Marcellus & Utica Shale Story Links: Mon, Apr 6, 2015
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:
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Happy Easter! MDN’s Top 30 Stories for Last 30 Days
MDN is taking today, Good Friday, off from the normal story writing routine. We have, however, assembled a list of the top 30 most-read MDN stories over the past 30 days. We thought you might find it useful to see which stories were most appealing to the majority of MDN readers. As you scan the list, did you read these stories? You might spot a story or two you didn’t read that maybe you want to read now–or re-read!The stories below are ranked in order from highest number of reads to lowest. Bear in mind some these stories were published prior to the last 30 days–but remain popular. Story #1 in the list below was read 2,842 times in the last 30 days, and story #30 below was read 514 times in the last 30 days–just to give you some perspective.
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Energy Companies | Industrywide Issues | Inflection Energy | Lease & Royalty Payments | Litigation | New York | Statewide NY | Tioga County (NY)
NY High Court Decision Creates Toxic Environment for O&G Companies
A court case decided earlier this week by New York’s Court of Appeals (NY’s highest court), will, in our opinion, have a profoundly negative effect on oil and gas development in the state, forever. Or until another court case overturns it (which seems very unlikely). The case, as its core, is about the question of whether or not state action or inaction constitutes an extraordinary action, in essence an Act of God outside of the control of parties who sign a contract. Years ago landowners signed leases to allow oil and gas drilling, often for a few bucks and acre, long before Marcellus and fracking were common, household words. Then came delay after delay in New York–from the governor–and eventually a more or less semi-permanent ban on fracking. Energy companies argued that the leases they had signed could be extended until the day they are allowed to drill in the Marcellus because of “force majeure”–the concept that due to circumstances beyond our control we could not drill as we intended during the original term of the lease, usually five years. The NY Court of Appeals on Tuesday decided that the state preventing drilling does not qualify as force majeure after the original five-year period of a lease (full copy of the decision below). If the original lease was extended for some reason and then the driller was prevented from drilling during the extended time due to state laws preventing it, it’s not force majeure in the eyes of the “wise” justices in Albany…
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Allegheny County | CONSOL Energy | Energy Companies | Energy Services | Halliburton | Hydraulic Fracturing | Industrywide Issues | Pennsylvania
CONSOL Begins Fracking at Pittsburgh Airport, Using New Tech
Yesterday CONSOL Energy began fracking operations on Pad #2 at the Pittsburgh International Airport. That’s a pretty big deal in and of itself–the fact that fracking has begun under airport property. You may recall that CONSOL paid the airport a $50 million signing bonus and when everything is done, they will drill 47 wells on 6 pads (see CONSOL Energy Reveals Drilling Plan for Pittsburgh Airport). After royalties come in, the airport says it will make upward of a staggering $1 billion in revenue from the deal. This is a high profile project for CONSOL, so they’re pushing the technology to ensure environmental impacts are as absolutely minimal as they can be–including air emissions. The big news coming from yesterday, aside from the fact they’ve begun to frack, is HOW they’re doing the fracking. CONSOL is using oilfield services company Halliburton (cue sinister sounding music and flash a picture of Dick Cheney with horns). Halliburton is using brand new equipment to perform the fracking that is “fully compliant with the Environmental Protection Agency’s 2015 Tier 4F emissions standard for non-road, high-horsepower engines.” That is, it’s really really efficient and low-emissions equipment that will reduce air pollution from the operation by an estimated 36%…
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Sexy New Marcellus Maps & Info from EIA
The number-crunching wizards at our favorite government agency, the U.S. Energy Information Administration (EIA), have constructed yet another superb report. Using well data provided by various state agencies, EIA wizards have constructed a series of new maps showing the extent and structure of the Marcellus Shale–where its productive and prospectively productive regions are located. Here’s some sexy new maps and important information to go along with them from our friends at the EIA…
