Marcellus Drilling News

Industrywide Issues | Research

Morningstar Report on Marcellus Pegs Production & More Thru 2015
March 4, 2014March 4, 2014

The brains at investment research service Morningstar the February 2014 issue of their Energy Observer publication. The title of that issue? “Shale Shock—How the Marcellus Shale Transformed the Domestic Natural Gas Landscape and What It Means for Supply in the Years Ahead” (see a full copy embedded below). This is one seriously excellent analysis report–one that we highly recommend. Included in the report is narrative and charts that discuss the challenges forecasters have and continue to face when attempting to predict where shale gas production is headed. Also in the report is Morningstar’s best thinking on how much natural gas the Marcellus will produce as we exit 2015 (low-ball scenario, around 14 trillion cubic feet, rosy scenario, nearly 20 Tcf).

The authors address the interplay of supply and demand and provide forecasts for demand. They also compare the Marcellus to other major plays to see how it stacks up. Full of charts and graphs and clear explanations, this report is a keeper. Below is Morningstar’s press release announcing the report, followed by a copy of the report itself…
Read More “Morningstar Report on Marcellus Pegs Production & More Thru 2015”
Antero Resources | Energy Companies | Gulfport Energy | Ohio | Statewide OH | Utica Shale

Antero Resources & Gulfport Energy’s Utica Shale High Notes
March 4, 2014March 4, 2014

In recent weeks as part of a flurry of year end and fourth quarter financial and operational reports, MDN brought you the latest news from Marcellus and Utica Shale powerhouse driller Antero Resources (see Antero Resources Keeps up the Pace in the Marcellus/Utica). We also told you the latest from Gulfport Energy, including our “takeaways” (see Gulfport Production & Profits Jump in 2013 Thanks to Utica Shale).

The Intelligencer/Wheeling News-Register reporter Casey Junkins has done a great job of summarizing the highlights from both companies–hitting the “high notes” as it were, particularly with respect to the Utica Shale–in the following update:
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Energy Services | Industrywide Issues | Pipelines | Regulation | Transco | Williams

Williams Happy with FERC Progress on NE Pipeline Expansions
March 4, 2014March 4, 2014

Yesterday Williams issued a press release touting last Friday’s Federal Energy Regulatory Commission (FERC) issuance of a final environmental review for the Transco Pipeline’s Rockaway Lateral and Northeast Connector expansions. The final review is prelude to a final decision by FERC to green light the projects, something Williams (the owner of Transco) clearly believes will happen. The final FERC decision will be issued this spring. When it is, and when Williams builds those expansions, it means more gas will flow to New York City by next winter–in time for the winter heating season.

The irony is, of course, that none of the gas flowing through the Transco to NY will be from New York State itself but instead will come mostly from the Marcellus Shale in Pennsylvania. Keep an eye out for the loonies who are bound to come out of the woodwork to oppose the expansion. Perhaps we’ll see more nutjobs like those that opposed the now-functioning Spectra Energy pipeline to Manhattan (see NYC Pipeline Protesters Get Naked, Paint Themselves Green). Here is yesterday’s “attaboy FERC” announcement from Williams:
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Broome County | Hydraulic Fracturing | Industrywide Issues | New York | Public Opinion | Regulation | Statewide NY

Binghamton Newspaper’s Informal Fracking Poll – Cast Your Vote Now
March 4, 2014March 4, 2014

Just a quick word of encouragement to participate in an informal poll on the Binghamton Press & Sun-Bulletin website that asks the question: “Should New York approve natural gas drilling?” This poll has been active since late last week, so we expect them to shut it down at any time–be sure to vote right away (if that’s your pleasure). As of this morning, some 18,133 people had voted. Here was how the results stood…
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Best of the Rest

Marcellus & Utica Shale Story Links: Tue, Mar 4, 2014
March 4, 2014March 4, 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: Tue, Mar 4, 2014”
Coterra Energy (Cabot O&G) | Energy Companies | Energy Services | Industrywide Issues | New York | Pennsylvania | Pipelines | Public Opinion | Regulation | Statewide NY | Statewide PA | Williams

Constitution Pipeline Payments to Groups – Donations or Payola?
March 3, 2014March 3, 2014

What do you call it when a company pays money to local organizations and agencies before the project has been fully approved by federal, state and local agencies? These payments, mind you, are not fees for permits or licenses, but voluntary chunks of money offered to groups that may be affected by the project if it’s built–in this case a pipeline. Is it called, Good corporate citizenship? Being a responsible member of the local community? Or perhaps, payola?

