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    Rice Energy Exec: 90% of Utica Gas Will Come from 3-4 Counties

    An update on what Rice Energy is up to, from none other than Rice’s vice president in charge of exploration, Derek Rice. Derek said at yesterday’s Hart Energy DUG East conference in Pittsburgh that his company is, this week, finishing up work on a Utica Shale well in Greene County, PA. Derek admitted there’s differing opinions within the company about whether or not they should be drilling Utica wells in PA. He says the rock is great, they’re convinced of that. The “problem” is that it costs a heck of a lot more to drill a deep Utica well than it does a Marcellus well. If Rice can squeeze more costs out of drilling a Utica well, it will be profitable. He also said something very interesting about the geography of the Utica–that he believes 90% of the gas that will come out of the Utica play will come from just three or four counties…
    Read More “Rice Energy Exec: 90% of Utica Gas Will Come from 3-4 Counties”

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    CONSOL Energy May Add More Utica Wells to Pitt. Airport Project

    Correction: The information MDN used for this post was derived from an inaccurate news account that misstated CONSOL received a permit to drill one Utica well at the Pittsburgh Airport. That was factually incorrect. CONSOL has received no permits for a Utica well–only permits for Marcellus and Upper Devonian wells. If they pursue drilling Utica wells at the airport, they will likely need a new environmental impact study done first. Our thanks to CONSOL for contacting us to clarify.

    From the “Hmmm, that’s interesting” department: Speaking at yesterday’s Hart Energy DUG East conference in Pittsburgh, CONSOL Energy vice president Craig Neal said the company is considering requesting a change in its drilling plan at the Pittsburgh International Airport. CONSOL, as you may recall, is in the midst of a multi-year program to drill 45 Marcellus Shale wells and a handful of Utica and Upper Devonian wells at the Pittsburgh Airport (see Sky is the Limit: CONSOL Begins Drilling at Pittsburgh Airport). The permits and plan call for a single no Utica Shale wells, but yesterday Neal said the company is mulling over the possibility of swapping out some of the Upper Devonian wells they had planned to drill on some pads with deeper Utica wells instead…
    Read More “CONSOL Energy May Add More Utica Wells to Pitt. Airport Project”

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    New Bill HB 1391 Will Guarantee PA Landowners 12.5% Royalties

    Last week MDN told you that a new royalty bill would be introduced in the Pennsylvania legislature to guarantee landowners get a minimum 12.5% royalty (see New Bill Pushes 12.5% Guaranteed Minimum Royalty for PA Landowners). The new bill, House Bill (HB) 1391 is, according to the bill’s main sponsor State Rep. Garth Everett, more narrowly focused than the previous bill introduced in 2013 (HB 1684). Gareth and a group of supporters from the PA chapter of the National Association of Royalty Owners gathered in the Capitol Rotunda in Harrisburg on Tuesday in a bill launch rally. We don’t (yet) have the language of the new bill, but we do have Everett’s description of what’s in the bill, a brief video interview of Everett from Tuesday’s launch rally, and a newspaper write-up from the event…
    Read More “New Bill HB 1391 Will Guarantee PA Landowners 12.5% Royalties”

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    Blue Racer Brings OH Processing Plant Online, Continues to Expand

    Blue Racer Midstream, a joint venture between Caiman Energy II and Dominion, shared the good news yesterday that a second 200 million cubic feet per day (MMcf/d) cryogenic processing plant at its Berne Natural Gas Processing Complex in Monroe County, OH (known as Berne II, yes, they name these things) is now online and operating. Berne II doubles the processing capacity at the plant. Blue Racer also operates a processing AND fractionation complex in Natrium, WV. A 30-mile Y-grade (NGL) pipeline connects the two facilities so that Berne can send along its NGLs to Natrium for further processing. Fractionaters like those in Natrium separate NGLs into their component hydrocarbons, including ethane, butane, propane, etc. In addition to Berne II going online, Blue Racer gave us a general update on the expanding health of their operation: They have 14 long-term major Marcellus/Utica drilling customers; 650 miles of gathering pipelines in OH and WV with another 200 miles of new gathering lines under construction; and gathered volumes have doubled, and processed volumes have tripled in just the last year…
    Read More “Blue Racer Brings OH Processing Plant Online, Continues to Expand”

