NEPA School w/2 Marcellus Wells in “America’s Best High Schools” List
In 2014 MDN told you about a rural school district in northeastern Pennsylvania–the Elk Lake School District in Susquehanna County–that had (gasp) drilled two Marcellus Shale wells right on the school campus (see Rural NE PA School Nets $1.7M in Royalties from 2 Marcellus Wells). Not only does that tiny school district still rake in the royalties, they also heat with natural gas (see Elk Lake School LOVES Their 2 Marcellus Shale Wells & Gas Heat). Now comes word that Elk Lake SD is in an elite group–recognized by U.S. News & World Report as among the top 6,041 “Best High Schools in America” for 2017. The U.S. News rankings look at data on more than 22,000 public high schools in 50 states and the District of Columbia. Schools were awarded gold, silver or bronze medals based on their performance on state assessments and how well they prepare students for college. Elk Lake made the cut–getting a bronze award–putting them in the top tier of schools in the country. We mention it for two reasons: (1) The revenue Elk Lake gets from their gas wells, and from saving money on heating with gas, is likely a big contributor to Elk Lake’s success; and (2) other school districts, like the Mars School District in Butler County, PA (adamantly opposed to shale drilling 3/4 of a mile away) can learn something from Elk Lake…
Read More “NEPA School w/2 Marcellus Wells in “America’s Best High Schools” List”
We wonder if the residents of Massachusetts, which is hellbent on blocking ANY new natural gas pipeline–local or interstate–know that since the year 2000 some 200,000 Massachusetts households have switched to/added natural gas for heating and other uses. We also wonder if Mass. residents know that the the Brayton Point coal plant in Somerset, a plant that closed two months ago, provided enough power to keep the lights on for 1.5 million Mass. residents. Or that the sole surviving nuclear power plant in Plymouth, the Pilgrim nuclear plant, is closing in two years. And that 11 more electric generating plants (coal-fired) in the region are in danger of closing over the next few years. It doesn’t take a lot of brain power to predict (a) electric rates will go even higher for New England residents, people already paying 4x what other areas of the country pay for electricity, and (b) at some point there just won’t be enough electricity, meaning brownouts and blackouts. Singing kumbaya and fantasizing that wind mills and solar panels (which make up less than 3% of our national electric supply) will ride in to save the day is dangerously stupid. Stephen Dodge, executive director of the Massachusetts Petroleum Council, makes a convincing case for more natural gas via pipelines in New England…
A sharp MDN reader recently brought to our attention some exciting news. The only export facility currently in operation is Cheniere Energy’s Sabine Pass facility. In July Sabine Pass (in southwestern Louisiana, right on the border with Texas) exported 2.19 billion cubic feet per day (Bcf/d) of American-produced natural gas to other countries. The U.S. Energy Information Administration (EIA) reports that in May (most recent month available) the entire production of natural gas in the U.S. was 89.5 Bcf/d. When you run the math, you find that Cheniere alone, with that one facility, exported 2.4% of all U.S. natgas production. The EIA published an article yesterday (below) that predicts the U.S. will become a net exporter of natural gas–exporting more than we import–THIS YEAR. EIA also predicts by the end of 2019 we will be exporting 9.5 Bcf/d of natural gas. If overall production stays about the same, which is a pretty safe guess, that means we will be exporting 10.6% of the natgas we produce, to other countries. Amazing! Of course, production may increase as prices increase, so that 10.6% may be under 10%. But you get the idea. With just LNG exports alone an important new market is opening up over the next two years for our shale gas. One of those export facilities coming online (later this year) is Cove Point, Maryland, which will be exporting Marcellus/Utica gas…
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Report says Northern Access Pipe won’t hurt wildlife; IOGA WV names new president; Bechtel completes Driftwood LNG study; is Shell’s “lower oil price forever” sentiment unrealistic; new WOTUS rule will provide clarity says EPA; Dear Millennials – Big Oil is not the enemy; and more!