Regardless of what you call it, the Constitution Pipeline, a desperately needed natural gas pipeline that will run from the gas fields of Susquehanna County, PA to central New York where it will connect to two major interstate pipelines, has now paid out more than $1 million in “community grants” to help build support for the pipeline. Is that a good thing, or bad? We think it’s time to have that discussion…
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Industrywide Issues | Landfills | Regulation | Statewide WV | West Virginia

Will WV Lawmakers Have Guts to Tackle Cuttings in Landfills Bill?
March 3, 2014March 3, 2014

Two weeks ago MDN told you about a House Bill (HB) 4411, actively under consideration by the West Virginia state legislature, that would codify into law the right for landfills in the state to accept Marcellus and Utica Shale drill cuttings (see WV Bill to Allow More Drill Cuttings in Landfills Faces Opposition). At the time a parade of speakers spoke against the bill with one speaker (from the Independent Oil and Gas Association of West Virginia) speaking in favor. The bill would codify into law the right for landfills to accept larger amounts of cuttings, which anti-drillers object to because it encourages more drilling.

What we didn’t know at the time is why the WV Dept. of Environmental Protection is supporting the bill: because it will codify into law the protections they drafted as a temporary measure (now in place). Yes, protections, like separating the cuttings into their own cell within a landfill, the use of special liners, and lechate monitoring. The DEP is keeping a close eye on this issue and believes the proper place to have the debate about it, along with a resolution to the debate, is in the state legislature–if they have the intestinal fortitude to address it…
Read More “Will WV Lawmakers Have Guts to Tackle Cuttings in Landfills Bill?”
Economic Impact | Energy Services | Ethane | Industrywide Issues | Jobs | Odebrecht | Processing Plants | Statewide WV | West Virginia | Wood County

WV Ethane Cracker – Cautious Optimism in the Mountain State
March 3, 2014March 3, 2014

The editors at the Charleston Gazette have penned an editorial about their “cautious hope” that the ethane cracker plant announced by Odebrecht for Parkersburg, WV will become a reality. As they note, coal is descending in the state, and natural gas is ascending. If the cracker plant is built–complete with environmental safeguards–it will be a huge economic bonanza for the state. Although the editors are a tad skeptical about the “drill drill drill” attitude from Gov. Earl Ray Tomblin and his administration (a Democrat, which is noteworthy), they’re willing to suspend the usual knee-jerk reaction against such projects and allow hope to bloom on the editorial page. A good sign!

From the Gazette:
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Energy Companies | Southwestern Energy

Southwestern Energy – Full Speed Ahead in Marcellus for 2014
March 3, 2014March 3, 2014

Southwestern Energy is a large Marcellus Shale driller. According to NGI’s Shale Play Factbook, Southwestern leases 337,300 acres in the Marcellus. In 2013 Southwestern invested $872 million into their Marcellus drilling operations, drilling 108 wells. Their proved reserves in the Marcellus grew by 141% in 2013 to 1.9 trillion cubic feet. More interesting facts from Southwestern: their average completed Marcellus well cost was $7.0 million per well; the average horizontal lateral length was 4,982 feet and they used an average of 18 fracture stimulation stages per well in 2013.

Below is Southwestern’s fourth quarter and full year 2013 financial and operational update. Below the update is a portion of a recent analyst call with Southwestern’s top management. The call transcript, unsurprisingly, mentions the Marcellus Shale–a lot…
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Industrywide Issues | Jobs | Pennsylvania | Statewide PA

Hundreds of Thousands of Marcellus Drilling Jobs in PA
March 3, 2014March 3, 2014

Over the past six years hundreds of thousands of jobs have been created in Pennsylvania that are either directly or indirectly tied to the Marcellus Shale drilling industry. Of that there is no dispute. It is provable and has been proven, over and over, by government agencies that count such things. Yet, when a new jobs report is issued that shows another 15,000 direct jobs have been added over the past few years, those opposed to drilling jump on the number and say, “See! See! It doesn’t create all that many jobs. They’re a lyin’ to ya–all them pro-drillers.”

Meanwhile, anti-drillers ignore the total number of 240,000 people working directly in the Marcellus Shale industry, or for companies that serve the industry (“supply chain”), in Pennsylvania. And so the anti-drilling spin machine keeps whirling around and around and around…
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Anti-Drilling/Fossil Fuel | CNG/LNG | Dominion Energy | Energy Services | Exporting | Industrywide Issues | Maryland | Statewide MD

The Radicals Behind Efforts to Stop Cove Point, MD LNG Plant
March 3, 2014March 3, 2014

The group 350.org, a rabidly anti-drilling group that has adopted the same tactics used by the Ku Klux Klan complete with face masks and burning torches (see Wackadoodle 350.org protesters disappear their KKK moment), is behind the movement to stop the XL Keystone oil pipeline from Canada to the Gulf Coast. They are also behind an effort to stop the LNG (liquefied natural gas) export terminal in Cove Point, MD. The Chesapeake Climate Action Network has enlisted the help of 350.org in their effort to stop Cove Point. We wonder, are torches and bed sheets coming to Maryland now? Shame on the Climate Action Network for hooking up with these radicals–but then, perhaps they’re just as radical?

