Marcellus Drilling News

Electrical Generation | Industrywide Issues | Research

Black & Veatch Electric Industry Report – The Rise of NatGas
August 17, 2016August 17, 2016

Black & Veatch, a ginormous engineering, consulting and construction company, recently released their “2016 Strategic Directions: Electric Industry Report” (full copy below). The report captures Black & Veatch’s global engineering and thought leadership to examine how distributed electric generation, the low price of natural gas and modern customer information systems represent growth opportunities for the electric industry–even as security concerns are on the rise and legacy power generation sources (i.e. coal powered plants) are fading away, being replaced by new natgas technology. One trend MDN editor Jim Willis did not foresee when he started writing about the Marcellus industry back in January 2009 was the rise of natgas-fired electric generating plants–and the critically important role they would play in the Marcellus/Utica region. This B&V report provides useful insights into how natgas and electric generation are increasing “joined at the hip”…
Read More “Black & Veatch Electric Industry Report – The Rise of NatGas”
Energy Services | Industrywide Issues | Pennsylvania | Pipelines | Statewide PA | Williams

Sign Letter to PA Gov. Wolf re Support Atlantic Sunrise Pipeline
August 17, 2016August 17, 2016

Pennsylvania residents: It’s time to (once again) show your support for the Atlantic Sunrise Pipeline project, a $3 billion, 198-mile project running through 10 Pennsylvania counties to connect Marcellus Shale natural gas from PA with the Williams’ Transco pipeline in southern Lancaster County. It is a much-needed pipeline to move more Marcellus gas south, to new markets. In the past MDN has asked you to sign letters going to the Federal Energy Regulatory Commission (FERC) and to the PA Dept. of Environmental Protection (DEP). And you, our dear readers, have been the most responsive audience to get behind the effort to support this project. Thank you! We’re coming to you again with a new request. Please electronically sign a letter that will go to PA Gov. Tom Wolf, requesting his support for the project. Wolf’s active support of the project will go a long way toward ensuring it gets built. All you need to do is fill out your name and a few details and click the “Sign” button–it literally takes less than 60 seconds. Please take a moment and do it right now by clicking this button:
Crestwood Midstream | Energy Services | New York | Schuyler County

Rally in Support of Finger Lakes Propane Storage Facility
August 17, 2016August 17, 2016

Click for larger version

Late breaking news: Tomorrow (Thursday), Aug. 18 there will be a rally to support Crestwood’s Finger Lakes LPG Storage Facility planned for the shore of Seneca Lake. The rally will be located at the entrance of the facility, at 3768 NYS Route 14 North, Watkins Glen, NY at 4:30 pm. The New York State Dept. of Environmental Conservation continues to obstruct this vitally important piece of infrastructure. The facility planned would store LPG (liquefied petroleum gas, or propane) in a depleted underground salt cavern. Anti fossil fuel wackos have been protesting continuously for the past several years. Many of them have been arrested for illegally blocking the entrance to the facility. Here’s your chance to show up and show your support for the facility, and send a loud and clear message to Andrew Cuomo that enough is enough. Here’s the details for the rally…
Read More “Rally in Support of Finger Lakes Propane Storage Facility”
Best of the Rest

Marcellus & Utica Shale Story Links: Wed, Aug 17, 2016
August 17, 2016August 17, 2016

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Utica rigs drop by 2; PA AG Kane resigns; DEP holds Mariner East 2 hearing in Harrisburg; Dakota pipeline reveals split in Democrat Party; big oil tries to frack again; DOE Sec. Moniz loves fracking – good for the environment; LNG exports impacting US natgas supplies; and more!
Read More “Marcellus & Utica Shale Story Links: Wed, Aug 17, 2016”
Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | Lehigh County | Northampton County | PennEast Pipeline | Pennsylvania | Pipelines | Regulation

FERC Alters PennEast Hearing Process to Reduce Antis’ Bleating
August 16, 2016August 16, 2016

