Marcellus Drilling News

Anti-Drilling/Fossil Fuel | Hydraulic Fracturing | Industrywide Issues | Regulation

EDF Endorses Drilling & Fracking Again, Sort Of
May 1, 2014May 1, 2014

Former Mayor of New York City Michael Bloomberg, a very wealthy Democrat who ran as a Republican and then changed to become an Independent, along with the mostly anti-drilling head of the Environmental Defense Fund, Fred Krupp, teamed up to write an op-ed which they sent around to, well, everyone, including MDN. The New York Times picked it up and ran it, so we though we would insert it below. It essentially says regulations so strict they force the breath out of shale drillers is a good thing. So let’s continue to let them drill, as long as they jump through fractals of hoops while they do it.

The piece is noteworthy because the EDF, the “best” of the anti-drilling wacko so-called environmentalist organizations, frequently is criticized by their wacko “green” brethren because they won’t call for an outright ban on all shale drilling. And indeed in this op-ed Krupp endorses shale drilling and fracking–but like we said, as long as it’s regulated so tight it leaves drillers with little profit or incentive…
Read More “EDF Endorses Drilling & Fracking Again, Sort Of”
Best of the Rest

Marcellus & Utica Shale Story Links: Thu, May 1, 2014
May 1, 2014May 1, 2014

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, May 1, 2014”
Energy Companies | Pennsylvania | Range Resources Corp | Statewide PA

Range’s Record-Setting Marcellus Well Nearly Ties Best Utica Well
April 30, 2014April 30, 2014

Yesterday on an their quarterly analyst phone call, Range Resources CEO Jeffrey Ventura announced the company drilled their best-ever well in the “super-rich” portion of the Marcellus Shale in southwestern Pennsylvania during 1Q14. Indeed, it is the best-ever Marcellus well drilled by anyone–not just Range. When we compare the results of Range’s top well with the best well we’ve heard of in the Utica–it nearly ties the top Utica contender, Antero Resource’s Yontz well (see Antero Resources Utica Well Produces Stratospheric 38.9 Mmcf/d). We were not able to locate the name or specific location of the Range well, but what we can tell you is this: It was drilled in SW PA on a pad with two other wells. It had an initial 24-hour rate of 6,357 barrels per day (versus the Yontz well’s 8,879 boe/d), or 38.1 million cubic feet equivalent per day (versus the Yontz well’s 38.9 Mmcfe/d). The Range well has a 7,065 foot lateral length (nearly a mile and a half long) with 36 stages tapping the Marcellus Shale. Truly impressive stuff. Even more impressive–there’s a Utica Shale layer below it and an Upper Devonian layer above it that Range can drill in the future. In other words, Range is just getting started.

Below we have a quote from CEO Jeff Ventura on yesterday’s investor analyst phone call along with the press release Range issued on Monday summarizing first quarter results. We’ve also included the PowerPoint presentation (VERY interesting slides) Range released on Monday…
Read More “Range’s Record-Setting Marcellus Well Nearly Ties Best Utica Well”
Energy Companies | Pennsylvania | Range Resources Corp | Statewide PA

Range CEO & COO Talk Marcellus, Utica & More
April 30, 2014April 30, 2014

Although analyst calls are sometimes dry affairs, MDN found a lot to like in yesterday’s Range Resources analyst call that discussed first quarter 2014 results along with some predictions for where the company is going. The call kicked off with Range CEO Jeffrey Ventura and Range COO and Executive VP Ray Walker. Here’s a portion of the transcript from the call worth reading:
Read More “Range CEO & COO Talk Marcellus, Utica & More”
Belmont County | Energy Companies | Lease & Royalty Payments | Ohio | Rice Energy | Utica Shale

Belmont County Shopping New Deal to Lease Additional 426 Acres
April 30, 2014April 30, 2014

Belmont County, OH commissioners like the $3 million check they just got from Rice Energy for leasing 406 acres of county-owned land (see Belmont County, OH Waiting for $3M Lease Check from Rice Energy). That’s $7,500 per acre for a signing bonus! Commissioners with Belmont like that gas money so much, they’re now looking to lease another 426 acres–at an even higher price. Oy vey!

