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    Chesapeake Energy to Test Utica Shale in NE PA’s Bradford County

    Chesapeake Energy CEO Doug Lawler says the company plans to drill a test Utica Shale well in its core Marcellus acreage in Bradford County, PA sometime early next year. Which is really big news. Bradford is in the northeastern corner of the state, next door to Susquehanna County (east of Bradford). Susquehanna and Bradford have been heavily drilled by Chesapeake–at least in the Marcellus. Both counties sit in the “dry gas” (methane only) zone of the play, with no NGL or oil production, according to MDN’s forthcoming Marcellus and Utica Shale Almanac (stay tuned for more details about the Almanac). There have been very few, if any, shale wells drilled into the Utica in either Bradford or Susquehanna. However, there have been a few Utica wells drilled in Tioga County, which shares a border with and sits west of Bradford. And beyond Tioga (in the northerntier) sits Potter County, where there are more Utica wells. So Chessy wants to see if the Utica in Bradford may be productive. Lord knows the company has enough locations. According to the forthcoming Almanac, Chesapeake had 473 actively producing shale wells in Bradford in 2016. Now if we could only get Chesapeake to stop screwing landowners out of royalties…
    Read More “Chesapeake Energy to Test Utica Shale in NE PA’s Bradford County”

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    XNG Virtual Pipe Delivering 50 MMcf/d of PA NatGas to NY Pipeline

    Iroquois Gas Transmission is not waiting for the Constitution Pipeline to get built–they’ve found a way around it. At least for some of the supply they hopped to get from the Constitution. Iroquois is a 416-mile interstate natural gas pipeline extending from the U.S.-Canadian border at Waddington, NY, through New York State and western Connecticut to a terminus in Commack, NY (Long Island), and from Huntington (on Long Island) to the Bronx, NY. It is an important pipeline in the Empire State. Iroquois was in line to receive some of the 650 million cubic feet per day (MMcf/d) of natural gas the Constitution would flow from northeast PA to Schoharie County, NY, where the Constitution would connect to both the Iroquois and Tennessee Gas Pipeline. We’re not sure how much of the 650 MMcf/d Iroquois was supposed to get, but right now and for the foreseeable future, they’re getting nothing, thanks to a corrupt governor who has corrupted New York’s environmental agency which has denied the Constitution a necessary permit to build. Iroquois has found a way to replace at least some of that volume–by trucking it in. That is, a “virtual pipeline” which is now feeding the Iroquois, and in-the-ground pipeline. Usually it’s the other way around! Iroquois is getting up to 50 MMcf/d from Xpress Natural Gas (XNG), which is trucking the gas from a facility in northeastern PA (Susquehanna County). Here’s a story you’ll read first (perhaps only) on MDN–of how a virtual pipeline is now feeding an interstate pipeline in New York State with fracked gas from Pennsylvania…
    Read More “XNG Virtual Pipe Delivering 50 MMcf/d of PA NatGas to NY Pipeline”

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    Penn Hills, PA Grudgingly Votes 5-0 to Allow H&H Seismic Testing

    What a difference two months–and the very real threat of a lawsuit–can make. At the end of July Penn Hills (in Allegheny County, near Pittsburgh) voted to ban seismic testing in their community as a symbolic action “meant to send a message to companies that the municipality is against oil and gas activities on Penn Hills property.” Driller Huntley & Huntley has hired Texas-based Geokinetics to conduct seismic testing in the region and had wanted to conduct testing on 37 municipal-owned properties in Penn Hills, about 390 acres total. But Penn Hills resisted. So H&H’s attorneys at Steptoe & Johnson sent a “we’ll sue your rear-ends” letter and that got the attention of the symbolizers. Last night another vote was taken. This time it was 5 to 0 in favor of allowing seismic testing after all. The mayor (grumbling) said the municipality did it’s best to resist…
    Read More “Penn Hills, PA Grudgingly Votes 5-0 to Allow H&H Seismic Testing”

