Marcellus Drilling News

Energy Companies | Energy Services | EQT Corp | Industrywide Issues | Pipelines | WGL Holdings

Mountain Valley Pipeline Picks Up 2 New Investors/Partners
March 12, 2015March 12, 2015

Yesterday we told you that some landowners in West Virginia are not happy with what they call threatening letters coming from the Mountain Valley Pipeline (see WV Landowners Say They’re Bullied by Mountain Valley Pipeline). MVP is a 330-mile pipeline from Wetzel County, WV to the Transco Pipeline in Pittsylvania County, VA. It’s a joint venture between EQT and NextEra US Gas Assets. At least it was a jv between the two until yesterday when MVP announced two more partners/investors: WGL Midstream and Vega Midstream. Who’s on top? EQT owns 55% (and manages) the jv, NextEra owns 35%, WGL will own 7% and Vega 3%. Here’s the announcement from yesterday…
Read More “Mountain Valley Pipeline Picks Up 2 New Investors/Partners”
Pennsylvania | Susquehanna County

Elk Lake School LOVES Their 2 Marcellus Shale Wells & Gas Heat
March 12, 2015March 12, 2015

Seems like it was ages ago now that we told you (and keep telling you) about a rural school district in northeastern Pennsylvania–the Elk Lake School District–that drilled two Marcellus Shale wells on the school campus (see Rural NE PA School Nets $1.7M in Royalties from 2 Marcellus Wells). Not only is that tiny school district still raking in the royalties, they’re also heating with natural gas. Even though there’s been record cold in Susquehanna County this winter, the students and faculty are nice and toasty, thanks to Marcellus Shale gas…
Read More “Elk Lake School LOVES Their 2 Marcellus Shale Wells & Gas Heat”
Best of the Rest

Marcellus & Utica Shale Story Links: Thu, Mar 12, 2015
March 12, 2015March 12, 2015

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:
Read More “Marcellus & Utica Shale Story Links: Thu, Mar 12, 2015”
Industrywide Issues | Research

Turning Point: EIA Drilling Report Shows Slow Down in Production
March 11, 2015March 11, 2015

It is true that what goes up must come down? As a general rule, yes. That age-old wisdom is manifesting itself in both oil and natural gas production from shale plays. Two days ago our favorite report from our favorite government agency–the Drilling Productivity Report (DPR) from the U.S. Energy Information Administration (EIA)–was issued. It shows something we haven’t seen before: negative numbers in some of the production columns for some of the shale plays–in both oil and natural gas. No, the Marcellus and Utica are not in the negative (they will both produce more oil and gas in April than they did in March). However, the rate of increase in production for the Marcellus and Utica, indeed all of the shale plays, is much less than it has been previously. Scaling back on new drilling will, sooner or later, affect production. We’re now seeing it in the numbers…
Read More “Turning Point: EIA Drilling Report Shows Slow Down in Production”
Industrywide Issues | Ohio | Statewide OH | Taxation

OH Gov Kasich the Bully: Accept My 6.5% Tax or Risk a 10%+ Tax
March 11, 2015March 11, 2015

Wow. We’re kind of speechless. Ohio Gov. John Kasich (RINO) sure is a sore loser. And a vicious one too. Get this: Kasich is now saying if the oil and gas industry doesn’t lay down and take the high severance tax he’s proposing, some “citizen group or aspiring politician” will probably (wink wink nod nod) push for a ballot measure in the state to create such a tax. And if that happens, his measly 6.5% severance tax will look darned good compared to the 10% or more those wild citizen groups will no doubt push for (see OH Gov. Kasich Increases Proposed Severance Tax Rate by 236%). That is, Kasich just threatened the oil and gas industry with a 10%+ severance tax if they don’t accept his tax in this year’s budget. Talk about a bully! We’re used to this from Democrats, but not from so-called Republicans…
Read More “OH Gov Kasich the Bully: Accept My 6.5% Tax or Risk a 10%+ Tax”
Chesapeake Energy | Columbiana County | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Litigation | Ohio

Columbiana Landowners Win Right to Renegotiate Some Lease Terms
March 11, 2015March 11, 2015

In 2008, before the word “Utica Shale” was on people’s lips and in their consciousness, landmen from Patriot Energy Partners “smiled and dialed” calling up landowners in Columbiana County, offering them a whopping $10 (yes 10 bucks) an acre to sign gas and oil exploration leases. Patriot mailed them the contracts, the landowners signed and sent them back, and then got pennies on the dollar for what those leases were actually worth. Patriot then flipped the leases, selling the deep exploration rights to Chesapeake Energy–for $1,100 an acre. Patriot claimed the practice (of hoodwinking landowners and flipping leases) is legal. The landowners wised up and in 2011, 25 landowner families sued to have their leases dissolved. Four years later the case, after going to arbitration, is resolved…
Read More “Columbiana Landowners Win Right to Renegotiate Some Lease Terms”
Energy Companies | Industrywide Issues | Pennsylvania | Range Resources Corp | Regulation | Washington County | Wastewater