The announcement about Belmont shopping for another lease deal came at a meeting last week…
Read More “Belmont County Shopping New Deal to Lease Additional 426 Acres”
Crime | Industrywide Issues | Marshall County | Trucking | West Virginia

Moundsville, WV Vigilante Councilman Stops Tractor Trailer
April 30, 2014April 30, 2014

Moundsville (Marshall County), WV Councilman Phil Remke illegally pulled in front of a tractor trailer hauling a backhoe traveling down a street he says the truck was not supposed to be traveling. Remke’s stunt, which endangered himself, the truck, and other motorists, elicited a police response. Remke says big trucks in the area hauling equipment for gas drillers are ruining city streets. Apparently Remke is patrolling on his own to ensure trucks don’t travel prohibited streets–even though he admits the signs prohibiting truck traffic on certain streets are too small and go unnoticed.

Here’s the story of the vigilante councilman in Moundsville…
Read More “Moundsville, WV Vigilante Councilman Stops Tractor Trailer”
Accidents | Energy Services | Industrywide Issues | Marshall County | Pipelines | West Virginia | Williams

Williams Avoids Fine in WV for Marshall County Pipeline Explosion
April 30, 2014April 30, 2014

Should drillers (and pipeline companies) be responsible for damage done from their installations if an accident occurs that’s not really the fault of the driller or pipeline operator? It’s a valid question, and one playing out in West Virginia. On Saturday morning, April 5th, a 12-inch Williams pipeline in Marshall County, WV exploded and burst into flames, resulting in damages to two acres of trees and causing the evacuation of nearby residents (see Williams Pipeline Rupture/Fire in Marshall County, WV). It appears, from all accounts, that a landslide put extreme pressure on the pipeline causing a welding joint to break, resulting in a spark, the explosion, and the fire (see Williams Restores Service on Ruptured WV Pipeline, More Details).

The West Virginia Dept. of Environmental Protection investigated and concluded that since there was no contamination of water supplies, it would not fine Williams for the explosion and fire that destroyed two acres of trees. Should Williams be on the hook anyway? Here’s an article detailing the WV DEP’s reasoning:
Read More “Williams Avoids Fine in WV for Marshall County Pipeline Explosion”
CONSOL Energy | Energy Companies

CONSOL 1Q14: Top Mgmt Changes, Change to Shale Driller Continues
April 30, 2014April 30, 2014

It’s hard to believe, but CONSOL Energy, originally a coal company, is 150 years old. The company was founded when Abe Lincoln was alive. As CONSOL’s current CEO Brett Harvey (retiring in May) says mentioning Abe and the age of CONSOL is relevant “because good assets, with the right strategy, are timeless.” CONSOL issued their first quarter operating and financial report yesterday (see it below). After experiencing a net loss last year at this time, CONSOL’s 1Q14 net income was a healthy $116 million on the black side of the ledger.

In the Marcellus Shale, CONSOL Energy and its joint venture partner drilled 35 wells, completed 23 wells, and had 11 wells turned in line. In the Utica Shale, CONSOL Energy and its joint venture partner drilled 7 wells, completed 3 wells, and had 10 wells turned in line. Below we have an overview of yesterday’s CONSOL 1Q14 report, the report itself, and a portion of an analyst call with top management…
Read More “CONSOL 1Q14: Top Mgmt Changes, Change to Shale Driller Continues”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Jobs | Pennsylvania | Statewide PA

Latest Attack on PA Drillers: Discrimination
April 30, 2014April 30, 2014

Pennsylvania’s Act 13 Marcellus drilling law, passed two years ago and now partially gutted by seven selfish towns (see Act 13 Case Goes Back to Court, Drillers Petition to Join Lawsuit), has a provision that requires PA drillers to provide “maximum practicable contracting opportunities for diverse small businesses,” defined as minority, women, or veteran-owned businesses. Please don’t get us started on reverse discrimination in this country. Just play along for the moment and pretend such silly ideas are good and righteous (when indeed they are not). Fortunately the Act 13 law does not set quotas–but it does require an annual survey to be filled out and returned to the state. Apparently some drillers have not been filing their paperwork (naughty white boys) providing platitudes about how they try to find “diverse small business” to shower with their largess. Voila! A new, instant issue which anti-drillers will use to try and bludgeon to death the miracle of hydraulic fracturing and the economic miracle happening in Pennsylvania.

