• MDN Update from the Road – Full Strength MDN Returns Tomorrow

    coffeeEvery now and again MDN editor Jim Willis emerges from his writing cave in Binghamton, NY to travel. Such is the case this week. Normally you (hopefully) wouldn’t know that Jim is on the road as he does his best to keep the news coming. Today, however, is different. There will be no new stories posted today. For the past two days Jim attended the excellent “Analyst Training in the Power and Gas Sectors,” hosted by S&P Global Market Intelligence (formerly SNL KnowledgeCenter), in New York City. NYC is Jim’s favorite large city in the world. 🙂 Jim was there to improve his education on how the natural gas and electricity markets fit together–an increasingly important part of the “drilling” story in the Marcellus/Utica. And what an education it was! Jim remains on the road for the balance of the week, visiting the good folks of NGI (Natural Gas Intelligence) in the Washington, DC area. Between the seminar and traveling to DC (and not sleeping so well in hotel rooms), Jim couldn’t quite swing posting stories today. This is a RARE occurrence. A “no story day” has happened perhaps once or twice in the past 5+ years we’ve had paying subscribers. Our apologies in advance! What it means is that you will have 100% full strength, amped up, aromatic Marcellus/Utica news again beginning tomorrow. Jim is already working on some big stories. Stay tuned!

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    Rumor: US Methanol Building 5 Methanol Plants in WV

    rumor mongeringMethanol plants convert natural gas into methanol, used as a chemical feedstock (or raw material) to create other things, like gasoline, antifreeze and more. More commonly you may call it a gas-to-liquids (GTL) plant. Methanol plants have the capacity to create a big demand for natural gas and sop up some of the oversupply we have in the Marcellus/Utica. In May we told you about Primus Green Energy’s plan to build a 160 metric tons per day (MT/day) methanol plant for Tauber Oil somewhere in the Marcellus (see Customer Announced for Primus Green Energy’s GTL Methanol Plant). We have more exciting news. US Methanol, according to their website, is working on two Marcellus methanol plants, coming to West Virginia. One plant, called Liberty One, will produce 175,000 metrics tons per annum, or about 480 MT/day. Liberty Two will produce 150,000 MT/annum, or a about 410 MT/day. Here’s the really really exciting news. We’ve stumbled across a rumor that U.S. Methanol is actually planning to build five methanol plants total. According to the rumor, we know where the first two plants already announced (Liberty One and Two) will be built–AND we know which driller they’ve contracted with to supply the natgas for those plants…
    Read More “Rumor: US Methanol Building 5 Methanol Plants in WV”

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    Big Stakes: Gorsline Zoning Case Goes to PA Supreme Court

    theyre backGuess who’s back with a case now before the Pennsylvania Supreme Court? Yep, the odious nutters from Big Green Groups PennFuture, THE (arrogant) Delaware Riverkeeper, and the Peters Township gang. You may recall we reported last September of the humiliating defeat suffered by these groups in the “Gorsline” case (see Major Victory for PA Landowners/Drillers in Lycoming County Case). It was a Lycoming County zoning case before the Pennsylvania Commonwealth Court. In Gorsline v. Board of Supervisors of Fairfield Township, anti-drilling neighbors, including Brian and Dawn Gorsline, Paul and Michele Batkowski and others (collectively “Gorsline”) sued to stop a conditional use permit granted by Fairfield Township to allow Inflection Energy to construct a well pad on the property of Donald and Eleanor Shaheen. The case was weak, but the lowest court in the PA court system–the Court of Common Pleas (i.e. county court)–said the ninny nanny neighbors had a right to strip away the Shaheen’s property rights to allow drilling on their own property. The PA Commonwealth Court obliterated the faulty reasoning of the lower court and, significantly, redefined how courts should interpret the results of the Act 13 zoning lawsuit that allows local municipalities the right to restrict shale drilling. Unfortunately the matter won’t rest there. The Pennsylvania Supreme Court has taken up the Gorsline case on appeal. The PA Supreme Court has a 5-2 majority of left-leaning Democrats. Below we have a copy of the brief filed by PennFuture on behalf of the ninny nanny Gorslines, along with “friend of the court” briefs filed by THE Delaware Riverkeeper and Peters Township. Folks, this is a dangerous case the for drilling industry… Read More “Big Stakes: Gorsline Zoning Case Goes to PA Supreme Court”

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    Cayuga Power Plant Stays Open (Burning Coal) – Thx to Fractivists

