund will be used to supplement financial support for the Tioga County 4-H program and may include educational awards for 4-H members.

    “East Resources has a major stake in Tioga County’s future through its oil and gas interests, and our contribution to this endowment reflects East’s commitment to help sustain that future,” says Bob Long, the company’s executive vice president. “Tioga County’s young men and women are the key to the long-term health of our communities, and we appreciate the significant role that the county 4-H program plays in helping them grow into productive, self-directed citizens.”*

    Non-profits are always looking for new funding sources. Given that East Resources plans to drill upward of 6,000-7,000 gas wells in Tioga in the next few years (see this story), it’s nice to see them “giving back” to the community in this gesture of goodwill.

    *The Wellsboro Gazette (Mar 3) – East gives $50,000 to 4-H

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    CONSOL Energy COO DeIuliis Says Marcellus Drilling has Potential to “Reshape Western PA Economy”

    Nicholas DeIuliis, the Chief Operating Officer of CONSOL Energy Inc., spoke to a leadership group at the Rivers Club in Downtown Pittsburgh today. Among the things he said:

    “Five years ago, no one knew how to spell Marcellus Shale,” DeIuliis, who is also president and COO of CNX Gas Corp., a part of CONSOL, said. But now, the natural gas reserve has the potential to reshape western Pennsylvania’s economy. He projected that by 2020, 175,000 jobs would be created from the Shale, and state and local tax revenue would be in the neighborhood of $1.4 billion.

    “These are jobs that require serious levels of training, they’re not minimum wage jobs,” he said. “There’s a lot to be excited about in the Marcellus Shale.”*

    *Pittsburgh Business Times (Mar 2) – CONSOL COO Nicholas DeIuliis: Marcellus has changed everything

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    Rex Energy Drills 7 Horizontal Gas Wells in the Marcellus in 2009, Expects to Drill Another 19 in 2010, Controls 67,000 Acres

    Rex Energy Corporation, an energy company drilling in the Marcellus Shale, today announced its fourth quarter and year-end 2009 results. The portion of the press release dealing with Marcellus drilling activity is reproduced below.

    —–

    In the Appalachian Region, Rex Energy has drilled and completed nine horizontal Marcellus Shale wells to date. The company drilled and completed two of these as test wells in a different zone of the shale, which resulted in lower recoveries. Excluding the two test wells, the seven day average test rate after peak production was reached has averaged 3.1 MMcfe per day with an average lateral length of 2,200 feet. The company has experimented with six to twelve stage fracture stimulations. The average gross EUR of these wells was estimated to be 3.2 Bcfe per well at an average cost of $4.6 million.

    Currently, Rex Energy is running two horizontal drilling rigs in the play. The company recently completed the drilling of two horizontal wells in Butler County. The wells have an average lateral length of 3,500 feet and were drilled in under 21 days per well. The company expects to simultaneously fracture stimulate these wells during the first quarter of 2010. The company has budgeted $4.0 million per well for its 2010 wells and it expects the wells to have average lateral lengths of 3,000 to 4,000 feet. The company is currently drilling two wells in Butler County and one well in Westmoreland County. During 2010, the company expects to drill and complete 10 gross (10 net) operated horizontal Marcellus Shale wells, and to participate in 9 gross (4.5 net) horizontal Marcellus Shale wells with our partner.

    [Rex Energy’s President and CEO Benjamin] Hulburt continued, “The build-out of our Marcellus midstream infrastructure is progressing as scheduled. We expect our two Clearfield County wells to be connected to our initial gathering system in April 2010. In Butler County, we expect our midstream joint venture to put our cryogenic processing facility into operation during the fourth quarter of 2010. We expect the plant will have a processing capacity of 40 MMcf per day. We plan to install compression to permit the plant to process 20 MMcf per day initially, which will be scaled up as additional wells are brought online.”