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    Columbia Pipeline Board Approves 2 Projects from NE to Gulf Coast

    In August 2014, MDN told you that Columbia Pipeline Group, a division of NiSource, had decided to move forward with investing $1.75 billion dollars for two new projects: the Leach XPress and Rayne XPress pipeline projects (see Columbia Gas: $1.75B for 2 Projects to Send Marcellus Gas to Gulf). Leach Xpress will begin in Marshall County, West Virginia, cross Ohio and end up in Leach, Kentucky. Rayne Xpress will beef up an existing pipeline from Leach, Kentucky that goes all the way to Rayne, Louisiana with new compressor stations and looping. The two projects together mean up to 2.7 billion cubic feet per day (Bcf/d) of natural gas can move through the entire system–from West Virginia to the Gulf Coast and all point in between. We commented on the funny name “Leach” for a pipeline. Looks like the marketers at Columbia thought twice about it because the name has changed–for both projects. At least we think so. Yesterday Columbia issued a press release to announce the board of directors has signed off on $2.7 billion worth of investment in two projects: Moutaineer XPress and Gulf XPress. Descriptions for the two projects are almost identical to the descriptions for the Leach and Rayne XPress projects. About the only difference is that the price tag went up for the pair of projects by a billion bucks. The key takeaway from the announcement for us? The capacity to move another 2.7 Bcf/d of Marcellus and Utica Shale gas out of the northeast is on the way in the next couple of years…
    Read More “Columbia Pipeline Board Approves 2 Projects from NE to Gulf Coast”

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    Carnival Orders LNG-Powered Cruise Ships + Jim’s Cruise from Hell

    Hurricane Irene
    Hurricane Irene

    We have mixed emotions about this story. We spotted a story a few days ago that a major cruise ship line has ordered up four new megaship cruise liners that will be powered by liquefied natural gas (LNG)–a first for cruise ships. The new ships will be the “greenest” cruise ships yet, cutting down significantly on air pollution by changing from diesel to LNG. Each of the four ships will have the capacity to haul 6,600 passengers (mammoth!). The first of the four ships will be delivered in 2019. So far so good–we find it really cool that cruise ships are converting to LNG, some of which will no doubt use natural gas from the Marcellus/Utica. The mixed emotions we have came when learning that the cruise line the new LNG ships are being delivered to is Carnival. Thunk. MDN editor Jim Willis took his bride of 25 years on a Silver Anniversary cruise (our first cruise ever) on a Carnival Cruise “fun ship” in 2011. It was the worst vacation we’ve ever had. Read the sad (and funny) story below…
    Read More “Carnival Orders LNG-Powered Cruise Ships + Jim’s Cruise from Hell”

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    The Landman Cometh – Sunoco Seeks Easements for Mariner East 2

    The Iceman ComethLandmen for Sunoco Logistics have begun knocking on doors and talking to residents in nine municipalities in Chester County and six in Delaware County (Philadelphia area) to sign easements to allow the Mariner East 2 pipeline to be built through their property. Sunoco wants to begin construction in early 2016. Meetings have cropped up for landowners to hear information about the project, and get information about what their rights are and what terms they should seek before signing an easement. What is Sunoco offering in the way of compensation? It varies from landowner to landowner, depending on where the land is located and how much land they must cross. We do know how much the company offered one resident, in Uwchlan Township (Chester County)…
    Read More “The Landman Cometh – Sunoco Seeks Easements for Mariner East 2”

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    Dueling Rallies in Harrisburg, PA Over Severance Tax Turn Nasty