Range Re-Opens 2 of 3 Water Impoundments in Washington County, PA
March 11, 2015March 11, 2015

Last September Range Resources was fined $4.15 million for a series of violations at eight water impoundments they operate in southwestern PA (see PA DEP Fines Range Resources $4.15M for Wastewater Impoundments). As part of the deal worked out with the PA Dept. of Environmental Protection (DEP) under then-Sec. Chris Abruzzo, Range agreed to shut down five of the eight impoundments. Actually, all eight of the impoundments ceased operation either during or prior to last September. Two of the remaining three impoundments–the “Carter” and “Carol Baker” impoundments–are now back up and running. The Carter impoundment is handling only fresh water these days, while the Carol Baker impoundment has been upgraded and once again handles wastewater. The remaining “Jon Day” impoundment is being upgraded to begin handling wastewater again, when the weather breaks…
Read More “Range Re-Opens 2 of 3 Water Impoundments in Washington County, PA”
Energy Companies | EQT Corp | Industrywide Issues | Pipelines | Regulation | West Virginia | Wetzel County

WV Landowners Say They’re Bullied by Mountain Valley Pipeline
March 11, 2015March 11, 2015

Last June EQT and NextEra US Gas Assets formed a joint venture to build a 330-mile pipeline from Wetzel County, WV to the Transco Pipeline in Pittsylvania County, VA to deliver abundant, cheap Marcellus and Utica Shale gas to markets throughout the southeast (see EQT Announces New Marcellus/Utica Pipeline to Southeastern US). The new pipeline was dubbed the Mountain Valley Pipeline (MVP) project. Since that time, MVP has filed paperwork with the Federal Energy Regulatory Commission (FERC), which has jurisdiction on whether or not to build it because the pipeline crosses state lines (see EQT’s WV to VA Pipeline Open Season a Success, FERC Filing in Oct). In February, rumors began to bubble that the pipeline is changing its route (see WV to VA Mountain Valley Pipeline Changing Routes?). There has been some resistance, as there always is, on the part of some landowners who refuse to let surveyors on their property. So MVP sent letters to landowners threatening to sue them if they don’t allow the surveyors access. How can they sue? Using the power of eminent domain–but FERC hasn’t yet approved the project which would trigger the right to use eminent domain…
Read More “WV Landowners Say They’re Bullied by Mountain Valley Pipeline”
Energy Companies | Energy Services | EQT Corp | Equitrans/EQT Midstream | Industrywide Issues | Pipelines | Statewide WV | West Virginia

EQT Sells WV Pipeline Gathering System to Itself for $1B
March 11, 2015March 11, 2015

We’re always somewhat amused by these stories. Sometimes a company will spin off a division into its own company–a subsidiary–and later transfer or “sell” certain assets to the subsidiary. On paper the subsidiary is its own company with its own set of investors, its own board, and its own management. But the primary investor with controlling interest remains the mother company. For all practical purposes, the subsidiary IS the same company as the mother company. Midstream companies tend to do this with some regularity. Back in 2012 we noted that Kinder Morgan did it (see Kinder Morgan Sells Tennessee Pipeline to Itself). This week it’s EQT–selling its Northern West Virginia Marcellus Gathering System, along with a “preferred interest” in another EQT subsidiary, for $1.05 billion to the company’s pipeline subsidiary, EQT Midstream Partners…
Read More “EQT Sells WV Pipeline Gathering System to Itself for $1B”
Energy Services | Energy Transfer Partners | Industrywide Issues | M&A | Regency Energy Partners

ETP Buyout of Regency Energy Has a Date: April 28
March 11, 2015March 11, 2015

In January MDN brought you the big news that Energy Transfer Partners (ETP) is buying/merging with Regency Energy Partners (see Energy Transfer Partners Buys Regency Energy for $25B). Both companies have meaningful operations in the Marcellus/Utica region. These mergers & acquisitions, as you know, take time. Both companies have been busy and Regency reported earlier this week they have a date to make it all final: April 28. On that date, Regency will hold a special meeting at their company headquarters in Dallas, TX to vote on the deal…
Read More “ETP Buyout of Regency Energy Has a Date: April 28”
Energy Services | Energy Transfer Partners

ETP Swapping $2.5B of Old Debt for New Debt, Floats Notes
March 11, 2015March 11, 2015

Energy Transfer Partners (ETP) is buying Regency Energy Partners and assuming $6.8 billion worth of debt in the process (see Energy Transfer Partners Buys Regency Energy for $25B). Apparently it’s time to clean up the old debt ETP has on the books, so they’re floating notes (or IOUs) looking to trade $2.5 billion worth of new debt for old debt…
Read More “ETP Swapping $2.5B of Old Debt for New Debt, Floats Notes”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Ohio | Pipelines | Regulation | Statewide OH

NE Wackos on a Rampage: Demand FERC Stop Approving Pipelines
March 11, 2015March 11, 2015