    Cayuga power plant
    Credit: Ithaca Journal

    In July 2013 we wrote this: “It would be hysterically funny if it weren’t so pathetically sad. So-called environmentalists don’t want an electrical generating power plant in Tompkins County, near Ithaca, NY, to switch from burning coal to natural gas because they’re afraid it will mean more fracking. Talk about cuckoo birds” (see NY Eco Group Protest to Stop Plant Converting from Coal to NatGas). In August 2013 we pointed out that if the plant can’t convert and ends up closing, the local school district is the biggest loser (see If NY Electric Plant Can’t Convert to NatGas, School Gets Screwed). The owner of the plant, Cayuga Operating Co., ended up selling it. The new owner, Riesling Power, tried to continue to process to get approval for converting the coal-fired plant to burn natural gas (not only cleaner, but also cheaper). Ultimately, the Cuomo-controlled Public Service Commission (PSC) turned down the request to convert. So guess what? The new owner certainly isn’t closing the plant after investing all that money. They’re going to keep operating it as a coal-fired plant–belching out far more pollution than a natgas plant would. Congratulations idiot fractivists (including obtuse Assemblywoman Barbara Lifton, who wanted the plant closed). You’ve just screwed yourselves and all of your neighbors too!…
    Read More “Cayuga Power Plant Stays Open (Burning Coal) – Thx to Fractivists”

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    NFG/Seneca Resources Expanding Utica Drilling Program

    Seneca ResourcesLast week MDN reported on National Fuel Gas Company’s quarterly recently-filed quarterly report (see NFG Update: Seneca Gas Production Up 25%, Pipeline Profits Up Too). What we didn’t have at the time we wrote that story was comments from NFG’s drilling subsidiary, Seneca Resources. During the quarterly earnings phone call with analysts, Seneca head and COO, John McGinnis, said that Seneca is “quite pleased” with their very first Utica well which has been online for the past 45 days (drilled in northern PA). In fact, Seneca now plans to drill six more Utica wells over the next year, based on initial results. Here is what McGinnis had to say about the Utica, and the Marcellus–and what to expect…
    Read More “NFG/Seneca Resources Expanding Utica Drilling Program”

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    New (To Us) Gathering Pipeline in the Centre of the Marcellus

    Unit-CorporationIt’s not often we miss something that happens in the Marcellus. No, we’re certainly not omniscient. But not much (we hope) escapes our eye when it comes to drillers, midstreamers and other participants in the Marcellus/Utica region. Here’s one that did! Unit Corporation is a Tulsa-based, publicly held energy company engaged through its subsidiaries in oil and gas exploration, production, contract drilling, and gas gathering and processing. Pretty much the whole upstream and midstream pie. In January 2016 Unit completed 49 miles of gathering pipelines in Centre County, PA. That’s the part we missed. Below are a few excerpts from their recent second quarter 2016 update talking about what they call their Snow Shoe Gathering system, along with a couple of screen shots from the most recent company PowerPoint presentation…
    Read More “New (To Us) Gathering Pipeline in the Centre of the Marcellus”

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    Crestwood 2Q16: Bleeding Slows, the Stagecoach Rides

    CrestwoodCrestwood Equity Partners (nee Crestwood Midstream) issued its second quarter 2016 update last week. In April Crestwood announced that New York City utility giant Consolidated Edison Inc. has formed a 50/50 joint venture to purchase ownership of pipelines and storage facilities in the PA and NY Marcellus region (see Utility Giant ConEdison Buys a Piece of the Marcellus Midstream). The newly formed jv, called Stagecoach Gas Services, became official in June (see Con Ed & Crestwood Seal the Deal on Marcellus Pipeline/Storage JV). Stagecoach and other projects in the Marcellus/Utica get an update in this latest quarterly report from Crestwood…
    Read More “Crestwood 2Q16: Bleeding Slows, the Stagecoach Rides”

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    US Silica 2Q16: So-So Quarter, Buys Frack Logistics Company

    US SilicaLast week U.S. Silica, one of the largest frac sand providers in the U.S., issued their second quarter 2016 update last week. Frac sand providers are a good barometer for when/if drilling is coming back. You don’t order sand unless you’re drilling wells. The company lost $12 million in 2Q16 versus losing $10 million in 2Q15. However, $1.1 million of that was due to “restructuring costs.” What about revenue? Revenue was $117 million in 2Q16 versus $147.5 million in 2Q15. So we can sum up 2Q16 as “so-so.” Not terrible, not good. With luck, 3Q16 will look better (with drilling beginning to pick up). However, in a sign that U.S. Silica believes the market will come back, they also announced last week they are buying out Sandbox Enterprises, “a leading provider of innovative logistics solutions and technology for the transportation of proppant used in hydraulic fracturing in the oil and gas industry.” That’s a sure sign they think oil and gas is coming back…
    Read More “US Silica 2Q16: So-So Quarter, Buys Frack Logistics Company”

