Marcellus & Utica Shale Story Links: Fri, May 2, 2014
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:
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EQT: We’ll Let Range & Others Figure Out the Utica in SW PA
Last Friday MDN told you that EQT is a bit wary and skeptical of the Utica Shale–at least in Ohio (see EQT Leaving the Utica? Maybe. Guernsey County Wells Disappoint). But what about the Utica in Pennsylvania? EQT CEO David Porges, in a Q&A with reporters yesterday, said the company is watching and waiting when it comes to the Utica in southwestern PA.Porges said “the Utica’s potential is enormous,” but…
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Economic Impact | Electrical Generation | Industrywide Issues | Jobs | Marshall County | Taxation | West Virginia
Complicated Deal for Proposed WV Gas-Powered Electric Plant
Last week MDN told you about the proposed Marcellus gas-powered electrical generating plant proposed for Moundsville, WV (see Marcellus-Powered Electric Plant Coming to Marshall County, WV). To make the plant profitable to run, the owners have proposed a complicated deal whereby the county would end up owning the land and assets and lease them back to the operators (“owners”) thereby reducing what would have been hundreds of millions in property and school taxes to virtually nothing in taxes. For example, the local Moundsville school district would get something like $4 million instead of $181 million over 30 years, under the deal–if it’s approved.
Those numbers may seem out of kilter until you consider this: Currently the property is a contaminated EPA Superfund site with nothing on it–earning the school district and the county nothing in taxes. Zero. Under the deal proposed by Moundsville Power, the school would get $4 million, and the county would receive nearly $40 million in lease payments over the next 30 years. So let’s do the math: $0 or $44 million over the next 30 years, plus an added 30 permanent jobs at the plant and all of the economic stimulation the plant will bring to the local economy with purchases of goods and services. Pretty easy decision if you ask us. Here’s more on the complicated deal to build the power plant in Moundsville…
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U.S. Capital Advisers: PA Marcellus “Gift that Keeps on Giving”
Investment firm U.S. Capital Advisers has just issued their third in a series of resource basin and infrastructure studies. Titled “Appalachia Infrastructure & Marcellus Basin Study Summary” (full copy embedded below), the new study begins this way: “Why Appalachia? It’s the biggest, baddest basin there is when it comes to gas production and the gift that keeps on giving, even in a $4 gas environment.” The study focuses exclusive on the Marcellus in Pennsylvania but the authors promise more studies are coming that will cover the West Virginia Marcellus and Ohio Utica Shale. Can’t wait!
Read on to learn more about pipelines, NGLs, and even which counties showed the most well productivity improvement…
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Allegheny County | Anti-Drilling/Fossil Fuel | Industrywide Issues | Pennsylvania | Washington County
PPG (Incredibly) Supports Discredited Dem Rep. Jesse White
It’s no surprise to MDN that the left-leaning and increasingly anti-drilling Pittsburgh Post-Gazette editorial board published an editorial today supporting PA State Rep. (and Democrat) Jesse White, from Washington County, in a primary set for May 20. You may recall that Jesse himself is strongly anti-drilling, unethical, a fraud and should have been removed from office months ago. White used fake online IDs to attack and smear the reputation of some of his own pro-drilling constituents (see How the Mighty Have Fallen: PA Rep White Admits Guilt, Not Sorry). Incomprehensibly, the PA Democrat Party refused to remove him from office. Profound ethical lapses are nothing new for Dems, so this, apparently, was ho-hum for them. Stretching the bounds of incredulity, White is running once again–for a fifth term. But this time he has a challenger (see PA Rep. White (He of Fake Online IDs) Gets a Primary Challenger). Constituents from White’s district have written to MDN to tell us how hard they are working to get rid of the anti-drilling, unethical White. We endorse their efforts.
