West Virginia

Barbour County | CONSOL Energy | Energy Companies | Lease & Royalty Payments | Pennsylvania | Statewide WV | Washington County | West Virginia

CONSOL Buys 90K WV Marcellus/Upper Devonian Acres, Well Report
December 10, 2013December 10, 2013

CONSOL Energy issued a press release today updating their Marcellus Shale well results from wells drilled in Washington County, PA. In addition to PA, CONSOL owns leases for and is actively drilling in the West Virginia Marcellus area–most of it in the “wet gas” (natural gas liquids) area of the Marcellus. The update says they just completed their first pad in Barbour County, WV, a pad with six wells on it.

The big news in today’s announcement: CONSOL has just purchased another 90,000 acres of leases in WV–from Dominion Resources–for $190 million ($2,111 per acre). The deal will allow CONSOL to not only drill in the Marcellus layer, but also the Upper Devonian shale layer as well. CONSOL is one of the few drillers (so far) targeting the Upper Denonian (see MDN’s Upper Devonian category for stories about who else is targeting that layer)…
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Economic Impact | Ethane | Industrywide Issues | Jobs | Ohio | Processing Plants | Statewide OH | Statewide WV | West Virginia | Wood County

More Details Leak About Proposed WV Ethane Cracker Plant
December 9, 2013December 9, 2013

A few weeks ago WV and Brazilian-based Odebrecht announced plans to build an ethane cracker plant near Parkersburg, WV (see WV Announces Brazilian Company to Build Ethane Cracker Complex). Wayne Dunn, the president of the commission that governs Wood County, WV where the cracker would be built, recently said some very interesting things about the cracker. One comment: he’s known about the Odebrecht cracker for more two years! Congratulations to a politician that can keep a secret that long.

Dunn also said he pegs the chances that the Odebrecht cracker will be built at somewhere between 60-80%. He says it’s far from a done deal, but the odds are better that it will be built than not. Here’s a few more interesting “insider” insights into the proposed cracker plant coming to Parkersburg, WV:
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Industrywide Issues | Jobs | Statewide WV | West Virginia

One of WV Gov. Tomblin’s Biggest Fears: Untrained Workers
December 9, 2013December 9, 2013

Gov. Earl Ray Tomblin went to Europe to find him an ethane cracker plant, and by golly he did (see WV Announces Brazilian Company to Build Ethane Cracker Complex). Tomblin knows that an ethane cracker plant is an economic bonanza like none seen in the northeastern U.S. in generations–maybe centuries. Yes, it’s that big a deal–and he knows it. Kudos to Gov. Tomblin for persevering and finding a cracker plant for WV.

Now that it looks as if a cracker will come to WV, something else is keeping Gov. Tomblin up at night. Last week at a breakfast meeting Tombin said that one of his biggest fears is not having a trained workforce in WV to build and operate the cracker. So Gov. Tomblin is now on a new mission: get WV residents trained and ready…
Read More “One of WV Gov. Tomblin’s Biggest Fears: Untrained Workers”
Statewide WV | West Virginia

Paper Co MeadWestvaco Sells Forest Acreage, Keeps Marcellus Rights
December 9, 2013December 9, 2013

In our trawl of the daily news, MDN noticed last week that paper and manufacturing giant MeadWestvaco (MWV) Corporation (the makers of At-a-Glance planners and calendars) has sold ALL of its forestland in the U.S.–501,000 acres in all–to Plum Creek Timber Company for $1.1 billion.

Why is that interesting to MDN? Because according to the MWV the one thing not part of the deal are the oil and natural gas rights on 191,000 Marcellus Shale acres in West Virginia. MWV knows a good thing when they have it…
Read More “Paper Co MeadWestvaco Sells Forest Acreage, Keeps Marcellus Rights”
Harrison County | Industrywide Issues | Pipelines | Supply Chain | West Virginia

Supply Chain: WV Company Specializes in Hard-to-Lay Pipelines
December 5, 2013December 5, 2013

Looking to get a piece of the Marcellus/Utica Shale business for your company (i.e. plug in to the supply chain)? Think niches. An interesting story about a West Virginia construction company that specializes in digging and laying pipelines for the oil and gas industry. But they don’t specialize in the easy stuff–they specialize in the hard stuff…laying pipeline over hills and mountains.

The company, Ronald Lane Inc., has to hang their backhoes from two to four steel cables, dangling on the side of mountains! And they have all the work they can handle because of the Marcellus…
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Industrywide Issues | Lease & Royalty Payments | Litigation | Preston County | West Virginia

Developments in WV Lawsuit to Rescind $5/Acre Leases
December 4, 2013December 4, 2013

Way back in March MDN told you about a lawsuit filed by landowners in Preston County, WV. They sued Magnum Land Services and Belmont Resources LLC to have leases they were snookered into signing for as little as $5 per acres rescinded on the basis of fraud and a variety of other legal claims (see Update on WV Lawsuit to Rescind $5/Acre Leases). There’s been a major development in the case.

