Marcellus Drilling News

Blue Racer Midstream | Dominion Energy | Energy Services | Industrywide Issues | Ohio | Pipelines | Statewide OH

Dominion Says Their Pipelines Gather 80% of All Ohio Natural Gas
May 13, 2015May 13, 2015

The Guernsey County Energy Coalition heard from utility and midstream giant Dominion last week at their regular meeting in Cambridge, OH. Mack Smith Jr., Dominion’s manager of commercial gas services, had some fascinating things to say. One of them was this: “Dominion gathers about 80 percent of all Ohio gas and interconnects with seven major pipelines to distribute gas to markets, and to sell storage services to marketers and end users.” Did you know that Dominion gathers 80% of all Ohio natural gas? We sure didn’t! Here’s some more pickings from what Smith said last Thursday…
Read More “Dominion Says Their Pipelines Gather 80% of All Ohio Natural Gas”
CONE Midstream | CONSOL Energy | Energy Companies | Energy Services | Noble Energy

CONE Midstream Looking to Add Customers Beyond CONSOL & Noble
May 13, 2015May 13, 2015

In August 2014, CONSOL Energy and Noble Energy formed a midstream joint venture called CONE Midstream to connect their Marcellus and Utica wells (see CONSOL & Noble Energy Form New Marcellus Midstream Company). By February of this year, CONE had already flown by the 500 million cubic feet per day of of throughput (see CONE Midstream’s Strong Beginning, Hits 500 Mmcf/d 6 Mos Early). CONE issued their first quarter 2015 update on Monday. Management also held an earnings call and on that call upper management stated they are now looking to open up their pipelines to flow gas for other companies. CONE CEO John Lewis said so far CONE has two customers: CONSOL Energy and Noble Energy. Lewis said they’re looking at taking on new customers as well as looking at possibly buying other pipelines already in place to add to their network…
Read More “CONE Midstream Looking to Add Customers Beyond CONSOL & Noble”
Air Quality | Energy Companies | Energy Services | Industrywide Issues | Litigation | Lycoming County | National Fuel | Pennsylvania | Regulation | Seneca Resources

PA DEP Loses its ‘Common Sense’ in Seneca Air Pollution Ruling
May 13, 2015May 13, 2015

Every now and again the legal definition of “adjacent” and “contiguous” pops up in lawsuits in Pennsylvania related to natural gas drilling. Two years ago we highlighted the issue (see Should PA Compressor Plants Miles Away be Considered “Adjacent”?). The argument revolves around lumping together several potential air pollution sources, like compressor plants and even well pads and pipelines–into one, common, larger source of air pollution for the purposes of regulation. Smaller sources are regulated by the PA Dept. of Environmental Protection (DEP) and larger sources, over a certain threshold, by the federal Environmental Protection Agency (EPA), with much stricter and more expensive standards. The PA DEP, for whatever reason, has gone after Seneca Resources and its parent company National Fuel Gas Co. for their operations in Lycoming County, PA. Even though Seneca’s well pads, pipelines and compressor stations are miles apart, because they are all owned by one corporate entity, the DEP wants them all lumped together into one source for pollution regulation. Although the combined single source would not trigger EPA regulation, Seneca/National Fuel Gas is suing the DEP to push back, on principle. The case will get a hearing in court this week…
Read More “PA DEP Loses its ‘Common Sense’ in Seneca Air Pollution Ruling”
Anti-Drilling/Fossil Fuel | Hydraulic Fracturing | Industrywide Issues | Regulation | Statewide VA | Virginia

VA Newspaper Takes AG to Task for Decision Allowing Fracking Bans
May 13, 2015May 13, 2015