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    PA House Ctte Votes to Rename “Impact Fee” to “Severance Tax”

    The Pennsylvania House Environmental Resources and Energy Committee amended a bill yesterday that will rename PA’s impact fee to a “severance tax,” a move which really ticked off the high taxers in the legislature, and anti-drillers (most of them one and the same). The PA House came back into session yesterday and 25 House members (most of them Democrats) made a move to get a vote on a bill with a 3.5% severance tax. The Republican majority on the committee flipped things around and replaced that measure with a vote to rename the impact fee–as a way of illustrating that the industry IS ALREADY TAXED, JUST LIKE A SEVERANCE TAX, even if you don’t call it one. So, let’s just call it one! Brilliant! Of course there are differences between a severance tax and an impact fee–actually the fee is a better revenue generator than a severance tax. However, the point remains: the industry is already paying a high tax, and to slap another on top of it is suicide. Republicans on the committee got their point across…
    Read More “PA House Ctte Votes to Rename “Impact Fee” to “Severance Tax””

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    Compression Training Schools in the Marcellus/Utica Region

    Looking for a good job in the Marcellus/Utica industry? You may want to consider a job working at a compressor station. You know, those big facilities that sit every 30-40 miles along pipelines to keep the gas flowing through them? According to an article in COMPRESSORtech2 magazine (yes, there’s a magazine devoted to it!), “Indications are that the gas industry is recovering from the latest slump and can expect slow, steady growth in the next 10 years.” There are several college-level programs in the Marcellus/Utica region that train workers for compressor stations. We have the list below, just in case you’re looking for a rewarding career, or career change…
    Read More “Compression Training Schools in the Marcellus/Utica Region”

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    Jefferson County, WV Hopes Hinge on Gas Pipe Under Potomac River

    Jefferson County, WV has been working for the last 30 years to get natural gas piped into the community. Jefferson is on the cusp of seeing that long-time dream turn into reality–if anti fossil-fuelers in Maryland don’t screw it all up. In April, MDN brought you the news that Columbia Pipeline (now owned by TransCanada) has filed an application with the Federal Energy Regulatory Commission (FERC) to build a 3.5 mile, 8-inch pipeline that will carry natural gas from Pennsylvania to connect the Mountaineer Gas system in the Eastern Panhandle of West Virginia with the Columbia Gas Pipeline in Pennsylvania (see New 3.5 Mile Pipeline Project to Drill Under the Potomac River). The purpose of the Eastern Panhandle Expansion project is to deliver natural gas via local distribution channels (local utility Mountaineer Gas) to a new industrial facility in Berkeley County, WV, scheduled to open this fall, and to provide gas to other local businesses and residents in the Tri-State area. Most of the proposed pipeline crosses through a tiny sliver of Washington County, Maryland. The main “issue” with the project is that the pipeline will be drilled underneath the Potomac River, which serves as the border between WV and MD. That has radical anti-fossil fuelers in an uproar (see Mountaineer Pipeline Under Potomac Latest Focus of Anti Movement). Here’s a look at the faces of those whose lives will be changed for the good by a short, 3.5 mile pipeline under the Potomac, IF…
    Read More “Jefferson County, WV Hopes Hinge on Gas Pipe Under Potomac River”

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    Manhattan Institute Report: Why America Needs More Pipelines

    The New York-based Manhattan Institute, a non-profit think tank with a mission “to develop and disseminate new ideas that foster greater economic choice and individual responsibility” recently released a new report titled, “The Energy Bottleneck: Why America Needs More Pipelines” (full copy embedded below). The 16-page report says that while America is enjoying an energy renaissance thanks to fracking, there is a growing energy bottleneck that is forcing oil and gas companies to turn increasingly to more “accident-prone and more expensive shipping alternatives, such as trucks, railroads, and tankers.” The report says to maximize the benefits of America’s energy renaissance, the Trump administration, Congress, and federal and state regulators should “prioritize expanding and upgrading the country’s inadequate pipeline infrastructure.” We agree! Here’s the latest from the MI calling for more pipelines…
    Read More “Manhattan Institute Report: Why America Needs More Pipelines”

