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    Judge Rules Yes, Mariner East Pipe IS a Public Utility After All

    In June we told you that Sunoco Logistics Partners had sued two different families/landowners in Washington County, PA using eminent domain to complete a pipeline part of the Mariner East project (see Mariner East Invokes Eminent Domain Against 2 SWPA Landowners). As we said at the time, nobody wins when it comes to using eminent domain for pipelines. In the case of the Mariner East pipeline, the ongoing legal question/issue has been whether or not the pipeline qualifies as a public utility with the right to invoke eminent domain. Last week a Washington County judge ruled that yes, Mariner East is a public utility and that the state of Pennsylvania controls permitting for the pipeline, not the Federal Energy Regulatory Commission (FERC). The Washington County landowners who sued have lost their appeal of the eminent domain case against Sunoco, and the pipeline will now cut through their property…
    Read More “Judge Rules Yes, Mariner East Pipe IS a Public Utility After All”

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    Scottish Company Buys OH Construction Co for Utica/Marcellus Work

    Wood Group, a $7 billion energy services company headquartered in Aberdeen, Scotland, announced this morning they are purchasing Kelchner Inc., a privately-owned construction firm. Kelchner is located in Ohio and concentrates on providing civil engineering and construction services for midstream and upstream companies in the Marcellus/Utica. Terms of the deal were not disclosed, but Kelchner generated sales of $93 million last year and Wood just got done buying a similar company along the Texas Gulf Coast by the name of Infinity Group for $150 million. So it wouldn’t surprise us if they paid a similar amount for Kelchner…
    Read More “Scottish Company Buys OH Construction Co for Utica/Marcellus Work”

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    Moody’s: Fed Interest Rate Hike Hurts the Oil & Gas Industry

    Moody’s Investors Service, one of the biggest and most respected ratings services on the planet, issued a statement last week after the Federal Reserve voted to raise interest rates from zero to a quarter point (0.25%). Moody’s offered their opinion of how the interest rate increase will affect U.S. companies. Their conclusion? Companies with good credit quality will be able to absorb the higher interest rate no problem. But companies that are, shall we say, “credit challenged” will have a tougher time. Among those most credit challenged? Yep, the oil and gas sector…
    Read More “Moody’s: Fed Interest Rate Hike Hurts the Oil & Gas Industry”

  • Marcellus & Utica Shale Story Links: Mon, Dec 21, 2015

    The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: Another bankruptcy in the oil patch; Cove Point Hail Mary; NY frack ban sentencing upstate to poverty; NY landowners demand Cuomo approve Constitution Pipeline; natgas pipeline in southern NJ makes progress; $30 crude leads to $6 natgas; is ETE in financial trouble?; shale gas drilling in UK close to reality; and more!
    Read More “Marcellus & Utica Shale Story Links: Mon, Dec 21, 2015”

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    PA DEP Admits No Radiation in Ten Mile Creek, Closes Investigation

    rest of the storyHere’s a story most of the Democrat anti-drilling media won’t tell you–but we will. In 2014 Pennsylvania anti-drillers from a local chapter of the Izaak Walton League, a so-called conservation organization, attempted a smear job on the Marcellus Shale industry. They alleged that shale drillers were illegally dumping frack wastewater in an abandoned coal mine, the Clyde Mine, which sits near the Ten Mile Creek where the creek joins the Monongahela River. According to the smearmeisters, the illegally dumped wastewater was leaking out of the mine and into Ten Mile Creek (see Is Shale Wastewater Causing Radiation Spike in Ten Mile Creek?). They claimed testing they had done showed high levels of radioactivity that could not come from just acid mine drainage, that it is radioactivity typically seen in shale wastewater. Of course the allegations got a lot of media attention. The Pennsylvania Dept. of Environmental Protection (DEP) investigated and echoed their concerns with initial tests also showing high radioactivity. Except the testing done by the DEP, and the testing done by the Izaak Walton League, WAS THE WRONG TYPE OF TEST. They blew it. Researchers from West Virginia University came in and tested using the appropriate type of test and found no elevated radioactivity (see PA DEP Screws Up Water Test at Ten Mile Creek – Egg on Face). The DEP has just concluded six months of their own tests–the right type of tests–and guess what? They’ve also found there IS NO elevated radioactivity in Ten Mile Creek nor anywhere else in the area…
    Read More “PA DEP Admits No Radiation in Ten Mile Creek, Closes Investigation”