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PA’s First Monthly O&G Production Report Goes Live
Pennsylvania has now moved to the head of Marcellus pack when it comes to production reporting. Previously drillers in the state were required to file production numbers with the Dept. of Environmental Protection (DEP) every six months, but last October the Republican state legislature passed a bill that Republican Tom Corbett signed into law moving reporting from every six months to every month (see 2 Bills on PA Gov’s Desk: Monthly Production #s, Lease Termination). The first monthly production report, for January 2015, is now available. The DEP says 80% of drillers filed on time (representing 99.5% of shale wells in the state). What do the numbers show?…
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Chesapeake Energy | Energy Companies | Industrywide Issues | Litigation | Pennsylvania | Statewide PA
Judge Rules Royalty Lawsuit Against Chesapeake in PA Continues
Last June MDN told you about a class action lawsuit filed by the Suessenbach Family Limited Partnership. Using a Wilkes-Barre, PA law firm, Suessenbach launched a “sprawling class action” lawsuit against Chesapeake Energy and Access Midstream accusing the two companies of a $5 billion scheme to defraud landowners out of royalties rightfully due to them (see 2nd PA Class Action Lawsuit Against Chesapeake re Royalty Fraud). MDN previously covered how the Chesapeake/Access scheme worked (see Chesapeake Shafting Landowners out of Royalties Mess Gets Messier). In December, another class action lawsuit was settled (see Chesapeake’s PA Royalty Settlement Affects Some, Not All Landowners). However, Suessenbach soldiered on with their lawsuit. Chesapeake tried to have the Suessenbach lawsuit tossed, but a federal judge earlier this week denied that motion and has ruled there’s enough of a case for Suessenbach to continue…
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PA Dem Seeks Severance Tax Break for 2 P&G Wells in His District
One of the unsung hero stories we’ve told a few times on MDN is about the only Proctor & Gamble manufacturing plant in the world that is 100% energy self-sufficient. It’s located in Wyoming County, PA (see PA P&G Plant: 100% Energy Self-Sufficient from Marcellus Gas and P&G Plant in NEPA Adds Marcellus CNG Filling Station). The reason the P&G plant is energy self-sufficient and in fact the reason it sells energy back to the local power utility is because it drilled and operates two Marcellus Shale wells on company property. The gas from those wells feeds an electric generating plant that produces more electricity than P&G can use at the plant. It’s a very cool story. But now, here comes Democrat Gov. Tom Wolf who wants to tax the shale gas industry into oblivion. The severance tax he’s proposing would apply to the two wells on P&G’s property–even though they don’t sell the gas for a profit. So local PA Rep. Mike Carroll, a Democrat from Avoca (who supports Wolf’s tax and spend policies), is trying to carve out an exception for the two P&G shale wells because…well because P&G is in his district employing lots of Carroll’s voters and no doubt a big contributor to his campaign coffers, either directly or via the salaries P&G pays to people who work at the plant and contribute to Carroll…
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FERC Will Not Oversee UTOPIA NGL Pipeline Project in Ohio
In December 2013, MDN told you about Kinder Morgan’s new NGL (natural gas liquids) pipeline cleverly named UTOPIA (Utica To Ontario Pipeline Access). UTOPIA is a $500 million, 210-mile, 10-inch pipeline from Harrison County, Ohio to Riga, Michigan and from there connecting with another pipeline heading into Windsor, Ontario (see UTOPIA is Coming! The UTOPIA Pipeline, that is…). Kinder has held an open season and in January 2016 they will file a full application and target November 2016 to begin construction. What we didn’t know, or realize (until today) is that all of the new pipeline that needs to be constructed for the project will happen within Ohio. No new pipeline is needed in Michigan or indeed into Ontario. Why is that important? Because newly constructed pipeline doesn’t cross state lines, the Federal Energy Regulatory Commission (FERC) will not be involved with approving or overseeing construction for the project. Because it’s all within Ohio, the lead agency for approval and oversight will be the U.S. Army Corps of Engineers, with an assist from the Ohio Dept. of Natural Resources, the Ohio Environmental Protection Agency and the U.S. Fish and Wildlife Service (an agency drunk on its own power)…
