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    Rice Energy Picks Up Pipelines in SWPA in Deal with M3 for $110M

    Rice Energy, one of our favorite newer drilling companies, announced yesterday they’ve put some of that IPO money to good use (see Rice Energy IPO Soars, Brings in $84M More Than Expected). Rice has purchased a 28-mile pipeline gathering system already up and running in Washington County, PA from M3 Midstream for $110 million cash on the barrel head. The deal also includes rights of way to build more gathering pipelines in both Washington and Greene counties. Rice Energy owns leases and is conducting active drilling in both counties.

    The Marcellus and Utica Shale Databook, Vol. 3 (just out) shows Rice with 28 unique well location permits in Washington County, PA for the last four months of 2013, and 9 unique well location permits in Greene County (via Alpha Shale Resources, which Rice recently picked up in a deal with Alpha Natural Resources). Makes perfect sense Rice would want to buy the pipelines that connect to their wells and get a piece of the midstream action in the white hot Marcellus region of SWPA. Here’s yesterday’s announcement:
    Read More “Rice Energy Picks Up Pipelines in SWPA in Deal with M3 for $110M”

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    Update: Chevron Well Fire in Greene County Still Burning

    Yesterday MDN told you of the explosion and well fire at Chevron’s Lanco 7H well pad, in a remote area of Greene County, PA, northwest of Bobtown. The explosion/fire began around 6:45 am Tuesday (see Explosion & Fire at Chevron Well in SWPA – 1 Person Missing). The update is that the fire still burns–out of control–although it hasn’t spread to several other wells on the same well pad, yet. The specialists brought in to put the fire out, a company called Wild Well Control, are evaluating and planning and apparently getting ready to go into action. The one missing contract worker, which we have learned is from Cameron International, a Fortune 500 company that specializes in completing wells (flow control), is still missing.

    Below are a few more select bits of information along with the four updates provided thus far from Chevron itself about the accident:
    Read More “Update: Chevron Well Fire in Greene County Still Burning”

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    JLCNY Prepares to File Lawsuit Against Gov. Cuomo Tomorrow

    The Joint Landowners Coalition of New York, a 70,000-member strong confederation of landowners who want to move forward with shale drilling, is slated to file an Article 78 lawsuit tomorrow against Gov. Andrew Cuomo, Dept. of Environmental Conservation Commissioner Joe Martens, and State Health Commissioner Nirav Shah. As MDN previously explained, an Article 78 essentially forces recalcitrant (and perhaps inept) elected officials to perform their sworn duties (see JLCNY Lawsuit Imminent – But Not the One You Thought).

    The JLCNY is being given an assist with their lawsuit by the Mountain States Legal Foundation. Just two weeks ago the JLCNY put out the call to raise another $18,000 for legal expenses, and by golly, they got it…
    Read More “JLCNY Prepares to File Lawsuit Against Gov. Cuomo Tomorrow”

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    Q-Poll Shows NYers Think Cuomo is Foot-Dragging on Fracking Issue

    foot draggingThe latest statewide Quinnipiac University poll of New York residents finds a majority of NYers believe Cuomo is indecisive–that is, he’s intentionally dragging his feet on making a decision about whether or not to allow shale drilling in the state. A smaller percent still buy his line about “carefully evaluating” the situation. Translation: There are 32% of us living in NY (who don’t smoke pot) who know that nearly 6 years is long enough for a decision to be made. We can see through the transparently pathetic attempt at stalling for political purposes. Some 23% think Andy’s jest bein’ xtra careful (that’s the hippie greenies). Then there’s the 42% who don’t have an opinion either way–yet. Our best hope is to swing those people to the truth side of the debate.

