Bill to Ease WV Oil & Gas Storage Tank Inspections Gets Pushback
In the closing hours of the 2014 West Virginia legislative session, the legislature passed SB373, the Aboveground Storage Tank Act (see Fate of 3 WV Laws that Impact Marcellus/Utica Drilling). The bill, which was signed into law, was in response to a chemical leak that affected the drinking water for 300,000 WV residents. Even though the leak was not related to oil and gas drilling (it was related to coal mining), the new rules governing above ground storage tanks for chemicals affect a number of industries, including the Marcellus Shale drilling industry (see Impact of WV’s New Chemical Tank Law on Marcellus Drillers). Over the years several attempts have been made to relax the over-restrictive new rules for the oil and gas industry. Another such attempt is underway this year.
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All three M-U states received permits to drill new shale wells last week. Pennsylvania received 10 new permits. Ohio received 6 new permits. And West Virginia received 3 new permits.
Yesterday the country’s largest natural gas producer, EQT Corporation, released its 4Q and full-year 2020 update, holding a conference call with analysts to discuss the results. The update shows the company produced an average of 4.45 million cubic feet per day (MMcf/d) of natural gas in 4Q. Although there was plenty of “free cash flow” for the year, on paper the company lost $967 million in 2020, which is an improvement over the year before when it lost $1.2 billion. Perhaps the biggest news (for us) coming from yesterday’s update is that in 4Q EQT turned its drilling attention to the West Virginia Marcellus. EQT plans to do much more drilling in WV this year too.
West Virginia is represented by one Republican U.S. Senator, Shelley Moore Capito, and one Democrat, Joe Manchin. Manchin is tolerable (just) because he advocates for coal and oil/gas. Manchin is also the new chairman of the powerful Senate Committee on Energy and Natural Resources. Manchin, to his credit, is pushing back against Joe Biden’s ill-advised cancelation of the Keystone XL oil pipeline. In fact, both Biden and Capito are loudly supporting Keystone and (important for us) the Mountain Valley Pipeline (MVP) project, which runs through WV.
Last year the West Virginia Dept. of Environmental Protection (WVDEP) fined the Mountain Valley Pipeline (MVP) project $265,972 for erosion and sediment issues related to constructing the 303-mile pipeline (see 
Life is full of unsung heroes. The West Virginia Geological and Economic Survey (WVGES) is one such hero in the Mountain State. WVGES plays a vital role in the state’s shale gas/oil industry. How WVGES determines where and how much natural gas, oil, and NGLs are located under the crust of WV. They also determine how best to take advantage of those natural resources.
The West Virginia Office of Oil and Gas (part of the Dept. of Environmental Protection) reports there are some 60,000 active and 15,000 abandoned oil and gas wells in the state. Staffers at Oil and Gas respond to complaints and do the inspection for all those wells. Currently, there are just 14 field staffers with three moving to other positions leaving just 11 staffers who are in the field to monitor all those wells.
On Joe Biden’s first day in occupying the White House, he signed an Executive Order (EO) suspending new oil and gas leasing while the Interior Department reviews existing leases and permitting practices for 60 days. The aim is to make the federal lease ban permanent. However, some permits on existing leases will continue to be issued during the 60-day review period. You may think Biden’s federal lease ban does not affect the Marcellus/Utica region. You would be wrong.
Diversified Gas & Oil (DGO) owns close to 8 million acres of leases with some 60,000 (mostly) conventional oil and gas wells. Their focus has been to acquire quality production and cash flow–regardless of the well or commodity type (gas or oil)–in the Appalachian Basin. DGO currently owns over 400 Marcellus/Utica shale wells in their portfolio too. The company announced yesterday it has just opened a new “state-of-the-art” natural gas control center in Charleston, WV. Initially, the new center will monitor the Cranberry Pipeline network.
Equitrans Midstream’s Mountain Valley Pipeline (MVP), which stretches 303 miles from Wetzel County, WV to Pittsylvania County, VA, is backed into a corner by anti-fossil fuelers. The project is 92% complete and in the ground, yet somehow antis have successfully blocked an Army Corps of Engineers Nationwide Permit 12 (NWP12) that allows the project to cross creeks and rivers and mud puddles. Antis have convinced three leftist judges on the 4th Circuit Court of Appeals to overturn the NWP12 permit–twice. But, MVP has just outmaneuvered the antis.