Marcellus Drilling News

Dominion Energy | Energy Services | Industrywide Issues | M&A

Dominion Resources Makes Play for Western NatGas Company Questar
February 2, 2016February 2, 2016

In what is being called a “cheap” deal, midstream and local utility Dominion, with a major presence in the Marcellus/Utica region, has floated a takover offer to Questar Corporation, offering to buy the company for $4.4 billion. Questar is a Rockies-based integrated natural gas company operating through three principal subsidiaries: Questar Gas provides retail natural gas distribution in Utah, Wyoming and Idaho; Wexpro develops and produces natural gas on behalf of Questar Gas; and Questar Pipeline operates interstate natural gas pipelines and storage facilities in the Western U.S. The deal is an attempt by Dominion to diversify out of the northeast/Mid-Atlantic region. It’s also a deal to bump up Dominion’s natural gas footprint, lessening the company’s reliance on electric power generation which is not growing. The reason this is MDN news is because…
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Anti-Drilling/Fossil Fuel | Industrywide Issues | Litigation | Ohio | Statewide OH

Federal Judge Tosses Anti Lawsuit Against MWCD re OH Lease Deals
February 2, 2016February 2, 2016

In some older news (but good news) that has until now escaped our notice, late last year a federal judge dismissed a lawsuit we first told you about in October 2013 (see Muskingum Watershed Taken to Court by Anti-Frackers (Yawn)). Lea Harper and her husband Steve filed a lawsuit challenging the right of the Muskingum Watershed Conservancy District to enter into lease agreements with drillers to allow shale drilling on Conservancy-owned land. The Harpers were assisted in this lawsuit by the radical and odious Food & Water Watch. Judge Sara Lioi of the U.S. District Court for the Northern District of Ohio found the lawsuit lacking in merit and tossed it. The Harpers and their Big Green backers have appealed the decision…
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Energy Services | Summit Midstream

Instead of Selling, ECP Increases Ownership of Summit Midstream
February 2, 2016February 2, 2016

In November MDN told you that the majority owner of Summit Midstream, private equity firm Energy Capital Partners (ECP) was looking to sell some or all of their units (i.e. shares) in the company (see Summit Midstream 3Q15: Current Owner ECP Looking to Sell). At the time ECP owned 43.8% of the company. Looks like that plan didn’t work out so well–at least so far. In a recent Securities and Exchange Commission filing, Summit reveals that ECP now owns 47.1% of the company…
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Industrywide Issues | Jobs | Public Opinion

Survey: O&G Workers Love the Industry, but Not Their Company
February 2, 2016February 2, 2016

We spotted some interesting survey results from a survey conducted by the UK-based recruiting firm Petroplan. The survey polled more than 1,500 oil and gas professionals asking them about their attitudes toward our beloved industry. Respondents came from 107 countries and territories worldwide. Over 60% of those surveyed said they would be “very” or “extremely” likely to recommend a career in the oil and gas industry to others. However, their commitment to the particular company they work for, i.e. “company loyalty,” is low. Some 56% said they’d change jobs “given the right circumstances.” Here’s a high level overview of the survey results…
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Energy Companies | Energy Services | Equinor/Statoil | GE Oil & Gas | Hydraulic Fracturing | Industrywide Issues

4 People Win GE/Statoil Contest to Reduce Water Used in Shale
February 2, 2016February 2, 2016

GE and Norwegian oil giant Statoil today announced four winners of their Open Innovation Challenge, a contest designed to use crowd sourcing to find solutions that reduce fresh water use in shale oil and gas production. There of the winners are in the United States, and one is from Australia. Each winner gets a cash prize of $25,000 with the promise of future funding for their technology. Here’s the cool new technologies that won this year’s contest…
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Commodity Price | Industrywide Issues

Will NatGas Price Drop to 20-Year Low in February? Quite Possibly
February 2, 2016February 2, 2016

A somewhat depressing article on MarketWatch says we are potentially heading for natural gas prices (at the Henry Hub) of $1.50 or lower. If the price hits those levels, it will be the lowest prices we’ve seen for natgas in the past 21 years. Even more ominous was a comment by oil and gas industry titan T. Boone Pickens. In a recent CNBC interview Boone said this: “I don’t think we’ll ever see $3 natural gas again.” Ouch. If that’s true, the question becomes, how can companies make a profit at these super low prices? Here’s more on what may lie ahead for natgas prices this month and this year…
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Columbia Pipeline Group | Energy Companies | Energy Services | Gastar Exploration

Gastar’s Mike McCown Retires; Peg Heeg Joins Columbia Pipeline Bd
February 2, 2016February 2, 2016

