Marcellus Drilling News

Industrywide Issues | Lackawanna County | Luzerne County | Pennsylvania | Taxation

Update on Project Using Marcellus $ to Treat PA Acid Mine Water
March 17, 2014March 17, 2014

Late last year MDN brought you the story of how $1 million of Marcellus Shale Act 13 impact fee money (about to dry up thanks to seven PA litigious townships) was awarded as a grant to help fund a project that will clean up one of PA’s biggest ongoing environmental disasters and the single largest source of pollution for the Chesapeake Bay–acid mine drainage from the Old Forge borehole near Scranton, PA (see Specifics on Marcellus $ Helping to Clean Chesapeake Bay Pollution). Susquehanna Mining Solutions plans to build a plant to strip out the minerals from the water that comes from long-abandoned coal mines.

A quick update on the project:
Read More “Update on Project Using Marcellus $ to Treat PA Acid Mine Water”
Anti-Drilling/Fossil Fuel | Hydraulic Fracturing | Industrywide Issues | Regulation

NJ Congressman Wants Permanent Drilling Ban in Dela. River Basin
March 17, 2014March 17, 2014

U.S. Congressman Rush Holt from New Jersey is, by all accounts, a pretty smart guy. He worked as a nuclear physicist and starred on Jeopardy! (going up against the Watson robot) before joining Congress in 1999. Holt is also an anti-drilling Democrat, apparently under the vise grip of far-left environmentalist organizations. He and his far-out enviro pals (including Sierra Clubers) took the opportunity of last week’s announcement of the new incoming head of the Delaware River Basin Commission (see DRBC Selects Steve Tambini as New Leader, Enviro Groups Unsure) to call for a permanent ban on fracking in the Delaware River Basin. Oh, and just for good measure, they also want all new shale drilling in the PA and WV to stop immediately, until “someday”…when Holt and his “smart” friends determine whether or not it’s really safe.

If Holt thinks that 60,000+ safely drilled shale wells is not enough proof, maybe Holt, who is (thankfully) not running again this November, is not so smart after all…
Read More “NJ Congressman Wants Permanent Drilling Ban in Dela. River Basin”
Anti-Drilling/Fossil Fuel | Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Statewide PA

PA Environmental Council Appoints New Leader, Ties to CSSD
March 17, 2014March 17, 2014

The mostly anti-drilling Pennsylvania Environmental Council has a new leader. We say “mostly” in deference to being corrected by the PEC a few years ago when we called them outright anti-drilling (see Pennsylvania Environmental Council Publishes New “Green Lease” Guide). On Friday the PEC named Davitt B. Woodwell to the position of president and chief executive officer, succeeding Paul M. King, who is retiring. The PEC is not dogmatically opposed to Marcellus drilling like many similar organizations in the environmentalist movement. The PEC at least allows there will be some drilling (they’re pragmatic). But make no mistake–they really wish there was no shale drilling in the state. They wouldn’t say that out loud in polite company–but that’s what they think and talk about behind closed doors.

The newly promoted Mr. Woodwell is a participant in the so-far underwhelming Center for Sustainable Shale Development (CSSD)–an uneasy partnership between the shale drilling industry and environmentalists (see CSSD’s Andrew Place Talks About 3-Leg Approaches & Firehoses). Woodwell belongs to the Standards and Evaluation Committee of the CSSD. We’ll keep a close eye on the PEC and Mr. Woodwell for signs of Marcellus trouble-making. Meanwhile, here’s Friday’s announcement and brief bio (with lots of enviro-cred) for Mr. Woodwell:
Read More “PA Environmental Council Appoints New Leader, Ties to CSSD”
Anti-Drilling/Fossil Fuel | Industrywide Issues | Meetings | Statewide VA | Virginia

Anti-Drillers Turn Out in VA to Disrupt Forum on Drilling
March 17, 2014March 17, 2014

Ignorant anti-drillers–typically old hippie retreads and hippie wannabes–seem to derive meaning from their miserable existence by turning up at meetings where drilling will be discussed so they can cause trouble. They don’t listen because their minds are closed. They simply want to be heard. Real communication takes place when there is both a sender and a receiver (Speech 101). Anti-drillers are simply stuck on “sender” mode–they never open up and receive.

