Trade War Puts $83.7 Billion Chinese Investment in WV on Hold
You can’t say we didn’t warn you. In early April, when the current “trade war” with China began to heat up, we said this with respect to the deal China signed to invest $83.7 billion in West Virginia shale and petrochemicals: “However, if a trade war does develop, it would be foolish to not think those investments (withholding them) will be used against us.” (Will Trade War with China Affect $83.7B Investment in WV Shale?) At yesterday’s Northeast U.S. Petrochemical Construction Conference in Pittsburgh, our fears (and prediction) were confirmed. Chinese officials were due to attend the event and announce the first round of investments in WV. However, Brian Anderson, director of the West Virginia University Energy Institute, said given the trade war now on with China, the officials elected to stay home instead. Anderson said, “The pending trade war has put this project in jeopardy.” Add to the trade war the fact that WV Gov. Jim Justice just fired the guy who built the relationships and negotiated the $83.7 billion deal, Commerce Sec. Woody Thrasher (see WV Commerce Secretary Who Brokered $83B China Deal…Fired), and it doesn’t bode well for China’s billions of investment. The Chinese are using their announced investment as an economic weapon against the U.S. Which points out the folly of relying on investments from your enemies to prop up your economy. Make no mistake: China is an enemy of the United States. However, there’s one thing the Chinese are not retaliating against, and indeed something they want more of: U.S. LNG…
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It increasingly looks like LyondellBasell Industries, one of the largest plastics, chemicals and refining companies in the world, will buy out/take over Braskem, the largest petrochemical company in Latin America (headquartered in Brazil). Braskem and its parent company Odebrecht, as you may recall, was hot-to-trot to build a multi-billion dollar ethane cracker near Parkersburg, WV–four years ago. Odebrecht got mired in scandal in Brazil and that put things on hold in 2015 (see 
We told you last week that Columbia Gas Transmission’s Leach XPress Pipeline, which only came online in January, experienced an explosion and fire in Marshall County, WV (see 
Rover Pipeline (Energy Transfer Partners) has agreed to pay a $430,030 fine to the West Virginia Dept. of Environmental Protection for water pollution violations related to construction activities for the pipeline. The “consent order” was dated May 15 but not released to the public until Tuesday of this week. The proposed deal is now open for public comment until July 13. Rover received 18 notices of violation and 2 cease-and-desist orders dating back to April 2017. Most of the violations relate to failure to control erosion and for allowing sediment water to leak out of construction areas. WV DEP has not yet signed (officially accepted) the order, but it certainly appears to be a done deal. Here’s the news and a copy of the consent order…
No wonder the teachers in Philadelphia think that the money in drillers’ pockets actually belongs to them. Because in neighboring West Virginia, it does! At least some of the money. WV held its final public hearing (#21) as part of a statewide “listening tour” about how the state should fix (i.e. pay for) its insurance program for public employees. Most of the speakers at the 21 complain-fests were teachers. Their #1 preferred solution to “fixing” (paying for) better benefits is to boost the severance tax on natural gas higher than the current 5% (already one of the highest rates in the country). Such an increase would, of course, kill new drilling. And sooner or later previously drilled wells on which current severance tax revenues are based wind down, leaving teachers back at square one, with no extra money to pay for better insurance plans. Here’s more on the story of WV teachers looking to take money out of the pockets of a single industry, in order to grab other people’s hard-earn money for themselves…
It’s one thing for a landowner (or Big Green supporter, sometimes one and the same) to oppose a pipeline project by protesting, asking politicians to get involved, writing to regulatory agencies, etc. We have a great American tradition of free speech. Go for it. But it’s quite another thing to “harass, intimidate and interfere” with work crews in an area by screaming at them and shooting your “large caliber gun” near where they’re working. Columbia Gas Transmission is currently building the Mountaineer XPress Pipeline, a $2 billion, 170-mile pipeline that will flow 2.7 billion cubic feet (Bcf) per day of natural gas from existing and future points of receipt along or near the Columbia pipeline system–most of it located in West Virginia (see 
Building and operating a fracking site can emit some airborne particles. But scientists don’t fully understand how many, and how these particles may impact human health. Do drilling operations for unconventional wells emit a lot or a little in the way of particles? And do those particles affect human health? Travis Knuckles, assistant professor at the West Virginia University School of Public Health, has received $450,000 from the National Institutes of Health to investigate these questions. Knuckles will attempt to answer the question, Does fracking impact cardiovascular health–for workers and for those living nearby? We applaud real research efforts like this one…
Mountain V Oil and Gas owns a Marcellus Shale well drilled in 2014 in Upshur County, WV that was a bust. You don’t often hear about Marcellus wells that don’t produce. Because their Marcellus well is a non-producer, Mountain V wants to convert it into a wastewater injection well. The neighbors are not happy about it. The WV Dept. of Environmental Protection held a public hearing last week about the proposal. Twelve local residents spoke at the hearing–every one of them against the project. No one spoke in favor. Is that really a surprise? The comments made at the hearing referred to the potential for earthquakes and pollution of the water table. Here’s what the good (but misinformed) residents of Upshur don’t understand about injection wells: (1) There are hundreds of thousands of them across the country, and have been for decades. (2) The wastewater (brine) going down the proposed injection well first came up from the same deep sources–we’re just putting it back where it came from. (3) If the well is properly cased, and rest assured these wells are heavily regulated and regularly checked, there is no way for the wastewater to seep back up to the surface. The water was down there for millennia and didn’t make its way to the surface, so why would it now? (4) Earthquakes can happen, but only when massive amounts of fluids are injected into an existing fault, or crack, in the rock layers. Earthquakes from injection wells, at least in the northeast, are as rare as hen’s teeth. Look, in all honesty, we wouldn’t be overly thrilled with an injection well locating near us either. However, if you’re going to object, as a first step you need to get your facts straight. Here’s more about last week’s hearing and the lack of facts (and wild statements) that circulated at that meeting…
The Utica Shale is starting to get more love. No, not in Ohio where the play is already well-loved, but in Pennsylvania and West Virginia. Although it’s always been known that the Utica underlies the Marcellus and in fact covers a larger geography than the Marcellus, drillers have not targeted the Utica nearly as much outside of OH. Why? Because it’s nearly twice as deep as the Marcellus and costs more to tap it. The Marcellus is roughly a mile below the surface, and the Utica roughly two miles below. However, there is renewed interest in the Utica in PA and WV in 2018. Most of the Utica wells drilled in PA have, so far, been drilled by Hilcorp. JKLM is targeting the Utica in Potter County. SWEPI (Shell) has drilled a few Utica test wells, as has EQT, CNX and others. Most recently CNX and Seneca Resources mentioned targeting the Utica in their quarterly updates. Throw it all in the mix and what it spells is more Utica drilling on the way in what has, until now, been largely Marcellus country…
In February 2016 there was an accidental release of a hazardous chemical at the MarkWest Energy cryogenic processing plant in Mobley (Wetzel County), WV (see