We’ve sat through our fair share of public hearings and open houses for pipelines–from Federal Energy Regulatory Commission (FERC) hearings to state agency hearings to open houses sponsored by midstream companies (see Vicariously Attend FERC Scoping Hearing on Constitution Pipeline). The script is always the same. Anti-fossil fuel freaks show up and perform before the cameras and microphones. That’s what they are there to do–engage in a circus act. When they are denied such an opportunity, they complain (see Williams’ Smart Open House in Lebanon County Confounds Antis). FERC hearings are always the same–show up and sign up to speak, with 3 or 4-minute allotments for each speaker. And speakers are taken in the order in which they signed in. Those in the audience who are for or against typically applaud or issue boos and insults. We have often said FERC personnel should get hazard pay for sitting through 4-hour marathons of this nonsense. FERC has wised up. They held a public hearing last night in the Bethlehem, PA area for the proposed PennEast Pipeline project. Instead of a public forum, FERC set two private rooms with a stenographer in each. FERC recorded comments two-at-a-time, in private. And they saved themselves all of the theatrics by anti-drilling trolls. And of course, that didn’t sit well with the antis. Most of the antis who spoke were reading from cue cards prepared for them by THE Delaware Riverkeeper, Maya van Rossum. The antis are so dumb they can’t even form their own thoughts about why they are against the project! Too funny…
Read More “FERC Alters PennEast Hearing Process to Reduce Antis’ Bleating”
Anadarko | Chesapeake Energy | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Litigation | Pennsylvania | Statewide PA

Lawsuit Against Chesapeake, Anadarko Heads Back to PA Court
August 16, 2016August 16, 2016

Last December Pennsylvania’s felony-indicted Attorney General, Kathleen Kane, brought a lawsuit against Chesapeake Energy, Anadarko and Williams accusing them of, among other things, royalty fraud (see PA Atty General Sues Chesapeake Energy, Williams for Royalty Fraud). In May MDN reported that Chesapeake and Anadarko had filed to dismiss Kane’s complaints against them, accusing Kane of attempting to litigate federal antitrust claims in state court (see Chesapeake, Anadarko Try to Wiggle Out of PA Royalty Lawsuit). In June Kane fired back by filing a motion to keep the case in state, not federal, court (see PA AG Files Motion to Keep Chesapeake Lawsuit in State Court). Yesterday U.S. Middle District Judge Christopher C. Conner granted Kane’s motion–the case will stay in state court…
Read More “Lawsuit Against Chesapeake, Anadarko Heads Back to PA Court”
Industrywide Issues | Litigation | Pennsylvania | Statewide PA

Jury Finds PA AG Kathleen Kane Guilty of Committing Felonies
August 16, 2016August 16, 2016

Kathleen Kane convicted

Pennsylvania Attorney General Kathleen Kane is no longer just felony-indicted. She’s now felony-convicted. Yesterday a jury of six women and six men spent 4 1/2 hours in deliberation following Kane’s trial for committing perjury, among other crimes, and they found her guilty of all nine counts against her. We’ve chronicled this long, sordid affair from the beginning. Kane is an enemy of the drilling industry–she has been from the beginning when she filed criminal charges against XTO Energy for an accidental spill that happened years before she took office. That case was settled just a few weeks ago (see Shakedown Complete: XTO Pays PA AG $400K to Make Case Go Away). Kane’s crimes and subsequent trial have nothing to do with the Marcellus industry. Although she is the top law enforcement officer in the state, Kane is now a convicted criminal facing up to 28 years in jail for her crimes. Yet she still has not resigned her office. If Kane does not resign within the next day or two, look for the PA legislature move swiftly to impeach, convict and forcibly remove her from office…
Read More “Jury Finds PA AG Kathleen Kane Guilty of Committing Felonies”
Energy Companies | Ethane | Industrywide Issues | Ohio | Pennsylvania | Pipelines | Shell | Statewide OH | Statewide PA | Statewide WV | West Virginia

Shell Working on 94-Mile Ethane Pipeline to Feed PA Cracker
August 16, 2016August 16, 2016

All the way back in February 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!). NGI’s Shale Daily has broken a story that gives us new details. Shell is 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. Here’s brief details about the new ethane pipeline system…
Read More “Shell Working on 94-Mile Ethane Pipeline to Feed PA Cracker”
Chesapeake Energy | Energy Companies

