Marcellus Drilling News

Dominion Energy | Energy Services | Industrywide Issues | Pipelines | Statewide VA | Virginia | West Virginia | Wetzel County

Dominion Files Pipeline Route Change to Avoid Salamanders, Swamp
November 2, 2015November 2, 2015

Cow Knob Salamander

Contrary to what anti-fossil fuelers would have you believe, midstream companies building big pipeline projects DO listen to concerns and they DO change the route of a pipeline to address those concerns–like changing the route to minimize environmental impacts or to address the concerns of landowners. For example, Dominion has just announced it filed route changes for the Atlantic Coast Pipeline, a $5 billion natural gas pipeline running from West Virginia through Virginia and into North Carolina. The changes are made to minimize impacts on salamanders in two locations, to minimize impacts on a historic district, and to avoid crossing a swamp (yes, a swamp). Somewhere along the way in the past 30 years swamps became precious ecological assets instead of pools of stagnant, smelly, mosquito-infested water that need to be drained (go figure). Dominion is willing to play along. “Hey, if that smelly swamp is important to you, we’ll spend an extra $XX million and go a different route.” Dominion is not alone. Theirs is just the latest example that totally refutes the yarns spun by ninny nanny antis who blat about evil Big Pipelines and how they destroy everything. Here’s the latest “we’ll make some adjustments to the route to keep everyone happy” notice from Dominion…
Read More “Dominion Files Pipeline Route Change to Avoid Salamanders, Swamp”
Energy Services | Industrywide Issues | New York | Pipelines | Regulation | Statewide NY | Williams

DEC Official Says NY in Danger of FERC Taking Over Pipeline Permits
November 2, 2015November 2, 2015

It was just two weeks ago that MDN posted an article saying the New York Dept. of Environmental Conservation (DEC) has had enough time to approve stream-crossing permits for the much-needed Constitution Pipeline. It’s now time to force their hand (see Time to Force NY DEC to Issue Permit for Constitution Pipeline). As we wrote in that piece, the DEC risks the very real threat that the Federal Energy Regulatory Commission (FERC) may step in and force the DEC to issue the permits. Now a high-ranking official with the DEC has essentially said the same thing we did–on the record…
Read More “DEC Official Says NY in Danger of FERC Taking Over Pipeline Permits”
Electrical Generation | Industrywide Issues | New York | Oswego County

PA Marcellus Gas Claims a Nuclear Scalp in Central NY
November 2, 2015November 2, 2015

FitzPatrick Nuclear Plant

Low-cost Marcellus Shale gas has just taken out a nuclear plant in New York State. Entergy, owner of the James A. FitzPatrick Nuclear Power Plant in Scriba, NY, says they will shut down the plant in 2016 or 2017 because of the “continued deteriorating economics of the facility” and because of “significantly reduced plant revenues due to low natural gas prices, a poor market design that fails to properly compensate nuclear generators like FitzPatrick for their benefits, as well as high operational costs.” The FitzPatrick Nuclear Power Plant generates 838 megawatts of electricity, enough to power more than 800,000 homes, and employs 600 people in Oswego County, NY. Essentially over-regulation that drives up costs have shut it down. The question now is, where will those 800,000 homes get their electricity? Oh, they won’t go dark. But they will begin to pay much higher prices for their electricity than they do now. Unless a new natgas-fired electric plant opens up…
Read More “PA Marcellus Gas Claims a Nuclear Scalp in Central NY”
Economic Impact | Industrywide Issues | Ohio | Pipelines | Statewide OH | Taxation

OH Pipeline Projects in 2016: $8B of Investment, $360M in Taxes!
November 2, 2015November 2, 2015

In a somewhat related story posted today, MDN tackles the thorny issue of taxing pipelines in Pennsylvania. As serendipity would have it, last week Energy in Depth posted an excellent article on the financial impact pipelines are having in Ohio. Would you believe it if we told you that not only will an astounding $8 billion be spent to build new pipelines in the Buckeye State in 2016, but also an estimated $360 million in ad valorem property taxes (taxes on pipelines) will roll in to local municipal coffers. Next year. And every year thereafter! Here’s the numbers broken down by who is doing the spending and paying the taxes, and which pipelines will generate the most economic activity in Ohio next year…
Read More “OH Pipeline Projects in 2016: $8B of Investment, $360M in Taxes!”
Industrywide Issues | Pennsylvania | Pipelines | Statewide PA | Taxation

