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    FERC Commissioner Powelson Uncensored: New England Trouble Ahead

    We love Rob Powelson, newly-minted Federal Energy Regulatory Commission member appointed by President Trump. Before joining FERC, Powelson was a member of the Pennsylvania Public Utility Commission. We love him because he speaks his mind. Although he’s circumspect about what he says, Powelson still finds a way to get in those zingers. You never have to wonder what he thinks. For example, in March of this year (before joining FERC), Powelson said this: “The jihad has begun…At the Federal Energy Regulatory Commission groups actually show up at commissioners’ homes to make sure we don’t get this gas to market. How irresponsible is that?” (see Potential FERC Com. Powleson Calls Anti-Fossil Fuelers “Jihadists”). Yes! He called eco-jihadists, “jihadists,” which of course sent the left into a tailspin. He later had to walk back that comment (see Powelson Under Fire for Calling Enviro Jihadists, “Jihadists”). At a conference last week, Powelson was at it again. We call it being uncensored–and that’s a good thing. Powelson said that Cove Point LNG is now up and running, as of Nov. 1st. He also had some choice comments about New England’s abysmal electric situation and New York’s obtuse opposition to shale gas…
    Read More “FERC Commissioner Powelson Uncensored: New England Trouble Ahead”

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    Eclipse Res. 3Q17: Super-Laterals Proving to be Super Productive

    Last week Eclipse Resources, the “super-lateral” Marcellus/Utica driller, turned in its third quarter 2017 update. Eclipse is a Marcellus/Utica pure play driller headquartered in State College, PA that drills mostly in the Ohio Utica. Eclipse has drilled the top three longest onshore oil/gas wells in the world. What do we glean from the 3Q17 update? Two of their world’s longest onshore wells–the Great Scott 3H and Outlaw C11H–are now online and pumping. They are pumping record-setting amounts of condensate. Each is averaging 3,300 barrels of oil equivalent (BOE) to date on a restricted choke, consisting of almost 50% condensate and 68% in total liquids. Gushers! During 3Q17 Eclipse drilled 10 wells in all, including four super-laterals with an average lateral length of over 17,500 feet. So far the company has drilled 11 super-lateral wells with an average lateral length of ~18,000 feet–averaging just 16 days from spud to total depth. Incredible! The company had average daily production of 353 million cubic feet equivalent per day (MMcfe/d). On an analyst phone call, Eclipse’s top brass said they are working to create a “reputable” super-lateral program, meaning (our words) building a successful program of long laterals that also makes big money. Here’s the 3Q17 update, along with portions of the analyst phone call and the latest slide deck…
    Read More “Eclipse Res. 3Q17: Super-Laterals Proving to be Super Productive”

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    Questerre Plans 8 Initial Well Pads in Canadian Utica 2018-2019

    Although the primary focus of Marcellus Drilling News has always been on Marcellus and Utica Shale gas (and oil) as found in the northeastern U.S., the Utica Shale also underlies part of Canada’s Quebec province. From time to time we highlight news concerning the Utica in Canada. There hasn’t been much news to highlight over the years since Quebec has had a moratorium on fracking at least as long as New York’s moratorium (now at 9 years and 9 months and counting). But as we reported in December 2016, something of a minor miracle happened–the Quebec National Assembly voted to pass Bill 106, ostensibly to support Quebec’s “clean power plan” (see Fracking in Canadian Utica Shale Takes Big Step Closer to Reality). The bill includes a section that “lays out a framework for oil and gas development” in Quebec. Fracking will not begin immediately. The bill does, however, mean that new regulations will come along in 2017 and after that, it’s an almost certainty that fracking will begin. Those draft rules were finally been released in September of this year (see Quebec Government Publishes Draft Utica Fracking Regulations). Questerre Energy, which owns Canadian Utica leases in Quebec and has long lobbied get the government to allow Utica drilling. In Questerre’s recently-released third quarter 2017 update we get an update on their plans to drill in the Canadian Utica. The company says if progress continues with the draft regulations, they have eight well pad sites picked out where they will drill first–in locations that have been oil and gas friendly in the past…
    Read More “Questerre Plans 8 Initial Well Pads in Canadian Utica 2018-2019”

  • Calendar of Marcellus/Utica Events for Nov 13 – Feb 12

    Events related (or of interest) to the Marcellus and Utica Shale, primarily pro-drilling events.