Earlier this week MDN told you about Virginia’s far-left Democrat Attorney General Mark Herring giving local municipalities the “right” to regulate and ban fracking (see Virginia AG Says Localities Can “Regulate” & “Prohibit”). What we didn’t know is that Herring’s “opinion” which is taken as law completely contradicts and undoes an opinion issued by his Republican predecessor, Ken Cuccinelli, who wrote that while municipalities can limit drilling to areas zoned for it, they can’t outright ban it. Herring, bowing to pressure from the kook fringe of his party, aims to change it. What gives us comfort is that we’re not the only ones to notice that Herring has stepped WAY over the line on this. None other than the editorial writers for the Norfolk Virginian-Pilot wrote an editorial yesterday that calls Herring to task for his recent overreach opinion on fracking…
Read More “VA Newspaper Takes AG to Task for Decision Allowing Fracking Bans”
Best of the Rest

Marcellus & Utica Shale Story Links: Wed, May 13, 2015
May 13, 2015May 13, 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, May 13, 2015”
Energy Companies | Energy Services | EV Energy Partners | GASFRAC | Hydraulic Fracturing | Industrywide Issues | Ohio | Tuscarawas County

EVEP Reports Waterless Fracked OH Well is a Bust
May 12, 2015May 12, 2015

Reading through earnings calls transcripts (hey, somebody has to do it), we discovered what we believe no one else has (yet) discovered or reported. On an earnings call yesterday, top management from EV Energy Partners, one of the largest acreage holders in the Utica Shale, shared interesting initial results from the test Utica well they drilled in Tuscarawas County, OH–a well drilled using waterless fracking technology from GASFRAC (see Details on GASFRAC’s Waterless Frack Test in OH Utica). The theory being tested by EVEP is that using water during fracking of a well targeted for oil recovery somehow damages the chances of oil recovery. GASFRAC used a mix of 75% butane and 25% mineral oil to frack EVEP’s “Nettles” well. The results? On yesterday’s earnings call EVEP Chairman John Walker revealed that after 90 days in production, the Nettles well is producing about half the production of a similar nearby well fracked using water. That is–the waterless frack job was a big disappointment…
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Blue Ridge Mtn Res/Magnum Hunter | Energy Companies | Utica Shale

Magnum Hunter’s 5-Point Plan to Raise Cash in 2015
May 12, 2015May 12, 2015

Yesterday MDN reported on Magnum Hunter Resources’ (MHR) first quarter 2015 update yesterday (see Magnum Hunter 1Q15: Prod. Up 66%, Financials Worse Than Expected). Something slipped by our notice–the section in the update that we call “Magnum Hunter’s 5-Point Plan to Raise Cash in 2015.” Buried in the update is a section called “2015 Liquidity Events” that outlines MHR’s strategy for raising money and keeping afloat in 2015. Below we show you what MHR said, and then we break it down and tell you what it means–we interpret what they said. The standout point (#5) is MHR’s plan to sell of $450 million worth of Utica Shale acreage…
Read More “Magnum Hunter’s 5-Point Plan to Raise Cash in 2015”
Industrywide Issues | Research

EIA DPR May 2015: Shale Production Slips, But Not in Marc/Utica
May 12, 2015May 12, 2015

Our favorite government agency, the U.S. Energy Information Administration (EIA), released our favorite government report, the Drilling Productivity Report, yesterday. There is important news to report from the DPR. First, the total amount of natural gas produced across all of the seven major commercial shale plays tracked in the DPR slide backward for the second month in a row. Last month, you may recall, was the very first time in the modern shale era when production month to month was not higher than the month before (see First Time Ever: US Shale Produces Less Oil/Gas Month Over Month). That trend continued this month (forecasting for volumes in June). Last month the total volume reduced by 23 million cubic feet per day (Mmcf/d) than the month before. This month? It goes down 112 Mmcf/d. That is, the shrinkage in production is accelerating. Except in two plays. Can you guess which two shale plays are still in positive territory–producing more shale gas this month than last month, hitting new all-time highs? That’s right–the Marcellus and Utica. All other shale plays produced less natural gas this month than last with the exception of the Marcellus, hitting a new high of 16,737 Mmcf/d (or put another way, 16.737 billion cubic feet), and the Utica, hitting a new high of 2,509 Mmcf/d (2.509 Bcf/d)…
Read More “EIA DPR May 2015: Shale Production Slips, But Not in Marc/Utica”
Butler County | Energy Companies | Industrywide Issues | Pennsylvania | Processing Plants | Regulation | XTO