Here’s an update on the ongoing effort to stop what, frankly, can’t be stopped: the permitting of a new export facility in Cove Point that will liquefy and send some of our cheap, abundant Marcellus Shale gas to India and Japan where they need it badly…
Read More “The Radicals Behind Efforts to Stop Cove Point, MD LNG Plant”
Chesapeake Energy | Energy Companies | Guest Post

Guest Viewpoint – Solar Guy Knocks Chesapeake Energy
March 3, 2014March 3, 2014

Last week MDN was contacted by Robert Magyar, Managing Director at Navitus Strategies, to offer a guest viewpoint to run on MDN. We occasionally post guest articles and agreed to post Bob’s article (below). His article takes a look at Chesapeake Energy and offers the view that although Chesapeake has laid off more than a thousand people and sold off (and continues to sell off) key assets, the company is still financially unhealthy. Bob offers his reasons why (mostly from hedging agreements). He also highlights the recent and ongoing problems Chessy has with royalty payments in Pennsylvania.

In our email correspondence Bob says, “we need natural gas” and that he is not anti-drilling by any stretch. However, we would note for the record that his company, Navitus, works on alternative energy projects–primarily solar–and so it seems in his own best interests to knock the shale industry (and one of it’s most prominent players) around just a bit. With that as a preface, here is Bob’s article on Chessy “continuing to grind down,” which first appeared on the freelance article website Examiner.com:
Read More “Guest Viewpoint – Solar Guy Knocks Chesapeake Energy”
Anti-Drilling/Fossil Fuel | Hydraulic Fracturing | Industrywide Issues | Pennsylvania | Regulation | Statewide PA

Voting for the Lesser of the PA LibDem Loonies
March 3, 2014March 3, 2014

There’s at least a few prominent Democrats running in the primary for Lieutenant Governor that have departed from the Democrat Party’s lunatic demand to stop all Marcellus drilling in the state–precious few, but at least a few that don’t share that view. So if you’re a registered LibDem and you must (hold your nose and) swing the lever for a Dem, you might want to consider who should get your vote based on their loony rating.

Hint: Don’t vote for Brenda Alton or Brad Koplinksi, both support an immediate ban on further shale drilling…
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Best of the Rest

Marcellus & Utica Shale Story Links: Mon, Mar 3, 2014
March 3, 2014March 3, 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 3, 2014”
Energy Services | MarkWest Energy

MarkWest PowerPoint Preso – Really Cool Slides, Worth Your Time
February 28, 2014February 28, 2014

Yesterday MDN highlighted the official financial and operating update from MarkWest for 2013 (see MarkWest’s Banner 2013, Plans for 2014). Also happening yesterday that we’re reporting on today, was the inevitable investor phone call with top MarkWest management. In the past MarkWest has produced some great PowerPoint presentations, loaded with useful information. They didn’t disappoint this time around either. Below is a copy of the newest PowerPoint slide deck from yesterday’s investor call, along with a transcript of MarkWest CEO Frank Semple talking his way through the slides.

Although you’ll want to review the entire slide deck, here are our favorite slides…
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Accidents | Industrywide Issues | Pennsylvania | Pipelines | Regulation | Statewide PA

PA Marcellus Industry’s Biggest Fines & Biggest Violators
February 28, 2014February 28, 2014

NPR’s StateImpact Pennsylvania is only too happy to bring us the breathless news of who the baddest of the bad were in the Marcellus drilling industry in PA for 2013. How do they measure who was naughty and who was nice? Well, they’re all naughty (right?), but the naughtiest were those who paid the biggest fines last year. It may surprise you to know that the when you add all fines together, the company paying the most in 2013 was Williams, a pipeline operator–not a driller. Williams settled up in 2013 for violations going back several years, mostly related to accidents and drilling mud spills that resulted from foul weather (including Hurricane Irene and Tropical Storm Lee). Williams’ total fine tab in 2013 was $388,694 (for violations occurring in 2011-2012). Coming in at #2 was National Fuel Gas Company’s Seneca Resources subsidiary. They were clipped $377,000 for violations occurring from 2010 to 2013.

Below are the top 5 violators cumulatively (adding up all of their violations), along with the top 5 biggest single violations from last year, in the PA Marcellus drilling industry:
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