U.S. District Judge Irene Keeley has dismissed charges against 19 employees from Magnum and Belmont because the paperwork was not timely. She also dismissed half the counts brought by the landowners against the companies. Plus, we now have a date for a trial: October 2014. Justice delayed…
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Economic Impact | Industrywide Issues | Ohio | Pennsylvania | Statewide OH | Statewide PA | Statewide WV | West Virginia

List of U.S. Shale Plays Ranked by Profitability (IRR)
December 3, 2013December 2, 2013

Thanks to our ever-helpful second set of eyes, Chris Acker, MDN was alerted to a Seeking Alpha article with a table showing the Internal Rate of Return (IRR) for commercially developed U.S. shale plays. It is a way of ranking shale plays (specific regions within plays) that shows the profitability of the plays. The higher the IRR percentage, the better/more profitable that play is. A dollar of investment goes further with a higher IRR.

And what did we spot in scanning the chart? The top spot–the most profitable shale play in America–is the “Marcellus Super Rich” area located in southwest PA and the northern panhandle of WV. The second most profitable play, virtually tied with the Marcellus? The “Utica Liquids Rich” region in eastern OH. It’s a fascinating table. Have a look…
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Chief Oil & Gas | Clarion County | Electrical Generation | Energy Companies | Energy Services | Greene County (PA) | IMG Midstream | Industrywide Issues | Pennsylvania | Statewide WV | Susquehanna County | West Virginia | Wyoming County (PA)

4 Electric Plants Coming to NE PA, Powered by Marcellus Gas
November 27, 2013November 27, 2013

In August MDN told you the news that Chief Oil & Gas has struck up a deal with IMG Midstream (sort of misnamed, IMG is not a pipeline company) to provide IMG with Marcellus Shale gas to power several small regional, super efficient and low-polluting electric generation plants they plan to build in northeastern Pennsylvania (see Chief Strikes Deal to Provide Marcellus Gas for Electric Plants). We have good news: projects to build those plants are moving forward with all due speed.

We now know that there are four plants planned for Pennsylvania and one for West Virginia. We also know where those plants will be built…
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Economic Impact | Hydraulic Fracturing | Industrywide Issues | Ohio | Pennsylvania | Pipelines | Processing Plants | Research | Statewide OH | Statewide PA | Statewide WV | West Virginia

Deloitte & EIA: 90,000 Marcellus Wells Drilled in Next 20 Years
November 25, 2013November 25, 2013

A new report published by consulting powerhouse Deloitte references (and affirms) U.S. Energy Information Administration’s predictions that it will take at least $5 trillion of investment in the oil and gas sector between now and 2035 to main current levels of oil and natural gas production and meet future demand as it rises. The report is titled “The challenge of renaissance: Managing an unprecedented wave of oil and gas investment.” Unfortunately we couldn’t locate a copy–but reportedly it’s full of interesting facts–like the $5 trillion number.

Another eye-popping number from the report: Current estimates are that 90,000 Marcellus Shale wells will be drilled over the next 20 years. That kind of activity will spur an unfathomable economic revival in the northeast like we haven’t seen in since, well, forever! The study says while “trillions” will be spent on upstream (drilling), “hundreds of billions” will need to be spent on midstream (pipelines & processing plants) in order to keep up with the production. More from the Deloitte study…
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Economic Impact | Hydraulic Fracturing | Industrywide Issues | New York | Ohio | Pennsylvania | Research | Statewide NY | Statewide OH | Statewide PA | Statewide WV | West Virginia

Marcellus/Utica States Slip in Global Petroleum Survey
November 21, 2013November 21, 2013

Each year, the Canadian-based Fraser Institute surveys petroleum industry executives and managers (864 of them for 2013) asking them their opinions on the barriers to investing in exploration and production in various geographies across the globe. That is, what makes them more likely or less likely to spend money drilling in a particular location? It’s vitally important to understand what drives investors because without money, drilling doesn’t happen.

The Global Petroleum Survey, as it’s called, tallies the survey responses and ranks each geography from most desirable place to invest, to least desirable. MDN reported the rankings last year (see Energy Execs Rank Drilling Locations Including WV, OH, PA, NY). A copy of this year’s full report/rankings is embedded below. How did Pennsylvania, Ohio, West Virginia and (yes) New York fare this year, compared to last?…
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Forced Pooling | Industrywide Issues | Statewide WV | West Virginia

Forced Pooling Talk at WV Legislative Interim Meeting
November 21, 2013November 21, 2013

Like a bad penny, the issue of forced pooling (or “unitization” or whatever you want to call it) keeps turning up in West Virginia. WV legislators are in the midst of holding an interim meeting, and this week they heard from both supporters and opponents of forced pooling.

The sharp lawyers from Lewis Glasser Casey & Rollins made this observation about the session where it was discussed:
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Economic Impact | Energy Services | Ethane | Industrywide Issues | Jobs | Odebrecht | Processing Plants | West Virginia | Wood County

Analysis: Why Parkersburg, WV for a Cracker Plant Complex?
November 20, 2013November 20, 2013

Don Surber from the Charleston Daily Mail writes a good analysis article in today’s edition that attempts to answer the question, “Why would Brazilian company Odebrecht pick Parkersburg, WV to build an ethane cracker plant?” Surber argues the selection of Parkersburg as the location vaults it into potentially being the most important city in the entire state of WV. He’s right.