Here’s what passes for thinking in anti-drilling land: Fossil fuels, when burned, release carbon into the atmosphere. Carbon is bad (at least it is for anti-drillers), although you and all other animals breathe carbon out with every breath and plants breathe it in–it’s a requirement for all of life to exist. Still, play along, k? Because natural gas is a fossil fuel, it’s evil. By burning it you pollute Mother Earth and will cause Her to bake with mythical global warming (although we almost froze to death this winter in the northeast). So fracking is the ultimate rape of Mother Earth, as stated by none other than that towering intellect Yoko Ono when singing the song “Don’t Frack My Mother” (see Yoko Ono and Son Sean Lennon Go on Anti-Fracking Tirade). Fracked shale wells require pipelines. If you can stop pipelines, you can stop fracking. Who approves the big pipelines? The Federal Energy Regulatory Commission (FERC). So who’s the latest target of anti-drilling wackos? You got it–FERC…
Read More “NE Wackos on a Rampage: Demand FERC Stop Approving Pipelines”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Research

UCS “Report” Says Using Natural Gas for Electric Generation Big Gamble
March 11, 2015March 11, 2015

The Union of So-Called Concerned Scientists (UCS) recently issued a new report that says switching to natural gas use, especially for electric generation, is one big gamble and we’re being lured down the primrose path to destruction. According to the “scientists” at UCS, it’s far better to turn the thermostat down to 50 degrees in the winter (called “energy efficiency”) and ride to work via horse and buggy (called “switching to renewables”) than risk using that foul, evil, nasty fossil fuel natgas (natgas, natgas, natgas–echo for evil-sounding effect). One might put more stock in such a report if it were actually authored by scientists–people with degrees in the hard sciences. Instead, its primary author is someone with a political science degree…
Read More “UCS “Report” Says Using Natural Gas for Electric Generation Big Gamble”
Best of the Rest

Marcellus & Utica Shale Story Links: Wed, Mar 11, 2015
March 11, 2015March 11, 2015

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:
Read More “Marcellus & Utica Shale Story Links: Wed, Mar 11, 2015”
Industrywide Issues | Pennsylvania | Regulation | Statewide PA | Wastewater

New Draft Drilling Regulations in PA: Wastewater Impoundments Out
March 10, 2015March 10, 2015

The Pennsylvania Dept. of Environmental Protection (DEP) has been working on revisions to oil and gas regulations, something called Chapter 78, since 2011. In 2012 the new Act 13 drilling law required the DEP to update Chapter 78 to reflect the new reality of shale drilling. Over the past three years, the DEP held nine public hearings and received some 24,000 public comments on the proposed changes (see PA DEP Extends Roadshow for Public Comment on New Drilling Rules). The new rules were supposed to be over and done with long before now, but got derailed by last year’s election cycle. New governor, new secretary of the DEP, and guess what? The proposed rules have changed yet again. There’s a new due date too: the final rules won’t be ready until early 2016. Yesterday the DEP released yet another revision to the rules (we’ve lost track how many times the rules have been revised and changed). Drillers under Democrat Gov. Tom Wolf and his PennFutureDEP Sec. John Quigley want to increase the red tape drillers must navigate. Among the changes in this latest draft (full copy below) are…
Read More “New Draft Drilling Regulations in PA: Wastewater Impoundments Out”
Energy Services | Energy Transfer Partners | Industrywide Issues | Litigation | Ohio | Pipelines | Regulation | Statewide OH

OH Law Firm Asks FERC to Stop ET Rover Pipeline Eminent Domain
March 10, 2015March 10, 2015

Columbus, OH law firm has filed a motion with the Federal Energy Regulatory Commission (FERC) challenging Energy Transfer Partners’ ET Rover application before FERC. The issue at the heart of the motion is to prevent ET Rover from invoking eminent domain and steamrollering over landowners, building the pipeline without an agreement in place with each individual landowner first. When pipeline companies have the power of eminent domain, they hold all the cards. They can say, “Here’s the offer–take it or leave it–and if you leave it, we’ll build the pipeline through your land anyway at the price we want.” We’ve never been fans of eminent domain for pipelines. Far better for pipeline companies to work it out with landowners and pay them–or reroute it through someone else’s property who will play ball. We acknowledge it’s a thorny issue and not completely black and white. ET Rover is an 830-mile, $4.4 billion pipeline that will flow Marcellus and Utica Shale gas from PA, WV and eastern OH through OH into Michigan and eventually into Canada (see ET Rover Pipeline’s 800-Mile Journey Begins with FERC Filing). The bulk of the pipeline will run diagonally from southeast to northwest across Ohio. Just yesterday we told you about ET Rover’s program to help landowners (see ET Rover Pipeline Hires Land Stewards to Protect the Land in OH). The motion filed with FERC, from what we can tell in reading the press release and the motion itself (embedded below) is not an attempt to stop ET Rover–it’s an attempt to give landowners more negotiating power and leave them firmly in control of whether, and how much, they will accept to allow the pipeline through their property…
Read More “OH Law Firm Asks FERC to Stop ET Rover Pipeline Eminent Domain”