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    Make Marcellus Drilling Better – by Using a Math Formula?!

    Can you actually use a mathematical formula to figure out better ways to plan how to drill shale gas wells? It turns out the answer to that question is a resounding, “Yes!” A chemical engineering professor at Carnegie Mellon University, along with several Ph.D. students have, working with EQT, pioneered research that figured out how to turn 14,000 water truck trips to a well site into 1,400 trips–an “order of magnitude” difference. That is a big deal in the drilling industry. Using mathematical formulas–something called “mixed-integer optimization”–Professor Ignacio Grossmann and the other researchers tackled how to make processes in the shale gas industry more efficient. They published a paper in the AIChE Journal in 2016 titled, “Strategic Planning, Design and Development of the Shale Gas Supply Chain Network” (full copy below). The paper “presents a mixed-integer nonlinear programming (MINLP) model to optimally determine the number of wells to drill at every location, the size of gas processing plants, the section and length of pipelines for gathering raw gas and delivering processed gas and by-products, the power of gas compressors, and the amount of freshwater required from reservoirs for drilling and hydraulic fracturing so as to maximize the economics of the project.” Er, right. As you can tell, it’s complex. But it’s also very interesting and relevant for drillers and others in the industry, which is why we bring it to you. Below is a quick summary/overview of the paper, a video of Prof. Grossmann describing the research, and a copy of the paper itself…
    Read More “Make Marcellus Drilling Better – by Using a Math Formula?!”

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    EXCO’s Day of Reckoning with Bankers: Feb 1

    EXCO Resources was once a sizable player in the Marcellus. They still have 145,000 net acres in the Marcellus, with 124 horizontal Marcellus wells drilled and in production. However, EXCO, as we pointed out last March, has pretty much abandoned the Marcellus at this point (see EXCO: No Marcellus Drilling in 2015/2016, NYSE Threatens Delisting). The company has flirted with bankruptcy for some time. They were able to slow the bleeding in 2Q16 (see EXCO Still Hammering Midstreamers re Contracts, Bleeding Slowed). In 3Q16 EXCO finally turned a profit, going from losing $355 million in 3Q15 to making $51 million in 3Q16 (see EXCO 3Q16: Turns a Profit! Marcellus Production Continues to Fall). That is an astonishing turnaround for a company razor close to bankruptcy. However, they aren’t out of the woods yet. Last fall EXCO was due to have borrowing base redetermination. A company’s borrowing base is the value of its assets–in this case the value of the leases and oil/gas wells EXCO owns. Those assets are used as collateral to back up loans and IOUs. If the bankers extending credit determine a company’s assets are no longer sufficient to cover their loans, the bankers may force that company into bankruptcy as a way to protect the bank’s investment. EXCO pushed off the asset checkup to November. Then in December, the company got a reprieve, pushing the overdue checkup from Nov. 1, 2016 to Feb. 1, 2017. It now appears time is up and the redetermination will happen on Feb. 1. What will the banks find?…
    Read More “EXCO’s Day of Reckoning with Bankers: Feb 1”

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    Climate Radicals Protest in Philly Against Trump’s Cabinet Picks

    Some 200 leftist/radical bought-and-paid-for “protesters” (paid by Big Green groups) “rallied” in downtown Philadelphia yesterday in front of both of PA’s U.S. Senate office (Bob Casey, total jerk and Democrat hack, and Pat Toomey, marginal Republican). They were protesting President-elect Trump’s picks to run the EPA, Dept. of Energy and Dept. of Interior–calling them “climate deniers.” This is part of a national campaign paid for by radical environmental groups, like 350.org and the Sierra Club, groups totally invested in the theory that mankind is causing the earth to catastrophically heat up–even though the temperature record doesn’t back up the theory. Holding silly banners like “NO CLIMATE DENIAL CABINET” they paraded around, collected their paychecks, bought a few dime bags of weed while they were in the ‘hood and generally had a good time. What’s really offensive is that these same idiots demanded that Republicans rubber stamp Obama’s radical cabinet when he assumed office–which stupid Republicans did. These same “protesters” now demand the victor (yes, Trump won) cave to their childish demands. Fortunately Trump is a different kind of Republican and doesn’t back down from a fight…
    Read More “Climate Radicals Protest in Philly Against Trump’s Cabinet Picks”

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    Indeck Gets Michigan Approval for $1B Gas-Powered Electric Plant

    Indeck Niles Power Plant – artist’s rendering (click for larger version)

    Indeck Energy announced in October a plan to build a $1 billion electric generating plant (powered by natural gas) in Niles, Michigan, not far from Chicago (see $1B Electric Plant Planned Near Chicago, M-U Connection?). There has been no mention of Marcellus/Utica gas feeding the plant (so far), but our own speculation is that with the reversal of the Rockies Express (REX) pipeline which now flows gas from the Marcellus/Utica west to Illinois, we suspect our gas will be used to power the plant. Good news: the State of Michigan has given its blessing and approval for the project and Indeck plans to begin construction on the 1000-megawatt plant this year…
    Read More “Indeck Gets Michigan Approval for $1B Gas-Powered Electric Plant”

