PA Democrats Spout Lame Reasons to Support Severance Tax @ Hearing
It seems no matter how many times we calmly, rationally, factually respond to and refute the intellectual dishonesty around the issue of a severance tax in Pennsylvania, PA Democrats pop up to make the same already-refuted, debunked lies they spew, again and again. They must be of the opinion that if you repeat the same lies long enough, people will begin to believe them. And so a group of elected (and appointed) Democrat “leaders” gathered in Wilkes-Barre yesterday to rehash and repeat the same tired old lies about a severance tax. The organizer of the event was State Rep. Eddie Day Pashinski (Democrat from Wilkes-Barre) who stated at the event he doesn’t think the gas companies pay “their fair share.” That is such a bogus statement in so many ways. When did privately earned money suddenly belong to the state in the first place? Does Rep. Pashinski know that drillers already pay a severance tax–called an impact fee? And that by passing a severance tax on top of an impact fee, PA vaults to the top of the list–it would have the highest taxation of the industry in the United States at an effective rate of 9% (see PA Independent Fiscal Office: Wolf Severance Tax Highest in U.S.). There is NO doubt that drillers would shut down their programs in PA if such a tax were passed. But perhaps that’s what Rep. Pashinksi wants? Also at the meeting was a Democrat who is usually reasonable–Dennis Davin, secretary of the state Department of Community and Economic Development. Davin and his crew have done good work for the state, but unfortunately he answers to Gov. Tom Wolf (worst PA governor in living memory), and Wolf forces Davin to attend these types of meetings to wave the flag for Wolf’s idiotic severance tax proposal. It must be demeaning for Davin. If Davin really believes what he says about Wolf’s severance tax–we guess he’s not as smart as we thought he was. Here’s how the fawning establishment press reported yesterday’s “tax the $%#! out of drillers” meeting in Wilkes-Barre…
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Yesterday Rex Energy, a driller focused mainly on the Marcellus/Utica (headquartered in State College, PA), signed paperwork for a new $300 million loan–due to be paid back by April 2021. Rex immediately withdrew $144 million from the loan, to pay back other loans it owed. When all is said and done with paying back this and that, Rex says they will have $110 million they can use for their Marcellus/Utica drilling program. Rex CEO Tom Stabley said that will be enough money to help fund the company’s two-year development program, including “the potential to access the M&A market.” Curious statement. We take that to mean that Rex is potentially in the hunt to add large acreage tracts (or perhaps buy and add a small driller) to its existing operations. Here’s the company statement from yesterday…
Seems like every time we talk about Big Money foundations, those foundations (which are tax exempt) are far-left in philosophy and when they fund anything to do with the environment or education or business, it’s always with strings attached that said activity will have an anti-drilling bias. Need money for a new “study” to bash shale energy? Take your pick. In Philadelphia, there is the William Penn Foundation. In New York (and North Carolina) there’s the Park Foundation. And in Pittsburgh, the Heinz Foundation–run by Teresa Heinz Kerry (whom we call Mamma Teresa here on MDN). Hard left, all of them. So when we spotted an article about another Pittsburgh-based foundation–the Benedum Foundation–that is donating money to HELP the shale industry, well, we knew that’s a “man bites dog” story worthy of highlighting. The Benedum Foundation does a great deal of its grantmaking for science, technology, medical and engineering (STEM) education. Lately they’ve concentrated on training students who will, after school, land a job at someplace like CONSOL Energy, or the under-construction Shell ethane cracker plant in Beaver County. Although Benedum doesn’t spend nearly as much as the larger Heinz Foundation, we see Benedum as the antidote–a counterbalance–to some of the damage caused by Mamma Teresa and her married-into, huge piles of money that she spends to oppose shale energy…
Fire departments, schools, parks and townships are some of the 44 Pennsylvania organizations in 11 counties that will receive $326,800 in funding *this spring* from Williams–through its bi-annual community grant program. Grants up to $10,000 per organization are being awarded by Williams in communities where the proposed Atlantic Sunrise pipeline project will be constructed and operated. This is the fifth round of grants for areas that will host or be affected by the Atlantic Sunrise Pipeline. All together (including this latest round of $326,800), Williams has now given away $1.79 million to communities on behalf of Atlantic Sunrise. Now that’s something worth celebrating! Is your organization eligible? Grant applications are available at 
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Vector Pipeline preps for Rover connection; Dominion set for Cove Point LNG pipeline maintenance; Mass. AG cuddles with McKibben; study says selling US LNG abroad will create 136K jobs here at home; pipeline companies push back on Trump directive to “buy American”; carbon intensity; new natgas engines for trucks; and more!
