Marcellus Drilling News

BP | Economic Impact | Energy Companies | Industrywide Issues | Ohio | Processing Plants | Statewide OH | Utica Shale

BP Refinery Near Toledo Gets Upgrade, Anticipates OH Crude
March 8, 2013March 8, 2013

The BP-Husky Refinery, a 94 year-old oil and gasoline refinery in Oregon, OH (near Toledo), showed off a $400 million upgrade yesterday. The new upgrade took two years and 1,500 short-term workers to complete and will make the refinery more efficient, less polluting and enable it to refine better grades of gasoline.

The interesting part for MDN readers: Right now the refinery gets most of its crude oil from Canada, but new sources of crude are starting to flow from Ohio itself, as well as Pennsylvania and West Virginia—from the Utica and Marcellus Shale. The upgraded refinery has more flexibility to process different types of crude, including Ohio crude…

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Best of the Rest

Marcellus & Utica Shale Story Links: Fri, Mar 8, 2013
March 8, 2013March 8, 2013

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:

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Anti-Drilling/Fossil Fuel | Hydraulic Fracturing | Industrywide Issues | New York | Regulation | Statewide NY

NY Assemblyman Says Colleagues are Waging Jihad Against Fracking
March 7, 2013March 7, 2013

Yesterday, as expected, the heavily Democrat New York State Assembly passed a bill (103 to 40) that would ban fracking in the state for yet another two years—even though fracking has already been banned for nearly five years (a copy of the bill as passed is embedded below). We’re not quite sure what another two years will tell us we don’t already know after five—but that’s Democrat jihadists for you. Harsh word there—jihad—but it was aptly used on the floor of the Assembly by a Republican assemblyman to describe what’s really going on in New York—and we concur.

The Assembly’s action yesterday is not about “one more health study” to triply ensure nothing bad will happen to New York residents. It is about a “an intellectual and political jihad against natural fuels.” Fortunately, it’s unlikely the bill will pass in the NY Senate…

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Chesapeake Energy | Energy Companies

Chesapeake Board Member Resigns 2nd Time, Now Accepted
March 7, 2013March 7, 2013

A changing of the guard continues at Chesapeake Energy. Today the company announced one of its board members, V. Burns Hargis, is stepping down and will be replaced by Louis A. Raspino. Hargis headed up the internal audit committee that looked into whether or not CEO Aubrey McClendon’s personal financial deals had compromised the company. Hargis and the audit committee concluded nothing improper was done. The Securities & Exchange Commission, however, has transitioned from “a probe” into McClendon’s dealings into “an investigation.”

We suspect Chesapeake’s second largest outside investor, Carl Icahn (a corporate raider looking to flip his investment in the company into big money), also had something to do with Hargis’ departure. Icahn voted against Hargis at the last board election in June 2012. Hargis tendered his resignation immediately following the vote but the board refused it at that time. This time they accepted it.

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Anti-Drilling/Fossil Fuel | Hydraulic Fracturing | Industrywide Issues | New York | Regulation | Statewide NY

Oil & Gas Drilling in NY: 15K Active Conventional Wells
March 7, 2013March 7, 2013

Pop quiz: Which northeastern state has used hydraulic fracturing (“fracking”) in vertical oil and gas wells since the 1950s? Which northeastern state has used horizontal drilling for oil and gas wells since the 1980s? Which state (so far) has refused to allow the combination of the two—fracking + horizontal drilling? The answer to all three questions: New York.

What’s that? You didn’t know fracking (in vertical wells) has been going on in NY since the 1950s? Welcome to the club. Most people either don’t know it, or upon reading it in a publication like MDN, refuse to believe it. If you don’t believe us, just ask the state DEC for confirmation.

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Industrywide Issues | Pennsylvania | Supply Chain | Washington County

Western PA Company’s “2 Keys to Success” in Selling to Drillers
March 7, 2013March 7, 2013

A Washington County, PA manufacturer of parts used in drilling oil and gas wells is highlighted in an article in today’s Pittsburgh Post-Gazette. It’s an interesting story that focuses mostly on two sisters who have taken over and successfully expanded the family business. We enjoy these kinds of “human interest” stories. However, buried deep down in the story is a short section that reveals two things the sisters did that may benefit other businesses in the Marcellus and Utica Shale supply chain.

If you work for or own a business interested in selling to the drilling industry—especially to the larger companies—you’ll be interested in these two “keys to success” for Washington Rotating Control Heads Inc.:

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Coshocton County | Landowner Coalition News | Muskingum County | Ohio

SE OH Landowner Group Meets, Looking for New Members
March 7, 2013March 7, 2013

The Southwest Coshocton and Muskingum County Landowner’s Association in southeastern Ohio met last night in Dresden, OH to hear from experts and lawyers about progress with a lease for association members.

The group is still actively seeking new landowners to join…

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Industrywide Issues | Pennsylvania | Pipelines | Regulation | Statewide PA

Childish Protesters Berate DRBC Officials at NJ Meeting
March 7, 2013March 7, 2013

About 70 hippie protesters, led by the extremist group Delaware Riverkeeper, “packed” a dinky meeting room in Trenton, NJ where the Delaware River Basin Commission (DRBC) held their regular meeting. The protesters were there to express their desire the DRBC put the breaks on any further natural gas pipelines to carry much-needed gas to New York City, Philadelphia and other East Coast urban areas where the DRBC has jurisdiction.