XTO Files Paperwork to Double Size of NGL Plant in W PA
May 12, 2015May 12, 2015

In 2013 XTO Energy began operation at its very own natural gas liquids (NGL) cryogenic processing facility in Butler County, PA (see XTO’s New NGL Recovery Plant in Butler County, PA Now Online). Life is good in the midstream. According to the Pittsburgh Business Times, XTO has just filed paperwork with the state to build a new plant at the site, doubling capacity at the facility…
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Industrywide Issues | Pennsylvania | Research | Statewide PA | Wastewater

USGS Research – Marcellus Wastewater from 13 PA Wells Tested
May 12, 2015May 12, 2015

The U.S. Geological Survey (USGS) has just published a new research paper on the topic of produced water–the water that comes out of a drilled hole, drilled for an oil or gas well. The paper, titled “Organic and inorganic composition and microbiology of produced waters from Pennsylvania shale gas wells” was published in the journal Applied Geochemistry and looked at produced water samples from Pennsylvania Marcellus Shale wells. The weakness in the research is that it is based on water samples from only 13 wells. Quite frankly, the research (which we think pursues a worthwhile line of inquiry) raises more questions than it answers. What can we divine from this study? In our cursory review, it appears two things stand out: (1) Although the inorganic chemistry of the produced water was pretty consistent across all 13 wells, there were big differences in the organic geochemistry and microbiology (bacteria) from well to well; and (2) volatile organic compounds (VOCs) were found in only a few samples–just 4 of the 13 wells…
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Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | Kinder Morgan | Pipelines | Tennessee Gas Pipeline

Lunacy: NH Group Votes Against Pipeline Because of Global Warming
May 12, 2015May 12, 2015

It’s maddening. It makes one want to scream, “You idiots! Can’t you see the utter hypocrisy?” But it happens more than we’d like to admit. A group of “volunteers” who advise the Select Board in the New Hampshire community of Wilton have unanimously voted to oppose Kinder Morgan’s proposed expansion of the Tennessee Gas Pipeline that would run through Hillsborough County. The reason they oppose it? Natural gas is not a “renewable” energy source. They don’t oppose it because pipelines are unsafe or in any way threaten the environment. Nope. They oppose it because they cling to the belief that mankind is causing catastrophic global warming by using fossil fuels. Meanwhile, everything in their lives is made possible by the very fossil fuels they profess to loathe. And they don’t see it–don’t understand it–don’t seem to comprehend it. We want to point out that, in their own words, they voted against support for the pipeline because they are prejudiced against fossil fuel energy and they seek to deny everyone else the option of using it…
Read More “Lunacy: NH Group Votes Against Pipeline Because of Global Warming”
Industrywide Issues | Research

The #1 Factor in Earth’s Temps/Weather (Hint: It’s Not Mankind)
May 12, 2015May 12, 2015

Do you know what the single biggest factor is that governs earth’s weather and temperatures across the globe? If you guessed burning fossil fuels and the amount of carbon in the atmosphere–you would be dead wrong. The single biggest factor affecting our climate has nothing to do with mankind–it is the sun. You know, that bright yellow thing in the sky? The sun heats the earth, and when the sun has sunspots–or radiation storms–that activity causes temps on ole Mom Earth to spike up. What happens when there is an absence of sunspots? What has happened over the past 20 years that there have been fewer and fewer sunspots–the earth stops getting warmer and begins to cool. Nearly all of the opposition to natural gas drilling and pipelines comes from people with an irrational hatred of fossil fuels–people who believe we’re about to fry because of “global warming.” That’s what drives opposition to good, wholesome, beneficial use of fossil fuels. So every now and again we highlight stories on so-called climate change–because that’s at the root of why most people oppose natural gas. Paul Driessen, author of the book “Eco-Imperialism: Green Power – Black Death” and Senior Policy Analyst with the Committee For A Constructive Tomorrow has written a top shelf article on the always excellent Natural Gas Now website. We think this article does a great job of explaining why the earth warms and cools–in cycles. So we’re bringing you his article here in total…
Read More “The #1 Factor in Earth’s Temps/Weather (Hint: It’s Not Mankind)”
Best of the Rest

