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    Big News from the O&G Awards Northeast Industry Summit

    Yesterday MDN editor Jim Willis had the pleasure of attending, and moderating two panel sessions, at the Oil & Gas Awards 2017 Northeast Industry Summit in Pittsburgh. (Jim is back in Binghamton today, very tired!) When the sessions are made available via video, Jim will post them here on MDN. In the meantime a few words about the sessions and presenters, and about what we consider some pretty big news coming out of yesterday’s meeting. The day began with MDN friend George Stark, Director of External Affairs for Cabot Oil & Gas, making an impassioned plea for everyone in the industry to get involved with telling the great story of our beloved industry. Don’t think it’s someone else’s role–it’s the role of every single person in the industry, from janitor to secretary to CEO. George gave a rousing, opening address. George was followed by a panel discussion led by MDN friend Charlie Schliebs, Managing Director of Stone Pier Capital. Charlie’s panel tackled some interesting topics about mergers and acquisitions, bankruptcies, and where they see the price of natural gas going over the next several years. After Charlies panel was a panel discussing pipeline projects. The moderator was Fred Lowther, a partner at powerhouse energy law firm Blank Rome. Fred, who once worked on the Iroquois Gas Transmission Pipeline project when it was being built, said over the years since that pipeline was built he’s often joked they failed to do a “celebrity impact statement” when building it. Liked that line! After Fred’s panel was a talk given by Michael Krancer, also with Blank Rome (and former Secretary of the PA Dept. of Environmental Protection). Mike is always a take-no-prisoners presenter. We’ve always loved the way he thinks and expresses himself. Yesterday was no different. It was during Mike’s talk that we found what we believe was the most important thing said yesterday. It has to do with PA’s proposed General Permit 5A. Mike said if GP-5A is enacted as written, it will result in a 12-18 month moratorium on production in Pennsylvania…
    Read More “Big News from the O&G Awards Northeast Industry Summit”

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    Ohio Dormant Minerals Act – Rights Do Not Automatically Transer

    MDN has highlighted the importance of the Ohio Supreme Court’s decision with regard to the Ohio Dormant Mineral Act (DMA). In September the OH Supreme Court ruled in three DMA cases, saying all of the other cases come under those three (see Important: OH Supreme Court Finally Rules on Dormant Mineral Act). Following that ruling, we brought you insights on what it means from international law firm Jones Day (see One More Look at Important OH Supreme Court DMA Decision). We later ran a copy of an analysis done by attorney David Wigham, who commented that title and ownership to mineral interests in Ohio has “significantly changed” (see Expert Says OH DMA Decision “Significantly Changed” Mineral Rights). Below we have yet another analysis. This one does a great job of summarizing the three cases and what they mean. The bottom line takeaway: the Ohio Dormant Mineral Act does not automatically transfer oil and gas mineral rights to surface owners…
    Read More “Ohio Dormant Minerals Act – Rights Do Not Automatically Transer”

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    Could Challenge to Colo. Frack Ban Affect NY’s Moratorium?

    We spotted an article on the Hot Air website about a court challenge in Colorado that may (or may not) have implications for shale drilling in places like New York State. Several years ago the ultra-liberal Boulder County, CO banned fracking. Landowners in the county are unconstitutionally denied the right to use their land as they see fit. So Colorado’s Attorney General, Cynthia Coffman, has just sued Boulder County to have the frack ban declared illegal. IF the case were to get appealed to a federal court and IF the case decided that Boulder County does not have the right to ban fracking, might that not serve as a precedence for New York and a statewide ban? We know, we know. It’s a stretch and a lot of IFs. But it is an intriguing idea–and a case worth watching…
    Read More “Could Challenge to Colo. Frack Ban Affect NY’s Moratorium?”