    The company has continued to lease additional acreage in its three Marcellus Shale project areas in southwestern and central Pennsylvania. Rex Energy’s current total acreage under control in the Marcellus Shale fairway is 68,700 acres, an increase of approximately 15% compared with the company’s previous leasing update in January 2010. The net acreage amount excludes approximately 22,000 acres, which can be earned by Williams pursuant to the Participation and Exploration Agreement entered into on June 18, 2009, and includes approximately 8,300 acres covered by oil and gas leases that are pending title verification and final closing.

    From: MarketWatch (Mar 2) – Rex Energy Corporation Announces Fourth Quarter and Year-End 2009 Results

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    Energy Company EQT Buys Rights to 58,000 Acres in PA, Now Holds 500K Net Acres in the Marcellus Shale

    EQT Corp. said today it is buying mineral rights to 58,000 net acres in the Marcellus Shale from a group of private operators and landowners for $280 million in stock and cash. That works out to $4,828 per acre. While the names of the sellers were not disclosed, most of the land is located in the Pennsylvania counties of Cameron, Clearfield, Elk and Jefferson.

    The deal includes a 200 mile gathering system and approximately 100 producing vertical wells. The deal is expected to close on April 30th, at which time EQT will then control approximately 500,000 net acres in the Marcellus Shale.

    More Details: Yahoo Finance (Mar 2) – EQT Announces Strategic Marcellus Acreage Acquisition; Increases EUR per Marcellus Well; Provides Update on Latest Marcellus Well

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    Susquehanna County, PA Landowner Offered $800K for Mineral Rights to 153 Acre Farm

    A landowner in Brooklyn Twp. (Susquehanna County), Pennsylvania faces a big decision. Denise Dennis owns 153 acres and a farm that is eligible to be placed on the National Register of Historic Places. Her ancestors moved to the land in 1811. They were African American and they were free landowners during a time when slavery was legal.

    Ms. Dennis does not want to “destroy the property or the landscape,” but she needs money to fix up the buildings, the cemetery and the stone walls. According to a news report, she has been offered $800,000 for the “mineral rights” to the farm. No word on which drilling company made the offer, and what those rights entail (i.e., does that include royalties?).

    Ms. Dennis is mulling over the proposition.

    See: WBNG-TV (Mar 1) – The Price of History

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    Tennessee Gas Pipeline from PA to NJ Clears Major Hurdle

    The Tennessee Gas Pipeline Northeast Upgrade Project (previously reported on here), also known as the 300 Line Project, has just cleared a major hurdle on its way to becoming reality. The Federal Energy Regulatory Commission (FERC) has completed an environmental assessment of the proposed project and has found there will be no major impact to the environment from the proposed pipeline.

    The 300 Line Project involves the installation of seven looping segments in Pennsylvania and New Jersey totaling approximately 128 miles of 30-inch pipeline, and the addition of approximately 55,000 horsepower following the installation of two new compressor stations and upgrades at seven existing compressor stations. The new stations will be built in northwestern Pennsylvania.*

    Construction is set to begin in the later half of 2010, and the pipeline will come online by the end of 2011.

    *Wayne Independent (Mar 1) – Gas pipeline project clears review

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    New Wastewater Treatment Plant Approved in Central PA

    Narrowsburg, NY – The River Reporter (Feb 25)
    ‘Unauthorized’ wastewater hearing brings flowback feedback

    The Pennsylvania Department of Environmental Protection (DEP) has granted its first permit to a wastewater treatment facility since new, stricter guidelines were recently implemented. From The River Reporter article:

    The DEP has issued its first new permit for treating drilling wastewater to TerrAqua Resource Management LLC of Williamsport, allowing the company to treat and discharge 400,000 gallons per day of gas well drilling wastewater into the West Branch Susquehanna River Watershed.

    According to the DEP, the permit requires TerrAqua to meet the proposed new regulatory standards of 500 parts per million for total dissolved solids (TDS) and 250 parts per million for chlorides and sulfates. TerrAqua has indicated that it will pursue a thermal treatment process capable of reducing TDS levels to less than 500 parts per million at all times.