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    Cove Point LNG Now 78% Complete, On Track to Open This Year

    In October 2014 Dominion announced they had officially broken ground on the Cove Point LNG export plant, a project that will inject between $3.4 and $3.8 billion in Calvert County, Maryland and pump upward of 1.8 billion cubic feet per day of cheap, abundant Marcellus and Utica Shale gas (see Dominion Breaks Ground on Cove Point, MD LNG Export Facility). Anti-drilling zealots have been desperate to stop the facility in a vain attempt to stop “fracked gas.” The Sierra Club, among others, has repeatedly launched frivolous lawsuits. They’ve all failed. Dominion released a video update (below) that shows the facility is now 78% complete and “on track for an in-service date in late 2017.” There are currently 1,800 construction workers on site. All of the concrete has been poured, the sound wall is finished, and more than 50% of the steel has been installed for this project. Some 31 of the 34 barge loads have been received and 68 of the 77 heavy haul deliveries have been transported. It is all systems “go” for this project…
    Read More “Cove Point LNG Now 78% Complete, On Track to Open This Year”

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    Journal ‘Science’ Pimps Itself to the Democrat Party with Op-Ed

    Science, as in the storied journal, is supposed to be about, well, science. Instead, they’ve opened up their pages to politics. Not that Science hasn’t long been bastardized by and riddled with politics. But just like mainstream media was unmasked during this last election as being TOTALLY biased and willing to “shade” the truth (i.e. lie), Science is now unmasked. Barack Hussein Obama submitted an article to the journal about global warming, as an exercise in mass propaganda, to try and create the meme that he actually achieved great things related to energy while in office–i.e., his “legacy.” The opposite is true. In the Science article (below) Obama alludes to the rise of fracking as lowering carbon emissions, but he can’t even bring himself to actually refer to fracking or hydraulic fracturing in the article itself. That would tick off his radical base. The entire article is about global warming and how mankind is causing it–pure rubbish and non-science. But there you go. Our point is that it is now only too obvious that Science is to the scientific world what the National Enquirer is to the “news” world…
    Read More “Journal ‘Science’ Pimps Itself to the Democrat Party with Op-Ed”

  • Marcellus & Utica Shale Story Links: Tue, Jan 10, 2017

    The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Citizens Financial a gem in the heart of the Marcellus; Energy Services of America, firesale prices; NY closing nuke plant, will burn more oil instead; why hasn’t natgas shopping caught on in PA; will U.S. shale soon get a $50B infusion; EPA asks employees if they are gay, straight, or “other”; and more!
    Read More “Marcellus & Utica Shale Story Links: Tue, Jan 10, 2017”

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    Shell Leases More PA Properties to Build Ethane Pipeline

    Click to view larger version

    Nearly a year ago, in February 2016, MDN brought you exclusive news that Shell had begun approaching landowners in Beaver County to get them to sign easements for two ethane pipelines to feed the mighty cracker plant they plan to build in the county (see Exclusive: Shell Leasing Land for 2 Pipelines to PA Cracker Plant). At that time Shell had still not fully committed to building the cracker–something they finally did in June (see Breaking: Shell Pulls the Trigger, PA Ethane Cracker is a Go!). In August, MDN brought you more details, that Shell is indeed working on a 94-mile ethane “pipeline system” with two “legs” to feed the cracker, confirming the tip we received in February. The new ethane pipeline system has a name: the Falcon Ethane Pipeline System (see Shell Working on 94-Mile Ethane Pipeline to Feed PA Cracker). Last October Shell formally launched an open season to sign up shippers for the Falcon Pipeline (see Shell Launches Open Season for PA-WV-OH Falcon Ethane Pipeline). Some new news to share. Last September and October Shell signed up six more property easements, in Beaver County, for the Falcon Pipeline. How much Shell will pay the landowners is still being negotiated and will not be made public (unfortunately). However, we can tell you who leased, along with the piddly amount of taxes Shell will pay to the state and local towns…
    Read More “Shell Leases More PA Properties to Build Ethane Pipeline”

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    Obama EPA Signs One Final “Sue and Settle” Case Against O&G

