Statewide PA

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    Marcellus Credited with 90% of New Jobs in PA 2005-2012

    Does Marcellus Shale drilling generate real jobs? You bet it does. Try this statistic on for size: Of all the new jobs created in Pennsylvania from 2005-2012, 90% of them were created by the drilling industry. No, that’s not a misprint. Those numbers come from analysts at Raymond James, a highly respected financial services firm. In addition, new hires in core Marcellus Shale industries were up 35% in the second quarter of 2013 compared to the second quarter of 2010. As one RJ analyst said, “unconventional oil and gas is not just a flash in the pan.” It will be a job-creating engine for decades to come.

    When someone tells you drilling doesn’t create jobs, tell them to go fly a kite…
    Read More “Marcellus Credited with 90% of New Jobs in PA 2005-2012”

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    Are Marcellus Drilling Regs Killing Conventional Drilling in PA?

    A pair of north central PA Republicans from the Pennsylvania House of Representatives along with “hundreds” of independent oil producers are sending a message to PA politicians and regulators: You can’t use the same broad brush you’re using with unconventional shale drilling to paint the traditional conventional drilling in the state. The independents say that new regulations crafted for Marcellus Shale (deep) drilling should not apply to conventional (shallow) drilling and if this ongoing “unfair” situation continues, it will drive conventional drilling in the state, which has been around for 150 years, out of existence.

    Do the independents have a point? Are they an “apple” being regulated by unfair and overly strict “orange” standards? Or to change up the metaphors, is this a case of the buggy whip industry grumbling about those newfangled automobiles?…
    Read More “Are Marcellus Drilling Regs Killing Conventional Drilling in PA?”

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    Bobby Vagt Out as Pres of Heinz Endowments – Fracking Connection?

    Night of the Long KnivesIn August MDN told you about a shake-up taking place at the Heinz Endowments with the firing of “longtime head” of environmental grant making for the Heinz Endowments, Caren Glotfelty (see Heinz Endowments Fires Head of Enviro Grants – Change Coming?). The story is an important one because of the role played by the Heinz Endowments in funding anti-fracking causes. Earlier this year, president of the Heinz Endowments, Bobby Vagt, dared to strike up first a conversation, then a pact, with drillers and a few other brave environmental organizations to found the Center for Sustainable Shale Development (see  Important: Drillers & Enviros Form New Group, Launch Cert Program). Apparently Vagt’s “sell-out” to the drilling industry was the beginning of the end and the enviro-nut long knives came out for him (see Heinz Endowments President Owns $1.2M in Kinder Morgan Stock).

    In what appears to be a move by one of the Endowments’ board members–one of the Heinz boys, Andre–Vagt announced he is “retiring” from his job as president of the Endowments. Looks like the long knives finally found their mark…
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    Unexpected News in Latest BH Rig Counts – 42% Jump in Rigs in…

    From time to time MDN takes a look at the Baker Hughes “rig count”–the number of rotary drilling rigs operating in Pennsylvania, Ohio and West Virginia. The “received wisdom” in the drilling industry that is as goes the rig count, so goes production numbers. Used to be if you saw a decrease in the number of rigs in a given geography, maybe 6-12 months later you would see a corresponding decrease in production from that area. No more. Shale drilling has changed all of that. Nowadays the rig counts go down, and production (in PA anyway), doubles! Why? A lot of wells previously drilled are still waiting to be hooked up to pipelines and begin their production. And shale well production is different from conventional well production. The once simple measurement of more rigs/more production (and the reverse) no longer holds completely true.

    Rig counts are still, however, a useful metric to track. And sometimes they reveal something surprising, as MDN found out today in reviewing the latest numbers. Rig counts are an indication of where there is an increase (or decrease) in new drilling activity. Landowners eager to have a well drilled on their property can use rig counts to gauge how quickly (or not) that may happen. Supply chain companies that sell services to drillers are also interested in tracking rig counts. So what, exactly, did MDN find that surprised us? The big surprise is where rig counts have recently spiked–significantly. It’s in a Marcellus/Utica state you may not expect…
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    Williams Takes Next Step with Transco Leidy Pipeline Expansion

    Williams is hard at work on expanding their Transco Leidy interstate natural gas pipeline–especially in northeast PA around the Scranton area. The “Transco Leidy Southeast Expansion Project” is a massive $610 million project designed to increase the pipeline’s capacity by 525,000 decatherms per day–enough natural gas to serve 2 million homes. The expansion will pipe Marcellus Shale gas to points from New York City to the southeastern U.S. The project includes construction of approximately 30 miles of additional pipe segments, called loops, in PA and NJ, in addition to modifying some existing compressor stations and valve sites.