    The discharge permit also requires TerrAqua to monitor for radioactivity, a large number of metals, including barium, strontium, iron, manganese and aluminum, as well as organics such as toluene, benzene, phenols, ethylene glycol and surfactants.

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    PA Gov. Rendell Predicts His Proposal to Tax Marcellus Shale Gas is DOA

    WTAE Pittsburgh (Feb 25)
    Rendell Talks Expanded Sales Tax Plan In Pittsburgh

    Pennsylvania Gov. Ed Rendell (Democrat), has proposed a severance tax on natural gas in the Marcellus Shale. But the Governor himself is not optimistic that the Pennsylvania Legislature will pass his proposals. From the WTAE news report:

    In addition, Rendell is reviving proposals he has offered before, including extending the tobacco tax to cigars and smokeless tobacco and adding a severance tax on natural gas extraction to capitalize on the industry’s hot pursuit of Marcellus Shale.

    However, Rendell said he’s not optimistic the state Legislature will vote for his changes.

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    New President of Marcellus Shale Coalition Says Drilling Will Bring 110,000 Jobs to PA in 2010

    Katie Klaber, the new President of the Marcellus Shale Coalition recently appeared on the Clean Skies News network to discuss the environmental issues of natural gas drilling. It’s an informative and short piece (under 10 minutes), and worth watching (embedded below).

    Among the things discussed that MDN found interesting:

    • Ms. Klaber says Marcellus Drilling will bring 110,000 jobs to Pennsylvania in 2010.
    • Some drillers recycle and reuse 100% of fracking water, but the industry average right now is recycling and reusing 60%.
    • Because of the high rate of recycling, a shortage of wastewater treatment facilities is not critical at the moment, but more facilities will be needed in the next few years.
    • Drilling companies already have an MSDS (Materials Safety Data Sheet) at the drilling site for each and every chemical used in the fracking process. That is right now, today. So the hue and cry that drillers are “hiding” the chemicals used in fracking is not true.
    • Ms. Klaber predicts that Pennsylvania will be a net exporter of natural gas by 2014.

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    Southwestern Energy Investing $145 Million and Drilling 35-40 Wells in the Marcellus in 2010

    MarketWatch/PR Newswire (Feb 25)
    Southwestern Energy Announces 2009 Financial and Operating Results

    Southerwestern Energy made it’s 2009 results known today in a press release. Of concern to landowners in the Marcellus, particularly in northeastern PA, is this paragraph:

    Appalachia – The company began leasing in northeastern Pennsylvania in 2007 in an effort to gain a position in the emerging Marcellus Shale play. At December 31, 2009, Southwestern had approximately 149,000 net acres in Pennsylvania under which it believes the Marcellus Shale is prospective. The company’s undeveloped acreage position as of December 31, 2009 had an average remaining lease term of 5 years, an average royalty interest of 13% and was obtained at an average cost of approximately $594 per acre. During 2009, Southwestern invested approximately $40 million in Pennsylvania, almost all of which was for acquisition of acreage. In 2010, the company plans to invest approximately $145 million in Appalachia, which includes drilling with one operated rig in the Marcellus Shale play in Pennsylvania and participating in a total of 35 to 40 wells, 21 to 24 of which will be operated.

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    Range Resources Will Drill 150 Horizontal Wells in PA in 2010

    Range Resources Press Release (Feb 24)
    Range Announces 2009 Results

    Range Resources held an investors conference call today, and released a report on the health of the company for 2009, with predictions for 2010. In advance of the call, they issued a comprehensive press release detailing all of their operations. Below is the portion of the release dealing with Range’s drilling activities in the Marcellus Shale. Although originally the information below was in one large paragraph, MDN has formatted it to be more readable.

    From the press release:

    During the fourth quarter, the Marcellus Shale division continued to make outstanding progress. Most notably, we drilled and completed our first two horizontal wells in the northeastern portion of the play in Lycoming County, Pennsylvania. The average seven-day test rate for the first well was 13.3 Mmcfe per day, while the average seven-day test rate for the second well was 13.6 Mmcfe per day. These two wells are now shut-in awaiting pipeline hook-up. The pipeline to the first well is expected to be completed late in the fourth quarter of 2010 with the pipeline to the second well expected to be completed in 2011.

