Downeast LNG Puts Maine LNG Export Project Up for Sale
One of the planned LNG (liquefied natural gas) export projects that would use Marcellus/Utica Shale gas to export to overseas markets is a project called Downeast LNG–to be built along the coast of northern Maine (see 2nd LNG Export Terminal for Marcellus Gas Advances – in Maine!). Downeast was originally planned to be an LNG importing facility, but later changed to be an import AND export facility. Last June the company, backed by New York City venture capital firm Yorktown Partners, hired an engineering firm to design the facility with the promise it would be ready in 2017 (see Downeast Plans to Begin Building ME LNG Export Facility in 2017). But then the bottom dropped out of the oil market, and oil/LNG prices are closely aligned. Downeast put the project on hold earlier this year, asking the Federal Energy Regulatory Commission (FERC) to hold up on reviewing its application until June 1st (see East Coast LNG Export Updates – Bear Head & Downeast). The second shoe dropped not long ago for Downeast. You see, the project was planning to source gas at Wright, NY and transport it via Kinder Morgan’s Northeast Energy Direct (NED) project that would run from Wright, NY to Dracut, MA. That’s no longer an option (see NED is Dead – Kinder Morgan Suspends $3.3B New England Pipeline). There are other pipes that can possibly serve the plant, but not as easily has NED could have. Given the low price and NED cancellation, it won’t surprise you to learn that Downeast has just put the project up for sale. They no longer want to build it. The real question is, will anyone else want to build it?…
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The ongoing low price for oil and gas is profoundly changing the drilling landscape under our feet. In what some might call a marriage of convenience we would call a marriage of desperation: U.S.-based oilfield services company FMC Technologies announced yesterday they will merge with their much larger quasi-competitor, France-based Technip, in an all-stock deal that will create a new company called TechnipFMC worth $13 billion. FMC had/has some operations in the Marcellus/Utica, hence this merger has implications for our region. The new venture would be bigger than Baker Hughes and would rival and compete with the world’s two largest oilfield services companies: Schlumberger and Halliburton. Technip specializes in engineering and construction, while FMC specializes in offshore equipment and systems. The immediate question becomes, will Europe, the U.S. and other counties that opposed the Halliburton/Baker Hughes merger also oppose this one? Prevailing thought by analysts is that this merger will have a much easier path because the two companies have very little overlap in the current services they offer…
Floyd Wilson, CEO of driller Halcon Resources, is a plainspoken kind of guy. Halcon “guessed wrong” by leasing 140,000 Utica Shale acres in the northern part of the play (in Ohio) and currently doesn’t drill in any of that acreage. Their less-than-stellar acreage led Wilson to comment, in colorful language, that the company would no longer drill any “substandard” (our word) Utica wells (see 
In January 2015 MDN highlighted an ongoing squabble near Cleveland, in Cuyahoga County, OH, between the Ohio Dept. of Natural Resources (ODNR) and the Ohio Oil and Gas Commission (OOGC) (see 
We wonder if the anti-pipeline/anti-fossil fuel zealots in Lebanon County, PA are trying to kill members of the Federal Energy Regulatory Commission (FERC) by boring them to death. The local antis–a small yet vociferous group of nattering nabobs–have hounded the Lebanon County Board of Commissioners into sending along a 1,000-page tome to FERC listing their concerns with two pipeline projects. Along with the bore-you-to-death document, the Commissioners have included a letter requesting FERC extend the comment period on the Atlantic Sunrise Project by an extra 30 days. Which sounds reasonable–except at the end of that 30 days the antis will ask for another extension, then another, and another. That’s the strategy. If you can’t dazzle them with brilliance, baffle them with, well, you know what…
One of the big stories of the past year is the conversion of coal-fired electric generating plants to natural gas, and the construction of brand new gas-fired electric plants. We’ve written plenty about it. Yesterday the U.S. Energy Information Administration (EIA) returned to that theme with a post observing that “many” (we’d say almost all) new gas-fired electric plants that are getting built in the U.S. are getting built in or close to major shale plays. The Marcellus/Utica represents some of the heaviest concentrations of new power plant projects…
New research from the once-great Duke University actually supports shale drilling for a change–instead of denigrating it. In the past researchers from Duke, using money from the odious Park Foundation, have been bought off in their research efforts. This latest research, which concentrates on the benefits to local governments from shale drilling, wasn’t funded by Park and appears to be objective for a change. Two Duke U researchers conducted a three-year research project (between 2013-2015) funded by the Alfred P. Sloan Foundation. They traveled far and wide, to 16 states and interviewed over 200 local government officials along with gathering data and facts. The conclusion: on balance oil and gas drilling benefit local communities…
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Can Range deal get approved?; Maryland needs its own lawsuit; Hawaiian LNG; FERC dumps public from meeting; Linn Energy bankruptcy won’t be pretty; rich liquids and crackers; Toronto backs away from natgas ban; and more!