    The Transco Leidy Southeast Expansion is a multi-year project that Williams hopes will be in service by the end of 2015. They recently took the next step in the project with an official filing with the Federal Energy Regulatory Commission (FERC). An update on the project’s status and what will happen next…
    Read More “Williams Takes Next Step with Transco Leidy Pipeline Expansion”

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    MSC Releases Recommended Practices for Drilling & Completions

    There are the rules and regulations that drillers must follow, issued by state laws and by regulatory agencies like the PA Dept. of Environmental Protection, the WV Dept. of Environmental Protection, and the Ohio Dept. of Natural Resources. The rules & regs are non-negotiable. But then there are “best” or “recommended” practices–those things drillers can and should do that go above and beyond the letter of the law. The Marcellus Shale Coalition, whose members are many of the largest energy companies in the world, has issued seven such “recommended practices” documents to date for its members. They’ve just released the eighth, titled “Recommended Practices for Drilling and Completions.”

    This latest set of practices is arguably one of the most important, affecting how drillers drill–everything from spacing to safety to well control technologies…
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    MSC to PA Dem Gubernatorial Candidates: Nix the Big Tax Idea

    Most (all?) of the candidates who have announced they are running for the Democrat nomination for governor in Pennsylvania have said they will (a) increase regulation on the Marcellus Shale industry, and (b) dramatically increase taxes on the industry. Democrats either don’t know or don’t care that such taxes suffocate businesses and cause those businesses to go elsewhere. It’s a fact, not a threat.

    The Marcellus Shale Coalition (MSC)–a group of some of the biggest drillers and midstream companies in the Marcellus–have weighed in and are giving PA’s Democrat gubernatorial candidates a verbal slap about their plans to tax and regulate…
    Read More “MSC to PA Dem Gubernatorial Candidates: Nix the Big Tax Idea”

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    PA DEP Files Required Report on So-Called Climate Change Affects

    Let’s assume, just for the sake of argument, that there really is a Santa Claus. Let’s further assume brilliant politicians in Pennsylvania want a state government agency to do a “scientific study” of the physics of how Santa can visit all of the homes in PA in a single night–Dec. 24–and still make it home to the North Pole in time to eat cookies by sunrise. The purpose of the report is to reassure the little kiddies that Santie is real and yes, he can and does get it all done in a single night.

    Now assume that those same PA politicians believe in another fairy story–something called man-made global warming (now renamed to “climate change” because the earth’s so-called average temperature hasn’t risen in the last 15 years)–and that said politicians directed a state agency–the Dept. of Environmental Protection–to draft up a document detailing how the big, bad bogeyman of global warming will affect all the little boys and girls in PA, and oh, by the way, don’t forget to sprinkle the report with lots of talk about “renewables” because we hate nasty fossil fuels, ya know. And snap snap, get that report written PDQ!

    Unfortunately, the second scenario above is true. And when the DEP was late in filing this exercise in fantasyland, PA eco-nuts and anti-drillers got their knickers in a twist. They can untwist them now–the fairy story report is finally here…
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    PA Natural Gas Advisory Committee Holds First Meeting

    Hats off to the Pennsylvania Dept. of Conservation and Natural Resources for convening the first-ever meeting of the Natural Gas Advisory Committee (NGAC) on Wednesday, Oct. 9 in State College, PA. NGAC membership is composed of people from the drilling industry, academe and even anti-drilling environmental groups (like Trout Unlimited). It’s quite a feat to get them all in the same room and talking to each other.

    NGAC was a recommendation that came out of Gov. Tom Corbett’s Marcellus Shale Advisory Commission, chaired by Lt. Gov. Jim Cawley. Here’s who attended, and what was on the agenda:
    Read More “PA Natural Gas Advisory Committee Holds First Meeting”

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    New Study: No Increase in Childhood Cancer Rates Near PA Fracking

    More bad news for anti-drillers. A recently published study in the peer-reviewed Journal of Occupational and Environmental Medicine (July 2013 issue) looks at incidences of childhood cancers in Pennsylvania–in areas with hydraulic fracturing. The study, titled “Childhood Cancer Incidence in Pennsylvania Counties in Relation to Living in Counties With Hydraulic Fracturing Sites” (full copy embedded below) looks at the rates of cancer both before fracking begins, and then again after fracking has been going on.

    And what did this scientific study find? Statistically, there are no increases in childhood cancers in areas where there is fracking. Bad news for anti-drillers–good news for everyone else, including “the children”…
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    How Do You Talk to (Educate) Friends & Neighbors About Shale?

    It’s a common problem for those of us who are immersed in the shale energy industry. We are so saturated all the time with the arguments and counter-arguments and details about shale drilling, that when faced with a family member, friend or neighbor who isn’t well-versed in the industry, we grope for the words and terms to use to describe this incredible industry and its successes. Most of the time our friends and family have a built-in reticence and caution about shale drilling because they know nothing more than what mainstream media feeds them, most of it untrue.