    Here’s the latest Q-poll results on the topic of shale drilling in NY:
    Read More “Q-Poll Shows NYers Think Cuomo is Foot-Dragging on Fracking Issue”

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    Marcellus Gas to the Rescue: WNY Customers Avoid Step Price Jump

    National Fuel Gas Company is a large, integrated energy company with its HQ in Buffalo, NY. They have operations spanning from upstream (Seneca Resources, a major Marcellus Shale driller) to midstream pipelines to a downstream utility company serving customers in western New York State and northwestern Pennsylvania. A story from the NFG utility company caught our eye today. NFG is putting the word out to its hundreds of thousands of customers that they might want to consider hopping on the budget plan–to spread out their winter heating bill payments. Why are NFG’s customers paying a lot more this winter to heat with natural gas? Simply because this is one of the longest and coldest winters we’ve had in decades.

    The interesting part of the NFG “you ought to get on the budget plan” story is that, according to the company, it could have been a lot worse than it is. The price of NFG’s natural gas is steady and has not gone up. What’s helping to save western NY (and NWPA) gas customers from huge price spikes being experienced elsewhere? PA Marcellus Shale gas…
    Read More “Marcellus Gas to the Rescue: WNY Customers Avoid Step Price Jump”

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    New England Pipeline May Reverse Flow & Pump Marcellus Gas

    If there’s a silver lining to the misery of this long, cold, hard winter, it’s that the energy shortage this winter has precipitated an attitude change in New England–a place with a dearth of natural gas even though there’s plenty to be had. Gone are the snotty, haughty attitudes of anti-fracking New Englanders that they don’t want any of that filthy, nasty, fracked natural gas. Not only do they now want it, they can’t get it fast enough because of price spikes up to 10 times the norm. That’ll grab your attention. Maybe fracking ain’t so bad after all, eh?

    The latest about face comes from the State of Maine. They need more natural gas and they need it bad. There’s a pipeline that comes down from Nova Scotia into Maine that’s supposed to carry natural gas produced offshore. Problem is, the offshore wells aren’t producing all that much and the pipeline isn’t delivering all that much. So there’s now talk that Spectra Energy, owner of the Maritimes and Northeast Pipeline, is willing to reverse the flow (which takes equipment and time) so that the pipeline will be bi-directional and can begin to carry cheap Marcellus Shale gas from PA up into Maine. We’re trying not to dance up and down and yell “Love it! Told’ya so!” Well, maybe just a little jig…
    Read More “New England Pipeline May Reverse Flow & Pump Marcellus Gas”

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    Anti-Drilling Site Daily Kos Runs Keystone Pipeline Ad [Screen Shot]

    Our daily trawl of the news takes us far and wide. Every day MDN editor Jim Willis wades through the mental equivalent of manure up to his neck–so you don’t have to. Sometimes it takes him to the far-out, left of Korean dictator Kim Jong-Un website, The Daily Kos. If an article appears on Daily Kos, you know it’s a) false, b) wacko, and c) anti-drilling. We usually skip on by such articles in an effort to control our blood pressure.

    But what’s this? It seems Daily Kos has no problems running ads for evil “big oil & gas” companies. We thought it funny when we started to read yet another rant on Kos and spotted an ad from TransCanada for the Keystone Pipeline, right there on the Kos website (see it below). We guess Kos has no problem making money from those nasty, horrible “big oil” companies they love to rail against so much…
    Read More “Anti-Drilling Site Daily Kos Runs Keystone Pipeline Ad [Screen Shot]”

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    Explosion & Fire at Chevron Well in SWPA – 1 Person Missing

    Chevron Well FireThere was an explosion and fire at a Chevron Marcellus shale well in Greene County, PA early yesterday morning. The explosion happened about 6:45 am at Chevron’s Lanco 7H well pad, in a remote area northwest of Bobtown. One person was treated for “minor injuries” and released. However, the sad news is another person is missing. Since the fire is still burning and hot, no one can get close enough to search for the missing worker, so we sadly assume the worst. Our prayers and thoughts go to the families involved.

    Chevron has flown in a disaster team from Wild Well Control (Houston, TX) to get the fire extinguished, but it will take at least “several days” before the fire is out. Below we have the information we’re able to find concerning the explosion and fire–why it happened–along with some perspective on the level of danger workers face working in the shale drilling industry, plus we make some connections and provide background you won’t find anywhere else but here, on MDN…
    Read More “Explosion & Fire at Chevron Well in SWPA – 1 Person Missing”

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    Boardwalk’s Stock Drops Like a Rock – Trouble in Midstreamland?

