Statewide PA

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    PA Gas Production #s Released: Top 10 Wells, Top 5 Counties & More!

    Top 10Pennsylvania released their second half 2013 production numbers yesterday and man oh man is it another sizzling hot report. Another 700 horizontal (mostly Marcellus) shale wells were brought online in the second half of 2013 in PA which brings the number of horizontal wells with reported production to 5,074. And, in what we believe is a first, Susquehanna County has displaced Bradford County as having the most production during a 6-month reporting period.

    Not surprisingly Cabot Oil & Gas and their prolific wells in Susquehanna County top the list as most productive. Get this, when you look at average daily production by wells, Cabot has the top 13 most productive wells in the state for 2H13–all top 13 spots. When you expand it out, they have 17 of the top 20 spots, and 34 of the top 50 spots. Truly astonishing.

    Below we have a few lists for you: Top 10 All Time Producing Wells in PA, Top 10 Wells by Production per Day, and the amount of gas produced by the top 5 counties in PA…
    Read More “PA Gas Production #s Released: Top 10 Wells, Top 5 Counties & More!”

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    Do PA Drillers have Law on Their Side in Royalty Debate?

    A sharp MDN reader, John S., emailed MDN to remind us of how PA landowners ended up in the quagmire they are now in with regard to royalties with drillers (like Chesapeake) deducting post-production expenses from what they pay to landowners. We had forgotten about the Kilmer v ElexCo Land Services case from March 2010 in which the PA Supreme Court ruled that drillers could indeed deduct certain post-production expenses without violating the law that says landowners must be paid a 12.5% minimum royalty (see Breaking News: PA Supreme Court Rules Against Landowner Seeking to Invalidate Lease).

    PA Gov. Tom Corbett wrote a letter to Doug “the ax” Lawler at Chesapeake telling him the company’s royalty calculations were unfair at best, and perhaps illegal. Doug just has to point to the 2010 PA Supreme Court case. Here’s more information about the 2010 case and what the decision means, and doesn’t mean:
    Read More “Do PA Drillers have Law on Their Side in Royalty Debate?”

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    CONSOL to Begin Ethane Shipments Next Year–to Europe?!

    CONSOL Energy is a big, important driller in the Marcellus and Utica Shale. Most of their operations are in “wet gas” areas–those locations that produce a lot of natural gas liquids (NGLs), like ethane, along with “dry gas” or methane. Although CONSOL has a lot of acreage in southwestern PA and in WV and eastern OH, the ethane they produce will not be going to a proposed new ethane cracker plant being built by Odebrecht in Parkersburg, WV. Instead, CONSOL is going to send their ethane by pipeline to an export facility in Philadelphia, and from there, on to Europe for processing and use in European petrochemical factories.

    Why in the world ship ethane all the way to Europe for processing instead of selling it in your own back yard? Timing. CONSOL doesn’t want to wait the 4-5 years for an ethane cracker to be built (if it’s built at all). They’ve adopted a “bird in hand” strategy. They’d rather start shipping it next year, when Sunoco Logstics’ Mariner East pipeline is up and running, rather than wait. And so CONSOL, according to their announcement below, has locked in a deal with Ineos Europe AG. But don’t despair, CONSOL also previously signed an agreement with Shell to provide its cracker plant in Beaver County, PA with ethane–when and if that plant gets built…
    Read More “CONSOL to Begin Ethane Shipments Next Year–to Europe?!”

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    WPX Gives MDN an Update on Their 2014 Marcellus Plans

    Yesterday MDN brought you the news that WPX Energy seemed to be waving good-bye to the Marcellus, based on our observation that they will not do any new drilling in the Marcellus in 2014 (see WPX Energy Abandoning the Marcellus? Sure Looks That Way). Upon posting that story, WPX official Susan Oliver contacted MDN to provide some perspective and background. MDN concludes that we had most of our analysis right, but we may have left the wrong impression by using the word “Abandoning” in our headline. We want to clear this up right here and now, at the beginning of this update: WPX Energy is not leaving the Marcellus. That is, the 100 or so wells they’ve already drilled here in the Marcellus will continue to be WPX wells. We thank the company for making that clarification and apologize to landowners if we gave you a bit of shock.