We have to ask–who in their right minds would vote for a fraud like White? Do ethics and standards mean nothing anymore? Shame on the editors of the PPG for their endorsement of someone who should have been removed from office months ago…
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Anti-Drilling/Fossil Fuel | Energy Services | Industrywide Issues | Litigation | Pennsylvania | Pipelines | Statewide PA | Sunoco Logistics
PA Reporter Gets Law Firm to Withdraw from Sunoco Pipeline Case
Since we’re tracking the progress of Sunoco Logistics’ Mariner East pipeline, and since this (minor) story has a potential impact on it, we’ll bring it to your attention. On Monday the anti-drilling PBS “reporter” Marie Cusick, who never misses a chance to trash-talk the Marcellus Shale industry, published an article on the reliably anti-drilling StateImpact Pennsylvania website highlighting what theoretically could be considered a conflict of interest for the law firm representing Sunoco Logistics. The law firm of McNees, Wallace and Nurick representing Sunoco Logistics is an associate member of the (hated) Marcellus Shale Coalition and they regularly represent (evil) gas industry companies. However, over the past two years McNees has also been used as outside (not inside, but outside) counsel for the state Public Utility Commission (PUC).
The potential conflict is that the Mariner East case requesting Sunoco Logistics be classified as a public utility corporation with right of eminent domain is right now before the PUC and it is the PUC that will make a decision. Although different attorneys work for Sunoco case than for the PUC, the surface appearance of a conflict still exists (it’s the same law firm)–that we have to admit. A day after the story ran McNees filed paperwork removing themselves from the case. Now Marie can do a happy dance and put a feather in her cap. Atta girl, Marie! Not that it will make one fig of a difference in the end…
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Bloomberg Reporter Takes Aim at Rice Energy, Comes Up Short
A dispassionate, “unbiased” reporterette from Bloomberg, Asjylyn Loder, does everything but swing an ax at Marcellus and Utica Shale driller Rice Energy with a new hit piece that tries to paint Rice as a horrible company to invest in. She takes aim at trying to sink Rice with an article on the Bloomberg wire by saying it’s financially unsound–even though Rice is ultimately backed by billionaire founder Dan Rice. Apparently what set off Ms. Loder was that Rice was able to raise $950 million over three days in April ($150 million more than they were looking for) by floating bonds. What seems to really gall her is that they got the money at a relatively low interest rate. Loder calls them junk bonds and hints Rice will never be able to pay them back.
Nice try Ms. Loder, but no cigar for the anti-drilling lady with the big chip on her shoulder…
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Williams NE Operations Turn a Profit in 1Q14, Continued Build-out
Williams is one of the country’s largest midstream (pipeline) companies–and an important midstream presence in the northeast in both the Marcellus and Utica Shale. Yesterday Williams issued their first quarter 2014 operational and financial update. The Marcellus/Utica rated a couple of prominent mentions in the update, which we’ve extracted for you below.
We also have included Williams’ quarter “data book” below, in essence their 1Q14 analyst PowerPoint slide deck. Lots of interesting slides covering northeast pipelines and processing plants…
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Energy Companies | Energy Services | EQT Corp | Equitrans/EQT Midstream | Greene County (PA) | Industrywide Issues | Pennsylvania | Pipelines | Washington County
EQT Sells Jupiter Pipeline System to Itself for $1.18 Billion
Yesterday Marcellus Shale driller EQT sold it’s Jupiter natural gas gathering pipeline system in Greene and Washington counties (PA) to…itself. Or rather, EQT Corporation has sold the Jupiter system to EQT Midstream Partners LP. Two different companies on paper, but still the same company overall. The deal to itself was for $1.18 billion–$1.12 billion of cash and $59 million of common and general partner units. All of which will keep the accountants busy and happy for a few months.
You may recall this is not the first time EQT has sold something to itself (see EQT Sells Sunrise Pipeline Operation to Itself for $540M). Oh the hoops we jump through to try to make a living under our bizarre tax codes. Here’s the announcement, with some interesting details about the Jupiter gathering system…
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EDF Endorses Drilling & Fracking Again, Sort Of
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…
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Marcellus & Utica Shale Story Links: Thu, May 1, 2014
The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:
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Range’s Record-Setting Marcellus Well Nearly Ties Best Utica Well
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…
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Range CEO & COO Talk Marcellus, Utica & More
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:
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Belmont County Shopping New Deal to Lease Additional 426 Acres
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…
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Moundsville, WV Vigilante Councilman Stops Tractor Trailer
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…
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Accidents | Energy Services | Industrywide Issues | Marshall County | Pipelines | West Virginia | Williams
Williams Avoids Fine in WV for Marshall County Pipeline Explosion
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:
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