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    PA DEP Fines CNX Gas $450K for Drawing Too Much Water Too Often

    Turns out drawing “free” water from a reservoir in Pennsylvania can cost you quite a bit. CNX Gas, the drilling division/subsidiary of CONSOL Energy, didn’t follow an agreed-upon plan for how much, and how often they withdrew water from a reservoir in North Franklin Township (Washington County), PA. The water withdrawal violations went on between 2011 and 2014 and because of it, CNX will now pay a whopping $450,750 fine. Three-fourths of the fine goes to the Dept. of Environmental Protection (DEP), and the other one-fourth goes to the PA Fish and Boat Commission (PFBC). Here’s the details from the DEP…
    Read More “PA DEP Fines CNX Gas $450K for Drawing Too Much Water Too Often”

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    Hilcorp is to Northern Utica as Cabot is to Eastern Marcellus

    We’re always fascinated how some companies, like Cabot Oil & Gas, make money even in the lowest of low price environments with their Marcellus wells in Susquehanna County, PA (northeastern part of the state), while another driller right down the road, like WPX Energy, can’t make money and end up selling all of their wells and leases. What does Cabot do right that WPX doesn’t do? That’s the gajillion dollar question. We’ve observed a similar situation in the Utica Shale region of western PA/eastern OH. Hilcorp Energy is drilling Utica wells in Lawrence County, PA. In fact, Hilcorp is the “dominant active prospector” in the northern tier area of the Utica Shale–an area including Columbiana, Mahoning and Trumbull counties in OH and Lawrence and Mercer counties in PA. Hilcorp is strong and steady–and they’re making money. They’re also producing gas–lots of it. Lawrence County, PA produces almost as much natural gas as the far-more-drilled Columbiana County (OH). And it’s nearly all Hilcorp gas in Lawrence County. So if Hilcorp is like the Cabot of the Utica, who’s the WPX of the Utica? That would be Halcon Resources, with 140,000 acres in the northern Utica. Back in 2013 Halcon CEO Floyd Wilson famously said he wouldn’t drill any more “crappy” wells in the Utica (see Halcon CEO Says No More S***** Wells in Northern OH Utica). Halcon is desperately trying to stay afloat, Hilcorp is flourishing. Here’s more about Hilcorp and their success in the northern Utica…
    Read More “Hilcorp is to Northern Utica as Cabot is to Eastern Marcellus”

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    2 Democrat Commissioners Ban Injection Wells in Fayette County, WV

    In the end it was just two people who decided to outlaw a legally operating wastewater injection well in Fayette County, WV. Two county commissioners, Denise Scalph and Matt Wender (both Democrats), voted to end the right of Danny Webb Construction to operate an injection well in the county, as it has done for over a decade (perhaps longer, we’re not sure). Aided by a rabidly leftist group called the Mountain Party (left of Vlad Putin), the so-called county commission attorney, Larry Harrah, crafted the state’s first “screw ’em royally” ordinance that he believes is lawsuit-proof. We’ll see just how lawsuit-proof it is when it gets tested, as it surely will…
    Read More “2 Democrat Commissioners Ban Injection Wells in Fayette County, WV”

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    Platts Says LNG Heading to Japan & Korea Fetching $7.40/Mcf