A perfect example is a meeting held last week in Virginia. The Virginia Outdoors Foundation (VOF) sponsored a forum in Fredericksburg to look at the issue of whether oil and gas drilling should be allowed on land protected from other development by conservation easements. Shale drilling may soon come to land with easements–easements that otherwise prohibit development but allows drilling–in the Taylorsville Basin, along the eastern/central part of the state around Caroline County, VA (see Fracking Finally on the Way in Virginia? Maybe Yes, Maybe No). The VOF invited Mike Ward, executive director of the Virginia Petroleum Council, to speak and answer questions about potential drilling. In typical fashion, closed-minded anti-drillers turned out to pester Mr. Ward…
Read More “Anti-Drillers Turn Out in VA to Disrupt Forum on Drilling”
About MDN | Calendar

Calendar of Events for Mar 17-30, 2014 [Free]
March 17, 2014March 17, 2014

Below are upcoming events for this week and next.
Read More “Calendar of Events for Mar 17-30, 2014 [Free]”
Best of the Rest

Marcellus & Utica Shale Story Links: Mon, Mar 17, 2014
March 17, 2014March 17, 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: Mon, Mar 17, 2014”
Energy Companies | Shell

Cuts Coming to Shell’s Marcellus Shale Operations
March 14, 2014March 14, 2014

In a statement issued yesterday, and from comments made by Shell’s CEO Ben van Beurden on a “management day” analyst phone call, Shell has signaled they aren’t happy with the return they’re getting from their shale plays in the U.S., including the Marcellus. Specifically Shell has said they plan to decrease spending and investment, and trim operations, in dry gas (methane only) shale areas starting this year. Trim by how much? The statement they issued says 20%, but van Beurden is reported to have said 30% in his statements on the analyst call. In either case, look for Shell to sell some of the their 900,000 acres of Marcellus Shale leases and trim back on the 300 workers they currently have working in the Marcellus play.

It was just four years ago that Shell bought all of East Resources and their Marcellus operations (see East Resources Sells to Royal Dutch Shell for $4.7 Billion, Deal Includes All of East’s Marcellus Shale Operations). Apparently they now believe that was a bit of “irrational exuberance,” to borrow a phrase from Alan Greenspan. The odd thing for us is that much smaller companies, like Cabot Oil & Gas, make money hand over fist in dry gas-only areas of the Marcellus, but the big boys like Shell are hamstrung and don’t make money. Why is that? What gives the smaller players a leg up that simply can’t be matched by companies like Shell?…
Read More “Cuts Coming to Shell’s Marcellus Shale Operations”
Beaver County | Energy Companies | Ethane | Industrywide Issues | Pennsylvania | Processing Plants | Shell

Shell’s Shale Pessimism Signals Worry for Some re PA Cracker
March 14, 2014March 14, 2014

The Shell emotional roller coaster continues to gyrate up and down when it comes to the fate of a multi-billion dollar ethane cracker plant previously announced by Shell for Beaver County, PA. We knew it would be a years-long process just to make a decision, and told you that two years ago almost to the day (see Shell’s Cracker Plant Actually “Years Away”?). Since that time it seemed at one point like all was lost (see Rumor Mill: PA Ethane Cracker Plant on Shell Chopping Block?). Over the past two years we’ve written dozens of stories, at first it seemed like a sure thing, then it wasn’t, then it was again, then it wasn’t again… you get the idea (see our list of Shell cracker stories here).

According to a Morningstar analyst interviewed by the Pittsburgh Post-Gazette, the pendulum has now swung back to the pessimistic side again in light of Shell CEO Ben van Beurden’s comments yesterday knocking U.S. shale (see our companion story today). van Beurden said Shell is triming back on U.S. shale investments this year, “restructuring” those assets (which is CEO talk for selling a good portion of it). Although the ethane cracker will be fed by Marcellus and Utica Shale gas, Shell’s impotence when it comes to turning a profit from shale drilling doesn’t mean they will walk away from a huge petrochemical plant. Such big projects are what they think they’re best at doing. Still, van Beurden’s comments have at least one analyst wondering if the PA cracker plant is now down the list of Shell’s priorities…
Read More “Shell’s Shale Pessimism Signals Worry for Some re PA Cracker”
Chesapeake Energy | Energy Companies | Lease & Royalty Payments | Pennsylvania | Statewide PA

Chesapeake Shafting Landowners out of Royalties Mess Gets Messier
March 14, 2014February 19, 2015

Corporate raider Carl Icahn is likely developing a case of heartburn over his investment in Chesapeake Energy. He’s been responsible for cutting thousands of jobs and selling off billions in assets at Chesapeake, but there is a developing situation he can’t control that will definitely affect his pocketbook. Pennsylvania’s landowners are up in arms over what they perceive to be theft of their royalty payments by Chesapeake Energy. We told you about the recent rally in Bradford County, and about Gov. Corbett and others who invited PA’s anti-drilling Attorney General, Kathleen Kane, to get involved (see Bradford PA Landowner Rally over Chesapeake Royalty Shenanigans). It’s now a royal mess and likely to get messier as time goes on.

