MSC to Allegheny Health Board: Your Own Data Says Shale Is Safe
Last Wednesday, MDN told you about the Allegheny County Board of Health’s latest move against shale drilling (see Antis Cheer as Allegheny Co. Moves to Pull Shale Air Exemptions). Right now, shale well pads in the county don’t need an air permit from the county health department because they’re exempt under Article 21, the county’s air pollution rules. In September, the board voted unanimously to have the health department study getting rid of that exemption. It turns out the industry saw this coming and tried to head it off. The Marcellus Shale Coalition (MSC), the main trade group for Pennsylvania’s shale drillers, sent MDN copies of two letters MSC President Jim Welty sent the board before that vote, one dated Aug. 20 and the other Sept. 15. The letters accuse the board’s “Fracking Committee” of doing its work in the shadows. And they point to something the board seems to want everyone to forget: the county’s own data. Read More “MSC to Allegheny Health Board: Your Own Data Says Shale Is Safe”
The rest of the country is heading into winter swimming in natural gas. Production is at record highs, storage is above average, and Henry Hub January futures are trading below $4. Yet traders are paying more than $20 per MMBtu for gas delivered into parts of New England in January. That’s more than five times the national benchmark. The problem isn’t a shortage of gas. It’s a shortage of pipe. New England sits just a few hundred miles from the Marcellus Shale, one of the most prolific gas fields on the planet, but more than a decade of blocked pipeline projects means it can’t get enough of our gas when the weather turns cold. 
Six weeks. Same number. The Marcellus/Utica held at 33 rigs again for the week ended October 9, while the national count jumped by five to 603 — the first time it has topped 600 in the current run-up, and a new 52-week high. Oil rigs did all the lifting (up six). Gas rigs slipped by one. Frac spreads jumped by seven, the biggest weekly gain in a while. And on the price board, natural gas climbed back over $3, settling at $3.22 per MMBtu. Plus: a familiar name pops up on the Enverus permit list for the first time. 
Finally, a little justice. An international arbitration panel ruled that Venture Global (VG) breached its contract with Portugal’s Galp by delaying the declaration of its Calcasieu Pass LNG export plant in Louisiana as “commercially operational.” That official start date, called COD (commercial operation date), is what triggers deliveries to long-term customers. For more than three years, VG shipped cargo after cargo of LNG from Calcasieu Pass, much of it sold on the sky-high spot market after Russia invaded Ukraine, all while insisting the plant was still in its “commissioning” (startup) phase. Galp, which signed up in 2018 to buy 1 million tonnes per year (MTPA) of LNG for 20 years, waited. Galp now joins BP as the second customer to beat VG in arbitration. The catch? Galp’s payday is capped at $170 million, and the check won’t be written until after a damages hearing in 2027 or 2028. 
MARCELLUS/UTICA REGION: Head of WV energy development and competitiveness exits Morrisey administration; How rural Pennsylvania’s $165M data center fight became a bipartisan battle against AI; OTHER U.S. REGIONS: Hochul, Blakeman offer very different views on data centers, energy needs; NATIONAL: U.S. natural gas futures settle higher; 10 downsides to solar farms everyone should be aware of; INTERNATIONAL: Oil advances amid war and hurricane risks; Australia to release final plan to keep more LNG at home; Tanker rates soar to record as oil crisis becomes shipping crisis. 
It’s Columbus Day! MDN will not publish our regular list of stories today — but have no fear; we will be back tomorrow (Tuesday) with a full lineup. Take a moment today to celebrate the world’s most famous Italian, the guy who started it all, the guy who discovered the Americas, and what would one day become the greatest country on earth: The United States of America!
The Marcellus/Utica region received 29 new drilling permits last week, September 28 – October 4, nearly double the 16 permits issued two weeks earlier. Pennsylvania issued 20 of the new permits. Ohio issued 9 new permits. And West Virginia got skunked, issuing no new permits. The drillers who received new permits last week were: Blackhill Energy, Coterra Energy (now Devon Energy), EOG Resources, Expand Energy, Gulfport Energy, Infinity Natural Resources (INR), and Snyder Brothers. 
One shoe has dropped. Yesterday (Oct. 8), Devon Energy announced it is selling its entire Eagle Ford position in South Texas to Houston-based Crescent Energy for $4.2 billion in cash. It’s Devon’s first big asset sale since it swallowed Coterra Energy in May. It’s also not the sale most of us expected a few months ago. The old Cabot Oil & Gas Marcellus position in Susquehanna County, which Devon now owns, stays put. For now. The question we keep hearing from Northeast PA landowners: Is the Marcellus next? Below we read the tea leaves. 
The Natural Gas Supply Association (NGSA) released its 26th annual Winter Outlook yesterday, and the bottom line is music to the ears of anyone who pays a heating bill: NGSA sees “downward market pressure” on natural gas prices this winter compared to last. Henry Hub futures for November through March average $3.43 per MMBtu, down $1.08 (23.9%) from $4.51/MMBtu realized last winter. That’s less happy news for landowners hoping for fat royalty checks. But buried on page 5 of the report is a nugget every MDN reader should notice: last winter, while nearly every other U.S. shale basin grew, Marcellus and Utica production actually shrank. The reason? Pipes. Or rather, the lack of them. 
Big Tech has a new problem, and it isn’t computer chips. It’s the neighbors. In Hazle Township (Luzerne County, PA), a data center developer offered $10,000 to every one of the town’s 4,500 households if they’d just let the project go forward. Most residents said “no thanks,” the township said no, and the developer is now suing. A week later, Amazon announced it will spend more than $1 billion over five years in communities that host its data centers, in an effort to cool a national backlash. Here’s why that matters to anyone who makes a living from Marcellus/Utica gas. 
A Pennsylvania House committee held a hearing on Monday about spreading brine from conventional oil and gas wells on township dirt roads. Former Department of Environmental Protection (DEP) Secretary David Hess testified and proposed a fix aimed squarely at Marcellus drillers: make the shale industry recycle all brine from Pennsylvania’s conventional wells, “at no cost to conventional well owners.” Shale isn’t the problem here, but it could end up with the bill. 
Expand Energy, the largest natural gas producer in the country (born from the 2024 merger of Chesapeake Energy and Southwestern Energy), is going all-in on artificial intelligence (AI). Recently, tech consulting firm Thoughtworks announced that Expand has hired it to build AI capability across the entire company. Not just out in the field, but in the office and on the gas marketing desk, too. Expand wants a working AI tool in “production” (i.e., actually being used, not just tested) by the end of this year. That’s about 12 weeks from now! This is not Expand’s first AI rodeo. Back in January, Expand signed a deal with Baker Hughes to put AI-powered software on thousands of its Marcellus, Utica, and Haynesville wells. 
Here’s a head-scratcher for you. The Henry Hub spot (physical, not futures) price, the national benchmark for natural gas down in Louisiana, closed yesterday at $3.155 per MMBtu (million British thermal units, roughly the same as 1 Mcf, or a thousand cubic feet). Up here in the Marcellus/Utica, the very same molecule of gas sold for 88.5 cents. That’s not a typo. Our gas traded at a $2.27 discount to Henry Hub, fetching just 28 cents on the dollar. Why? The short answer is the same one we’ve given for 15 years: not enough pipelines.