    However, WPX is, as we noted yesterday, not doing any new drilling in the Marcellus–at least in 2014 and likely beyond. That part of yesterday’s story was correct. As Susan told us, the change we see reflected in their 2014 budget and drilling plan is that the company is shifting from drilling to production in the Marcellus. As for their new drilling program in 2014, they owe it to their stockholders to drill new wells in more oily shale plays–places where they will make more money, quite frankly. And you can’t fault them for that…
    Read More “WPX Gives MDN an Update on Their 2014 Marcellus Plans”

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    Penn State Figures Out How to Convert Garbage into Proppants

    Shale drilling uses a special kind of sand called silica. It uses a LOT of silica, which is mostly mined in the Midwest, in places like Wisconsin. Sand is called a “proppant” in the industry because it “props open” tiny little holes in fracked shale rock to allow the natural gas (or oil or NGLs) to slip out and up the borehole. There are alternatives to silica as a proppant material–but not many are economic to use. What if you could turn industrial and domestic waste materials into a viable alternative source of raw materials for proppants? That is, what if you could turn garbage into the equivalent of sand? That would be so cool, getting rid of industrial waste on the one hand, creating a cheap source of proppants on the other.

    Turning garbage into proppants is exactly what the brains at Penn State have now figured out how to do. Below is the announcement from Penn State that a pair of their materials scientists have published a new paper in a scientific journal (copy of the paper embedded below). The announcement and paper trumpet the discovery that there is a better way to create cheap proppants for shale drilling, and it was discovered right here in Marcellus Shale country…
    Read More “Penn State Figures Out How to Convert Garbage into Proppants”

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    WPX Energy Abandoning the Marcellus? Sure Looks That Way

    bye byeWPX Energy, the drilling division of Williams that was spun off into its own company just two years ago, continues to “bump along the bottom” according to an unflattering article on The Motley Fool investor’s website (see WPX Energy Still Lacks Growth, Leading to Low Valuation). MDN told you about the shakeup in WPX’s leadership in December (see CEO Shake-up Explained: Taconic Capital Jerking WPX’s Chain). New CEO Jim Bender released WPX’s 2014 plan of action and capital spending budget on Monday. Although the company had 33 unique drill permit locations for the last four months of 2013 in PA according to the recently published Marcellus and Utica Shale Databook, it appears to us that for 2014 WPX plans to drill precisely zero new Marcellus wells, which of course is a disappointment–especially for landowners signed with WPX who haven’t yet seen drilling on their land.

    Looking at WPX’s 2014 budget (see below), there is a paltry $20-$30 million budgeted for the Marcellus (i.e. “Appalachia”), likely being used to finish wells started at the end of 2013. There’s a big fat goose egg for the number of rigs they plan to operate in the Marcellus this year. Our conclusion: WPX is saying bye-bye to the Marcellus. Is this yet more chain-jerking by Taconic and corporate raiders? Is it really the wisest course for WPX to abandon the northeast? Below is their announcement about 2014 plans, and the forecast of where they will spend $1.47 billion this year…
    Read More “WPX Energy Abandoning the Marcellus? Sure Looks That Way”

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    New SRBC Research Finds Marcellus Drilling Safe for Water

    This is fascinating–at least for those of us with an interest in the Marcellus and Utica Shale. The Susquehanna River Basin Commission (SRBC) which monitors and controls water withdrawals from creeks and rivers that empty into the mighty Susquehanna River (which eventually empties into the Chesapeake Bay), has long been a model of how to properly manage the areas under their control when it comes to shale drilling. The SRBC stands in stark contrast to the dysfunctional Delaware River Basin Commission (DRBC) which is hamstrung by New York City influence–apparently beholden to self righteous and self important liberal fat cats like Gov. Can’t-Make-a-Decision Cuomo and Mayor Ban-All-Fracking Bill de Blasio.

    While the DRBC dithers, along with Cuomo, on whether or not to allow drilling, the SRBC forges ahead and does real science–out in the field–to ensure the water resources under their management are not being adversely impacted by Marcellus drilling. The SRBC launched a state-of-the-art Remote Water Quality Monitoring Network in 2010 to track water quality throughout the SRBC region. They’ve just issued a second, comprehensive report on their findings thus far (embedded below). And what are those findings? Marcellus Shale drilling is not/has not adversely affected water quality anywhere in the SRBC region. Huh. Who would of imagined that? Science yet again proves that shale drilling is safe for water supplies…
    Read More “New SRBC Research Finds Marcellus Drilling Safe for Water”

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    Loyalsock Drilling Gets an Anti-Drilling Spin Job by PennFuture

    spinWe normally skip pronouncements from extremist anti-drilling groups like PennFuture. They, along with other PA groups like PennEnvironment, the League of [Liberal Democrat] Women Voters, Sierra Club, Shale Justice…you get the idea–hold unreasonable views on shale drilling and development. They simply want it all stopped–which ain’t gonna happen. There is no reasoning with them–no middle ground or acceptable way to drill for shale for such groups. So they become ever-more shrill in their false accusations and allegations about what may/maybe/might/could/possibly/theoretically happen if a particular area were to see shale drilling. Say, oh, like the Loyalsock State Forest in PA.