The sorta short version of the story is this: A few years ago Chesapeake was hammered by bad press (because the media hates Aubrey McClendon, then CEO). Chessy’s stock tanked and with lots of debt, McClendon couldn’t find any more money to borrow at a reasonable rate. So McClendon invented a clever scheme to re-interpret leases that would allow Chessy to deduct certain pipeline fees from landowner royalties. The expenses would be paid to Access Midstream (spun off from Chesapeake) in return for Access giving Chessy a big, fat pile of cash/investment. The inflated pipeline fees paid to Access–now deducted from royalty checks–would generate enough revenue for Access to recoup their investment in Chessy. It was a clever way of extracting money from landowners by doing it through the intermediary of a pipeline company. At least that’s the theory spun by the anti-drilling ProPublica/Daily Beast. Is it true?…
Read More “Chesapeake Shafting Landowners out of Royalties Mess Gets Messier”
Energy Companies | Rice Energy

Rice Energy Issues First Public Quarterly & Full Year Update
March 14, 2014March 14, 2014

Rice Energy, one of the success stories of a brand new energy company starting up to focus on the Marcellus and Utica Shale region, went public in January (see Rice Energy IPO Soars, Brings in $84M More Than Expected). Along with becoming a publicly traded company comes the responsibility to file quarterly updates with the Securities and Exchange Commission. Rice has done just that. Yesterday they released their fourth quarter and full year 2013 operational and financial update, for the first time. What did it show?

It shows that Rice’s natural gas production in 4Q13 was up 120% over 4Q12 (154 million cubic feet per day average, or MMcf/d), and up 20% over 3Q13. They certainly expect their daily volume to grow–a lot. The company has pipeline agreements in place for up to 330 MMcf/d in 2014, up to 654 MMcf/d in 2015 and up to 761 MMcf/d in 2016. As of Dec. 31, Rice owns 43,351 net acres in the Marcellus and 46,488 net acres in the Utica Shale with a big budget to buy more this year. That’s the good news. However, there was a small (very small) spot of “bad” news…
Read More “Rice Energy Issues First Public Quarterly & Full Year Update”
Energy Companies | Gastar Exploration | Marshall County | Utica Shale | West Virginia | Wetzel County

Gastar Update: First Utica Well Coming in April, Marcellus Grows
March 14, 2014March 14, 2014

Gastar Exploration released their fourth quarter and full year 2013 report yesterday. Gastar drills in both the northeast (Marcellus) and the Mid-Continent shale play areas in the U.S. What do we learn about Gastar’s recent history and plans going forward in our neck of the woods? First, the update says that Gastar plans to drill their very first Utica Shale well in April. Gastar says they believe there is drillable Utica acreage under their leased land in Wetzel and Marshall counties in West Virginia–and they plan to take full advantage of it starting this year.

We also learn that the company’s Marcellus Shale production increased by 37% year over year. In Q412 Gastar produced 29.9 million cubic feet per day of natural gas, and in Q413 it was 41.0 MMcf/d. Which is tiny when compared to the 1 Bcf/d being produced by several Marcellus producers. But still, the numbers are going in the right direction. Here’s a small portion of yesterday’s update that deals with the Utica and Marcellus…
Read More “Gastar Update: First Utica Well Coming in April, Marcellus Grows”
Energy Services | Industrywide Issues | Pipelines | TC Energy/TransCanada

TransCanada’s ANR Pipeline to Reverse & Carry Marcellus Gas South
March 14, 2014March 14, 2014

This week TransCanada’s ANR Pipeline announced an open season to gauge interest on carrying plain old natural gas from the Marcellus and Utica Shale region all the way to the Gulf Coast. The plan is to reverse the flow of the ANR Pipeline that stretches from Indiana to the Gulf, and get the gas to Indiana by using the ANR Lebanon Lateral, a pipeline that goes from Lenanon, OH to the mainline ANR in Indiana. TransCanada is offering up to 600,000 dekatherms per day (Dth/d).