From time to time we mention people coming and going at various drilling and midstream companies. The reason we mention it is because when there are changes at the top of an organization, it has the potential to affect the future actions of that organization. We have two such moves to report. The first is that Mike McCown, senior vice president and chief operating officer for driller Gastar is retiring. We’ve quoted Mike a number of times over the years–he’s an important cog in the Gastar wheel. The second bit of news is that Peggy Heeg has joined the board of directors at midstream giant Columbia Pipeline. Peggy is an attorney and former general counsel at El Paso Corporation…
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Best of the Rest

Marcellus & Utica Shale Story Links: Tue, Feb 2, 2016
February 2, 2016February 2, 2016

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Marcellus rig count lowest since 2010; why Marcellus may spell the end for Canadian natgas; Marcellus/Utica “overpiped”?; more proppant = more production in NE; FERC destroys opposition to Constitution Pipeline; BP cutting jobs; Harold Hamm says $60 oil this year; and more!
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CNX Resources | CONSOL Energy | Energy Companies | Utica Shale

CONSOL 4Q15: All About that Utica, ‘Bout that Utica, No Marcellus
February 1, 2016February 1, 2016

Last Friday CONSOL Energy released their fourth quarter 2015 update and we couldn’t stop the Meghan Trainor song “All About That Bass” from going through our heads, changing the word “bass” to Utica and “treble” to Marcellus. CONSOL was positively effusive about their Utica program and what it means for the future of the company. And well they should be (pun intended). In 4Q15 CONSOL drilled and brought online it’s most initially productive-ever Utica well, the GH 9 in Greene County, PA. The well’s initial flow was 61.9 million cubic feet per day per day (MMcf/d). That’s not as high as EQT’s record-breaker of 72.9 MMcf/d, also in Greene County (see EQT’s 1st Utica Well Shatters Record – 72.9 MMcf/d IP Rate!), but still, it’s amazing output for the CONSOL well. That amazing second well comes on the heels of CONSOL’s first PA Utica well, drilled in Westmoreland County in 3Q15, with an initial flow rate of 61.4 MMcf/d (see CONSOL 3Q15: Natgas Production Up 33%, Natgas Revenue Down $56M). Here’s what really caught our eye about Friday’s update and accompanying analyst conference call: In the Ohio Utica, the first well CONSOL drilled took 84 days and the drilling phase cost them $9 million. By the fifth well, the cost had gone down to $5 million. And they now believe they can get the cost of drilling a Utica well down to $4 million and do it in 23 days. Astonishing! (Note: that number is not the “all in” cost, which still is still more than $15 million per well.) So what about CONSOL’s Marcellus program?…
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Braskem | Energy Services | Ethane | Industrywide Issues | Odebrecht | Processing Plants | West Virginia | Wood County

A Crack of Light for the West Virginia Cracker?
February 1, 2016February 1, 2016

Speaking at an industry conference in Pittsburgh last week, West Virginia’s Dept. of Commerce Secretary, Keith Burdette, indicated there’s still a faint blip on the monitor that Odebrecht may yet decide to build an ethane cracker plant in Wood County, WV. According to Burdette, Odebrecht’s subsidiary Braskem will purchase more land for the cracker by the end of the first quarter. If the Odebrecht cracker project was as dead as a door nail (which it has appeared to be in recent months), it doesn’t seem like they would continue to spend money on it. Right? Burdette also said all three large cracker projects, Odebrecht, Shell’s project in PA, and PTT Global’s project in OH have indicated they are likely to push off a final investment decision (FID) until 2017. Bummer…
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Energy Services | Industrywide Issues | New York | Pennsylvania | Pipelines | Regulation | Statewide NY | Susquehanna County | Williams

FERC OKs Tree-Cutting for Constitution Pipeline – in PA
February 1, 2016February 1, 2016

In a crushing blow to anti-drilling radicals who have tried their best to stop the Constitution Pipeline, the Federal Energy Regulatory Commission (FERC) has granted Williams, builder of the Constitution, permission to begin cutting down trees along the pipeline’s path in Pennsylvania. Williams still cannot fell trees in New York State, where the bulk of the pipeline will be built. However, FERC would not grant permission for PA unless they intend to grant permission on the other side of the border too–and everyone knows it. Currently New York’s anti-drilling governor, Andrew Cuomo, is holding up the 125-mile project that will deliver natural gas from Susquehanna County, PA to Schoharie County, NY by connecting with two interstate pipelines. Cuomo is about to create a constitution crisis in which the federal government will be forced to overrule the state and allow the pipeline to be built. Cuomo is withholding stream crossing permits–the only thing left before bulldozers begin to clear a path. Cuomo is once again caving to pressure from his lunatic left base of supporters. And he’s about to turn New York into a third-rate state, controlled by the federal government, through his unwillingness to grant the permits…
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Industrywide Issues | Ohio | Statewide OH | Taxation