    We include a press release by PennFuture below, spinkled with lots of unspoiled this’ and pristine thats, pushing the panic button that (gasp) Anadarko Petroleum might actually be allowed to drill on land they legally hold the rights to drill on (see Manufactured Controversy over Drilling in Loyalsock State Forest). Why, that forest actually contains a “critical bird nursery”–can you imagine the malevolent intent of disturbing little birdies? What a wicked company Anadarko must be. Below is the PennFuture press release that we think has more to do with fundraising than any real or imagined harm that may come to Loyalsock. We bring it to you as an example of a masterful spin job…
    Read More “Loyalsock Drilling Gets an Anti-Drilling Spin Job by PennFuture”

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    Ben Franklin Shale Gas Center Wins a Prize Itself – $750K

    For the third year running, the Ben Franklin Technology Partners Shale Gas Innovation & Commercialization Center (SGICC) holds a contest for newly-launched small businesses with innovative products or services for the Marcellus Shale drilling industry (see 2014 Ben Franklin Shale Gas Contest – $100K in Cash Prizes!). The deadline to apply for this year was Feb. 1, and after an extensive review process, four winners of $25,000 prizes will be announced on May 15 in Pittsburgh. You might say four awards totaling $100K isn’t much, but thanks to a grant from the State of Pennsylvania, the SGICC is about to help far more than four companies at a time.

    Yesterday the Secretary of the PA Department of Community and Economic Development (DCED) visited State College, PA to confer a $750,000 grant on the SGICC. There are many worthy upstart companies each year that can use a small economic boost to bring their new idea/technology to market. The SGICC will use the new grant money to do just that by in turn making small grants themselves–with an important string attached. The recipient company must match the grant with their own 1-to-1 matching investment. If the SGICC awards a grant of $20,000, the company receiving it must match it with their own $20,000. SGICC has already made their first grant, in Punxsutawney…
    Read More “Ben Franklin Shale Gas Center Wins a Prize Itself – $750K”

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    PA’s Long-Lived Marcellus Renaissance Can’t be Denied, Even by NY

    Judging by the stories we’re now seeing, must be Gov. Cuomo’s internal poll numbers are a lot worse than we thought. So bad that his buddies at Gannett need to try and prop him up by rewriting current history. Get this, the headline for a story in the Binghamton Press & Sun-Bulletin actually attempts to make the claim that the economic miracle happening right across our border in PA…isn’t actually happening! Talk about chutzpah. “Pay no attention to all of those jobs–all of that money–all of the new tax revenue. None of it’s real. It’s all a flash in the pan. Here today, gone tomorrow.”

    Wow. We guess you can fool some of the people all of the time, going by the PSB’s propaganda…
    Read More “PA’s Long-Lived Marcellus Renaissance Can’t be Denied, Even by NY”

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    PA Dems, DRBC Squeal over Proposed Cut to DRBC Budget

    The Delaware River Basin Commission suckling pig is about to have less slop in the trough to gorge itself on, thanks to wise oversight by PA Gov. Tom Corbett. The DRBC, for those who don’t know, is an interstate quasi-governmental agency made up of the states that are in the Delaware River Basin, including Pennsylvania, New York, New Jersey (where HQ for the DRBC is located) and Delaware. The governors for each of those states plus a representative from the U.S. Army Corps of Engineers make up the voting board of the DRBC.

    For years PA has borne the brunt of the funding for the DRBC–disproportionately–lavishing the DRBC staff with buckets of cash with which they supposedly do their jobs. PA has had enough. Time for the other states that profess to love the DRBC so much to pull their own weight, so Corbett has decreased the amount of money PA will contribute to the trough. And that has the pigs squealing, including Corbetts potential Democrat opponents for the governor’s chair and (not surprisingly) DRBC staffers who have gone apoplectic with dire warnings…
    Read More “PA Dems, DRBC Squeal over Proposed Cut to DRBC Budget”

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    Harrisburg Newspaper Criticizes 0.00255 Drilling Part of PA Budget

    If you want to know what the prevailing political attitudes are from Pennsylvania’s (Democrat) politicians, look no further than the editorial page of the Harrisburg Patriot-News newspaper. There you’ll find whatever the next party line attack will be against PA Republicans and/or the shale drilling industry. And so today what do the learned, careful, deliberative minds of the PN editors focus on in PA Gov. Tom Corbett’s proposed budget which he unveiled on Tuesday–a budget which is an astonishing $29.4 BILLION in size and includes spending INCREASES for education and old folks but no broad-based tax increases? One of the sources for revenue in the budget–pocket change really–is a measly $75 million (which is 0.00255, or roughly 2/10ths of 1% of the entire budget) raised by allowing a little bit more drilling under, not on, state forests. And that’s what the editors at the PN jump on about the budget. Amazing.