    January 20th, when Donald Trump is inaugurated and decomposing swamps like the EPA get drained, can’t happen soon enough. However, before that date, the Obamadroids are doing everything they can to get their last digs in. One of them is the rogue, out-of-control Environmental Protection Agency, which will soon be swept clean by Scott Pruitt (delicious justice if ever there were some). We’ve written about the sleazy practice of “sue and settle” in the past–a practice whereby government agencies like the EPA get their friends in the radical environmental movement to sue them, then they quickly settle the case and say “See, we HAVE to do this because the court is making us do it.” Scott Pruitt knows all about that practice and it will stop on Jan. 20. But until then, the EPA continues to engage in it. The latest case they’ve just settled was brought by the odious National Resources Defense Council, Earthworks and a mishmash of other radical groups in May 2016 regarding an attempt to ban injection wells and stop landfills from accepting drill cuttings (see Enviro Nazis File Lawsuit to “Force” EPA to End Injection Wells). The EPA wants to once again eat away at the sovereignty of the states by regulating oil and gas drilling “wastes” using federal law (illegal under the U.S. Constitution). When was the last time you heard of a big lawsuit like this being settled in a matter of a few months? Yeah, never…
    Read More “Obama EPA Signs One Final “Sue and Settle” Case Against O&G”

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    Obama EPA Files to List NatGas Plants as “Toxic” Polluters

    In January 2015 a gang of nine far-left anti-drilling “environmental” organizations sued the federal Environmental Protection Agency (EPA) claiming the agency doesn’t require the oil and gas industry to spend big bucks to fill out reams of paperwork to prove it’s not polluting Precious Mother Earth with nasty chemicals (see 9 Anti-Drilling Groups Sue EPA Hoping to Damage the O&G Industry). The lawsuit was filed by the Environmental Integrity Project (better called the Environmental Dishonesty Project), Natural Resources Defense Council (NRDC), the Center for Effective Government, the Chesapeake Climate Action Network, Citizens for Pennsylvania’s Future (PennFuture), the Clean Air Council, THE Delaware Riverkeeper Network (i.e. Maya van Rossum), the Responsible Drilling Alliance, and Texas Campaign for the Environment. The lawsuit by the litigious gang of nine, as we said at the time, will provide cover and an excuse for the EPA. This is all scripted out and done in collusion with the Obama EPA. In October last year, the EPA announced that natural gas plants do qualify to be included in their so-called Toxics Release Inventory (TRI), a system that will require processing plants to fill out several trees’ worth of paperwork on an annual basis. The EPA decision made the antis orgasmic with delight (see PA Big Green Groups Elated: Latest EPA Sue-and-Settle Scam Worked). The Obama EPA, in a parting shot at the natural gas industry, just filed the official proposed rule (last Friday, copy below) that will make it happen. Fortunately the rule won’t go into effect until March 7, giving incoming EPA chief Scott Pruitt the opportunity to stop this nonsense…
    Read More “Obama EPA Files to List NatGas Plants as “Toxic” Polluters”

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    VA County Approves Compressor Stn for Atlantic Coast Pipeline

    As MDN reported last week, area residents packed a small meeting hall in Buckingham County, VA for a five-hour marathon session to express their concerns about building a new compressor station in the county for the upcoming Atlantic Coast Pipeline (see Residents Pack County Bd Mtg re Atlantic Coast Compressor Stn). A number of those residents, working from misinformation, are opposed to the pipeline. Fortunately the Buckingham County Board of Supervisors, who have been researching the compressor station project for the past two years, saw through the misinformation and vitriol and voted to approve the project after the marathon session. That vote “incensed” some of the antis…
    Read More “VA County Approves Compressor Stn for Atlantic Coast Pipeline”

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    More Background on Investors Encouraging EQT to Sell Itself

    W Barnes Hauptfuhrer

    Last week MDN told you about a kerfuffle that erupted yesterday when Chapter IV Investors, a Charlotte, NC-based investment firm with investments in EQT, Range Resources and Antero Resources, announced it had sent a letter to EQT urging the company to consider merging with either Range Resources or Antero Resources (see EQT Urged by Major Investor to Merge with Either Range or Antero). As we told you, Chapter IV is essentially two investors, W. Barnes Hauptfuhrer, Managing Partner and Portfolio Manager, and Ryan J. Jack, Partner. We said at the time, “we don’t detect any kind of bullying on the part of Chapter IV, like that of a raider Carl Icahn (successful takeover of Chesapeake Energy & Cheniere Energy) or Keith “Mini-Me” Meister (unsuccessful attempt to takeover Williams). Rather, it appears to be a couple of investors who believe there is an honest and good case for a combination of EQT with another company.” We now have more evidence that our gut instinct was right–from an article Bloomberg published…
    Read More “More Background on Investors Encouraging EQT to Sell Itself”

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    Towns Near Philly Collude with CAC to Block Mariner East 2 Pipe?