What seemed to escape the reasoning power of the protesters is that the DRBC has no jurisdiction in approving pipelines—and only a very limited role in the process. The protesters behaved badly at the meeting, as they usually do. They “took over” the meeting and refused to be orderly and wait their turn to speak, disrupting the meeting with their petulant, white-liberal-spoiled-rich-kid tantrums of “mommy listen to me!” If only their parents had raised them right…

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

Maryland Fracking Ban Bill Dies in Senate
March 7, 2013March 7, 2013

Good news in the state of Maryland, a state (like New York) considering legislation to delay or outright ban hydraulic fracturing (fracking). Each year the Maryland legislature meets for just 90 days to consider new legislation. During the current session now under way, a bill was introduced in the Senate that would outright ban the miracle of hydraulic fracturing. That bill has, thankfully, died in committee.

However, a moratorium (temporary ban) bill in the General Assembly is still very much alive…

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Best of the Rest

Marcellus & Utica Shale Story Links: Thu, Mar 7, 2013
March 7, 2013March 7, 2013

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 7, 2013”
Anti-Drilling/Fossil Fuel | Hydraulic Fracturing | Industrywide Issues | New York | Regulation | Statewide NY

Lights Out on NY Fracking? Senate, Assembly Dems Push 2-Year Ban
March 6, 2013March 6, 2013

Is New York doomed when it comes to the issue of fracking? Maybe. In addition to Cuomo being the ditherer-in-chief and failing to lead on the issue of fracking, an important group of state senators—the Independent Democrat Conference (they share control of the Senate with Republicans)—yesterday proposed a two-year further delay in fracking. Previously the state Assembly, which is heavily Democrat and is led by the nefarious Sheldon Silver, has pushed legislation to kill fracking. Sliver is supposed to be make yet another announcement today (Wednesday) along those lines.

It all adds up to a huge mess and an ongoing hardship for New York landowners. The 77,000-member Joint Landowners Coalition of New York is none too happy about it and issued a blistering statement in response to the IDC yesterday…

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Boardwalk Pipeline Partners | Energy Services | Industrywide Issues | Pipelines | Williams

Williams, Boardwalk Announce Marcellus-to-Gulf Coast NGL Pipeline
March 6, 2013March 6, 2013

Williams and Boardwalk Pipeline Partners, two midstream (pipeline) companies today announced a bold new project to build and repurpose some existing pipelines into a new natural gas liquids (NGL) pipeline that will run from the Marcellus and Utica Shale region all the way to the Gulf Coast. The new project, dubbed the Bluegrass Pipeline, would provide an initial 200,000 barrels of NGL capacity per day, expandable to 400,000 barrels. If all goes according to plan, Williams and Boardwalk would like to have the new pipeline online by late 2015.

The JV partners maintain the pipeline is needed because in just a few years the northeast will have too much NGLs and not enough processing capacity to handle it all. MDN heard that argument and its opposite argued at the recent Utica Shale event we attended in Columbus. More analysis about the Williams announcement (and a quick NGL processing primer) from MDN below. First, here’s the press announcement today from Williams and Boardwalk, including a rough map of the route:

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Brooke County | Chesapeake Energy | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Litigation | West Virginia

WV Landowners *with* Lease Sue Chesapeake for Drilling Next Door
March 6, 2013March 6, 2013

A mother and son have filed a lawsuit against Chesapeake Energy in Brooke County, WV charging them with illegal trespass under their property and taking some of the natural gas that exists in the Marcellus Shale from under their property. West Virginia does not have a pooling law—the right of drillers to “force pool” parcels of land into a drilling unit if a majority of surrounding neighbors have agreed to allow it.

The strange thing about this case is that the mother and son have a signed lease with Chesapeake—a lease which they renewed for an additional 5-year term. For some reason they don’t want their property pooled with their neighbors into a unit for Marcellus drilling—they refused it. So Chesapeake drilled next door to their property, essentially ignoring them. The landowners say Chesapeake’s close-by drilling has caused them economic harm. It’s now a case in federal court…

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Crosstex Energy | E2 | Energy Services | Enerven Compression Services | Industrywide Issues | Monroe County | Noble County | Ohio | Pipelines | Processing Plants | Utica Shale

Crosstex Energy to Build New Compressors, Processing Plant in OH
March 6, 2013March 6, 2013

Crosstex Energy has formed a joint venture with Enerven Compression Services called E2 to build and operate new compressor stations and a condensate processing plant in the Ohio Utica Shale. In their announcement today, Crosstex says the company has set up a new $75 million line of credit and will invest an initial $50 million from it in the new JV. First up is building two compressor stations in Noble and Monroe counties in Ohio—they already have an unnamed customer lined up for those. After that, they’ll build a condensate (“natural gasoline”) processing plant. Crosstex will own 93% of the JV and Enerven will own the other 7%.

The Crosstex announcement from this morning:

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Carroll County | Columbiana County | Guernsey County | Harrison County | Monroe County | Ohio | Utica Shale

Another 20 Utica Shale Permits Issued Last Week in OH
March 6, 2013March 6, 2013

The latest permit numbers released from the Ohio Dept. of Natural Resources shows 20 new permits for the week ending March 2nd.

Here’s where the latest round of permits were issued, along with an update on how many wells have been drilled and are now in production in Ohio:

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1st NRG | Energy Companies | Utica Shale

1st NRG Still Looking for $ to Drill 7K Acres in Utica Shale
March 6, 2013March 6, 2013

1st NRG Corp. is one of the newer “players” in the Ohio Utica Shale. MDN previously pointed out their press statements seem to be heavy on fluff and light on specifics for how and when they’ll begin drilling (see 1st NRG Corp Gets $7M Loan to Begin Drilling in Utica, Other Plays). They issued a press release last week almost identical to the one from last November. Instead of saying we’re about to finalize an agreement for the Utica, they changed it to say we have finalized an agreement for the Utica. Again, no further specifics, other than they have their hand out looking for money (i.e. investors).

Here’s the latest slightly-tweaked and re-worked version of their previous press release:

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