OH’s “Low” Severance Tax will Raise $30M+ in FY 2016
February 1, 2016February 1, 2016

For all of Ohio Gov. John “foreigner hunter” Kasich’s bellyaching about a low severance tax, the state is doing very nicely, thank you. According to a report appearing in the Akron Beacon Journal, the severance tax collected mostly from Utica Shale wells in the Buckeye State for fiscal year 2016 (runs from July 1, 2015 throught June 30, 2016) could top $30 million. That pales in comparison to the $200 million or so Pennsylvania collects each year via an impact fee, their version of a severance tax. PA collects 6.5 times more in taxes on drilling than Ohio–but then again, there are 6.5x more wells drilled in PA than in OH…
Read More “OH’s “Low” Severance Tax will Raise $30M+ in FY 2016″
Electrical Generation | Industrywide Issues | NG Vehicles

The Truth About “Green” Electric Cars & What Really Powers Them
February 1, 2016February 1, 2016

This may offend some, but it has to be said. Electric cars are manufactured to make rich, white liberals feel good about themselves–like they’re actually doing something to Save the Planet. The truth behind electric cars, however, is the opposite of what they believe. The thinking goes like this: “I’ll buy and drive an electric car and by doing so I’ll show all of my rich, white friends just how Green I am.” Here’s the truth: In 2015, 61% of all electricity was produced by either natural gas (31%) or coal (30%)–evil, vile, nasty fossil fuels, in the eyes of the rich, white liberal elites. Another 20% of electricity was produced by nuclear power plants, giving us a grand total of 81% of electricity running in those electric cars comes from “dirty” sources, in the minds of the libs. Do they realize that? Do they know their so-called “green” cars are actually powered mostly by fossil fuels? Another statistic: In 2015, 9% of all electricity in the U.S. was produced by so-called renewables, like wind and solar. Still feel good about yourselves, you dolts? In what can only be considered a laugh-out-loud moment, last week the American Council for an Energy-Efficient Economy (ACEEE) released its 19th Annual Comprehensive Environmental Ratings for Vehicles. Electric vehicles (EVs) got 9 of the top 12 spots in the ACEEE Environmental Vehicle Rankings for being “greenest.” There’s also a list of “greener” vehicles, and (of course), a list of “meanest” vehicles–those that use nasty fossil fuels and belch out carbon dioxide (the same thing you exhale with every breath). The ACEEE rating is yet another attempt to make rich, white libs feel good about themselves…
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Blue Racer Midstream | Energy Services

Blue Racer Midstream: Keeping a Sharp Eye on the Bottom Line
February 1, 2016February 1, 2016

Blue Racer Midstream is a joint venture between Caiman Energy II and Dominion. It is a privately-held company, so we don’t have SEC reports and public statements about the company from which to gage how it’s doing. However, every now again Blue Racer’s upper management shows up at an industry conference. Last week Blue Racer’s relatively new CEO, Stephen Arata, spoke at the Hart Energy Marcellus-Utica Midstream event in Pittsburgh. It’s no surprise that Arata said the company has had to curb spending and growth, giving the downturn in oil and natgas prices…
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Industrywide Issues | Statewide WV | Taxation | West Virginia

Why Can’t We be Friends: Can Coal & NatGas Get Along in WV?
February 1, 2016February 1, 2016

Can’t we all just get along? That was the message from Corky DeMarco, executive director of the West Virginia Oil and Natural Gas Association, in responding to a call from Murray Energy CEO Robert Murray that West Virginia should trim the coal severance tax from 5% to 2%, and raise the natural gas severance tax from 5% to whatever in order to give coal a break in the Mountain State. Murray went after natural gas in a speech last week at the West Virginia Coal Mining Symposium in Charleston, WV. It appears Murray’s philosophy is “every man for himself” when it comes to government taxation. He’s wrong. Here’s why…
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CNG/LNG | Industrywide Issues | NG Vehicles | Taxation

CNG for 34 Cents/Gal Equivalent! Fill ‘Er Up for Price of a Coke
February 1, 2016February 1, 2016

This story will appear to be inaccurate, or a “too good to be true” story. We assure you it is not. In December Congress passed a new law granting a retroactive (for 2015) tax cut on alternative fuels, and proactive tax cut for 2016. It amounts to a 50 cent savings per gallon equivalent for things like compressed natural gas (CNG). Following the tax cut, 7-Eleven Stores in Oklahoma at their locations with CNG pumps, reduced the price of their CNG to 39 cents per equivalent gallon of gasoline. If you use the 7-Eleven debit card, you can get it for 34 cents per equivalent gallon. No lie: you can fill up your CNG car up at 7-Eleven for little more than the price of a 20-ounce bottle of Coca Cola! Now THAT’s incredible…
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