    Boardwalk Pipeline Partners, a Houston-based midstream company, suffered a massive stock drop on Monday (down over 40% in one day) after announcing a big drop in revenue and earnings and lowering cash distribution some 81%. Boardwalk’s stock recovered slightly yesterday–something traders refer to pejoratively as a “dead cat bounce”–meaning when something drops so far from such a height, when it hits bottom it’s likely to bounce at least a little. Ouch. To date, Boardwalk has no presence with its pipelines and other operations in the northeastern Marcellus/Utica region–so why is it news here?

    Number one, much of the reason for Boardwalk’s woes is precisely because they don’t have infrastructure in the northeast, an area white hot with activity. Number two, because Boardwalk, partnering with Williams, is trying to establish a presence in the northeast by building the Bluegrass mixed NGL pipeline from the Marcellus/Utica to the Gulf Coast. And Boardwalk/Williams is in a horse race with Kinder Morgan/MarkWest to see who builds their pipeline first (see “Midstream Knife Fight” – Who Will Have 1st Operational NGL Pipeline to Gulf?). Will Boardwalk’s stock drop affect Bluegrass plans? And, as one analyst asks, will Boardwalk’s stock drop bleed over and affect similar midstream companies?…
    Read More “Boardwalk’s Stock Drops Like a Rock – Trouble in Midstreamland?”

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    NY Senate Bill Forces Cuomo DEC to Authorize New Propane Storage

    MDN has long chronicled the struggle for Inergy (now a part of Crestwood Midstream) to turn a depleted salt cavern along Seneca Lake, NY into a critically important underground propane storage facility–the only such new facility planned for the northeast. We’ve also told you about nutty protesters, like so-called “distinguished scholar in residence” at Ithaca College, Sandra Steingraber, who was arrested for blocking the entrance to the facility last year (see NY Protesters Arrested for Blocking NatGas Storage Facility). We even told you which businesses you should consider boycotting for their agitation against the facility (see Inergy: Boycott NY Businesses that Support ‘Gas Free Seneca’). One of the businesses in the list stands out: Pompous Ass Winery, run by…well, you can imagine.

    As MDN noted not long ago, the delay in allowing Inergy/Crestwood to begin using the facility to store propane is partially to blame for why northeasterners are now paying propane rates out the nose (see Northeast Propane Shortage – Andrew Cuomo Partially to Blame). Enough dithering by Can’t-Make-a-Decision Cuomo. NY State Senate Energy Committee Chairman George Maziarz, R-Lockport, has introduced a bill that requires the recalcitrant state Dept. of Environmental Conservation to get off the pot and permit the facility…
    Read More “NY Senate Bill Forces Cuomo DEC to Authorize New Propane Storage”

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    Marietta Residents Generally in Favor of Leasing City-Owned Land

    Seems to us, from an informal survey around town, that most residents of Marietta, OH are in favor of the city leasing 35 acres of municipal property to Protege Energy for the offered $4,750 per acre signing bonus and 17.5% royalty on any gas produced.

    A sampling of reaction “around town”…
    Read More “Marietta Residents Generally in Favor of Leasing City-Owned Land”

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    Chesapeake, Atlas Try Forced Pooling in Columbiana County, OH

    Forced pooling, or as it’s called in Ohio, “unitization”–it’s something we understand, but we don’t like it. Chesapeake Energy and Atlas Noble have filed petitions seeking forced pooling for property owned by a number of landowners in Columbiana County, OH. Some of those petitions have been approved by the Ohio Dept. of Natural Resources (ODNR). Some are still pending.