Is it Time to Tax Big Pipelines in PA?
November 2, 2015November 2, 2015

An Associated Press (AP) story appearing in multiple newspapers and in online outlets has returned to the meme of how unfair it is that pipelines in Pennsylvania are not taxed, as they are in other states like New York, Ohio and West Virginia. Perhaps they have a point? No, MDN isn’t going “soft”! We’ve long made the argument that a permanent structure in the ground should benefit landowners beyond a one-time, up-front payment (see the suggestion by Bryant LaTourette made at the Constitution Pipeline scoping hearing in April 2014: Vicariously Attend FERC Scoping Hearing on Constitution Pipeline). The counter to landowners receiving ongoing royalties for pipelines is the argument of electric power lines. They run everywhere over people’s property. You can’t build a structure under or near such lines once they are in place. Yes, they can be taken down/removed (i.e. not “permanent”), but when was the last time that happened? Landowners are not given an ongoing royalty for the electricity flowing through power lines that criss cross their land. Why would you grant an ongoing payment/royalty for a pipeline in the ground if you don’t for a power line above the ground? You see this is a thorny, complex issue. Although individual landowners in states like New York don’t receive an ongoing royalty for pipelines, the pipelines themselves are considered property and pipeline companies are taxed for having them in the ground, giving a community-wide benefit to all residents in a town or village. We’ve remarked before that the property taxes where we live (in NY) have gone DOWN because of a local pipeline. When’s the last time you heard about taxes going down in New York State?! In Pennsylvania, pipelines are NOT taxed, and therefore taxpayers in those communities don’t benefit. That’s the bone of contention…
Read More “Is it Time to Tax Big Pipelines in PA?”
Economic Impact | Hydraulic Fracturing | Industrywide Issues | Research

Dartmouth Research: Fracking’s Benefits Extend Hundreds of Miles
November 2, 2015November 2, 2015

It’s always fascinating for us to see which universities tout the research papers published by their professors and students, and which don’t. And which papers they decide to promote, and which they don’t. Publish a study that knocks fracking as somehow damaging the environment? That’s worth a full-blown press release and calls to the New York Times to see if you can get some juicy PR. Publish a paper that concludes, oh, the economic benefits of fracking actually extend out for hundreds of miles? Not a peep. In fact such a study was released by Dartmouth researchers called “Geographic Dispersion of Economic Shocks: Evidence from the Fracking Revolution” (full copy below). The report concludes: “Every million dollars of oil and gas extracted produces $66,000 in wage income, $61,000 in royalty payments, and 0.78 jobs within the county. Outside the immediate county but within the region, the economic impacts are over three times larger. Within 100 miles of the new production, one million dollars generates $243,000 in wages, $117,000 in royalties, and 2.49 jobs.” You might think such good news would be emblazoned on major newspapers across the country. Nope. Nothing. Nada. Zippo. That kind of objective research, that finds fracking benefits society, doesn’t fit the liberal bias of mainstream media. So they ignore it. If they don’t cover it, it essentially doesn’t exist. What a shame…
Read More “Dartmouth Research: Fracking’s Benefits Extend Hundreds of Miles”
Industrywide Issues | Litigation | Regulation

26 States Ask Federal Court to Shut Down Clean Power Plan Now
November 2, 2015November 2, 2015

MDN has highlighted in several posts the draconian and dictatorial Clean Power Plan (CPP) issued by B.H. Obama’s Environmental Protection Agency (EPA). Not only will Obama’s CPP outright assassinate the coal industry in this country, it will deliver a mortal wound to the natural gas industry, a wound it may not survive (see Obama Stabs Natural Gas Electric Plants in Clean Power Plan). The EPA intentionally delayed publishing a final copy of the plan (by 87 days) in order to run out the clock. They knew the sooner they published, the quicker lawsuits would be filed that may defeat the plan. By delaying, they force states to begin implementing the plan because they dare not be caught in violation in case they lose the court battle. Sleazy in the extreme. Once the plan was published in final form, states immediately filed a lawsuit against it (see States Gear Up to Fight Obama’s Illegal Clean Power Plan in Court). The number of states suing the EPA to stop the CPP now numbers 26–over half of these United States of America. The lawsuit also includes dozens of business groups. They are all asking the federal courts to immediately stop any implementation of the CPP while the lawsuit has a chance to work its way through the court system–which will likely take years. This time, as a Wall Street Journal editorial points out, the courts may just grant the stay and shut down the CPP…
Read More “26 States Ask Federal Court to Shut Down Clean Power Plan Now”
Energy Services | Industrywide Issues | M&A | Marathon Petroleum | MarkWest Energy

MarkWest Tells Unitholders Time to Sign Proxy for Marathon Sale
November 2, 2015November 2, 2015