  • Marcellus & Utica Shale Story Links: Tue, Sep 12, 2017

    The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: WVU president says WV should be proud of Marcellus/Utica; “massive” OH anti-fracking rallies draw 47 people; WV Sen. Manchin sings the praises of PA cracker plant; if going 100% renewable is so great, why is California doing it via backroom deals; US gas rig count rises as drillers return to shale; Harvey & Irma’s impact on energy operations; Cheniere floats $1B in notes; and more!
    Read More “Marcellus & Utica Shale Story Links: Tue, Sep 12, 2017”

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    Trouble for Mountain Valley Pipe: WV DEP Withdraws Water Permit

    In March, the West Virginia Dept. of Environmental Protection (WVDEP) issued a federal water crossing permit for the Mountain Valley Pipeline (MVP)–a $3.5 billion, 301-mile pipeline that will run from Wetzel County, WV to the Transco Pipeline in Pittsylvania County, VA (see WV DEP Grants Mountain Valley Pipeline Water Crossing Permit). In June, a group of profoundly radical “environmental” organizations (Sierra Club, West Virginia Rivers Coalition, Indian Creek Watershed Association, Appalachian Voices and Chesapeake Climate Action Network) filed a lawsuit in the U.S. Court of Appeals for the Fourth Circuit against the WVDEP for doing their job issuing the permit (see Radicals File Lawsuit Against WV DEP for Approving MV Pipeline). Because of the pressure of that lawsuit, last week the WVDEP caved and reversed their decision, rescinding (called “vacating”) the permit for MVP. The WVDEP says they will now “re-evaluate the complete application to determine whether the state’s certification is in compliance with Section 401 of the federal Clean Water Act.” Another victory for the forces of evil…
    Read More “Trouble for Mountain Valley Pipe: WV DEP Withdraws Water Permit”

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    Ridgetop Capital Raises $200M to Invest in Marcellus/Utica Leases

    Ridgetop Capital Partners, founded in 2007 and headquartered in the Pittsburgh area, is a private institutional investment firm focused mainly on the oil and gas space. That is, they raise money from rich people (and businesses) and invest that money in projects which they closely watch and influence, hoping to make their money back with a generous interest rate. A LOT of private money funds oil and gas development–there is nothing new or novel about Ridgetop. However, what is new and novel is that the company has just closed on another round of fundraising–chasing $200 million through the door–which they will now use to buy natural gas mineral rights (i.e. leases) in the Marcellus/Utica. The company previously invested ~$130 million in our region’s shale, snapping up ownership in over 30,000 acres (most, perhaps all of it, in joint ventures with major M-U drillers). Where will Ridgetop likely invest to buy new acreage? They’ve given us a big clue…
    Read More “Ridgetop Capital Raises $200M to Invest in Marcellus/Utica Leases”

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    WV Surface Owners Win Important Case Against EQT re Drill Pad

    A West Virginia Circuit Court case decided last week (by jury) found in favor of surface owners against a well pad constructed by EQT. The decision has far-reaching implications for not only surface owners and drillers, but mineral rights owners too. From the first time we read about so-called “joint development” legislation being promoted by the drilling industry in WV (back in February), we’ve not been fans (see More on WV’s Push for “Joint Development” Instead of Forced Pooling). In brief, there are a number of existing old leases in WV, signed before shale drilling began, that prevents drillers from drilling a horizontal well across an individual property boundary line–until a new lease is signed. Joint development says if the driller already owns the leases on all adjoining properties they want to combine into a drilling unit, they can do so without signing a new lease. The proposed joint development law seemed to us to be a way for drillers to avoid negotiating and paying more for new leases–which they should be willing to do! However, the case of Crowder and Wentz v EQT puts joint development in a new light for us. The case appears (to us) to be an abuse of power by surface owners against both drillers and mineral rights owners–by using the current prohibition against joint development. We certainly understand why surface rights owners would resist having a drill pad on their property, however, that’s life. They bought land (or inherited it, etc.) that doesn’t have mineral rights attached. Under existing WV law, a well pad can be drilled, taking 10-15 acres of the surface land (against the surface landowner’s wishes, but with compensation), in order to access the minerals under that specific piece of property. However, the court ruled last week in Crowder and Wentz v EQT that a driller cannot then use that same already-constructed well pad to further drill wells that access minerals under other, adjacent properties. Which in our book makes a strong case for a joint development law, to avoid this kind of misuse by surface landowners…
    Read More “WV Surface Owners Win Important Case Against EQT re Drill Pad”