Chesapeake Borrows $1B to Pay IOUs; Bankrupt or Brilliant?
August 16, 2016August 16, 2016

Yesterday Chesapeake Energy, the secon largest natural gas producer in the United States (and the largest Marcellus producer, by far) issued three press releases. The first release said the company is working to obtain a five-year bank loan for a staggering $1 billion. The second two releases outlined what they will do with that money: pay off older IOUs. We also spotted commentary on the company’s $1B plan. One analyst predicts Chesapeake is heading for a pre-packaged bankruptcy, similar to what other o&g companies have done, and this massive loan/debt repayment is proof. Another analyst says Chessy CEO Doug Lawler is brilliant and that this move will strengthen Chessy’s stock in the long-term and make the company more solvent. Which one is right? They both can’t be right…
Read More “Chesapeake Borrows $1B to Pay IOUs; Bankrupt or Brilliant?”
Industrywide Issues | Research

EIA August DPR: Utica Production Up, Marcellus Down
August 16, 2016August 16, 2016

Yesterday MDN’s favorite government agency, the U.S. Energy Information Administration (EIA), issued our favorite monthly report–the Drilling Productivity Report (DPR). The DPR is the EIA’s best guess, based on expert data crunchers, as to how much each of the U.S.’s seven major shale plays will produce for both oil and natural gas in the coming month. The EIA projects natural gas production cumulatively across all shale plays will once again fall in September–the seventh consecutive month it will have fallen. However, as was the case in last month’s report, the Utica stands alone and against the trend by showing an increase in production month over month. Last month the EIA predicted the Utica would increase production by 5 million cubic feet per day, or MMcf/d (see EIA July DPR: Utica Only Play with Increased NatGas Production). This month’s report shows the Utica is expected to increase production by an average of 9 MMcf/d. Also of note, last month Marcellus production was projected to drop by 26 MMcf/d, while this month the production drop is projected to be 33 MMcf/d. That is, the rate of production decline in the Marcellus is accelerating. Here’s the lowdown from the EIA…
Read More “EIA August DPR: Utica Production Up, Marcellus Down”
Energy Companies | Halcon Resources

Halcon’s Market Cap Falls Below $50M, NYSE Threatens to De-List
August 16, 2016August 16, 2016

The New York Stock Exchange (NYSE) has certain minimum standards if a company wants to continue trading stocks on the exchange: The company’s stock price must be trading for at least $1 per share, and the company’s market capitalization must be at least $50 million. Market cap is pretty easy to calculate: it’s the number of outstanding shares times the per-share price. If you have 50 million shares of stock and the price is trading for $1/share, you’re there. You meet the NYSE’s requirements. Various companies with operations in the Marcellus/Utica have fallen short and have been warned by the NYSE that unless they get their act together, they would be de-listed. Some turned it around (see Eclipse Resources Dodges a Bullet – Stock Won’t Get De-Listed), and some didn’t (see Magnum Hunter De-Listed from NYSE; Still Shopping Eureka Hunter). Halcon Resources, a driller with 140,000 Utica acres it doesn’t bother to drill on, was warned in June by the NYSE that their share price, trading under $1/share, is too low (see NYSE Threatens Halcon Resources with De-Listing of Stock). In July Halcon filed for bankruptcy (see Halcon Resources Files for “Pre-Packaged” Bankruptcy). The NYSE has just issued another warning to Halcon: the company’s market capitalization has now fallen below $50 million…
Read More “Halcon’s Market Cap Falls Below $50M, NYSE Threatens to De-List”
Energy Services | Williams

Williams to Appoint 3 New Board Members, Replace Raiders Who Quit
August 16, 2016August 16, 2016