Marcellus & Utica Shale Story Links: Tue, May 12, 2015
May 12, 2015May 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: Tue, May 12, 2015”
Belmont County | Energy Companies | Greene County (PA) | Ohio | Pennsylvania | Rice Energy | Washington County

Rice Energy 1Q15 Earnings Call: 100% Focused on 3 Counties
May 11, 2015May 11, 2015

Last Friday MDN brought you the Rice Energy first quarter 2015 update (see Rice Energy Doubles Production 1Q15; Utica Flows; Ekes Out a Profit). On Friday, Rice’s upper management held an earnings call with analysts and as always, quite a bit more comes out in the call than in the official press release. Below is Rice Energy CEO Dan Rice’s prepared remarks on that call with some interesting details on both their Marcellus and Utica operations. Among the interesting comments: Rice is 100% focused on just three counties in the Marcellus/Utica…
Read More “Rice Energy 1Q15 Earnings Call: 100% Focused on 3 Counties”
Butler County | Carroll County | Energy Companies | Lawrence County | Ohio | Pennsylvania | Rex Energy

Rex Energy to Sell Acreage in OH & PA, Focus on 3 Counties
May 11, 2015May 11, 2015

Last week MDN brought you the first quarter 2015 update for State College, PA-based Rex Energy (see Rex Energy 1Q15: Production Up 61%, Revenue Down 33%, Gulf Coast Deal). Rex’s management held an earnings call later that day, and as is typical, a some important news was revealed on that call that was not included in the press release update. Namely, Rex is looking to sell it’s leased Utica Shale property in Belmont, Guernsey and Noble counties in Ohio. They also plan to sell leases in Westmoreland, Clearfield, and Centre counties in PA. When it’s all over and done, Rex will be concentrating on just three counties…
Read More “Rex Energy to Sell Acreage in OH & PA, Focus on 3 Counties”
American Energy Partners | Belmont County | Energy Companies | Lease & Royalty Payments | Ohio | XTO

Another Belmont County Landowner Threatened with Forced Pooling
May 11, 2015May 11, 2015

In April MDN told you about a landowner in Belmont County, OH who had questions and objections to phrasing in a proposed lease agreement from XTO Energy that talks about “nuisance oil” (see XTO Threatens Belmont County, OH Landowner with Forced Pooling). NEVER sign a lease without running it by a competent oil & gas attorney, and ALWAYS get the sometimes obscure terminology in a lease explained before you sign it. That’s our advice. We have another story along the same lines as the “nuisance oil” story–language that energy companies can’t or won’t explain to landowners. This one also comes from Belmont County, OH–perhaps the hottest of the hot places for drilling right now in the Utica Shale. A landowner from Martins Ferry, OH says XTO offered him an eye-popping $8,000 per acre signing bonus with 20% royalties, and Aubrey McClendon’s American Energy Partners offered $6,000 per acre with 20% royalties. Both have a “market enhancement clause” in the lease. The landowner didn’t like the clause, fearing it would reduce his royalties. The landowner was told by either XTO or AEP or both (we’re not sure), that they would force pool him if he didn’t sign. By force pooling him he would not get a signing bonus at all and only a 12.5% royalty. These kinds of strong-arm tactics give the industry a black eye in our opinion…
Read More “Another Belmont County Landowner Threatened with Forced Pooling”