    An interesting contrast in rallies yesterday in Harrisburg, PA. As the July 1 deadline quickly approaches for Pennsylvania to approve a budget, there were two rallies at the state Capitol. The first was held by life’s producers–the people who actually create wealth in this country. It was populated by business leaders and those who work for businesses that support the Marcellus Shale industry. They were there to protest against PA Gov. Wolf’s 17.3% severance tax (often mischaracterized by Wolf and a sycophantic press as a “5% tax” on Marcellus gas). Businesses know that such a tax will effectively kill the industry and the jobs and economic impact that go with it, in the Keystone State. Then there was a second rally that followed the business/anti-tax rally. The second rally was held by the life’s takers–those who suck money from the producers. That is, teachers’ unions and their flacks who bleat and blat that stealing money from businesses “is for the children”–to justify their voracious appetite for other people’s money. The second group was there to protest in favor of a money-sucking, Marcellus-killing severance tax. Guess which crowd behaved like adults, and which crowd behaved like ill-tempered and undisciplined children, shouting down the other rally? No, you don’t really have to guess, do you?…
    Read More “Dueling Rallies in Harrisburg, PA Over Severance Tax Turn Nasty”

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    Radicalized Ohio U Students Vandalize Pipeline Construction Site

    Here is another story in our ongoing series of how people have become radicalized by the Big Green movement, turning into law-breakers in the name of saving Mother Earth. This latest story comes from a hotbed of radicalization–Athens, Ohio–where a small group of Ohio University students, complete with orange T-shirts with the slogan “OU Green Energy NOW!” on them, shoveled dirt back into a trench dug to lay a natural gas pipeline. They also wrapped construction equipment at the site with caution tape and plastered stickers on building materials at the site with labels saying “Recalled Due to Improper Energy Policy”. Once again we see a bunch of (in this case) mis-educated Ohio University students who grew up watching Captain Planet reruns, listening to liberal college professors, and believing every word of what they saw on Saturday morning cartoons and what they hear in the lecture hall–that mom and dad and Big Oil companies are destroying Mom Earth and the polar bears. That is, they’ve been brainwashed and now radicalized…
    Read More “Radicalized Ohio U Students Vandalize Pipeline Construction Site”

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    FirstEnergy Confirms Their Site is Future Home of OH Cracker

    More cracker plant talk. Yesterday we told you that Shell has received the air quality permit they need from the PA Dept. of Environmental Protection (see Shell Receives Air Quality Permit from PA DEP for Cracker Plant), moving that ethane cracker plant project significantly closer to reality. We also told you that the president and CEO of Odebrecht, the Brazilian company planning to build a cracker plant in WV, has been arrested in a bribery scandal (see Odebrecht CEO Arrested; What Does it Mean for WV Cracker Plant?), making that ethane cracker project less likely, in our humble opinion. The third major ethane cracker in the Marcellus/Utica is planned for Belmont County, OH. PTT Global Chemical, Thailand’s largest integrated petrochemical and refining company, with financial backing from Marubeni Corporation, a Japan-based company conglomerate, plans to build a cracker plant complex in Ohio (see It’s Official: Belmont County Chosen as POSSIBLE Cracker Plant Site). It has been an “open secret” the site for the plant would be at FirstEnergy Corp’s R.E. Burger power plant site along the banks of the Ohio River. FirstEnergy has, until now, denied they are selling the site. But a FirstEnergy official in a round-about way has just confirmed that yes, IF the cracker plant project gets built, it likely will get built at the R.E. Burger site…
    Read More “FirstEnergy Confirms Their Site is Future Home of OH Cracker”

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    Q: Why is ETE Making a Play to Buy Williams? A: Marcellus/Utica