The hew and cry will go out that drillers are all white, rich men who discriminate against the poor and disadvantaged. Which is, of course, horse manure…
Read More “Latest Attack on PA Drillers: Discrimination”
Energy Services | Ethane | Industrywide Issues | Pennsylvania | Pipelines | Statewide PA | Sunoco Logistics

Attorney Says Sunoco Should Seek FERC Approval for Mariner East
April 30, 2014April 30, 2014

A Pittsburgh attorney, writing in the Pittsburgh Post-Gazette, weighs in on the complex issue of whether or not Sunoco Logistics is a public utility corporation under Pennsylvania’s definition with the right to use eminent domain to force landowners in Washington and Westmoreland counties to allow Sunoco to lay pipeline under their land. The pipeline in question, as we previously wrote about, is the Mariner East ethane pipeline. Sunoco needs to lay 50 miles of pipeline in western PA. Most of the Mariner East pipeline already exists (being repurposed) and stretches from western PA all the way to Philadelphia and the Marcus Hook refinery. Sunoco still needs to build 31 compressor stations along the pipeline’s route as it crosses PA (see More Pushback from PA Residents on Proposed Mariner East Pipeline).

Sunoco is facing a plethora of lawsuits and filings to counter their request to be declared a public utility corporation (not to be confused with being a public utility proper). Pittsburgh attorney William P. Bresnahan II says that Sunoco likely is a public utility based on a definition by the Federal Energy Regulatory Commission (FERC). He hints that if Sunoco plays their cards right–by which he means seeking and getting FERC approval for the Mariner East project–Sunoco will put to rest endless local lawsuits. However, getting FERC’s buy-in is not an easy matter…
Read More “Attorney Says Sunoco Should Seek FERC Approval for Mariner East”
Industrywide Issues | Pennsylvania | Regulation | Seismic Testing | Statewide PA

Anti-Drilling PA Dem Rep. Matzie to Introduce Seismic Testing Law
April 30, 2014April 30, 2014

Anti-drilling Democrat PA Rep. Robert F. Matzie (District 16) is set to introduce new legislation in the Republican-controlled PA House that will make it nearly impossible for seismic testing to take place in the state. He intends to introduce a bill that automatically assumes seismic testing is responsible for damage to property within 1,000 feet of where it happens. If a thumper truck goes down your road, and you want to get that crack fixed that’s been in your basement wall for the past 10 years, here’s your chance. Just claim seismic testing is at fault and send the bill to the testing company. Nuts.

Here’s the rather funny announcement from Matzie saying this legislation is really not anti-drilling, oh no, and that he only wants to protect Pennsylvanians from evil, nasty seismic testing companies…
Read More “Anti-Drilling PA Dem Rep. Matzie to Introduce Seismic Testing Law”
Energy Services | Industrywide Issues | Pipelines | Transco | Williams

More Specifics on Deal for Georgia Pipeline Flowing Marcellus Gas
April 30, 2014April 30, 2014

Two weeks ago MDN told you the good news that Marcellus Shale gas will soon be on its way to Georgia (see Marcellus Gas Heading to Georgia via Transco Pipeline). The Williams Transco pipeline expansion to Georgia is called the Dalton Expansion Project and is already 100% spoken for. In the announcement from two weeks ago we learned that Williams’ partner in the expansion is AGL Resources, a natgas distribution, wholesaler and midstreamer with headquarters in Atlanta, GA. The new pipeline expansion in Georgia will be owned 50/50 by Williams and AGL.