    We also drilled our first horizontal Upper Devonian Shale well and our first horizontal Utica Shale well. The Upper Devonian well has been completed and is testing, and the Utica well has been drilled and cased and is awaiting completion.

    Currently, Range’s net production in the Marcellus is approximately 115 Mmcfe per day. We have 31 horizontal wells that have been drilled, of which 26 are awaiting completion and five are awaiting pipeline hook up. In the southwest portion of the play, where we have drilled the majority of our wells and have been accumulating data for the past 2.5 years, the average estimated ultimate recovery for a Marcellus horizontal is 4.4 Bcfe gross.

    Prior to August 2009, typical Range Marcellus wells had horizontal laterals that averaged 2,200 to 2,800 feet and were typically fraced with eight stages. Since then, we have been experimenting with longer laterals and more frac stages. The longer laterals range from 2,900 up to 5,000 feet and the higher frac stages range from nine stages up to 17 stages. As has been demonstrated in other shale plays, it appears that the longer laterals result in higher initial production rates, higher EURs and improved economics.

    Currently we are running 13 drilling rigs in the play. Plans are to add more rigs in the fourth quarter and exit at 16 rigs. During 2010, we expect to drill and case 150 horizontal Marcellus Shale wells. For 2011, we plan to increase our rig count and exit the year with 24 rigs running. Finally, the build out of the Marcellus midstream infrastructure is progressing as scheduled. In the high Btu portion of the play, gross cryogenic processing capacity increased to 155 Mmcf per day in the fourth quarter of 2009, and an additional 30 Mmcf per day is expected to be added in mid-2010. Another 150 Mmcf per day has been requested for first quarter 2011, which will bring gross cryogenic processing capacity to 335 Mmcf per day. In the dry gas portion of the play, we have 160 Mmcf per day of pipeline tap capacity with 20 Mmcf per day of compression capacity in place currently. Plans are in place to steadily increase dry gas pipeline compression capacity to meet our needs.

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    Engineering Firm in Luzerne County, PA is Hiring Engineers for Marcellus Drilling

    Wilkes-Barre Times Leader (Feb 23)
    Natural gas industry has engineering firm hiring

    More jobs are coming to the Marcellus Shale region because of drilling activity. An engineering firm in Plains Township (Luzerne County), Pennsylvania is hiring:

    Borton-Lawson has been advertising for seven engineering, design and surveyor positions. Chris Borton, company president, said the marketplace is unlike anything he’s seen in the 22 years since he and Tom Lawson teamed up.

    “It’s a tough economy. There are still things that are going on out there,” said Borton on Tuesday.

    The influx of companies exploring and drilling in the Marcellus Shale region has created work for Borton-Lawson and others. It’s opened a branch office in the Pittsburgh area.

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    PA Marcellus Shale Gas is Getting a Pipeline – To Canada!

    Vancouver Sun (Feb 22)
    Tertzakian: Lessons from a green ice resurfacer’s failure

    Will Marcellus Shale gas find a market over the border in Canada? It sure looks that way. An excerpt from an article published in the Vancouver Sun, says, in part:

    In fact, the real Energy Story of the Week came in the form of a couple of announcements: two corporate proposals hoping to bring natural gas and liquids from Pennsylvania’s Marcellus shale into Canadian markets. First Nova Chemicals and Buckeye Partners announced a joint memorandum of understanding to develop an NGL pipeline from Pittsburgh to Sarnia. Then, Union Gas announced that they would conduct an open season for a pipeline service that would allow for the shipping of up to 0.75 Bcf/d of natural gas from the Marcellus into Kirkwall, Ontario and through to Dawn.