    Several townships in the Philadelphia orbit appear to be colluding with each other and with the Philadelphia-based Clean Air Council in passing nearly identical resolutions opposing the Mariner East 2 natural gas liquids pipeline. Eight townships or boroughs along or “close to” (meaning not along) the route in Delaware and Chester counties have published resolutions or proclamations badmouthing the project. The municipalities include: Edgmont, West Goshen, Thornbury, Middletown, Westtown, Rose Valley, Swarthmore and Media. Some of the self-incriminating evidence for collusion comes from an admission by one of them: “The community statements are similar to each other because of consultation between their leaders.” And this, from the odious Clean Air Council: “Alex Bomstein, a lawyer with the environmental group Clean Air Council, said that while there are other local campaign such as those in Lebanon and Huntingdon Counties, the efforts in Delaware and Chester Counties are more ‘developed’ in the Philadelphia suburbs. ‘There are more people organizing than elsewhere,’ he said, probably because of a greater population density closer to Philadelphia.” Why would the StateImpact Pennsylvania propagandist quote the CAC in the same article as the colluding towns, unless they were somehow tied together?…
    Read More “Towns Near Philly Collude with CAC to Block Mariner East 2 Pipe?”

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    Nature Nuts Object to Appalachian Pipes Because of Visual Pollution

    La La Land

    Here’s a new one you probably haven’t heard before. Self-righteous and self-appointed people who claim to protect the Appalachian National Scenic Trail object to much-needed pipeline projects like EQT’s Mountain Valley Pipeline–a $3.5 billion, 301-mile pipeline that will run from Wetzel County, WV to the Transco Pipeline in Pittsylvania County, VA–because of “viewshed impairment,” or what the hoi polloi would call visual pollution. Yes, there’s a spot along the trail where if you look in a certain direction you will (if the pipeline gets built) see a path where the trees are cleared for the pipeline, and that just won’t do. It will rob the viewer of the pristine beauty they are used to seeing along that particular section of the trail. Of course, the fact that fires regularly destroy sections of the forest and destroy far more of the beauty along the trail is of no consequence. And the fact that entire cities are visible from the trail means nothing. It is that razor thin, narrow section where the pipeline will go that’s offensive to nature nuts…
    Read More “Nature Nuts Object to Appalachian Pipes Because of Visual Pollution”

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    Exterran Completes “Financial Restatement” – Releases Financials for 1Q-3Q

    Headquartered in Houston, Texas, Exterran Corporation (with 5,400 employees) specializes in natural gas compression production equipment and processing facilities. They design, build and operate compressor stations and natural gas processing plants. In 2012 MDN reported on a contract Exterran won to build three natural gas processing plants in West Virginia (see Exterran Wins Contract to Build 3 WV NatGas Processing Plants). The company is also active in other Marcellus/Utica states, including Ohio. In 2013 the company opened a plant to build compressor stations in an industrial park near Youngstown, OH. The state gave the company a $300,000 grant in return for promises to create 103 jobs over a seven year period. Exterran came close for the first couple of years, but then the crash in prices hit and along with it, work dried up. The plant closed in March, and as we recently reported, Ohio now wants “all or part of” the $300,000 grant back (see Ohio Wants to “Clawback” $300K Grant to TX-based Exterran Energy). The company, which is publicly traded on the New York Stock Exchange, has just issued what is called a “financial restatement”–which means they get to revise their previous quarterly financial statements. The do-over shows less bleeding in 3Q16 than earlier in the year. Exterran lost $93 million in 1Q16, they lost $96 million in 2Q16, and just $13 million in 3Q16. Here is the financial restatement issued by Exterran last week…
    Read More “Exterran Completes “Financial Restatement” – Releases Financials for 1Q-3Q”

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    Radical Democrat PA House Member Tossed to Curb by his Own Party

    Rep Greg Vitali

    Sometimes crazy, wacko environmentalist Democrats in the Pennsylvania legislature are so far left, so crazy, so wacko, it’s even too much for the PA Democrat party. Such is the case with “outspoken” (we’d say loud-mouthed) Rep. Greg Vitali, from the Philadelphia area. We’ve written a number of articles prominently mentioning Rep. Vitali, who wants PA residents to use less natural gas (see PA Rep. Vitali Wants to Force Residents to Use LESS Natgas). However, the wacko Vitali has burned bridges in Harrisburg. He has aggressively crossed swords with PA’s Dem Governor, Tom Wolf, after Wolf understandably fired John Quigley as Secretary of the Dept. of Environmental Protection when Quigley was caught using a private email account to collude with his buddies in the Big Green movement (see Smoking Gun: Copy of the Email that Got John Quigley Fired). Vitali savaged Wolf for not supporting Quigley (see PA Dems Eating Their Own – Turn on Gov. Wolf over Quigley Firing). Since last June, Vitali has continued his infighting and it’s now caught up with him. He arrived in his office in Harrisburg one day to find a computer, and the person who operates it, being reassigned to the the new chairman of the House Environmental Resources and Energy committee–a committee Vitali used to chair. It was the first he’d heard of being tossed to the curb…
    Read More “Radical Democrat PA House Member Tossed to Curb by his Own Party”