    On Monday, MDN brought you what has to be the biggest midstream news in the Marcellus/Utica for 2015: a proposed hostile takeover of Williams by Energy Transfer Equity (see Energy Transfer Makes “Indecent Proposal” to Buy Williams for $48B). We’re a bit dubious about the benefits of a proposed takeover/merger because the market loses competition with such mega mergers. But Wall Street loves these kinds of deals. We see jobs lost due to consolidation and price increases due to less competition. Wall Street sees fatter profits from “economies of scale” and other euphemisms they use for lost jobs and less competition. We spotted a Reuters article that evaluates the proposed ETE deal from the perspective of what it means (for ETE) in the Marcellus/Utica. The story says the primary motivator on the part of ETE in pursuing a takeover/merger with Williams is that it would give ETE a “dominant position” in the Marcellus/Utica…
    Read More “Q: Why is ETE Making a Play to Buy Williams? A: Marcellus/Utica”

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    Mass. DPU Rejects Anti Group’s Request to Join Pipeline Hearing

    ENOUGH of these anti-pipeline, anti-drilling, dump-all-fossil fuels protesters and their strategies to stop pipelines in New England. That’s essentially what the Massachusetts Department of Public Utilities (DPU) said in refusing to allow the anti-pipeline group Pipeline Awareness Network for the Northeast (PLAN-NE) “full intervenor status” at a series of hearings the DPU will hold today, tomorrow and Friday to consider whether the contracts sought by the local gas distribution companies (local gas utilities) who want to get cheap, abundant and clean-burning Marcellus natural gas from Kinder Morgan’s proposed Northeast Energy Direct pipeline, are in the public interest. The DPU wants to concentrate on the real issues at hand and not be distracted and derailed by the antics of anti-pipeliners, so the DPU turned down PLAN-NE’s request…
    Read More “Mass. DPU Rejects Anti Group’s Request to Join Pipeline Hearing”

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    EIA: Oil & Gas Jobs Plunge 6 Months After Oil Price Plunge

    Our favorite government agency, the U.S. Energy Information Administration, has authored an excellent article about how jobs in the oil and gas sector lag behind oil price gyrations. That is, once the price of oil drops to a certain level, it takes a while before jobs in the sector start to disappear. Which makes sense. Oil (and gas) prices are cyclical–they go up, they down, they go up again. It’s always been that way. When prices tank, companies don’t immediately layoff people–it take a few months of wait and see to see if prices will recover. If they don’t recover within a few months? That’s when layoffs start to happen, and the statistics show it. A startling statistic included in the EIA story below: on-shore rig counts hit a new low for the week ending June 19–54% below the same point a year ago. It’s the lowest rig count level in nearly six years. While you can’t say “half the rigs, half the number of jobs,” you can say “half the rigs means a whole lotta jobs are now, 12 months later, gone”…
    Read More “EIA: Oil & Gas Jobs Plunge 6 Months After Oil Price Plunge”

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    API Study Shows Energy Regulations are Killing Jobs & Economy

    The American Petroleum Institute (API) released a new study yesterday authored by Wood Mackenzie, a global research firm, which compares government policies that promote the growth of the energy industry with government policies that stifle energy growth. The study, titled “A Comparison of US Oil and Natural Gas Policies: Pro-development Policies vs. Proposed Regulatory Constraints” (full copy embedded below) finds that the study found that unnecessarily restrictive energy and environmental regulations proposed by the Obama administration will lead to 830,000 lost jobs and a decrease of $133 billion per year in the U.S. economy. In other words, Obama is ruining this country with his energy/environmental policies…
    Read More “API Study Shows Energy Regulations are Killing Jobs & Economy”

  • Important MDN Housekeeping Notices

    important announcementA few, short housekeeping notices for the Marcellus Drilling News service. First, for our paying subscribers, my web host tells me that tonight, Wednesday, June 24, starting around 10 pm and lasting through 2 am the server that MDN is hosted on is getting an upgrade and will be “off the air” at various points. Just a heads up if you read the site late at night.

    Second, as of right now, the MDN Facebook page has exactly 9,999 “likes”. By the time you read this it may be 10,000! If not, perhaps you would consider visiting our Facebook page and “liking” it to push us over the 10K mark? https://www.facebook.com/MarcellusDrilling

    Thanks!
    Jim Willis, Editor