Energy Transfer’s Sunoco Logisitics unit has struck a deal with the devil–the devil being the Philadelphia-based (and odoriferous) Clean Air Council, THE Delaware Riverkeeper and Mountain Watershed Association–that will ultimately lift the current ban on underground horizontal directional drilling (HDD) for the Mariner East 2 NGL pipeline project. The three Big Green groups (well funded by colluding leftist organizations) filed an appeal with the Pennsylvania Environmental Hearing Board to block all HDD work following several drilling mud leaks, one of them fouling a water aquifer in Chester County (see 
It’s about time. Cabot Oil & Gas is tired of being sued, and slandered, by people like Dimock resident Ray Kemble and his ambulance-chasing lawyers. So Cabot has sued back–for $5 million. Kemble lives in Dimock Township, in Susquehanna County, PA. Kemble and other families claimed Cabot’s drilling in the area (nearly 10 years ago) caused problems with their water wells–a claim strongly refuted by Cabot. Cabot settled with most of the landowners, including Kemble.
Last week one of the Marcellus Shale’s largest drillers, Southwestern Energy, issued its second quarter 2017 update. While production fell slightly from 2Q16 to 2Q17, the fall was due to Southwestern’s Fayetteville Shale production. In both the northeast and southwest Marcellus, Southwestern’s production went up year over year by 12 billion cubic feet equivalent (Bcfe). Southwestern continues to drill and concentrate solely on Marcellus wells–at least in 2Q17. In northeast Marcellus, Southwestern drilled and brought 21 wells online with an average lateral length of 5,530 feet and an average cost of $5.1 million per well. Perhaps we’d characterize them as “short but cheap” wells. Southwestern also drilled an experimental Marcellus well in Bradford County with a lateral of 12,000 feet. That well, the Seymour 1H, is among the top 10% of Southwestern’s wells, with an initial production rate of 37.7 million cubic feet feet (MMcf) per day. Also of note in the northeast–Southwestern added an additional 140 MMcf/d of pipeline capacity, to get their gas to better-paying markets. In southwest Marcellus Southwestern drilled and brought online 15 new wells, with an average lateral length of 7,627 feet and an average cost of $7.1 million per well. The company reported drilling one Utica well in 2Q17–in Washington County, PA. That well will not be completed and online until later this year. The company’s first Utica well, the O.E. Burge 501H in Marshall County, WV, “continues to exhibit strong productivity, with cumulative production of over 2 Bcf in its first six flowing months.” Here’s the lowdown on Southwestern Energy for 2Q17…
Carrizo Oil & Gas, a Houston-based driller, actively drills in the Eagle Ford Shale in South Texas, the Delaware Basin in West Texas, the Niobrara Formation in Colorado, and until mid-year in 2015, they did have an active drilling program in the Ohio Utica and Pennsylvania Marcellus. No more. They haven’t drilled in Appalachia since 3Q15. During the earnings call for 1Q17, Carrizo CEO S.P. “Chip” Johnson announced Carrizo is putting up their Marcellus/Utica assets for sale–both wells and leases. Yesterday Carrizo issued its second quarter update, holding a conference call to discuss the past three months. What do we learn from it relative to the Marcellus/Utica? Essentially, the company continues on the path of trying to sell their Marcellus/Utica assets. One questioner asked about the company “choking back” production in the Marcellus/Utica–what would it be if they didn’t restrict production? Answer: 180-190 million cubic feet per day…
Yesterday a group of Pennsylvania business and economic leaders from trade associations representing thousands of PA businesses held a conference call to roar their disapproval of the GOP-led Senate plan to impose high/new taxes on energy in the Keystone State. Those on the call included: Gene Barr, president of the Pennsylvania Chamber of Business and Industry; Terry Fitzpatrick, president of the Energy Association of Pennsylvania; David Taylor, president of the Pennsylvania Manufacturers Association; Mark Chasse, treasurer for Industrial Energy Consumers of Pennsylvania; Stephanie Catarino Wissman, executive director of Associated Petroleum Industries of Pennsylvania; David Spigelmyer, president of the Marcellus Shale Coalition; and Dan Weaver, president of the Pennsylvania Independent Oil