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Energy Companies | Hilcorp Energy | Industrywide Issues | Lawrence County | Mercer County | Pennsylvania | Pipelines
Hilcorp to Build New Gathering Pipeline in NWPA
Hilcorp remains very active in northwestern PA. The company has filed paperwork and plans to build several new pipelines in Lawrence and Mercer counties. They will build a buried gathering line (what they call the Weiser-Varano pipeline), a buried “fluids pipeline” and an above-ground temporary water pipeline. The details as we know them…
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Syracuse U Divests from Fossil Fuels, NYU Says “Irresponsible”
Silly (and frankly stupid) “green” students at universities who apparently don’t have enough homework to keep them busy have lately been protesting and attempting to get the schools their parents pay so much money to, to divest from any stock holdings in evil, filthy, nasty fossil fuel companies. No, we’re not making this up. These idiots, who believe in global warming fairy tales, are demanding, like the petulant undisciplined children they are, that universities pull out a gun and just shoot themselves in the head financially. And you know what? Syracuse University has just done it. They’ve just committed financial suicide by bowing to pressure from children and divesting any fossil fuel stocks from their $1.2 billion endowment. Forcing Coach Jim Boeheim to retire, and now divesting from fossil fuels? We’re officially no longer Orange basketball fans. Meanwhile, the divest from fossil fuels issue was extensively studied by New York University–and they concluded to do such a thing is nuts…
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Marcellus & Utica Shale Story Links: Thu, Apr 2, 2015
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:
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Accidents | Energy Services | Industrywide Issues | NGLs | Pennsylvania | Processing Plants | Statewide PA | Sunoco Logistics
Sad Day: Worker Killed at Marcus Hook Refinery NGL Project
It’s always a sad day when we report a death related to the Marcellus/Utica industry. Thankfully it doesn’t happen often, but the fact it happens at all is almost too much to bear. We know it’s not realistic to expect no fatalities, but still… On Monday afternoon around 2:30 pm a worker at the former Marcus Hook refinery–which is being converted into a natural gas liquids terminal–was killed after a pylon fell on him. The worker’s name has not yet been released, but it is reported he was in his 50s and from New Jersey and worked for engineering firm AECOM, a contractor working at the site. In a profoundly inappropriate manner, a member of the anti-drilling group Protecting Our Waters jumped on the death as an opportunity to push her anti-drilling message…
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Economic Impact | Energy Services | Industrywide Issues | PennEast Pipeline | Pennsylvania | Pipelines | Statewide PA
PennEast Payola? Buying Support One Community at a Time
In March 2014 MDN wrote about Williams spreading money around with local fire departments and other non-profit organizations in communities where they want to build the much-needed Constitution Pipeline (see Constitution Pipeline Payments to Groups – Donations or Payola?). The Constitution ended up paying out more than $1 million in grants to local groups. Our point at that time was maybe Williams should wait until the pipeline is approved and built before they hand out money. It just seemed to us like a not-so-transparent attempt at influencing (buying?) support for the project. Do we need that support? Sure! But wait until the pipeline is approved and built, and THEN help out those communities and be a good corporate citizen. Seems our advice fell on deaf ears. PennEast Pipeline is now trying the same tactic. Yesterday PennEast announced another round of community grants–handing out $70,000 this time around. PennEast is giving $5,000 each to 14 different organizations, most of them fire & ambulance departments in Pennsylvania and New Jersey…
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Braxton County | Doddridge County | Energy Services | Industrywide Issues | Lewis County | M3 Midstream | Momentum | Pipelines | Statewide WV | West Virginia
M3’s New Stonewall Gathering System Extends Existing AGS in WV
