Schlumberger 4Q16 & Full Year 2016 Results – Swings to Net Loss
The largest oilfield services (OFS) company in the world, Schlumberger, issued their fourth quarter and full year 2016 report on Friday. Schlumberger has major operations in the Marcellus/Utica. They drill and frack for many companies in our neck of the woods. (Other large OFS companies active in the M/U include Halliburton and Baker Hughes.) Schlumberger CEO Paal Kibsgaard said since the price of oil and gas is moving higher, his company will also increase the prices they charge E&Ps (exploration and production companies) in 2017. OFS companies have been hammered over the past couple of years to lower their prices. Such “price concessions” are now coming to an end. We can understand why. Revenue for Schlumberger in 2016 fell by 22% over 2015, and the company swung from making $2 billion in profit in 2015 to losing $1.7 billion in 2016. Ouch. Here’s the update…
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Below is an article not directly mentioning or tied to the Marcellus/Utica, but we can’t help but wonder if there are not applications for our region. The article focuses on the marketing and “packaging” of LNG (liquefied natural gas) as the new and “hottest” thing to hit the power generation world. If an electric power generating plant (that uses natgas) doesn’t sit along the route of a natgas pipeline, it needs to get that natgas via other means. Many countries around the world–not just the U.S.–are making a change from burning coal to burning natural gas. So getting the gas to the plant is an issue. There is a long chain of vendors between where gas is produced and where it gets used at a powergen plant. The gas is extracted and then hits a pipeline. That pipeline must, at some point, flow to an LNG liquefaction plant that cools and condenses the gas. The LNG is then loaded on a ship (typically) and sailed to another country. At the other country the LNG is offloaded, delivered to the end user, and before it gets used, it must go through a regasification process. There’s a lot of moving parts and logistics involved in moving LNG from point A to point B. So what if a company, or coalition of companies, were to form an alliance and market a ‘one stop shopping’ solution for power plants and the governments in other countries that want to use LNG? That’s the premise, and that’s the promise of what is beginning to be offered. No new technology–just a new way to market it. Which has applications for our own region…
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Utica rig count goes up; Range Resources volunteers help clean up watershed; Murrysville changing gas ordinance; WVU studying emissions from NG trucks; GE & Baker Hughes merger slated for mid-year completion; power sector CO2 falls below transportation CO2 emissions; peak oil demand, deja vu; China’s LNG imports rocket up 33%; and more!
Yesterday the Federal Energy Regulatory Commission (FERC) voted to approve and issue a certificate to Columbia Pipeine’s Leach XPress and Rayne XPress pipeline projects. This is fantastic news for the Marcellus/Utica region. MDN has covered these projects from their beginning. In August 2014 Columbia, then a subsidiary of Nisource, committed to building the two projects that will flow Marcellus/Utica gas to the Gulf Coast (see 
One of the issues that isn’t going away is the demand by landowners in some Pennsylvania counties, like Bradford, for lawmakers in the state to pass a bill that guarantees them what they believe they are already guaranteed–a 12.5% minimum royalty, based on a 1979 law that states they should get such a royalty. We’ve extensively covered what we call a civil war between two parties who are otherwise friendly toward each other–landowners and shale drillers. Last year the issue came to a head with House Bill (HB) 1391 (
The (for now) taxpayer funded PBS StateImpact Pennsylvania is so “in the tank” and biased for radical environmentalism, they are a reliable mouthpiece for Big Green. Want to know what Big Green thinks? Just read StateImpact. Which is how we know Big Green is now very worried that the incoming Trump Administration will stop implementation of the ill-conceived Delaware River Basin Conservation Act. We wrote about the Act when it was still just a bill (see 
Make no mistake. When the Heinz Endowments, a left-leaning, big-moneyed nonprofit invests its money via grants into programs that have anything to do with shale drilling, it is for one purpose and one purpose only: to smear the reputation of fracking and to make oil and gas look bad. They fund all sorts of “research” efforts that mysteriously always come to the same conclusion: fracking is bad. Funny how that works. So it was with interest we noted they’ve purchased for themselves another academic researcher rather cheaply–just $48,000–with a mission to test water wells near fracking sites. The aim? To prove that fracking contaminates water wells. Which is the claim made by groups like Heinz for years–and has never been proven. Millions of wells fracked, with a small number where methane has migrated into those wells (a fixable condition). NEVER has there been chemical transmission from fracking into groundwater wells. But that doesn’t stop Heinz from trying to manufacture evidence. Here’s their latest effort…
In December, the Pennsylvania Dept. of Environmental Protection (DEP) unveiled new regulations to clamp down on methane emissions and other other air pollution that allegedly comes from shale drilling sites (see 
Here’s a story we admittedly don’t know much about, a story that kind of came out of left field. It may affect some shale drillers in southwest PA. Sometimes drillers want to lease and drill under coal mines. Since coal mines sink large holes in the ground, there are existing guidelines in place for how closely an oil/gas well can be drilled on or under a coal mine–guidelines put in place in 1957. As a result of legislation passed in 2011 called Act 2, a review was conducted to see if the standards for oil/gas drilling near coal mines might be modified–we’re assuming “relaxed,” allowing such drilling to happen in conditions not currently allowed. A column of rock called a pillar needs to be of a certain size/width in order for drilling to take place. An independent study to review the size of pillars, called “Gas Well Pillar Study Update, PO 4300311202 and 4300400813,” was completed in March 2016. The PA Dept. of Environmental Protection (DEP) recently completed its own review of that study (copy of the DEP review below) and has rejected changing existing 1957 standards for pillar dimensions. Yeah, kind of technical. Short version: DEP is keeping super-strict standards in place claiming it’s safer for coal miners, limiting options for shale drilling under some coal mines…
FirstEnergy, based in Akron, OH, is one of the nation’s largest investor-owned electric systems, serving customers in Ohio, Pennsylvania, New Jersey, West Virginia, Maryland and New York. FirstEnergy owns a variety of regulated and non-regulated power generation plants. In November the company announced it wants to sell six power generating plants in PA, four of them natural gas-fired plants (see 
In the past MDN has highlighted the great work done by the Norton Rose Fulbright (NRF) law firm, most recently just last month (see 
A Cleveland, OH-based natural gas utility company, Gas Natural Inc., has sold itself to investment firm First Reserve Energy. Gas Natural sells 21 billion cubic feet (Bcf) of natural gas to roughly 68,600 customers through regulated utilities operating in Montana, Ohio, Maine and North Carolina. Gas Natural’s other operations include an intrastate pipeline, natural gas production and natural gas marketing. First Reserve Energy is an investment firm focused solely on investing in (and buying) energy companies. Shareholders for Gas Natural voted at the end of December to approve the buyout/merger…
In December the Potter Township Board of Supervisors convened a public hearing on the proposed Shell ethane cracker plant–to be built in Potter Twp–that ended up going on for 10 hours (see 