    Platts Japan/Korea Marker (JKM) LNG service issued an update yesterday that caught our eye. The JKM service says that LNG (liquefied natural gas) for delivery to northeast Asia (Japan and Korea) will average $7.397 per million British thermal units (MMBtu) for January delivery. Converted, that’s $7.40/Mcf (thousand cubic feet). That number is down 26.5% year-over-year. But hey, if our drillers were getting $7.40/Mcf for their gas? We’d be singing, “We’re in the money…” The problem is, of course, we don’t (yet) export our natural gas via LNG to any other countries. That’s about to change in January when Cheniere Energy’s Sabine Pass LNG facility begins shipping (see Genscape: Sabine Pass LNG Export Began Accepting Natgas on Dec 10). It’s not likely any gas will head to Asia from our shores until the Cove Point LNG export facility in Maryland is completed in the next few years. Until then, we can only watch and hope that some day our gas will be sold for $7+ per Mcf…
    Read More “Platts Says LNG Heading to Japan & Korea Fetching $7.40/Mcf”

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    Chesapeake Energy Faces Bankruptcy if Noteholders Don’t Cooperate

    It appears that Chesapeake Energy is having trouble convincing its noteholders with notes due in 2017/2018 to exchange those notes (IOUs), which are unsecured (no guarantees they get paid if the company goes belly up) for new secured, second-lien notes due in 2022. We told you two weeks ago that Chesapeake had embarked on a program to swap out various classes of notes, a plan to delay repaying outstanding debt (see Chesapeake Energy Floats Plan to Exchange $1.5B Worth of IOUs). Somewhere between 10%-28% of the outstanding $1.7 billion in 2017/2018 notes–those notes closest to maturity–have signed on to the plan. It’s not enough. Chesapeake has a gun to the head of its noteholders, a “prisoners’ dilemma.” If a significant number don’t go for the plan, it’s a near-certainty the company will be forced to file for bankruptcy according to finance experts, and those noteholders will get nothing because their notes are unsecured. If noteholders do go for the plan, they get less than what they signed on for, but at least they get something, and the something they get is far more assured, even if the company files for bankruptcy. If the note exchange does happen, Chesapeake is still not out of the bankruptcy woods by a long shot, and that has all of its investors, who hold debt (notes and bonds) or equity (stocks), worried…
    Read More “Chesapeake Energy Faces Bankruptcy if Noteholders Don’t Cooperate”

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    NatGas Production in Lower 48 Slips in November by Less than 1%

    Earlier this week Platts’ Bentek service issued their prediction for natural gas production in the lower 48 states for November. Platts says that total gas production averaged 71.3 billion cubic feet per day (Bcf/d) in November, which is down less than 1% from production levels in October. The slightly lower production seemed to have surprised Bentek analysts who blame lack of pipeline takeaway capacity in the northeast for the down number. In fact, Bentek says that it is the northeast that is the star performer when it comes to production and whether production goes up or down, it will be because of the northeast. Here’s more of their expert analysis…
    Read More “NatGas Production in Lower 48 Slips in November by Less than 1%”

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    The Pretenders: Multi-State Shale Research Collaborative

    Big Green groups like THE Delaware Riverkeeper and the Clean Air Council, just to name a couple, are the fractivist arms of big-money foundations that fund and control them, including the Heinz Endowments and the Park Foundation. It’s an incestuous game with behind the scenes collusion among these groups and the deep-pocket foundations that pay for their attorneys to continue filing frivolous lawsuits. Here’s one Big Green group you don’t hear about often, but also part of the enviro-cabal: the Multi-State Shale Research Collaborative, an official-sounding group which attempts to pass itself off as above-the-fray and populated with disinterested researchers focusing on the important issue of shale energy. It’s nothing of the sort. It’s a bunch of partisan hacks who lobby for high taxes on shale energy, and for limiting property rights for those who want to allow shale drilling. How do we know? Look at their so-called research. The Multi-State Shale Research Collaborative says, among many other things, that fracking is responsible an increase in sexually transmitted diseases. Yeah, lefty kooks. Oh, and they’re funded by the Heinz Endowments and the Park Foundation, plus a few other leftist groups. We’ve written about them before (see Marcellus/Utica Anti-Drilling Group Back with Impacts “Research”). Every now and again this group finds a willing accomplice to plant a story about their “research” hoping it gets picked up by mainstream media. The latest shill media accomplice–the Midwest Energy News (anti-drillers who want to end the use of all fossil fuels), is only too willing to accommodate….
    Read More “The Pretenders: Multi-State Shale Research Collaborative”