    To have your event included (or if you are aware of a worthy event you believe should be on this page), please send the details and/or a link to have it included to the calendar@marcellusdrilling.com email address. Thank you!
    Read More “Calendar of Marcellus/Utica Events for Nov 13 – Feb 12”

  • Marcellus & Utica Shale Story Links: Mon, Nov 13, 2017

    The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: WV legislators, industry leaders digesting $83.7B shale deal; Marcellus natgas lowers bills for all Americans; Tellurian cuts $15.2B deal with Bechtel to build Driftwood LNG; Texas ethane going to China; Permian peak in just 3 years?; fake fractivist news from Reuters; Algeria lectures US shale to get “more humble”; the coming boom in UK (yes UK) shale; and more!
    Read More “Marcellus & Utica Shale Story Links: Mon, Nov 13, 2017”

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    EQT/Rice Shareholders Make it Official – Merger Happens Nov 13

    Next Monday the largest natural gas-producing company in the these United States will be born–from the merger of EQT and Rice Energy, based in Pittsburgh. Yesterday the shareholders for both EQT and Rice voted to approve the merger/deal by overwhelming majorities. The megadeal was first announced back in June (see EQT Buys Rice Energy in $8.2B Deal, Becomes #1 Gas Producer in US). Evil corporate raider Jana Partners tried to stop the deal–but failed, as they acknowledged earlier this week (see Corp Raider Jana Partners Admits Defeat Ahead of EQT/Rice Vote). Next Monday the transaction will be complete and the new EQT will produce more natural gas in the Lower 48 States than Chesapeake Energy, the current reigning champ. Some 84% of the EQT shareholders who voted, voted to approve the deal, and 74% of voting Rice shareholders voted in favor of the deal. What happens next? After the consummation of the merger on Monday, EQT CEO Steve Schlotterbeck said the company will immediately appoint a committee to look into…splitting the company. Yes, you read that right. Not splitting it back into EQT and Rice, but splitting it into upstream (drilling) and midstream (pipelines). Two companies will become one and then become two again. Go figure. A recommendation and decision about whether to proceed with a split will happen, according to Schlotterbeck, by “the end of the first quarter 2018.” There’s little doubt the decision will be “yes” on a split…
    Read More “EQT/Rice Shareholders Make it Official – Merger Happens Nov 13”

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    More on that Massive $83.7B Chinese Investment in WV Shale/Petchem

    We’re still reeling after yesterday’s announcement that China has agreed to invest $83.7 billion in the State of West Virginia–largely in shale and shale-related petrochemical projects (see China Agrees to Invest Amazing $83.7 BILLION in WV Shale, Petchem). Let’s put China’s promised investment in perspective. The GDP (gross domestic product, or the value of all of the state’s economic activity) for WV last year was $73.4 billion. One expert calculates the entire investment by the Marcellus/Utica industry in WV so far has been about $35 billion. The investment by China, which will be spread out over 20 years, is larger than all of the economic activity in WV for a single year, and 2.5 times the investment made by the shale industry so far! That’s massive. It’s huge. It’s mind-blowing. There really aren’t words big enough for this investment–IF it comes to be. You see, what was signed in China yesterday is a Memorandum Of Understanding (MOU). It’s a handshake–a gentleman’s agreement. And sometimes those agreements disappear. So this is far from a done deal. However, we’ll take it. If even half of the promised investment becomes reality, it’s game-changing. It is, according to WV Gov. Jim Justice, the single largest private investment in the state’s history. Now that we’ve had 24 hours to digest the news, a number of people are talking. While we still don’t have specificity about the projects that will get funded with this money, we do have more insight. The first couple of projects to get funded will be electric generating power plants–powered by Marcellus/Utica gas. And we know where those plants will most likely be located: “one in Harrison County and one in Brooke County” according to head of the WV Chamber of Commerce. Cracker plants (plural) are also being talked about for WV. We’ve been monitoring the news since yesterday’s announcement and have collected a number of excerpts below of what people (in the know) are saying about this historic deal…
    Read More “More on that Massive $83.7B Chinese Investment in WV Shale/Petchem”