    What’s even more amazing is the mental gymnastics they have to perform to criticize Corbett’s proposal–a proposal that does not allow any new rigs or drill pads on state forest lands! They resort to quoting anti-drilling organizations like PennFuture with arguments made with more “maybes,” “mights,” and “coulds” than you can count. In other words, absent any scientific evidence to the contrary, we should not do something (that Eddie Rendell and John Hanger once did, raising $444 million), simply on Democrat anti-drillers’ say-so. Maybe the PN editors like Hanger’s plan to turn PA into a bunch of pot smokers (they can tax) instead? We say, no thanks…
    Read More “Harrisburg Newspaper Criticizes 0.00255 Drilling Part of PA Budget”

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    PA Gov. Corbett’s Bold Plan for More Drilling in State Forests

    marijuana jointPA Gov. Tom Corbett released his draft budget yesterday and his plan calls for ending the now three-year moratorium on drilling in state forests–which will bring in $75 million for Harrisburg politicians to play with. Predictably, the Democrats are squealing like stuck pigs about the proposed lifting of the moratorium. John Hanger, former Secretary of the Dept. of Environmental Protection under “Fast Eddie” Ed Rendell has already gone on record opposing drilling in state forests (see PA Democrat Gov Candidates Support Partial/Full Moratorium). Apparently John thinks there’s more money to be made by turning PA into a pot smoking state (see John Hanger pushes Democratic gubernatorial rivals to address progressive agenda). New campaign slogan: Pass a Joint for John!

    Here’s the “funny” part: Rendell and Hanger leased state forests in 2009 & 2010 and hauled in $444 million for the state–then they clamped down and stopped it before leaving office. Apparently moratoriums on drilling in state forests are good for thee but not for me when it comes to PA Dems like Hanger. Here’s more on Corbett’s bold plan to re-open some state forests for drilling:
    Read More “PA Gov. Corbett’s Bold Plan for More Drilling in State Forests”

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    UGI/AmeriGas Talks up the Marcellus & NEPA Auburn II Pipeline

    AmeriGas Partners is the nation’s largest propane company, serving 2 million+ residential, commercial, industrial, agricultural and motor fuel propane customers from 1200 locations in all 50 states. Chances are in a city of any size, there’s an AmeriGas storefront someplace around town. AmeriGas is also a subsidiary of PA-based utility company UGI. AmeriGas/UGI held a conference call yesterday to discuss the company’s first quarter financial performance (their quarters are slightly different from calendar year quarters).

    There were a number of references to the Marcellus made by John Walsh during the call. Walsh is the vice chairman of AmeriGas and president of UGI. Most of those Walsh’s references revolved around UGI’s Auburn Pipeline gathering system that finally went live last year (see UGI Wins! Auburn Pipeline with Marcellus Gas in NEPA Goes Live). We’ve selected out relevant portions of Walsh’s remarks from yesterday mentioning the Marcellus Shale and it’s importance to UGI’s future:
    Read More “UGI/AmeriGas Talks up the Marcellus & NEPA Auburn II Pipeline”

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    The Unconventional Rise & Sale of Atlas Energy

    Atlas Energy, aka Atlas Resource Partners and Atlas Pipeline Partners, is a Pittsburgh-based exploration and production (E&P) and midstream company with active drilling operations not only in the Marcellus/Utica region but another four resource plays as well. The company has an unconventional history, to say the least. The entrepreneurial Cohen family from Philadelphia bought a major stake in the company in the late 1990s and installed son Jonathan in Pittsburgh to help run it. The Cohens had no special knowledge or foresight but seemed to be in the right place at the right time (the Marcellus Shale), because in 2010 the Cohens sold Atlas Energy to Chevron for a pile of cash (see India’s RIL Loses Bidding War for Atlas Energy – $4.3 Billion Deal with Chevron Goes Forward).

    An interesting story about the entrepreneurial Cohen family, the businesses they’ve founded or grown, and the rise of Atlas Energy as a major driller in the Marcellus…
    Read More “The Unconventional Rise & Sale of Atlas Energy”

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    Range Floats Plan to Use Drill Cuttings to Build Roads

    This one is sure to set the anti-frackers into a tailspin. Range Resources has applied to the PA State Dept. of Environmental Protection (DEP) to begin using drill cuttings (leftover rock and dirt that comes out of the ground) as an “aggregate” or material to build roads to drilling sites. There’s nothing wrong with drill cuttings, but sometimes there are low levels of radioactivity found in them–far below any kind of health threat. But we can see the headlines now: Radioactive Roads! Run for the Hills! Drillers Want to Poison Mother Earth! That’s how the shrill anti-fossil fuel lobby will try and spin this.

    We’re sure Range knows they’ve opened a can of worms with this one. Let’s see how it all plays out in the coming 60 days, the time period authorized by the DEP to receive public comments on the proposed plan…
    Read More “Range Floats Plan to Use Drill Cuttings to Build Roads”