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    NY DEC Grants Permit for Millennium Pipe Eastern System Upgrade

    The New York Dept. of Environmental Conservation (DEC) is tap dancing to explain why they refused to grant a water crossing permit for a 7.8-mile pipeline in Orange County to Millennium Pipeline Valley Lateral Project, yet a few days before that refusal they granted a water crossing permit to Millennium for the Eastern System Upgrade, which includes 7.8 miles of looping pipeline in yes, Orange County! The Millennium Pipeline stretches ~244 miles from Independence in Steuben County, NY to Buena Vista in Rockland County, NY. The Millennium, which is supplied by local production (much of it Marcellus Shale gas) and storage fields and interconnecting upstream pipelines, serves customers along its route in New York’s Southern Tier region and helps meet the energy needs of northeast markets. In August 2016, Millennium filed an application for what it calls its Eastern System Upgrade (see Millennium Pipe Asks FERC to Approve Eastern System Upgrade in NY). The ESU would add 7.8 miles of extra looped pipeline in Orange County, upgrade a compressor station in Delaware County, build a new compressor in Sullivan County and make some minor tweaks to metering stations in Rockland County. Just days before the DEC denied a water permit for the Valley Lateral Project (see Corrupt NY DEC Denies Water Permit for 7.8 Mile Power Plant Pipeline), the DEC issued the same permit for the much larger ESU project. The DEC denied Valley Lateral on the premise that the Federal Energy Regulatory Commission (FERC) had not done a proper job in evaluating the global warming potential of the new power plant that pipeline will feed. Yet the DEC saw no problem with bumping up capacity by 223 million cubic feet of natural gas flowing per day along the mainline Millennium, which the ESU project will do. Lucy! You have some ‘splainin to do! Aside from the flaming DEC contradiction, Millennium has just asked FERC to please hurry up a final OK of the ESU project, before the DEC changes it mind…
    Read More “NY DEC Grants Permit for Millennium Pipe Eastern System Upgrade”

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    NY’s Critical Error in Denying Millennium Pipe for Power Plant

    On August 30th the New York Dept. of Environmental Conservation (DEC) issued a refusal to grant a water permit to Millennium Pipeline to build a tiny, 7.8 mile pipeline spur from the main Millennium Pipeline to an under-construction natural gas-fired electric generating plant in Orange County (see Corrupt NY DEC Denies Water Permit for 7.8 Mile Power Plant Pipeline). The electric plant will get finished either way, whether it’s fed by natural gas or, alternatively, by dirtier fuel oil. The DEC has blocked many (not all, but many) recently filed pipeline projects in the state–because of undue and corrupt influence from our governor, Andrew Cuomo. Cuomo seeks to appease his radical/left base. The DEC previously denied a water permit for the Constitution Pipeline, stating Constitution had not provided all of the required information the DEC needs to properly evaluate the project (see NY Gov. Cuomo Refuses to Grant Permits for Constitution Pipeline). The DEC later refused a water permit for NFG’s Northern Access Pipeline project (see Cuomo’s Corrupt NY DEC Blocks NFG Northern Access Pipeline Permit). In the case of Northern Access, the DEC claimed they did have enough information, but in their opinion the project would do too much damage to Mom Earth. Both the Constitution and Northern Access projects are in court to try and overturn the DEC’s decision to block. However, in refusing Millennium’s tiny 7.8 mile pipeline to the Valley Energy Power plant, the DEC claimed the Federal Energy Regulatory Commission (FERC) didn’t do a proper job in evaluating the project’s impact on mythical man-made global warming. The pipeline will feed gas to an electric plant, and the DEC says the electric plant will produce air emissions that will help toast Mom Earth. A couple of top energy attorneys from the law firm Blank Rome explain how the DEC has made a critical error in judgment with their refusal of the Millennium project, a decision they say stands a “very high” chance of being overturned on appeal…
    Read More “NY’s Critical Error in Denying Millennium Pipe for Power Plant”

