FirstEnergy Selling 4 NatGas-Fired Electric Plants in PA
The energy industry in our country is complicated and takes a while to wrap your brain around just how it works. Especially the utility industry. Companies that produce and then distribute electricity (and natural gas) are in some cases regulated by the government–meaning what they charge is strictly controlled–and in some cases not regulated. Some local utilities produce the electricity, via a nuclear plant, or coal-fired generating plant, or natural gas-fired plant, as well as distribute that electricity to customers. Other utilities just distribute the electricity. And still others just produce the electricity. Sometimes producing electricity is regulated by the government (i.e. price controlled) and other times it is not. Is your head spinning yet? 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. Last Friday the company announced it will sell six power generating plants in PA, four of them natural gas-fired plants. The plants being sold are non-regulated. This is part of FirstEnergy’s strategy to become a 100% “regulated” utility in the next 18 months. Which plants are going on the auction block?…
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National Fuel Gas Company (NFG) covers the full span of the oil and gas business–from upstream (with its wholly-owned drilling subsidiary Seneca Resources), to the midstream (with wholly-owned subsidiary Empire Pipeline) to downstream (NFG’s natural gas utility service to 740,000 customers in NY and PA). Big company. Diverse operations. Late last week NFG issued what they call their fourth quarter update (everyone else’s third quarter update), covering July through September. NFG’s CEO Ronald Tanski said lower natural gas prices and higher temperatures didn’t help. However, the company improved. In NFG’s 4Q15 the company lost $188 million–but this year they made $37.5 million. That’s a significant $225 million improvement in just one year’s time. However, NFG ended the full year in the red–losing $291 million (an improvement from losing $379 million last year). As for Seneca’s performance, it was a good year overall, with banner production. Seneca’s production was 161.1 Bcfe (billion cubic feet equivalent) in fiscal 2016, an increase of 3.3 Bcfe, or 2%, versus fiscal 2015. Seneca voluntarily curtailed an estimated 34.6 Bcf (billion cubic feet) of net natural gas production in fiscal 2016. Seneca’s average realized natural gas and oil prices, after the impact of hedging, was $3.02 per Mcf and $57.91 per Bbl, respectively, a decrease of $0.36 per Mcf and $12.45 per Bbl, versus fiscal 2015. Below is the NFG update for all of their subsidiaries including Seneca and Empire, along with a copy of the latest PowerPoint slide deck…
CONE Midstream, a joint venture between CONSOL Energy and Noble Energy (get it? CO from CONSOL and NE from Noble Energy) was formed in summer 2014 (see 
Summit Midstream has a small but growing presence in the Marcellus/Utica region largely through purchasing pipeline systems from other companies, including Mountaineer Midstream, Summit’s Marcellus-area pipeline system in Doddridge County, WV, and an interest in Ohio Gathering, a natgas gathering system in service and under development spanning the condensate, liquids-rich and dry gas windows of the Utica Shale in Harrison, Guernsey, Noble, Belmont and Monroe counties in southeastern OH. In 3Q16 Summit lost $215,000 vs. making $21.2 million in the same period a year earlier. The volume of gas pumping through Summit’s pipelines went up in the Utica, a lot–from 42 million cubic feet per day (MMcf/d) in 3Q15 to 234 MMcf/d in 3Q16 (up 4.5x). However, Marcellus gas volumes decreased year over year from 457 in 3Q15 to 418 in 3Q16, no doubt due to less new drilling in the Marcellus. Here’s a portion of the Summit update…
Hi-Crush Partners, headquartered in Houston, TX, is a frac sand company. Even though the company is based in TX and has sand mines in Wisconsin, it owns and operates the largest frac sand distribution network in the Marcellus and Utica Shale region. Last week Hi-Crush announced the first successful test and roll out of something they call PropStream–a new and better way to get sand to the well site and into the well itself. Hi-Crush has also formed (with investors) a new subsidiary company called PropX to manufacture the equipment used by the PropStream system…