  • Marcellus & Utica Shale Story Links: Tue, Aug 9, 2016

    best of the restThe “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Climate change conspiracy; NY’s fracking hypocrisy; groups trying to kill SE pipeline; TVA building $975M natgas electric plant; Texas Independents sue EPA over drilling regs; feast or famine in US o&g fields; more asset sales coming for Chesapeake; dirty trickster Bill McKibben whines about dirty tricks; UK may pay landowners in shale areas; and more!
    Read More “Marcellus & Utica Shale Story Links: Tue, Aug 9, 2016”

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    Cove Point LNG Now 67% Complete, Atlantic Coast Pipeline on Track

    Dominion Cove Point Terminal
    Dominion Cove Point Terminal – click for larger version

    Last week utility and midstream giant Dominion issued their second quarter update and held an earnings/analyst call to discuss the update. Sometimes those earnings calls are a treasure trove of information you don’t see in the prepared quarterly update, especially in the unscripted Q&A that follows prepared remarks. Such was the case last week. Dominion’s CEO and President, Tom Farrell, along with other top brass from the company, offered up key insights into the Cove Point LNG export project, the Atlantic Coast Pipeline project, Blue Racer Midstream (a Dominion’s joint venture project), and the status of leased acreage for which the company owns Marcellus/Utica drilling rights. A smorgasbord of yummy updates! Here they are…
    Read More “Cove Point LNG Now 67% Complete, Atlantic Coast Pipeline on Track”

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    US Rig Count Up Against in July, Marc/Utica Steady for 3rd Month

    North American rig countLast month when Baker Hughes released their venerable rig count numbers, we cracked a smile that things are beginning to turn around with an increase in U.S. rig counts (see US Rig Count Up by 9 in June, Marcellus/Utica Holds Even at 36). This month we have a full-on smile. Baker Hughes released their July rig count numbers on Friday and the average number of rigs working in the U.S. was 449, up 32 from the 417 counted in June 2016. Cool! Was there also good cheer for the Marcellus/Utica? Er, well, maybe “no cheer” is the best way to put it. PA’s rig count went up by one in July, Ohio stayed the same, and West Virginia’s count went down by one. Once again in July we had a Marcellus/Utica rig count of 36, same as June and the same as May. Hey, at least it didn’t slide backward! That’s progress of a sort…
    Read More “US Rig Count Up Against in July, Marc/Utica Steady for 3rd Month”

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    EXCO Still Hammering Midstreamers re Contracts, Bleeding Slowed

    EXCO.jpgEXCO Resources, a Dallas, TX-based driller with drilling operations in Texas, North Louisiana and the Marcellus/Utica, has been inching toward bankruptcy. So far the company has stayed out of bankrutpcy and hopes they can continue to do so. Their strategy, as we reported in May, is to hire new board members and try to wiggle out of long-term pipeline contracts (see EXCO Restructuring Plan: New Board Members, Hammer Midstreamers). How’s that working out? Last week the company released its second quarter 2016 update and CEO Harold Hickey said the company is “diligently working…[on] the consensual restructuring of our gathering and transportation contracts, noting the significant negative impact these contracts have on our cash flow, borrowing base and liquidity.” What if they can’t get midstream companies to buckle to their demands? They’ll sue: “If the efforts are not successful, the Company may seek alternatives to reject the contracts consistent with recent court decisions.” On the positive side, at least the bleeding is slowing down. In 2Q15 EXCO lost $454 million. In 2Q16 they lost $111 million. Here’s the EXCO update, including details on their Marcellus/Utica program…
    Read More “EXCO Still Hammering Midstreamers re Contracts, Bleeding Slowed”