and Gas Association. A group of heavy hitters. Their message was loud and very clear: no new severance tax, no new gross receipts tax. To enslave Pennsylvanians with these taxes now–to fix a single year’s budget–would sacrifice PA’s economic future. Gene Barr pointed out the Senate plan taxes natural gas four different times: 1. when drillers drill a well (impact fee); 2. the gas coming out of the well (severance tax); 3. when the gas gets used by consumers (gross receipts tax); and 4. if drillers make a profit, their profits are taxed too (income tax). It is a plan crafted to satisfy Big Education–to funnel money to teachers, rewarding them for voting Democrat. How many times do we have to point out this is not compromise, it’s insanity!…
As MDN reported in July, the Federal Environmental Protection Agency (EPA), the agency in charge of approving oil and gas wastewater injection wells, is currently reviewing an application and plan from Penneco Environmental Solutions (division of Penneco Oil Co.) to convert a plugged gas well into a brine (wastewater) injection well in Plum, PA–near Pittsburgh (see 
As we do every month (and have for more than two years), MDN tracks how many rigs oilfield services company Patterson-UTI Energy reports operating–as a proxy for rig count health in general and rig count health in the Marcellus/Utica in particular. Patterson recently bought out and merged in Seventy Seven Energy (see 
In April 2016 the New York Dept. of Environmental Conservation (DEC) caved to corrupt political pressure from Andrew Cuomo and denied the Williams Constitution Pipeline a necessary federal 401 stream crossing permit, blocking the project (see 
Antero Resources, one of the biggest and best drillers in the Marcellus/Utica concentrating on just those two plays, turned in their second quarter 2017 numbers last week, and held an earnings call to discuss the results. The company has a lot to crow about. Antero’s gas (and liquids) production hit a new record high of 2.2 billion cubic feet equivalent per day (Bcfe/d) in 2Q17. They continue to be the best hedging company in the Marcellus/Utica, getting an average of $3.15 per thousand cubic feet (Mcf) for the gas they sold BEFORE hedging. After hedging Antero got $3.41/Mcf for gas and equivalents (oil, NGLS). Antero’s hedging program is one of the greatest untold success stories of the Marcellus/Utica. The company lost $5 million in 2Q17, a vast improvement over losing $596 million in 2Q16. Antero completed and placed online 29 horizontal Marcellus wells during 2Q17 with an average lateral length of 9,380 feet. They drilled an average of 5,200 lateral feet per day, a 50% increase compared to 2016. In the Utica, Antero completed and placed online 5 horizontal wells with an average lateral length of 11,222 feet. During 2Q17, Antero set a record for drilling its longest lateral to date at 17,380 feet. The company also announced a big bump up in proved reserves…
Last week National Fuel Gas Company, headquartered in Western New York State with drilling subsidiary Seneca Resources and pipeline subsidiary Empire Pipeline, issued its third quarter (everyone else’s second quarter) 2017 update. NFG produced 567 million cubic feet per day (MMcf/d) of natural gas last quarter, a 6% increase over the same quarter a year ago. NFG realized an average price of $2.94 per thousand cubic feet (Mcf), up $0.08 per Mcf from the prior year. Compare that with Antero’s hedged average of $3.41/Mcf (see today’s story about Antero 2Q17). NFG CEO Ronald Tanski had some interesting remarks with respect to the company’s stalled Northern Access Pipeline project. As you may recall, the Andrew Cuomo New York Dept. of Environmental Conservation (DEC) is blocking Northern Access, like they blocked the Constitution Pipeline and a tiny spur project for the Millennium. Because NFG’s Northern Access project is stalled, they are shifting their budget and drilling further west, to do Utica drilling in locations where there is already pipeline infrastructure. So this is yet another case of the NY screwing up Marcellus drilling PA that would otherwise be happening. Landowners in PA can thank NY Gov. Cuomo for screwing them over. Tanski also mentioned the court case for Northern Access, and that FERC (Federal Energy Regulatory Commission) may step in and overrule the NY DEC, as is now being considered in the Constitution Pipeline case (see today’s lead story). Here’s the update from NFG…