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    EXCO Resources Taps Out Remaining Line of Credit, Borrows $88M

    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 a year ago, 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. In the end, they effectively turned over control of the company to its creditors (see EXCO Issues 2.7M Shares of New Stock in Lieu of Paying $23M). However, the company continues to struggle. Just last month they were threatened, for a third time, with having the company’s stock delisted from the New York Stock Exchange (see EXCO Resources Receives 3rd NYSE Notice of Delisting). EXCO has a line of credit (i.e. a “Revolving Credit Facility”) of $150 million. They’ve just borrowed the last $88 million of that total, to keep the company going…
    Read More “EXCO Resources Taps Out Remaining Line of Credit, Borrows $88M”

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    Southwestern Energy Floats $1.15B in New IOUs to Pay Off Old IOUs

    In a pair of announcements made this morning, major Marcellus/Utica driller Southwestern Energy said they are floating $1.15 billion of new IOUs (i.e. “notes”) that are unsecured and due to be repaid in 2026 and 2027. Part of the money will be used to pay off a 2015 loan for $327 million. It appears another part will be used to pay off up to $800 million of notes (a buyback or repurchase of the notes) due in 2020, 2022, and 2025. That is, Southwestern is swapping one form of debt for another. We’ve often observed this behavior in the energy industry–issuing new debt to pay off old debt. Bit of a shell game in our book, but then we’re not high finance people. Apparently this is not an unusual circumstance with large corporations, and nothing to be alarmed about…
    Read More “Southwestern Energy Floats $1.15B in New IOUs to Pay Off Old IOUs”

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    No DRBC Frack Ban…Yet; A Look at DRBC Corruption & Incompetence

    Last week the rumor mill was hot with speculation that on Friday the Delaware River Basin Commission would release a draft document outlining their proposal to ban hydraulic fracturing in the Delaware River Basin permanently (see DRBC Secretly Working on Permanent Delaware Basin Frack Ban). Fortunately, that didn’t happen. But don’t start celebrating just yet. The rumors are still swirling. Apart from a single Associated Press article (run in dozens of newspapers), there has been no other coverage of this big news. Why is that? Why is mainstream media so uncurious about a potential DRBC frack ban? The person doing the real work on this story is MDN friend Tom Shepstone. Writing on his blog site Natural Gas Now on Saturday, Tom did a masterful job of chronicling the foibles of the DRBC–and he laid out how we got to where we are now, with a potential permanent ban. In a nutshell, landowners in Wayne County, PA sued to reverse a grievous error, challenging the DRBC’s authority to regulate fracking in the basin. That lawsuit, and the very real possibility that a decision will go against the DRBC, prompted radical environmental groups like THE Delaware Riverkeeper to push for a DRBC permanent ban. The effort for a permanent ban, which (for now) would only affect Wayne and Pike counties in PA, went into overdrive a few months ago. Here’s Tom’s excellent article, which will bring you up to speed and prepare you for when the news of a permanent ban eventually does break–possibly this week at the DRBC regularly scheduled meeting…
    Read More “No DRBC Frack Ban…Yet; A Look at DRBC Corruption & Incompetence”