We’ve written about various pipelines either planned or under construction that will, by joining with other pipelines, haul Marcellus/Utica natural gas (and/or natural gas liquids) all the way to the Gulf Coast. However, the pipes hauling our gas to the Louisiana/Texas borders are one thing. But then the gas has to go the final leg of the journey through Texas (or Louisiana) to the Gulf Coast area where it gets used in petrochemical plants, like crackers or liquefied and exported as LNG. A recent RBN Energy blog post points out the big pipes hauling our gas to Texas and Louisiana are, in many ways, the easier projects to build. Getting it “the last mile of the way” to the Gulf Coast is the more difficult task. It involves reversing pipelines and tieing systems together. Here are six projects in the works to accomplish the mission of getting our gas all the way to the Gulf Coast…
The U.S. Chamber of Commerce recently launched a “What If…?” series to counter the radical “keep it in the ground” movement–a movement that irrationally hates the use of fossil fuels. In August the Chamber released their first such report, titled “What If…Energy Production was Banned on Federal Lands and Waters?” (see 
We laugh every time we read about peak oil and peak natural gas theorists, and mainstream “reporters” from places like the New York Times trumpeting that any day now natural gas is going to peter out. It’s just a flash in the pan. “Everybody” knows that shale wells are weak, pathetic performers than run out of juice almost as fast as their drilled. We’ve read stories about how shale drilling is a ponzi scheme. We’ve read stories that very soon we’ll run out of new places to drill, and then it’s all over. Except…except it’s all not true. None other than the U.S. Energy Information Administration has just posted a brief article that details, using real research, that horizontally drilled shale wells are MORE productive over the long-term than conventional wells. That is, they are more productive for longer than a conventional well. But that won’t stop the peakers and ponzi schemers from pedaling their pap…
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Utica output still surging in Ohio Valley; OH students visit well sites; energy cos giving less to charities, but still giving; activists don’t like the court shoe on their foot; rename fossil fuels to paleosolar; Chesapeake says SEC snooping around; and more!
Chesapeake Energy released it’s third quarter 2016 update yesterday. Revenues were down 33% year over year. Production for all forms of hydrocarbons the company extracts–oil, natural gas and natural gas liquids, expressed as million barrels of oil equivalent or MMboe–was down 2 MMboe (around 3%). The company lost $1.2 billion in 3Q16–a marked improvement over losing $4.6 billion in 3Q15. Most of the loss was a paper loss (write-downs for impairments) and not out-of-pocket money. Chesapeake remains one of the largest producers in the Marcellus/Utica region, with a combined production in the two plays of 261 thousand barrels of oil equivalent (~1.5 million cubic feet per day of natural gas). One thing stands out in the 3Q16 update: Chesapeake’s renewed/big push in the Haynesville. The company operated an average of 11 rigs in 3Q16 (down from 18 in 3Q15), drilling 63 wells (down from 81 in 3Q15) and completing 80 wells (down from 84 in 3Q15). They connected 105 wells to pipelines for production in 3Q16 (down from 112 in 3Q15). All of those numbers are cumulative across all shale plays. Unfortunately Chesapeake doesn’t break out any of their numbers by individual shale play. They remain the biggest driller in the Ohio Utica. Here’s the update…
Eclipse Resources, a Marcellus/Utica pure play driller headquartered in State College, PA that drills mostly in Ohio, released their third quarter 2016 update yesterday. In 2Q16 Eclipse resumed drilling with one rig, allocated a drilling budget of $196 million, and began completing previously drilled but uncompleted (DUC) wells in their portfolio (see 
In mid-October Gulfport Energy was one of the first out of the gate with information on the third quarter (see 
Carrizo Oil & Gas, a Houston-based driller, actively drills in the Eagle Ford Shale in South Texas, the Delaware Basin in West Texas, the Niobrara Formation in Colorado, and until mid-year in 2015, they did have an active drilling program in the Ohio Utica and Pennsylvania Marcellus. No more. They haven’t drilled in Appalachia since 3Q15. According to Carrizo’s latest quarterly update for 3Q16, that (sad) state of affairs continues…
As we do every month, MDN tracks how many rigs oilfield services company Patterson-UTI Energy reports operating–as a proxy for when/if the drop in rig counts for the Marcellus/Utica will turn around. Patterson operates a number of rigs in the northeast, as well as other areas of the continental United States (and Canada). Month by month Paterson’s rig count has declined over the past year plus–until June (see 
Magnum Hunter Resources Corporation (MHR), a driller 100% focused on the Marcellus/Utica emerged from bankruptcy in May, less than five months after filing (see