We now have a few more specifics about the AGL/Williams deal, including the fact that AGL is putting up $210 million to help fund the project…
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Best of the Rest

Marcellus & Utica Shale Story Links: Wed, Apr 30, 2014
April 30, 2014April 30, 2014

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, Apr 30, 2014”
BP | Energy Companies | Lease & Royalty Payments | Ohio | Trumbull County | Utica Shale

BP Calls it Quits in the Utica Shale – Total Write-off
April 29, 2014April 29, 2014

A sad day for landowners in Trumbull County, OH. Flashback: In March 2012 BP leased 84,000 acres in Trumbull County, OH from the Associated Landowners of the Ohio Valley (see BP’s Big Utica Shale Deal, Leases 84K Acres in Ohio). Just two years later and what started out with great fanfare is all down the toilet. BP announced today they are pulling out of the Utica Shale and writing it all off. In a very brief mention in a press release issued this morning about first quarter 2014 results, BP says: “Following on from the decision to create a separate BP business around its US lower 48 onshore oil and gas activities, and as a consequence of appraisal results, BP has decided not to proceed with development plans in the Utica shale. The Upstream result includes a write-off relating to the Utica acreage.”

Last November MDN wondered aloud whether BP would decide to move forward, or call it quits (see Decision Point: Will BP Drill Their Utica Acreage? Or Pass?). Now we know. Why leave? As we pointed out at the time, Trumbull County has proven to be mostly dry gas, and not wet gas (or natural gas liquids) which makes it a much less profitable part of the play to drill in. BP rolled the dice and bet wrong. The only other driller in Trumbull has been Halcon Resources. They pulled out too (see Halcon Resources Stops Drilling, Gives Up on the Utica Shale). Is there any hope for future Utica drilling in Trumbull County?…
Read More “BP Calls it Quits in the Utica Shale – Total Write-off”
Boardwalk Pipeline Partners | Energy Services | Industrywide Issues | NGLs | Pipelines | Williams

Williams Stops Work on Bluegrass Pipeline, Boardwalk Says “It’s Not Dead”
April 29, 2014April 29, 2014

Really big news that affects drilling throughout the Marcellus and Utica Shale region: Williams announced yesterday they are suspending work on the Bluegrass Pipeline, a $1.5 billion project that would have piped natural gas liquids (NGLs) from the Utica/Marcellus all the way to Gulf Coast for processing and sale. Looks like we now know who the winner of the “midstream knife fight” is: the Kinder Morgan/MarkWest joint venture UTOPIA pipeline (see “Midstream Knife Fight” – Who Will Have 1st Operational NGL Pipeline to Gulf?). Although Williams says the project is done, their joint venture partner in the Bluegrass, Boardwalk Pipeline Partners, says “it’s not dead.” Really? What does that mean?

Below we have the Williams statement that the Bluegrass is dead, the quote from Boardwalk saying it isn’t dead, and our opinion as to what may have pushed Williams to throw in the towel on this very important project, potentially leaving northeast drillers without options for NGLs…
Read More “Williams Stops Work on Bluegrass Pipeline, Boardwalk Says “It’s Not Dead””
Boardwalk Pipeline Partners | Energy Services | Industrywide Issues | NGLs | Pipelines | Williams

Boardwalk Talks About Bluegrass: That’s My Story and I’m Sticking to It
April 29, 2014April 29, 2014

Yesterday Boardwalk Pipeline Partners held an analyst call to update investors on their first quarter 2014 performance. As we wrote about a few months ago, Boardwalk’s stock fell off a cliff (down 50%) and is just now beginning to inch it’s way back up the cliff (see Serious Concerns about Boardwalk Pipeline Partners Continue). Yesterday’s analyst call coincided with the release of information that both Williams and Boardwalk, together in a joint venture to build the Bluegrass Pipeline, an important northeast to Gulf Coast NGL pipeline, have decided to suspend work on the pipeline. Williams hints that the project is all but dead, but Boardwalk says it isn’t (see our related story today).

We located the transcript of yesterday’s analyst call with Boardwalk and have extracted out all of the places where the Bluegrass was discussed. It’s interesting reading, providing us with a bit more color and context. For us it evokes Collin Raye’s song, “That’s My Story and I’m Sticking to It” as we read the comments by Boardwalk and the press release by Williams. Both partners have obviously decided to script the announcement–both are singing from the same song sheet, as it were. The stated reason they’ve stopped working on the Bluegrass? Not enough customer interest. Which, as we point out in today’s related story, we think is sort of bogus. Here’s what was said yesterday on the Boardwalk call about the Bluegrass suspension…
Read More “Boardwalk Talks About Bluegrass: That’s My Story and I’m Sticking to It”