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    EPA Axes Obama Reg Requiring O&G Methane Emission Reporting

    Last year the federal Environmental Protection Agency (EPA) under Barack Hussein Obama once again far exceeded its constitutional limits by enacting a new methane regulation that requires oil and gas operators to install all sorts of expensive equipment in a vain attempt to sniff out so-called fugitive methane (see EPA Does it Again: Tries to Destroy O&G with New Methane Rule). The erroneous thinking goes like this: even a little bit of methane leaking into the atmosphere is far worse than just about all carbon dioxide create when it comes to global warming, so we have to stop it. And the way to stop it is by forcing oil and gas companies (drillers, pipeliners, etc.) to ensure not one stray CH4 molecule ever escapes into the atmosphere. The EPA totally ignores the FACT that burping and farting cows put far more methane into the atmosphere than the oil and gas industry. But we digress. Not long after the EPA tried this latest heavy-handed approach with the o&g industry, 15 states sued to stop it, including Scott Pruitt as Attorney General from Oklahoma (see 15 States File Lawsuits to Block EPA O&G Methane Rule). It must have given Scott, now EPA Administrator, enormous satisfaction to issue the order yesterday that withdraws the methane rule “immediately”…
    Read More “EPA Axes Obama Reg Requiring O&G Methane Emission Reporting”

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    Steve Schlotterbeck Becomes CEO of EQT

    Steve Schlotterbeck

    As MDN reported back in October, EQT CEO David Porges said he would retire in early 2017 (see EQT CEO David Porges Retiring Early 2017, Schlotterbeck New CEO). Porges will stick around as Chairman of the Board. Steve Schlotterbeck, president of EQT, will step up to become the new CEO. That day has come. Beginning Wednesday, March 1, Steve took over from Dave and is now the top dog at EQT. Congratulations to Steve! Along with Steve ascending to the throne, there have a few other changes in the senior management team…
    Read More “Steve Schlotterbeck Becomes CEO of EQT”

  • Marcellus & Utica Shale Story Links: Fri, Mar 3, 2017

    The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Hundreds rally against fracking in Maryland; no new Utica wells in OH for Hess in 2017; phones “ringing off the hook” with biz opportunities in OH, thx to fracking; Utica Shale Academy students get certs; Marcellus Shale exports from Philly jump in 2016; Exxon now spends 50% of drilling budget on shale; US shale pokes OPEC in the eye; no peak oil for America, or the world; OPEC fails to deliver on promised target cuts in production; and more!
    Read More “Marcellus & Utica Shale Story Links: Fri, Mar 3, 2017”

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    Antero Resources Swings to $849M Loss in 2016, Prod Jumps 24%

    On Tuesday, Antero Resources, one of the largest and most active drillers in the Marcellus/Utica, issued its 2016 and fourth quarter 2016 update. The company reports net daily production averaged 1,847 million cubic feet equivalent (MMcfe) per day, a whopping 24% increase over 2015 production levels. Digging through the update we found this interesting statistic: It cost Antero an average of $0.84 million per 1,000 feet to drill and complete a Marcellus well, and it cost the company an average of $0.99 million per 1,000 feet to drill and complete a Utica well. Those numbers are 29% and 27% less than a year ago, respectively. The company continues to have some of the best hedging (prices locked in early for the gas they sell) in the business. The company’s natural gas production for 2017 is fully hedged at an average index price of $3.63 per thousand cubic feet (Mcf). The Henry Hub price as this was being written was $2.77/Mcf. Smart! But all was not butterflies and unicorns for Antero in 2016. The company reports losing $849 million in 2016, after making $941 million in 2015. That’s a swing of nearly $2 billion in one year. Ouch. More interesting factoids from the update: Antero plans to average sinking nine wells per pad in the Marcellus, and six wells per pad in the Utica in 2017. Here’s the full update, along with a brand new PowerPoint presentation…
    Read More “Antero Resources Swings to $849M Loss in 2016, Prod Jumps 24%”

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    Eclipse NatGas Production Up 23% in 2016, Big Utica’s Coming 2017