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    The ONLY Good Thing About Budget Deal: Lifts Oil Export Ban

    It was truly disheartening to learn of the complete sell-out by House Speaker Paul Ryan (Republican) and the Republican-led House in the latest budget deal. They essentially bent over and grabbed their ankles and assumed the position while Barack Hussein Obama had his way with them. This budget deal is repulsive–as grossly corrupt as it gets. The Democrats are even more corrupt–but we expect that of them. The only good thing that came from the budget deal, as near as we can tell, is that it lifts the 40-year ban on crude oil exports. As a Bloomberg article headline puts it, “Shale Drillers Are Now Free to Export U.S. Oil Into Global Glut.” Yeah, that about sums it up. Hey, having the crude oil ban lifted is good, we’re happy about that. But in the larger pantheon of the budget deal, we could have lived without it if we had gotten a better deal on far more critical items. Here’s what the inimitable Heartland Institute, one of our favorites, said about this disastrous budget deal…
    Read More “The ONLY Good Thing About Budget Deal: Lifts Oil Export Ban”

  • Marcellus & Utica Shale Story Links: Fri, Dec 18, 2015

    The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: TETCO pipeline from Appalachia to the Gulf gets FERC approval; DRBC adopts “one process/one permit” policy; AEP switching some electric plants to burn natgas in OH; FERC asks TGP to change NED route; FERC approves Lake Charles LNG; oil export ban lifted; COP21 doesn’t change fossil fuel reality; England gets ready to frack; and more!
    Read More “Marcellus & Utica Shale Story Links: Fri, Dec 18, 2015”

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    NY Econ Dev Grant Signals Constitution Pipeline Approval Imminent

    celebrateSome very good news for supporters of the long-overdue Constitution Pipeline slated to run from Susquehanna County, PA to Schoharie County, NY. So far, New York has delayed granting stream-crossing permits for the project. We’ve advocated that it’s time for Williams and the Federal Energy Regulatory Commission to take NY to court (see Time to Force NY DEC to Issue Permit for Constitution Pipeline). In fact, a Dept. of Environmental Conservation (DEC) official has said the DEC is in danger of permanently losing control over issuing such permits if they don’t approve the Constitution’s request (see DEC Official Says NY in Danger of FERC Taking Over Pipeline Permits). The good news is that NY has approved funding for a project that will build a $1.5 million, 18-mile feeder pipeline from the Constitution Pipeline to a forklift manufacturing plant in Chenango County. After banning fracking and the multi-billion dollar economic bonanza it would have brought to upstate NY, Andrew Cuomo has stolen $2 billion from taxpayers statewide to fund “economic development” via something called Upstate Revitalization Initiative grants. There are four grants of $500 million. One of those grants was just made to the Southern Tier area, where fracking would have been the strongest had it been allowed. In other words, this is a bribe being paid to upstate voters. But we digress. Tucked into the $500 million “grant” (i.e. bribe) for the Southern Tier is $1.5 million to build a feeder pipeline from the Constitution Pipeline to Raymond Corporation in Greene, NY. Why approve $1.5 million for a feeder pipeline if you’re not going to approve the Constitution Pipeline itself? You wouldn’t–ergo the Constitution is about to get approved…
    Read More “NY Econ Dev Grant Signals Constitution Pipeline Approval Imminent”