What has happened to one of the world’s finest research universities? A press release issued yesterday by Penn State touts their participation in helping set up a seismic monitoring system throughout Pennsylvania. In the announcement, Penn State researchers openly admit this about a series of tiny quakes in western PA that couldn’t be felt at the surface: “We have not done enough analysis of the data to make any conclusions yet, but there is a correlation spatially and temporally between the fracking and the earthquakes.” In other words–“We haven’t actually done the research, but we’re going to say there’s a connection between fracking and earthquakes–because we feel like it.” That’s not science–that’s politics. Real scientists observe first, then conclude. Penn State is reversing that order–they already have their conclusions, now it’s just a matter of warping the observations to fit their conclusions. Sad…
We’ve written plenty about President Obama’s draconian, so-called “Clean Power Plan” (
Fairmount Santrol is a proppant manufacturer/supplier headquartered in Ohio. Proppants are things like sand and ceramic beads used to “prop open” tiny fractures created in hydraulic fracturing of shale oil and gas wells. In other words, Fairmount Santrol is a regional sand supplier for shale drillers–and a good proxy to understand what’s happening (or not happening) in our neck of the woods when it comes to drilling. If drillers aren’t drilling as much, that will show up first in the balance sheets of companies like Fairmount. And so it does. Fairmount reports in their first quarter 2016 update that revenues in 1Q16 were down 52% from 1Q15. But you can’t automatically assume that means there was half the drilling one year later. Fairmount also reports the volume of sand sold was down just 8% from 1Q15 to 1Q16. Why the discrepancy between revenue and volume? Fairmount doesn’t say, but we think we know: drillers have been putting the squeeze on supply chain companies like Fairmount, forcing them to deeply discount their prices…
As MDN has previously noted, Atlas Energy has been in financial trouble for some time. Just a few years after the company sold two different tranches of their vast Marcellus assets for a cumulative $12 billion, the company’s stock was tossed off the New York Stock Exchange and relegated to the Pink Sheets as a penny stock (see 
In March MDN reported that Canadian midstream giant TransCanada wants a bigger piece of the Marcellus/Utica pipeline pie and has decided to buy Columbia Pipeline Group for $10 billion (see 
In March MDN brought you news of an environmental Nazi confab in New York City, headlined by New York Attorney Attorney General Eric Schneiderman and Al Gore (see 
Here’s a little good news, for a change. Research firm Grand View Research (headquartered in San Francisco) has just published a pricey new research report (a single copy will set you back $4,700) that projects the global hydraulic fracturing market will be worth $81 billion by 2024–in just eight short years. Grand View’s researchers say much of that value/revenue will come in the “plug and perf” (i.e. fracking) part of the industry. It will be driven primarily by two countries–the United States and (wait for it….) China. We haven’t heard a lot about fracking in China, but that country is definitely making major moves to unlock vast shale reserves beneath its soil. The Chinese don’t have to worry about silly things like getting permission from citizens–not in a brutal dictatorship like China. They just do it. Although we haven’t seen the full report ourselves, Grand View has shared some of the key, high level insights they gleaned from their research. Here are some interesting facts and tidbits…