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    WVU Effusive Over “Green” Drilling Fluid Used in Test Wells

    effusiveIn July MDN told you about exciting new publicly-financed research at West Virginia University that finds waste from Marcellus/Utica drilling (“frack waste”) is not radioactive or hazardous (see Independent Research @ WVU Concludes Frack Waste is Safe). Anti fossil fuel nutters would have you believe frack waste is an environmental holocaust–but such is proven to not the case. It’s been our observation that when Big Green groups don’t finance (i.e. purchase) research, you get honest, real science results. Like the results coming out of WVU’s 5-year study (financed by the U.S. Dept. of Energy). WVU, along with partner Ohio State University, is in the midst of drilling two Marcellus wells near Morgantown, WV. They are testing and measuring all sorts of things–air, noise, light and water and frack waste (see Drilling for WVU/OSU’s $11M Study Gets Underway in Morgantown). One of the key areas researchers are testing is the use of “green” drilling fluid–fluids that are environment and human friendly, even if they get accidentally released. According to WVU researchers, their experimentation will lead to Marcellus industry adopting greener drilling fluids…
    Read More “WVU Effusive Over “Green” Drilling Fluid Used in Test Wells”

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    Corporate Raiders Hassling Williams Split Up

    Keith Meister
    Keith Meister – corporate raider

    Nearly half of the Williams board (6 of 14 board members) were part of a cabal that tried to force the company to sell itself to Energy Transfer Equity. Following the aborted merger, six of Williams’ board members tried to engineer a palace coup to depose current CEO Alan Armstrong. The coup failed and the board members were either forced out, or resigned in disgust, we’re not sure (see Half of Williams Board, Including 2 Corporate Raiders, Quit). Among the board members pushing for a sale to ETE and pushing for the ouster of Armstrong, was Keith Meister, a disciple and student of evil corporate raider Carl Icahn. Another corporate raider investor who had joined forces with Meister was Eric Mandelblatt, from Soroban Capital Partners. We have an update. Meister is still pushing Williams to get a new board and get rid of Armstrong–as evidenced by a recent filing with the Securities and Exchange Commission. However, there’s been a split among the corporate raiders. Mandelblatt/Soroban is no longer colluding with Meister to push for board changes…
    Read More “Corporate Raiders Hassling Williams Split Up”

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    More on Trump’s Wrong Position on Local/State Frack Bans

    Donald TrumpLast week we pointed out the inconsistency of Donald Trump in his public comments during an interview in Denver on frack bans. Trump said he believes local municipalities and even states should be able to ban fracking if they don’t want it–even though he personally supports fracking (see Trump’s Disappointing Position on State & Local Frack Bans). Disclaimer: We feel we need to assert our support for Donald Trump. He is a vastly superior choice to Hillary Clinton. We are not a “bash Trump” website. However, when “our” candidate makes a misstep, we don’t look away and we don’t pretend it isn’t there. We have to deal with it honestly–and Trump is 100% wrong in his view on local bans. We explained why in our post last week. However, Paul Driessen, a senior policy adviser for the Committee For A Constructive Tomorrow (CFACT), which is sponsoring the All Pain No Gain petition against global-warming hype, writes about Trump’s inconsistent view on frack bans far more eloquently that we do. Driessen says Trump’s comments reflect “common misperceptions” about fracking and its supposed harms. Here’s what Driessen said in a recent column…
    Read More “More on Trump’s Wrong Position on Local/State Frack Bans”

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    Hillary Clinton’s War on Fracking

    Hillary ClintonSince we’re taking Donald Trump to task over his wrong-headed thinking on local frack bans, we’d like to be an equal opportunity basher. Hillary Clinton’s position on fracking is far worse than The Donald’s position. If Hill has her way, she’ll end the practice. Oh, not with an Executive Order banning fracking, as Crazy Bernie promised he would do if he got elected. No, Hill is promising to enact new regulations (either via Congress or via Executive Orders) so strict, that “By the time we get through all of my conditions, I do not think there will be many places in America where fracking will continue to take place.” Her words. Although Hillary is a known and proven liar, we happen to believe those words coming from her mouth. First up for Hill, “fix” the so-called “Halliburton loophole.” In 2005 Congress passed new environmental standards for the Safe Drinking Water Act (managed by the out-of-control Environmental Protection Agency) and chose not to include the oil and gas industry in those standards because the EPA has no right to regulate the oil & gas industry–only the states can regulate the o&g industry under the U.S. Constitution. The proper recognition of not expanding the EPA’s authority (illegally) somehow has been twisted into a “loophole” for the industry, and Halliburton’s name was applied to the loophole in an attempt to smear then-Vice President Dick Cheney, who was previously the CEO of Halliburton. Hillary has resurrected the same old Democrat lie and smear campaign from years gone by. She says if she becomes Prez (God forbid), she’ll jam the EPA right up the o&g industry’s….operations….as far as she can…
    Read More “Hillary Clinton’s War on Fracking”