    While there have been countless pipeline expansions and extensions announced recently to transport Marcellus gas into the US Northeast, this is the first major export proposal to pit Pennsylvania gas head-to-head with western Canadian gas, on Canadian soil.

    New York State shares one-third of its border with Canada! Unfortunately the Powers That Be in Albany are still diddling away while enterprising states like Pennsylvania are making money.

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    Delaware River Basic Commission to Hold Public Hearing on Requests from Stone Energy

    On Wednesday, Feb. 24, the Delaware River Basin Commission will hold a public hearing in Matamoras, PA on two applications from Stone Energy Company. The first application is a request to withdraw 700,000 gallons of water a day from the West Branch of the Lackawaxen River in Mount Pleasant Township, Wayne County, PA. The water would be used by Stone Energy in Marcellus drilling activities.

    The second application is for Stone Energy to use hydraulic fracturing in a gas well already drilled (in 2008). The gas well is located in Clinton Township, Wayne County. If approved, this is the would be the first Marcellus drilling activity in the Delaware River Basin.

    Environmental group Delaware Riverkeeper Network is planning to take 50 of its members to the hearing to speak against the applications. Although Stone Energy only plans to draw water from the Lackawaxen, and the resulting wastewater would be treated at approved facilities, the Riverkeepers believe any drilling activity in the region would be dangerous.

    For more information, see:

    Pike County Courier (Feb 22)
    UPDATE: Basin commission hearing for gas drilling water withdrawal permit

    PhillyBurbs.com (Feb 22)
    Get on the bus, says Delaware Riverkeeper

    Delaware River Basin Commission – Notice of Public Hearing
    Stone Energy Corporation Proposed Surface Water Withdrawal and Natural Gas Well Site

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    Swamp Angel Energy Guilty of Illegally Dumping 200K Gallons of Brine in PA

    Mother Nature Network (Feb 22)
    Gas drillers plead guilty to felony dumping violations

    Two people from Swamp Angel Energy pled guilty last week to dumping 200,000 gallons of brine in an abandoned oil well in McKean County, Pennsylvania.

    According to the article:

    [P]art-owner Michael Evans, 66, of La Quinta, Calif., and John Morgan, 54, of Sheffield, Penn., admitted dumping 200,000 gallons of brine – salty wastewater that’s created in the drilling process – down an abandoned oil well. The maximum penalty for both Evans and Morgan is three years in prison, a fine of $250,000, or both. Sentencing will be June 24.

    Swamp Angel Energy was (and is currently) drilling in the Allegheny National Forest, located in McKean County. Also according to the article:

    Swamp Angel has 77 active, permitted wells in Pennsylvania, all of them in McKean County.

    Fellow drillers and those in the drilling industry have swiftly and rightly condemned the illegal dumping. The article is anti-drilling with a smug “See, I told you so,” kind of tone, which is to be expected coming from MNN. However, the illegal actions of a few should not be used to paint all drilling companies with the same broad brush.

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    New Marcellus Wastewater Treatment Plant Coming to Elk County, PA

    DuBois Courier-Express/Tri-County (Feb 20)
    Marcellus shale drilling water may be treated at local acid mine treatment site

    Drillers in the Marcellus Shale in Pennsylvania will soon have a new plant to treat wastewater, called flowback, from drilling activities. The new plant will be located in Brandy Camp (Elk County), PA. From the article:

    The project will be located at the existing Blue Valley acid mine drainage treatment and fish culture station in Brandy Camp, which is operated by the Toby Creek Watershed Association, according to a Friday news release.

    The project, to be known as the Blue Valley Hydrofrac Plant, will be owned and operated by Flowback Wastewater Development Group, which has Frank Nickens as director of operations.

    As for capacity of the plant:

    The first phase will provide for treatment of up to 300,000 gallons per day of hydrofracture flowback and production brine wastewaters. The output will be 1.2 million gallons per day of recycled hydrofracture makeup water or 720,000 gallons per day of treated acid mine drainage water.

    The second phase will add an additional 1.15 million gallons per day of treated acid mine drainage.