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    Weirton, WV Tries to Interest the Chinese in a Cracker Plant

    The early bird catches the worm. Not even a day had gone by when Patrick Ford, the executive director of the Weirton-based Business Development Corp. of the Northern Panhandle, piped up and signaled China that Weirton would be a great place to locate an ethane cracker plant. Ford said Weirton sits roughly halfway between Shell’s cracker plant under construction, and a planned cracker plant by PTT Global in Belmont County, OH. Weirton was considered for both of those projects but apparently there was an issue getting enough contiguous acreage for a large-scale project like a cracker. However, Ford says those issues are now resolved and Weirton is open for cracker business. Ford told a reporter, “We want to see a third ethane cracker in this region — and it should be in Brooke or Hancock County” (note that Weirton straddles both). We like Weirton’s plucky opportunism. Businesses and projects in WV should not sit on their hands. Get that Chinese money and get it quick, before it disappears into someone else’s pocket!…
    Read More “Weirton, WV Tries to Interest the Chinese in a Cracker Plant”

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    EXCO Resources Heading for Bankruptcy, Turnaround Expert Resigns

    In the end, not even turnaround expert John Wilder could turn around EXCO Resources. Wilder is the guy now Secretary of Commerce Wilbur Ross brought in two years ago to turn around the ailing company. At first it seemed like it might be working (see EXCO Resources Turnaround is Working, but Comes at a High Cost). EXCO Resources was once a sizable player in the Marcellus. They still have 184,000 net acres in the Marcellus, with 124 horizontal Marcellus wells drilled and in production. However the company, as we pointed out in March 2016, has abandoned the Marcellus/Utica at this point (see EXCO: No Marcellus Drilling in 2015/2016, NYSE Threatens Delisting). The company flirted with bankruptcy for some time, but in the end they effectively turned over control of the company to its creditors this past summer (see EXCO Issues 2.7M Shares of New Stock in Lieu of Paying $23M). However, the company has continued to struggle financially. Yesterday EXCO announced Wilder has resigned from his position as a member of EXCO’s Board of Directors and from his position as Executive Chairman of the Board, effectively immediately. Translation: He’s given up on trying to save the company. In the same announcement, EXCO said Wilder’s departure “was not the result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.” In EXCO’s third quarter 2017 update, released on Tuesday, there is a section in which management says if they can’t make the interest payments on the company’s debt, “the Company may be forced to seek protection from creditors under the U.S. Bankruptcy Code.” They go on to say debt payments and other factors, “raise substantial doubt about the Company’s ability to continue as a going concern.” Ominous language. Here’s the announcement about John Wilder and company statements about possibly seeking bankruptcy protection…
    Read More “EXCO Resources Heading for Bankruptcy, Turnaround Expert Resigns”

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    Indians & Hippies Couldn’t Stop Connecticut Expansion Pipeline