All the way back in 2011 MDN told you about M3 Midstream’s Appalachia Gathering System (AGS), a local gathering pipeline system to serve dry gas production areas in northern West Virginia and southwestern Pennsylvania (see New Marcellus Shale Pipeline Coming to Southwestern PA, Northern WV). AGS was slated to be approximately 130 miles of large diameter gathering pipeline spanning Washington and Greene counties (in PA), and Monongalia, Marion and Harrison counties (in WV). Since that time we haven’t heard much–the project has flown mostly under the radar. It has, however, popped back up in the news in WV, so we thought it would be a good time to give you an update on the project…
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Struggling Rex Energy Gets JV Partner, Slashes Budget Again
Rex Energy, our little energy company that could (and does) continue to drill in the Marcellus/Utica, is struggling. Rex has, like all companies, been hit with low commodity prices for natural gas, a shortage of pipelines to get the gas to markets, and consequently has scaled back on plans for 2015. Although Rex had a great 2014 with production up some 66% over 2013, in December the company announced they would trim the 2015 budget by 44% over 2014 (see Rex Energy Reduces 2015 Marcellus/Utica Drilling Budget by 44%). In February Rex was included in a list of 19 companies on one analyst’s “death list”–meaning they owe a lot more money than they bring in–in Rex’s case they owe 5 times as much as they bring in annually (see 19 Oil/Gas Companies on “Death List” – 8 are in Marcellus/Utica). Shortly after that, Rex put 28K PA acres up for sale in their non-core area, to raise cash (see Rex Energy Looks to Sell 28,300 Marcellus Acres in Bid to Raise $). And that brings us to yesterday, when Rex announced they are slashing their drilling budget again, by another 30%, and they’ve taken on a joint venture partner for some of their acreage in a bid to keep drilling…
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MDN is taking today, Good Friday, off from the normal story writing routine. We have, however, assembled a list of the top 30 most-read MDN stories over the past 30 days. We thought you might find it useful to see which stories were most appealing to the majority of MDN readers. As you scan the list, did you read these stories? You might spot a story or two you didn’t read that maybe you want to read now–or re-read!
A court case decided earlier this week by New York’s Court of Appeals (NY’s highest court), will, in our opinion, have a profoundly negative effect on oil and gas development in the state, forever. Or until another court case overturns it (which seems very unlikely). The case, as its core, is about the question of whether or not state action or inaction constitutes an extraordinary action, in essence an Act of God outside of the control of parties who sign a contract. Years ago landowners signed leases to allow oil and gas drilling, often for a few bucks and acre, long before Marcellus and fracking were common, household words. Then came delay after delay in New York–from the governor–and eventually a more or less semi-permanent ban on fracking. Energy companies argued that the leases they had signed could be extended until the day they are allowed to drill in the Marcellus because of “force majeure”–the concept that due to circumstances beyond our control we could not drill as we intended during the original term of the lease, usually five years. The NY Court of Appeals on Tuesday decided that the state preventing drilling does not qualify as force majeure after the original five-year period of a lease (full copy of the decision below). If the original lease was extended for some reason and then the driller was prevented from drilling during the extended time due to state laws preventing it, it’s not force majeure in the eyes of the “wise” justices in Albany…
It’s always a sad day when we report a death related to the Marcellus/Utica industry. Thankfully it doesn’t happen often, but the fact it happens at all is almost too much to bear. We know it’s not realistic to expect no fatalities, but still… On Monday afternoon around 2:30 pm a worker at the former Marcus Hook refinery–which is being converted into a natural gas liquids terminal–was killed after a pylon fell on him. The worker’s name has not yet been released, but it is reported he was in his 50s and from New Jersey and worked for engineering firm AECOM, a contractor working at the site. In a profoundly inappropriate manner, a member of the anti-drilling group Protecting Our Waters jumped on the death as an opportunity to push her anti-drilling message…