    In early February, Eclipse Resources, a Marcellus/Utica pure play driller headquartered in State College, PA that drills mostly in Ohio, released an operational update for fourth quarter and all of 2016 (see Eclipse Resources 2016 & 4Q16 Update – Super Laterals Coming). Yesterday the company released a full update, including financials, for full year and fourth quarter 2016. The report shows natural gas production was up significantly in 2016, up 23% from 2015. However, natural gas liquids (NGL) production was flat and oil production, a small part of the company’s production, was down. On the financial side, Eclipse lost $204 million in 2016, which is a vast improvement over their $971 million loss in 2015. Things are turning around. During 2017, Eclipse plans to drill 24 wells with an average lateral length of approximately 13,300 feet. Eleven of those 24 will be “Super-Laterals” with lateral extensions exceeding 15,000 feet. Mammoth! You may recall Eclipse has drilled what is (so far) the longest Utica well ever, the Purple Hayes, some 18,500 feet long (see Eclipse Res. 1Q16: Drills Longest Shale Well Ever! “Purple Hayes”). Can you imagine another dozen of them?! Buckle up, here comes 2017 for Eclipse…
    Read More “Eclipse NatGas Production Up 23% in 2016, Big Utica’s Coming 2017”

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    O&G Industry Begins to Pick Up Again in Muskingum County, OH

    A “boost” from the oil and gas industry, specifically the Utica industry, is beginning to “trickle” through Muskingum County once again, says the director of the Zanesville-Muskingum County Port Authority. No, we’re not talking about drilling Utica wells–not in Muskingum, anyway. What we are talking about are companies that work in the industry. Oilfield services companies like Halliburton and Producers Service Corporation are, once again, expanding their businesses and adding new jobs. Muskingum is located next to four of the best counties in which to drill a Utica well–Guernsey, Belmont, Noble and Monroe. Belmont has the bonus of being the likely location of the next ethane cracker to commit to the region–PTT Global Chemical’s cracker plant. With an uptick in Utica drilling, and activity around the coming cracker plant, Muskingum County is in the catbird seat for economic expansion…
    Read More “O&G Industry Begins to Pick Up Again in Muskingum County, OH”

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    TransCanada Selling Stake in Iroquois Gas Pipeline – to Itself

    Companies in the oil and gas space, in particular midstream (pipeline) companies, have complicated ownership structures on paper. There are usually a number of subsidiary companies. Sometimes these companies have a “mother ship” which is owned by stockholders, and a subsidiary that is a master limited partnership (MLP), which is a different kind of corporate structure. MLPs don’t have shares of stock but instead issue units (about the same thing as shares of stock). MLPs give the unitholders certain tax advantages not offered to stockholders. Yes, its complicated. The important thing to know is that often these large pipeline companies have layers within layers. Which is the setup for this story. TransCanada, which purchased Columbia Pipeline Group last year for $10 billion (see TransCanada and Columbia Pipeline Tie the Knot Today). TransCanada controls another subsidiary called TC PipeLines, an MLP. On Monday, TransCanada issued a notice that it intends to “sell” its ownership stake in the Iroquois Gas Transmission System (an important Marcellus pipeline) along with its remaining ownership in Portland Natural Gas Transmission System (PNGTS), a New England pipeline, to its TC PipeLines subsidiary. Why? To raise money. How can a company selling something to itself raise money?…
    Read More “TransCanada Selling Stake in Iroquois Gas Pipeline – to Itself”

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    Kinder Morgan Sells 49% Stake in Elba Island LNG to EIG for $555M