In early April MDN reported that West Virginia’s effort to pass a law dealing with co-tenancy and joint development–what we called forced pooling lite–had gone up in pot smoke (see 
Last week one of our favorite Marcellus drillers, Cabot Oil & Gas, issued its first quarter 2017 update. There’s lots to see and to discuss. First up, Cabot’s production was up 7% from the same quarter a year earlier. And while Cabot lost $51 million in 1Q16, the company profited $106 million in 1Q17. So production went up a little, but profits went up a lot. Perhaps the main reason why Cabot made more money in 1Q17 is that the price they got for their natural gas went up 77% over the same period last year. Two items in particular caught our attention about the update: (1) Cabot predicts Williams’ Atlantic Sunrise Pipeline will be fully permitted “by early July” and construction will begin in the third quarter. They are jazzed about shipping an extra 1 billion cubic feet (Bcf) per day on the pipeline when its fully operational in 2018. (2) Other shale plays are now catching Cabot’s eye and CEO Dan Dinges is spending $125 million THIS YEAR on buying leases and drilling test wells–in plays they aren’t yet ready to disclose. The only hint we have is “that our focus is going to be oil.” Hmmmm. We don’t much like the sound of that. Cabot has developed a wandering eye for other plays. Make no mistake, Cabot will continue to drill aggressively in the Marcellus–but they will no longer be laser focused on the Marcellus. To be fair, the company has previously fiddled around in the Eagle Ford (an oil play in Texas). But apparently the Eagle Ford is not where “the next big thing” will be found. Cabot is looking elsewhere for the next miracle, like the one they found in Susquehanna County, PA with the Marcellus. Except this time it’s in oil and not gas…
Southwestern Energy turned in its first quarter 2017 update last week. Not widely reported is that production for the company slipped by 14% during 1Q17 over 1Q16. Why? The company shut down new drilling for a good part of last year, when prices were low. However, the company got a lot healthier last year, financially. After losing $1.1 billion in 1Q16, Southwestern made $351 million in profit in 1Q17–almost a $1.5 billion swing from red to black. Southwestern also reported a new high for their proved reserves–now over 10 trillion cubic feet. CEO Bill Way said on an earnings call that Southwestern is investing 85% of their budget in the Marcellus/Utica this year. They are, without a doubt, one of the largest (if not THE largest) active driller in the Marcellus/Utica today. Here’s more about Southwestern’s 1Q17 performance…
Whenever a big, important project like the Shell ethane cracker, reported to be a $6 billion investment, goes forward, a whole lotta people were involved before the decision was made. However, if there is one universal truth in business it is this: There is always a champion at the center of any important project. The one person who’s responsibility it is to propel that project forward. The person who, we like to say, has their “butt in a sling.” It is on their shoulders to ensure the projects success. When you dig down into the story of the multi-billion dollar Shell cracker plant now being built in Beaver County, PA, you will find that one person. His name is Brent Vernon. He worked for more than five years to lure Shell to the Keystone State. Vernon was senior project manager for energy for the state when he began working, full time, on the Shell project in 2011. Since then he was promoted, first to deputy director and eventually director of the Governor’s Action Team, a role he continues. Vernon is key–one of the linchpins without whom the Shell deal would not have happened…
Dominion CEO Diane Leopold held a conference call last Thursday to provide an update on progress for the company’s $5 billion, 594-mile Atlantic Coast Pipeline–a natural gas pipeline that will stretch from West Virginia through Virginia and into North Carolina. Leopold said on the call that Dominion has procured 85% of the land, materials, and services it needs to build the pipeline. Nearly all of the land surveying is now done (98%)–and the company now has signed agreements with 60% of the landowners along the proposed route. Leopold expects the Federal Energy Regulatory Commission (FERC) will grant a final approval for the project this fall. In other words, it’s full speed ahead for the Atlantic Coast Pipeline, irregardless of opposition from anti-fossil fuel fanatics, a relative few who continue to vociferously oppose the project…
More fake “research” is on the way courtesy of the anti-drilling Southwest Pennsylvania Environmental Health Project. The Project is launching a so-called public health registry. Log in to the website and if you live within five miles of a drilling site, you can report your latest headache in an attempt to link it to (and smear) shale development. Yep, just blame everything on drilling. Got allergies? Blame drilling. Headache? Blame drilling. Earache? Blame drilling. Er, a “performance issues?” Blame drilling. (Maybe they’ll give you some free Viagra.) That’s the purpose of this latest sham initiative by the same group that has brought us such glittering examples of “research” as “The List of the Harmed”…