    So how do we quickly, accurately and effectively communicate the positive shale drilling message? Michael Krancer, former Secretary of the PA Dept. of Environmental Protection, has a solution, which he shared recently at the Energy Inc. conference in Pittsburgh…

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    Should PA Compressor Plants Miles Away be Considered “Adjacent”?

    A few weeks ago at the Shale Insight 2013 event in Philadelphia, MDN heard a panel discussion that tackled a thorny, and on-going, issue in Pennsylvania. The issue is complex, but if we can condense it to a brief statement, it would be this: Should processing and compressor plants that are connected by pipelines but not directly next to each other be considered a “single source” when it comes to the pollution they emit? The argument comes down to the concept of adjacency–what does the word “adjacent” mean in the federal Clean Air Act? Does it mean “directly next to each other,” or “in the same general vicinity” (up to X miles away)?

    If the plants scattered in a general area–say 20-30 miles around–are considered a single source or “adjacent”, it means collectively they would be considered a “major source” of pollution and therefore subject to very strict federal guidelines under the Clean Air Act. If they are not adjacent and not a single source, they are regulated by the state and the state has less onerous rules when it comes to air pollution emissions. It may sound like a small difference, but being regulated by the EPA or the state of Pennsylvania is a huge (and expensive) difference. The real question is, are residents who live in areas with an abundance of compressor stations and processing plants being exposed to dangerously high levels of air pollution?…
    Read More “Should PA Compressor Plants Miles Away be Considered “Adjacent”?”

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    17 State Chambers of Commerce to EPA: States Regulate Fracking

    On Sept. 20, 17 state Chambers of Commerce sent a joint letter to President Obama’s new EPA Administrator, Gina McCarthy. They opened the letter (full copy below) with a nice greeting and a congratulations on her recent confirmation as administrator, and then immediately launched into a statement (not really a request) that tells her to, in so many words, keep her mitts off fracking. That is, leave the regulation of fracking where it properly and Constitutionally belongs–with the individual states.

    The federal government does not have a Constitutional role in regulating fracking and the Chambers of Commerce, representing 34% of all states and from the biggest oil and gas producing states in the Union–want to keep it that way. Not surprisingly, among the signatories are the Pennsylvania, Ohio and West Virginia Chambers of Commerce…
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    PA Republicans Introduce 4 Royalty Bills, Mea Culpa?

    A new PA law was supposed to give leased landowners whose property has had drilling more protections with respect to royalties, but instead ended up harming some landowners who are not leased by allowing forced pooling of their land–weakening their bargaining position (see PA Gov Corbett Signs Back-Door Forced Pooling Bill into Law). PA landowners in general and the National Association of Royalty Owners (NARO), PA chapter in particular were not pleased with the new law. Perhaps in an attempt to get back into the good graces of PA landowners, several Republican state lawmakers whose districts are in the Marcellus Shale have introduced a plethora of new bills to protect royalty interests of landowners.

    A group of four House Republicans, led by Rep. Garth Everett (R-Lycoming County), recently introduced House Bill 1684, which seeks to clarify state law regarding the minimum royalty payment for landowners so that the deduction of post-production costs from unconventional wells may not result in royalty payments less than the guaranteed minimum. On the Senate side, Sen. Gene Yaw, whose district covers many of the northeastern PA drilling counties, introduced a series of three companion bills to HB 1684. It seems the Republicans can’t do enough now to help out leased landowners…
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    Dow Disingenously Tells Shell to Forget About a PA Cracker Plant

    Manufacturing and labor leaders held a confab yesterday in Pittsburgh to discuss jobs, the economy, and how the Marcellus is lifting both in southwestern Pennsylvania (see our companion story today). One of the speakers at yesterday’s meeting was Peter Molinaro, vice president and senior advisor on government affairs for The Dow Chemical Co. One of Dow Chemical’s chief rivals and competitors is Shell Chemical. Shell, as MDN readers are well aware, is currently conducting a multi-year evaluation of whether or not to build a regional ethane cracker plant in Beaver County, PA, outside Pittsburgh about 30 miles.

    It probably won’t surprise you that Dow’s Molinaro said at yesterday’s meeting that PA probably doesn’t need a cracker plant after all. Are Molinaro’s comments about a PA cracker wise and measured counsel from an industry participant who has a feel for the economics of U.S. manufacturing and what it truly needs? Or are his comments trash-talking a competitor in hopes of scuttling a deal and eliminating competition so more ethane will be pipelined to the Gulf–where Dow’s cracker plants are located? You decide…
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