The big news in the midstream world over the past year was the attempted merger/takeover of Williams by Energy Transfer Equity. That deal finally fell apart in June (see Dead as a Doornail: ETE Terminates Merger with Williams). The only thing left still going on to do with that botched attempt is lawyers arguing about who owes what to whom (keeps the lawyers gainfully employed). After the deal failed, some Williams board members (namely two corporate raiders) attempted a palace coup. They tried to oust Williams CEO Alan Armstrong. When that effort failed, nearly half of the Williams board–who thought they would get rich quick by a sale to ETE–up and quit (see Half of Williams Board, Including 2 Corporate Raiders, Quit). Since last month Williams has been down 6 out of the original 14 board members. Time to fix that. Yesterday Williams announced it will name three new independent directors to the board in time for the annual meeting in November. No names were floated as potential candidates…
Read More “Williams to Appoint 3 New Board Members, Replace Raiders Who Quit”
Industrywide Issues | M&A | Research

Deloitte Oil & Gas M&A Report: Lowest Activity in Years
August 16, 2016August 16, 2016

“Everyone” thought that with low prices for oil and gas, and companies not able to turn a profit and heading into bankruptcy, that there would be a flurry of mergers and acquisitions in the oil and gas industry. “Everyone” was wrong. According to the just-released “Oil & Gas Mergers and Acquisitions Report – Mid-year 2016” from powerhouse consulting firm Deloitte (full copy below), M&A activity in the o&g industry is at its lowest point in years. The number of deals in the first half of 2016 was 198, an “extremely low” number compared to what it has been in past years. Where were the highest number of M&As? The number one shale play where deals were done was the Permian Basin–an extremely oil-rich shale layer in western Texas and southeastern New Mexico. The number two shale play where deals were done was, yep, the Marcellus Shale. Here’s the low down…
Read More “Deloitte Oil & Gas M&A Report: Lowest Activity in Years”
Industrywide Issues | Research

U.S. Shale Gas Production to Drive World NatGas Production Growth
August 16, 2016August 16, 2016

According to the U.S. Energy Information Administration’s (EIA) International Energy Outlook 2016 and Annual Energy Outlook 2016, natural gas production worldwide is projected to increase from 342 billion cubic feet per day (Bcf/d) in 2015 to 554 Bcf/d by 2040. The largest component of this growth is natural gas production from shale resources, which grows from 42 Bcf/d in 2015 to 168 Bcf/d by 2040. Shale gas is expected to account for 30% of world natural gas production by the end of the forecast period. And the largest component of the growth in shale will come from the good ole U.S. of A. Check out the forecast and the graph showing the shale miracle…
Read More “U.S. Shale Gas Production to Drive World NatGas Production Growth”
Best of the Rest

Marcellus & Utica Shale Story Links: Tue, Aug 16, 2016
August 16, 2016August 16, 2016

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Cabot production could double in 2 years; Marcellus/Utica takeaway capacity heading south; NE rig count goes up, but not in PA; John Hanger takes on StateImpact PA; Chesapeake Energy goes over Niagara Falls without a barrel; and more!
Read More “Marcellus & Utica Shale Story Links: Tue, Aug 16, 2016”
Anti-Drilling/Fossil Fuel | Elk County | Energy Companies | Industrywide Issues | Litigation | Pennsylvania | Regulation | Seneca Resources | Wastewater

Elk County Town Wises Up, Abandons Effort to Block Injection Well
August 15, 2016August 15, 2016

There is a new development in the case of an illegal ban on injection wells passed by Highland Township in Elk County, PA. In 2013 the radical leftist PA-based group Community Environmental Legal Defense Fund (CELDF) convinced ignoramuses in Highland Township to pass a so-called Community Bill of Rights. Seneca Resources, a driller with leases and an active drilling program in Elk, had planned to drill an injection well on their own property to dispose of their own flowback and produced water. The CELDF-inspired ordinance Highland Twp prevented it, and Seneca threatened to sue the town (see Seneca Resources Threatens to Sue PA Town over Injection Well). Seneca made good and filed to sue, but the town and CELDF tried to prevent the lawsuit. In March of this year, U.S. Magistrate Judge Susan Paradise Baxter ruled that Seneca has standing to sue and allowed the lawsuit to go forward (see Judge Rules Seneca May Challenge Injection Well Ban in Elk County). Faced with losing the lawsuit and taxpayers owing Seneca big money, township supervisors voted to overturn the so-called Community Bill of Rights. Another crushing defeat for the CELDF…
Read More “Elk County Town Wises Up, Abandons Effort to Block Injection Well”