If you hold MarkWest Energy “units” (similar to shares of stock), it’s time to vote on the merger/takeover of MarkWest by Marathon Petroleum. In July, MarkWest (arguably the premier midstream company in the Marcellus/Utica), and Marathon (the fourth largest refiner in the U.S., headquartered in Ohio) announced a $20 billion deal for Marathon to buy out MarkWest (see Midstream Bombshell: MarkWest Sells Itself to Marathon Petroleum). In August, the federal government gave its blessing on the deal (see Federal Govt Approves Marathon Petroleum Buyout of MarkWest). And just last week Marathon said they expect to close on the deal “later this year”–and the end of this year ain’t all that far away (see Marathon 3Q15: Closing on MarkWest Merger “Later this Year”). Last Friday MarkWest released a statement that it’s now time for existing unitholders to sign proxy statements that approve (or not) of the merger. A big meeting will be held on December 1st at MarkWest HQ in Denver for big unitholders, including those representing smaller unitholders via proxy, to cast their vote and plant a big ole rubber stamp of approval on this deal. What? You thought the outcome was ever in doubt? Hate to burst your bubble, but it’s not. This is a done deal folks…
Read More “MarkWest Tells Unitholders Time to Sign Proxy for Marathon Sale”
About MDN | Calendar

Calendar of Events for Nov 2 – Feb 1 (90 Days)
November 2, 2015November 2, 2015

Below are upcoming events for the next three months (90 days). To see the full list of future events, visit this page: //marcellusdrilling.com/calendar/.

NOTE: To have an item included, please email it to:calendar@marcellusdrilling.com.
Read More “Calendar of Events for Nov 2 – Feb 1 (90 Days)”
Best of the Rest

Marcellus & Utica Shale Story Links: Mon, Nov 2, 2015
November 2, 2015November 2, 2015

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading. In today’s lineup: gas drillers eye Utica promise; Appalachian dilemma, too much gas, nowhere to go; Marcellus gas stealing markets away from Canada; Cuomo cronyism; LNG for NYC; Ohio’s oil boom; Act 13 lands back in PA Supreme Court; Chevron cutting 7,000 jobs; big oil gears up for $60 price; and more!
Read More “Marcellus & Utica Shale Story Links: Mon, Nov 2, 2015”
Energy Companies | Range Resources Corp

Range Says Forget Utica, Our Focus “Totally on the Marcellus”
October 30, 2015October 30, 2015

Yesterday we brought you Range Resources’ third quarter update (see Range Resources 3Q15: Marcellus Prod Up 27%, but $301M Net Loss) and Range’s newly revised PowerPoint slide deck (see Range Resources Oct 2015 Investor Slide Presentation, Our Favs). As is typical, the top brass from the company, including CEO Jeff Ventura, held a quarterly analyst/investor phone call to go along with the release of the quarterly update. These phone calls are often treasure troves of additional information–and yesterday’s call was one of the richest troves we’ve seen in a while. What we learned from that call is this: Although early Utica Shale results in southwestern PA have turned the head for some companies, like EQT, who is refocusing on the Utica for 2016 (see EQT Dumps Marcellus Drilling, Concentrates on the Utica in 2016), it’s just the opposite for Range. Jeff Ventura said yesterday that while his company is interested and still testing their first three Utica wells, Range will focus exclusively on the Marcellus in 2016 as being the best/most productive option for them. We find it fascinating when two heavy weights like EQT and Range come to opposite conclusions…
Read More “Range Says Forget Utica, Our Focus “Totally on the Marcellus””
Lease & Royalty Payments | Ohio | Statewide OH

Gateway Royalty’s Latest Appeal to Buy Eastern OH Royalty Rights
October 30, 2015October 30, 2015

In March 2014 MDN alerted you to a pitch being made by Gateway Royalty to purchase royalty rights from landowners in eastern Ohio (see Company Targets OH Landowners – Buy Future Royalties for Cash Now). Gateway pays landowners a lump sum now in return for the right to receive that landowner’s future royalty payments for years to come. You (the landowner) get your money now, they (Gateway) get the money you would have gotten dribbled out over time. Of course the money you receive now is discounted and in all likelihood far less than you would have gotten if you had waited just a few years (the bulk of royalty payments come in the first four years). It’s a bit of a gamble by both parties because no one really knows how much a well will produce–nor what price the gas/oil will be sold for. Gateway is back with another appeal. We received the following email notice from an MDN subscriber, alerting us to Gateway’s renewed offer…
Read More “Gateway Royalty’s Latest Appeal to Buy Eastern OH Royalty Rights”
Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

DEP Board Votes to “Not Endorse” Sec. Quigley’s New Drilling Regs
October 30, 2015October 30, 2015