    Elba Island LNG facility

    Kinder Morgan’s Elba Island, Georgia (near Savannah) LNG export facility received a green light from the Federal Energy Regulatory Commission (FERC) last June (see KM’s Elba Island LNG Export Plant Approved by FERC). Kinder has since started construction at the site. In December, the U.S. Dept. of Energy granted Elba Island permission to export LNG to non-Free Trade Agreement countries (see Elba Island LNG Update: Non-FTA Exports Approved, Dump Truck City). What does the Georgia’s Elba LNG plant have to do with Marcellus/Utica? The Williams Transco pipeline runs through Georgia. Kinder owns and operates the 200-mile Elba Express pipeline, which connects the LNG facility to the Transco. Currently Elba Island imports LNG, getting it to market via the Transco. However, Williams has been on a mission to send Marcellus gas south–including to Georgia (see Marcellus Gas Heading to Georgia via Transco Pipeline). Marcellus Shale gas will, via the Transco, be at least some of, if not the primary, source for gas exported from the Elba Island facility. Although work continues at the facility, Kinder has decided they can use some money to help finish the project–so they’ve just sold a 49% stake in the project to investment firm EIG Global Energy Partners for $555 million. When the project is complete, Kinder says it will be worth $1.3 billion. So EIG got 49% of a $1.3 billion project (or $637 million worth of value) for $555 million. Sounds like EIG got a good deal, or perhaps Kinder was a tad desperate for the cash?…
    Read More “Kinder Morgan Sells 49% Stake in Elba Island LNG to EIG for $555M”

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    VA Senate Committee Nixes Frack Trade Secret Protection

    In January MDN told you about an effort in Virginia to ensure new changes in Virginia’s environmental regulations that require “mandatory disclosure of fracking chemicals, baseline water testing and monitoring, and spill prevention and response planning” would still protect trade secrets–the exact combinations of chemicals used by drillers when fracking (see Proposed VA Law Would Protect Frack Chemical Trade Secrets). As we said at the time, Big Green groups are demagoging the issue, claiming drillers want to keep fracking chemicals secret from first responders and doctors. Not true. But that doesn’t stop the headlines from continuing, like “Citizens have a right to know about fracking chemicals” and “King George supervisors lobby for disclosure of fracking chemicals” (see Debate & Misinformation re Frack Chemical Disclosure Rages in VA). Here’s the thing: fracking chemicals ARE required to be disclosed. The proposed law that modifies the regulations doesn’t change that. The new law only shields the exact combinations of chemicals from being disclosed–and even the exact combination can/will still be exposed for doctors and first responders. However, the damage has been done. Enough lies hit the fan that members of a Virginia Senate committee have rejected it, ending the bill before it could receive a full vote. In other words, Senators believed the lies…
    Read More “VA Senate Committee Nixes Frack Trade Secret Protection”

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    Trump Signs Exec Order Targeting EPA “Waters of the U.S.” Rule

    In May 2015, Obama’s rogue Environmental Protection Agency (EPA), along with the Obama U.S. Army Corps of Engineers (USACE), released a finalized rule clarifying what “Waters of the United States” (WOTUS) means vis-à-vis what can be regulated under the federal Clean Water Act (see EPA Power Grab: Redefines Waters of the U.S. to Include Everything). Essentially the rule change redefines everything down to mud puddles (no, we’re not exaggerating) as subject to the federal Clean Water Act. In October 2015 a federal judge stopped WOTUS from going into effect, while it’s litigated (see Sixth Circuit Court Stops EPA from Implementing WOTUS Anywhere). It took a year, but in November 31 states along with other entities filed briefs with the 6th U.S. Circuit Court of Appeals opposing the rule (see 31 States Ask Court to Dump Obama WOTUS Rule as Unconstitutional). It now looks like we won’t have to litigate it out after all. Yesterday, fulfilling a campaign promise, President Trump signed an Executive Order directing the EPA to reconsider WOTUS. Among the many at the signing ceremony was the new Administrator of the EPA, the marvelous Scott Pruitt–who has pledged to move forward immediately with rolling back WOTUS…
    Read More “Trump Signs Exec Order Targeting EPA “Waters of the U.S.” Rule”

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    Time to Swing the Ax at the EPA – Let the Firings Begin!