    In March 2016, the Federal Energy Regulatory Commission (FERC) approved Tennessee Gas Pipeline’s (TGP) Connecticut Expansion project (see FERC Approves TGP Connecticut Expansion Pipeline Project). The project includes building 13.42 miles of new pipeline loops in three states: Connecticut, Massachusetts and New York. When completed, the new looping will serve an additional 72.1 million cubic feet per day of (mostly) Marcellus Shale gas to three utility companies in Connecticut. The $86 million project is in no way connected to TGP’s now-dead Northeast Energy Direct (NED) pipeline project. However, antis continued to pitch a fit and try to block the project. A local Indian tribe in Massachusetts threatened to sue, accusing FERC of violating the National Historic Preservation Act by not protecting “ceremonial stone landscapes” supposedly found along the path of the pipeline (see Indian Tribe Fights FERC Over Tiny Pipeline in Mass.). After that, a group of old hippies got themselves arrested in Massachusetts for blocking construction of a 2-mile section of the pipeline through a state forest (see Bunch of Old Hippies Arrested in Mass. for Blocking Pipeline Work). We postulated at the time that maybe if underground pipelines flowed marijuana instead of fossil fuels, they’d feel differently about them. At any rate, neither the Indians nor the hippies could stop it. Yesterday FERC gave Kinder Morgan’s Tennessee Gas Pipeline subsidiary permission to flip the switch and turn on the expanded pipeline…
    Read More “Indians & Hippies Couldn’t Stop Connecticut Expansion Pipeline”

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    Pipeline Takeaway Capacity in M-U Ramps Up This Winter – Prices Too?

    Source: RBN Energy – click for larger version

    The experts at RBN Energy are back with another great article about pipelines in the Marcellus/Utica. This one takes a look at pipeline projects recently completed, and those that will get completed by March 2018. RBN says if you add them all together–the projects that were launched into service since last winter or will be online by the end of this winter, it amounts to a staggering 6.7 billion cubic feet per day of Marcellus/Utica gas flowing to other regions. Which regions? “Almost 3.0 Bcf/d of the incremental capacity versus last winter is designed to flow gas west from Ohio into the Midwest market; another 3.4 Bcf/d or so to the Gulf Coast via Ohio and the final 400 MMcf/d (from Atlantic Sunrise) to the Southeast via the Atlantic Coast.” The overall point of the article: natural gas prices nationally are going nowhere fast. At least, they aren’t going up any time soon. We are awash in new supplies of natural gas. Perhaps Marcellus/Utica prices will drift up a bit as the gas exits our region, but more likely prices in other regions will come down more than our prices will go up. That’s the upshot. Here’s the details…
    Read More “Pipeline Takeaway Capacity in M-U Ramps Up This Winter – Prices Too?”

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    Lancaster Organic Farmer Rails Against Atlantic Sunrise Pipeline

    An organic farmer in Lancaster County, PA is accusing Williams and their Atlantic Sunrise Pipeline project of violating the conditions they agreed to. What kinds of violations? “Heavy equipment was stored on the property.” Ooooookay. Uh, we don’t think they dig pipeline trenches with hand shovels any more. What about his horrific violation: “Nonorganic bags of mulch have continued to be stored on the property.” Have you ever seen a bag of “organic” mulch at Lowes or Home Depot? No, neither have we. Here’s another one: “For weeks, trucks traveled between the organic farm and a neighboring nonorganic property.” Apparently the organic farmer doesn’t like his neighbor. We suppose he’s afraid the tires will pick up some non-organic dirt (whatever that is) and track it onto his property. Does he drive a car? Does he visit “nonorganic” locations around the county? You see the hypocrisy. Here’s one we really liked: “Soil from an adjacent nonorganic property blew onto the organic farm.” What the heck is that? Now Williams is supposed to control the wind?? The last person we know of who walked Mom Earth and was able to control the wind was J.C. (Mark 4:39). And perhaps worst of all, a complete tragedy: “Signs warning construction workers of an organic farm were not posted.” You get the drift. This is all nonsense–either minor violations or outright fabrications. Williams pushed back and said so. Just one more anti, grumbling and grabbing a headline…
    Read More “Lancaster Organic Farmer Rails Against Atlantic Sunrise Pipeline”

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    TransCanada 3Q17: Plethora of Pipeline Updates for Marcellus/Utica