In a big metaphorical slap across the face, the Pennsylvania Dept. of Environmental Protection’s Oil and Gas Technical Advisory Board (TAB) has voted to not endorse re-worked drilling regulations proposed by the PennFuture Sec. of the DEP, John Quigley. We told you two days ago the DEP was meeting with TAB to get the group’s rubber stamp of approval (see New Drilling Rules for PA Take One Big Step Closer to Reality). Looks like Quigley’s hand-picked new board members are not yes men (and women) after all. This is the second DEP advisory group packed with Quigley appointees that has rejected his onerous proposed re-worked regulations. Previously the Conventional Oil and Gas Advisory Committee (COGAC) also told Quigley nyet (see PA DEP Sec Quigley’s Own Committee Appointees Turn Against Him). Which means both conventional and now unconventional drilling advisors, appointed by Quigley himself, don’t believe Quigley’s rejiggered regulations are good. Do we see a pattern developing here? Seeing that two boards of experts are telling him there’s a problem, does that mean Quigley will pause and reflect and perhaps consider changing his proposed rules? Are you kidding! Don’t make us laugh. Oh no no no. Quigley plans to ramrod these new regs through as fast as he can regardless…
Read More “DEP Board Votes to “Not Endorse” Sec. Quigley’s New Drilling Regs”
Dauphin County | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

PA DEP Sec. Quigley Defends DEP, Criticizes Patriot-News Series
October 30, 2015October 30, 2015

Wow. We didn’t think it possible. The PennFuture Secretary of the Pennsylvania Dept. of Environmental Protection (DEP), John Quigley himself, is sticking up for the honor and reputation of his agency. Last week the Democrat-run Harrisburg Patriot-News ran an attack series against shale energy. We told you about it by reprinting Tom Shepstone’s excellent critique (see Harrisburg Newspaper’s Attack Series on Marcellus Exposed). Tom followed it up with another excellent article with a clip of the vapid lead author’s Twitter feed showing her outright bias against not only shale in general, but against the DEP in particular (see Natural Gas Now, PennLive Shale Series: “Erin” Go Bragh?). Quigley had fully cooperated with the Patriot-News and lead series author Candy Woodall, and now feels betrayed and stabbed in the back (welcome to the club John). So Quigley wrote a response to the profoundly biased attack series–and wonder of wonders, the Democrat Patriot-News actually published his response! Here it is…
Read More “PA DEP Sec. Quigley Defends DEP, Criticizes Patriot-News Series”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Pennsylvania | Pipelines | Regulation | Statewide PA

PA DEP Sec. Quigley Calls Pipeline Protesters “Badly Misinformed”
October 30, 2015October 30, 2015

About 20 hippie retreads showed up in Harrisburg, PA on Wednesday to protest outside of the Dept. of Environmental Protection (DEP) regional office in Harrisburg to protest the fourth meeting of Gov. Tom Wolf’s Pipeline Infrastructure Taskforce. In May Gov. Wolf announced he was forming a taskforce to study and make recommendations on how the state can better work with (i.e. control) where local gathering pipelines are installed (see Disaster on the Horizon: PA Gov Wolf Creates Pipeline Task Force). DEP Secretary John Quigley packed the task force with 42 members, most of them government employees (beholden to Wolf/Quigley for their jobs) as well as some from the “environmental” community and a few from the pipeline industry (see PA Gov Wolf Packs Pipeline Task Force with His Own Minions). The gang of 42 was meeting for the fourth time in an effort to complete a draft report by mid-November. Some of the best and brightest gathered outside, including THE Delaware Riverkeeper, Maya van Rossum, to protest. Quigley called the assembled antis “badly misinformed”…
Read More “PA DEP Sec. Quigley Calls Pipeline Protesters “Badly Misinformed””
Energy Companies | EXCO Resources

EXCO’s Top Mgmt Talks About Shutting in Production in Marcellus
October 30, 2015October 30, 2015

Earlier this week MDN brought you EXCO Resources’ third quarter update, with the news that they have a “strategic plan” to turn things around at the troubled company (see EXCO Resources 3Q15: $42M Loss, Plan to Turn Things Around). EXCO has a sizable Marcellus presence with 145,000 net acres in the Marcellus and having drilled and operating 124 horizontal Marcellus wells. However, with natgas prices in the northeast the lowest in the country, EXCO is not drilling any new Marcellus wells save one appraisal well earlier this year. On Wednesday EXCO’s top management hosted a quarterly earnings call with analysts. We went fishing through the call transcript to find references to the Marcellus/Utica–to see if there was anything new in their thinking about the northeast. Here’s what we found…
Read More “EXCO’s Top Mgmt Talks About Shutting in Production in Marcellus”