Surber’s main point: Don’t focus on the ethane cracker, as nice as that will be. Instead, it’s the three polyethylene plants Odebrecht is going to build that are the real story, the real diamond, if (still a big if) the ethane cracker gets built. Why? It is the polyethylene (plastics) plants that will create a renaissance in manufacturing (i.e. jobs) in the region…
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Accidents | Blue Racer Midstream | Caiman Energy | Dominion Energy | Energy Services | Industrywide Issues | Marshall County | Processing Plants | West Virginia

Blue Racer’s Natrium Plant to Remain Offline Until Jan 2014
November 19, 2013November 19, 2013

Blue Racer Midstream, a joint venture between Dominion Resources and Caiman Energy II, had an explosion and fire at its Natrium, WV processing plant/fractionation facility in September (see Explosion/Fire at Blue Racer’s Natrium, WV Processing Plant). Since then, at least two Blue Racer customers have found alternatives to using the Natrium facility: Rex Energy and Atlas Resources. More drillers adversely affected by the facility being offline (some of whom complained about the plant closure last week at the DUG East conference in Pittsburgh) may also be in the hunt for alternatives, especially with the announcement the plant will remain offline until “at least January” of 2014. That’s bad news for drillers and for Blue Racer, although they obviously have to repair the facility and ensure whatever caused the explosion/fire does not happen again.

As part of upgrades at the facility, Blue Racer is installing an emergency siren system in the neighboring community of Kent–to warn them of any problems at the plant. The latest on the closed facility and its prospects for re-opening:

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Braskem | Economic Impact | Energy Services | Ethane | Industrywide Issues | Jobs | Odebrecht | Processing Plants | Statewide WV | West Virginia | Wood County

WV Announces Brazilian Company to Build Ethane Cracker Complex
November 15, 2013November 15, 2013

Yesterday West Virginia Gov. Earl Ray Tomblin was flanked by representatives from Brazilian chemical company Odebrecht to announce the company has chosen a site near Parkersburg, WV (third largest city in the state) to be the potential site of an ethane cracker plant complex. The complex will have an ethane cracker, three polyethylene plants and infrastructure for water treatment and energy co-generation. Gov. Tomblin was justifiably proud to make the announcement, calling it a “game changer” for West Virginia. He’s right.

Odebrecht will build the plant, and once built, it will be operated by Braskem, another Brazilian company with operations in Pennsylvania (51% owned by Odebrecht). MDN told you about Braskem’s interest in a WV ethane cracker all the way back in March 2012 (see Second Company Interested in Building Cracker Plant IDed). So it appears Odebrecht/Braskem have been sniffing around the concept of building a cracker in WV for at least a year and a half. We have a lot of coverage of the announcement below. The key word here is: caution. Like the Shell cracker, this is very early in the process and not yet a 100% done deal…
Read More “WV Announces Brazilian Company to Build Ethane Cracker Complex”
Beaver County | Braskem | Economic Impact | Energy Companies | Energy Services | Ethane | Industrywide Issues | Jobs | Odebrecht | Pennsylvania | Processing Plants | Shell | Statewide PA | Statewide WV | West Virginia | Wood County

Clash of the Ethane Cracker Titans: PA vs WV Smackdown
November 15, 2013November 15, 2013

As MDN mentions in today’s companion story about the newly announced potential ethane cracker plant complex to be built near Parkersburg, WV, there is angst in Pittsburgh about whether or not a WV cracker plant will help or harm the potential cracker plant to be built by Shell northwest of Pittsburgh in Beaver County, PA.

The Pittsburgh Business Times, a bit critical and skeptical of the WV cracker (no surprise there), tackles the question of, “Is you a friend or is you foe?”…
Read More “Clash of the Ethane Cracker Titans: PA vs WV Smackdown”
Economic Impact | Ethane | Industrywide Issues | Jobs | Processing Plants | Statewide WV | West Virginia | Wood County

Officials Say Cracker Will be Truly Huge for WV Jobs & Economy
November 15, 2013November 15, 2013

One final story in MDN today about WV ethane cracker mania (see our other two stories posted today for full coverage of the announcement from yesterday). Although WV Gov. Earl Ray Tomblin and officials with the companies that would build and operate a proposed ethane cracker in WV–Odebrecht and Braskem–were careful to say this is a preliminary announcement and not a 100% done deal, it’s still just too juicy a carrot to leave alone for the Tomblin administration.

Although Tomblin says Oderbrecht is “exploring” the possibility of building an ethane cracker, he’s also shouting that this is the best thing for West Virginia since sliced bread was invented (our words, but certainly his sentiment). And sure enough, right on the heels of his announcement, Tomblin officials were talking about the thousands of new jobs this project will generate and the incredible economic impact it will have on WV. IF built, they are 100% correct, this will be an economic and jobs-generating engine like none we’ve seen in the northeast for generations–no doubt about it. The key word, though, is IF…
Read More “Officials Say Cracker Will be Truly Huge for WV Jobs & Economy”