    The industry and landowners who have leased will argue it’s not fair that one or two hold-outs who won’t lease can scuttle a deal to drill and therefore should be forced to lease if they can’t come to reasonable terms. Landowners who don’t want to lease say it’s their land and drillers can figure out how to drill around them–I don’t say you can’t drill, and you don’t say I have to drill under my land. We favor the later position, to the consternation of our friends in the shale drilling industry. We say, make it worth their while–give them an offer they can’t refuse. Here’s some of the details on the forced pooling being sought by Chessy and Atlas in eastern OH:
    Read More “Chesapeake, Atlas Try Forced Pooling in Columbiana County, OH”

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    Chesapeake’s Lawler Says Utica is a “Huge Liquid Lever” for Them

    Last week Chesapeake Energy, a big driller in the Marcellus and the biggest driller in the Utica Shale, released their 2014 Outlook (see Chesapeake: My Rig’s Better than Your Rig, Cuts Capex Another 20%). They tried to spin spending 20% less on drilling as a good thing for the company–enforcing fiscal responsibility. But it means they’ll be drilling 20% less–cold, hard fact. We learned from the release of their 2014 outlook that Chesapeake will cut the number of drilling rigs in the Utica Shale from the typical 17 they operated in 2013 down to 7-9 rigs, making the Mark Twain-like claim that 7-9 of their rigs are like 20 of someone else’s rigs. Whatever.

    Chesapeake’s still new CEO Doug “the ax” Lawler was on an earnings call last week with his lieutenants (we’re sure boss man and corporate raider Carl Icahn was listening in too). Doug hasn’t met a Chessy employee he wouldn’t be willing to fire. But we digress. Woven throughout the call was references to the Marcellus and Utica and the important role they will play in the company in 2014 and beyond. Lawler’s comment on the Utica Shale is that it’s “a huge liquid lever for us.” Below is a transcript of last week’s call…
    Read More “Chesapeake’s Lawler Says Utica is a “Huge Liquid Lever” for Them”

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    Which Way Do You Flow? The Price of Gas, the Marcellus & Canada

    What’s the long-term prognosis for the commodity price of natural gas? Depends on who you ask–but overall, “the market” seems to be saying even amidst one of the coldest winters on record in decades, the longer term trend will be low to moderate prices for methane/natural gas. Industry publication Oil and Gas Investments Bulletin issued one of their analysis stories on the press release wire (a clever marketing move that we appreciate). The story delves into the issue of gas prices and its relationship to Canadian exports/imports. One of the major components of the story (full copy below) is an analysis by investment firm Raymond James.

    Guess which shale play Raymond James spends a good deal of time examining? The Marcellus, of course–which is why we found this particular story about gas prices intriguing. Another reason the story is intriguing is because it reveals that Canada, which has long been the #1 source of natural gas imported into the U.S., has seen their gas flows into the U.S. drop by 50% in the past six years. And now, Marcellus gas is starting to flow the direction, into Canada…
    Read More “Which Way Do You Flow? The Price of Gas, the Marcellus & Canada”

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    FERC Invokes Emergency Power to Force Propane Shipments on TEPPCO

    first time everLast Friday, for the first time ever, the Federal Energy Regulatory Commission (FERC), the agency charged with approving transmission pipelines for oil and gas across the country, invoked its its emergency authority under the Interstate Commerce Act and directed Enterprise Products Partners to prioritize propane shipments on one of its pipelines that runs from the Gulf Coast to the northeast and Midwest (see map below). The Enterprise TEPPCO (TE Products Pipelines Company) pipeline handles various refined products, including gasoline and natural gas liquids like propane. The order directs Enterprise to prioritize propane shipments beginning yesterday or today and continuing for a week. Last Friday Enterprise told shippers it would inject 150,000 barrels of propane into its pipeline on yesterday (Monday) and 350,000 barrels on Thursday. Enterprise later said they are willing to continue prioritized propane shipments until Feb. 21.

    All of this is in response to a developing crisis. More than 20 states have declared a state of emergency due to propane shortages. In some Midwestern states, residents and farms are in danger of running out of propane. Does that justify the federal government stepping in? Did FERC also direct Enterprise to reverse the flow of the newly minted ATEX ethane pipeline that runs from the northeast to the Gulf Coast so it too can carry propane?…
    Read More “FERC Invokes Emergency Power to Force Propane Shipments on TEPPCO”