Here’s the story from NGI’s excellent Shale Daily publication:
Read More “TransCanada’s ANR Pipeline to Reverse & Carry Marcellus Gas South”
Health Impacts | Industrywide Issues | Ohio County | West Virginia

Hocus Pocus Drilling Impacts Health Survey in Wheeling, WV
March 14, 2014March 14, 2014

We spotted a mention that the Wheeling-Ohio County (WV) Health Department has launched a so-called health survey to measure the impacts of Marcellus Shale drilling on area residents. So we took a peek–and we were unimpressed. Survey respondents are asked to self-report (no verification) how they “feel” about their current aches and pains–essentially the common ailments everyone faces no matter where they live. Then they’re asked precisely two questions (that we can determine) that *may* be related to gas drilling: “Have you noticed any changes in road conditions in your region since 2010?” and “Do you work in the gas industry?”

We’re guessing this is the kind of survey where they try to assign blame for headaches, etc. on gas drilling based on your address or occupation. If the people living (or working) within 5 miles of drill site have a statistical 2% increase in headaches, voilà–it was gas drilling that caused it. Which of course is not science at. It’s statistical hocus pocus that proves nothing. It’s all self-reported for goodness sake! How long will this “survey” be live? Oh, a few years, until they can “prove” drilling is causing problems…
Read More “Hocus Pocus Drilling Impacts Health Survey in Wheeling, WV”
Pennsylvania | Statewide PA

PA Gov Corbett Blocks Promotion of Moonlighter at Game Commission
March 14, 2014March 14, 2014

Last August MDN told you about the moonlighting PA Game Commission employee, William A. Capouillez, the director of the Bureau of Wildlife Habitat Management at the Game Commission (see PA Director of Game Commission Double-Dipping with Gas Leases?). Capouillez’s day job is to oversee leasing 1.4 million acres of public game lands for oil and gas drilling. But in his off hours he negotiates leases for oil and gas drilling for private landowners–sort of an “on the side” landman. When it all came to light in the *Philly Inquirer* last year, it prompted an ethics investigation (see PA Game Comm. Head Not Afraid of Gas Leasing Ethics Investigation).

How’s the investigation going? No one will say. However, the PA Game Commission is considering promoting Capouillez to the top job of executive director. PA Gov. Tom Corbett (Republican) isn’t impressed. In fact, he’s sent a warning shot across the bow of the independent 8-member board of the Commission, saying he will actively work to block the promotion…
Read More “PA Gov Corbett Blocks Promotion of Moonlighter at Game Commission”
Best of the Rest

Marcellus & Utica Shale Story Links: Thu, Mar 13, 2014
March 14, 2014March 14, 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, Mar 13, 2014”
Earthquakes | Energy Companies | Hilcorp Energy | Hydraulic Fracturing | Industrywide Issues | Mahoning County | Ohio

# of Youngstown Earthquakes go from 2 to 11 – Fracking to Blame?
March 13, 2014March 13, 2014

Two days ago MDN told you about a pair of earthquakes near Youngstown, OH (see 2 New Earthquakes Near Youngstown, OH – Fracking Connection?). That number has now grown. So far there have been a total of 11 measurable earthquakes ranging from 1.2 (not felt by humans) to 3.0 (barely felt by some humans). We suspect most people around Mahoning County didn’t feel anything, but that doesn’t stop mass hysteria when it’s announced that there have been a series of earthquakes and the only thing (supposedly) going on in the area is drilling and fracking.

As we previously pointed out, we are aware of one instance–in England–where fracking over an active fault caused an earthquake. So it can happen. But that’s one time out of 60,000+ horizontally, hydraulically fractured shale wells worldwide (maybe more than that now). Statistically it’s zero. We need to keep perspective in this situation. Initially the Ohio Dept. of Natural Resources (ODNR) said there are no active Class II injection wells in the area pumping waste fluids deep below the surface for disposal, and so the well being drilled and fracked by Hilcorp near the epicenter of the quake looks like the prime candidate as the cause. But one news story we’ve read (below) seems to cast doubt. There may be injection wells, which also have been known to cause earthquakes when injecting near a fault, operating in the area…
Read More “# of Youngstown Earthquakes go from 2 to 11 – Fracking to Blame?”