    TransCanada Corporation, headquartered in Calgary, Alberta, released their third quarter 2017 update yesterday. On July 1, 2016, TransCanada completed its buyout of Columbia Pipeline, a $10 billion deal (see TransCanada and Columbia Pipeline Tie the Knot Today). Columbia had/has a plethora of pipeline projects in the northeast, projects very important to the future of our region and flowing gas through it and out of it. We recently told you that one of those projects, Rayne XPress, was cleared to begin service and is now up and running (see FERC Clears 1 Bcf/d Rayne Xpress Pipe to Begin Service). We also told you that another project that works hand-in-glove with Rayne, called Leach XPress, is also supposed to be online this month. However, it’s been delayed. We learned from yesterday’s 3Q17 update that the new plan is to have Leach online in “early January 2018.” In addition to updates on Rayne and Leach from the 3Q17 update, we have news about Gibraltar Midstream, WB XPress, Mountaineer XPress, Gulf XPress and several other projects that impact our region…
    Read More “TransCanada 3Q17: Plethora of Pipeline Updates for Marcellus/Utica”

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    Black & Veatch Report: US LNG is Changing the World

    Black & Veatch, a leading engineering, consulting and construction company, released their “2017 Strategic Directions: Natural Gas Industry Report” earlier this week (full copy below). In the report, B&V examines how organizations are planning for long-term, sustainable operations that can handle rising supplies and deliver those supplies to markets eager to use natural gas as a cheaper and cleaner power generation source. The report finds that LNG (liquefied natural gas) is key in shifting oversupply from countries like the U.S. to growing demand centers in Asia, Latin America, India and Sub-Saharan Africa. The report emphasizes calls from the industry to fund infrastructure investments to enable increased LNG imports and exports, including floating LNG (FLNG) and natural gas-based power generating plants. There is no doubt, according to the report, that the U.S. is now in the driver’s seat with respect to LNG. Below is a summary of the key points, followed by the full report…
    Read More “Black & Veatch Report: US LNG is Changing the World”

  • Marcellus & Utica Shale Story Links: Fri, Nov 10, 2017

    The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Dominion dishes out $550K to veteran/military organizations; what’s a “fair tax” for PA natgas; Waste Management converting more vehicles to natgas in Scranton/WB; Alaska/China sign natgas pipeline deal; natural gas smell was dairy air in Wisconsin; another activist-funded climate change report that falls short; major changes afoot in sand use, supply, prices; Saudi Arabia’s version of “Game of Thrones” affects oil price; and more!
    Read More “Marcellus & Utica Shale Story Links: Fri, Nov 10, 2017”

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    China Agrees to Invest Amazing $83.7 BILLION in WV Shale, Petchem

    The “Art of the Deal” is still alive and well for Donald Trump. Trump along with an entourage of various state officials are currently on a trade mission in Asia. This morning (our time) a flurry of announcements were issued about Trump (and others) convincing China to invest $250 billion (a staggering number!) in various projects in the U.S. A whopping $83.7 billion of that (a full third!!) will be invested in one state–West Virginia. And the WV investment, according to the announcement, will be in “shale gas and chemical manufacturing projects.” The investment will come over the next 20 years, so yes, we’ll believe it when we see it. However, we cannot overstate how big and how good this news is for our friends in the Mountain State. While no specific projects are mentioned, we get this enticing tidbit from the announcement: “The projects will focus on power generation, chemical manufacturing, and underground storage of natural gas liquids and derivatives.” Sounds to us like we now know where the $10 billion NGL storage facility will be located (see WV Senators Ask Trump to Create NGL Storage Hub Commission). It also sounds to us like a cracker plant may be a possibility. And a number of Marcellus-fired electric plants. This is truly a “wow” story! Here’s the announcement released earlier today…
    Read More “China Agrees to Invest Amazing $83.7 BILLION in WV Shale, Petchem”