    Less than two weeks ago Oklahoma Attorney General Scott Pruitt was confirmed to be the new Administrator of the Environmental Protection Agency (see Scott Pruitt Confirmed to Lead EPA – Swamp Draining Begins). As we observed at the time, “A labor union representing more than 9,000 EPA employees actively opposed Pruitt’s confirmation. We personally think those 9,000 employees should be fired.” Perhaps our wish is coming true! Well, at least in part. President Trump is proposing to ax 24% off from the EPA’s annual, way overinflated budget. The speculation is that the new budget will result in firing 20% of the EPA’s 15,000 employees. Hooray! It’s about time. Let’s see how the insular bureaucrats who love to tell us all what to do like getting an unemployment check…
    Read More “Time to Swing the Ax at the EPA – Let the Firings Begin!”

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    Federal Judge Lets Rover Enter Most OH Properties for Tree Clearing

    On Friday, Feb. 3, the Federal Energy Regulatory Commission (FERC) gave a final approval for Energy Transfer’s Rover Pipeline project–a $3.7 billion, 711-mile Marcellus/Utica natural gas pipeline that will run from PA, WV and eastern OH through OH into Michigan and eventually into Canada (see ET Rover Pipeline Gets Final Approval by FERC). Rover immediately began cutting down trees along the path in Ohio, on property where landowners have signed easements and voluntarily granted access. However, some landowners, either signed or unsigned, have not yet granted access. So Rover went to court, seeking eminent domain declarations (see Time’s Up – Rover Pipe Uses Eminent Domain on Holdout OH Landowners). Yesterday a federal judge granted Rover a preliminary injunction that allows the company to enter most properties–at least for those who have already signed or are actively negotiating with Rover. There are a few holdouts (21 owners of 15 parcels) where certain legal hoops still need to be jumped through–but they will also soon have to allow Rover access. What are last minute offers by Rover to landowners for easements? Rover isn’t saying, but some landowners are mentioning $70 to $80 per linear foot as a good number…
    Read More “Federal Judge Lets Rover Enter Most OH Properties for Tree Clearing”

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    Millennium Asks FERC for OK to Cut Trees in NY w/o DEC Permits

    New York State is a hopeless, corrupt mess. MDN previously reported on a $900 million natural gas-fired electric generating plant coming to Orange County, NY (see Orange County, NY Marcellus-Fired Electric Plant OK’d by Judge). The CPV (Competitive Power Ventures) Valley Energy Center project is being opposed by local anti-drilling ninny nannies, including Hollywood star James Cromwell. No matter. It’s already under construction. The problem now is getting a 7.8 mile pipeline, an off-shoot pipeline from the mighty Millennium Pipeline, built to the plant to supply the natural gas it will need to run. In November the Federal Energy Regulatory Commission (FERC) approved the short pipeline (see FERC Approves Pipeline to Orange County, NY NatGas Power Plant). However, as with the Constitution Pipeline, the Cuomo Dept. of Environmental Conservation (DEC) is intentionally blocking this pipeline using delays. Millennium is not, like Williams did with the Constitution, sitting on its hands waiting for the DEC. The Millennium is aggressively pushing the DEC to grant the necessary water crossing permits and sued the DEC in January to make it happen (see Millennium Pipeline Sues Cuomo’s Corrupt DEC Over Expansion Delay). As with other such projects, Millennium is playing beat the clock with respect to cutting down trees before March 31. After that date federal law prohibits large-scale tree removal in order to protect roosting bats (don’t ask). Millennium, we are happy to report, continues to push aggressively. They’ve asked FERC for permission to cut down trees not on or near swamps, er a, wetlands, without having state permission in hand to do so. In other words, Millennium is asking FERC to put its boot on the neck of the DEC and push. Love it!…
    Read More “Millennium Asks FERC for OK to Cut Trees in NY w/o DEC Permits”