Marcellus Drilling News

Industrywide Issues | Jobs | Pennsylvania | Regulation | Statewide PA

DOL Targets Shale Gas Subcontractors over Pay Practices
June 14, 2012June 14, 2012

The U.S. Department of Labor (DOL) is targeting the shale gas drilling industry in northeastern Pennsylvania for enforcement actions. The specific issue they are targeting is subcontractors who DOL claims are intentionally misclassifying workers as independent contractors (“1099”) instead of as regular employees (“W2”). By doing so, DOL claims employers are skirting tax withholdings and payment of workers’ compensation and workers are denied benefits like paid holidays, family leave and overtime pay.

What evidence of this “widespread problem” has the DOL hot-and-bothered enough to launch a full-out attack on small businesses in PA? A study—with suspect data.

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Hydraulic Fracturing | Industrywide Issues | New York | Pipelines | Statewide NY

The Latest Anti-Drilling Scare Tactic: Radon in Shale Gas
June 14, 2012June 14, 2012

There’s no polite way to say this, so I won’t bother: The nutters are coming out of the woodwork. Damascus Citizens for Sustainability (DCS), NYH2O and 50 “other signatories” have sent a letter to Speaker Quinn of the New York City Council asking the speaker to convene hearings on the issue of radon in natural gas. They are claiming (and this is the nutty part) that Marcellus Shale gas contains radon and that Marcellus gas gets to market so fast the radon doesn’t have time to break down and dissipate. That is, it’s a health risk for New York City residents who use natural gas.

The solution, according to DCS and the others? Don’t use natural gas—at least not the cheap, abundant natural gas that comes from the Marcellus Shale.

Here’s their press release, if you can understand it:

Read More “The Latest Anti-Drilling Scare Tactic: Radon in Shale Gas”
Economic Impact | Industrywide Issues

Data Centers May Relocate to Use Marcellus Shale Gas
June 14, 2012June 14, 2012

Large computer data centers (sometimes called server farms), with thousands of computers, use a lot of electricity. By some estimates data centers use up to 2.2% of all the electricity generated in the U.S.

Now there’s talk that data centers, which have often been constructed in southern states, may have their eye on building new centers in the Mid-Atlantic region. Why? Marcellus shale gas. They want to take advantage of low gas prices and by building next to gas fields in the Marcellus, they can do just that.

Read More “Data Centers May Relocate to Use Marcellus Shale Gas”
Chesapeake Energy | Energy Companies

Chesapeake CEO Losing Chairman Title, But Keeping Powers
June 14, 2012June 14, 2012

Although Chesapeake Energy CEO Aubrey McClendon is about to lose his title as Chairman of the Board, it seems that’s about the only thing he’s losing—the title. The power of the position—the ability to call board meetings and the power to call special shareholder meetings—he’s going to keep. The existing board of directors made a change to its bylaws last Friday to grant McClendon the right to call meetings.

Those critical of Chesapeake’s management take it to mean that nothing is really changing with respect to board oversight of McClendon.

Read More “Chesapeake CEO Losing Chairman Title, But Keeping Powers”
Energy Services | Fayette County | Greene County (PA) | Industrywide Issues | Pennsylvania | Peregrine Keystone Gas Pipeline | Pipelines | Regulation | Washington County

Peregrine Pipeline Withdraws Public Utility Application
June 14, 2012June 14, 2012

Peregrine Keystone Gas Pipeline had planned to construct a gathering pipeline in Greene, Fayette and Washington counties in western PA. They filed an application with the PA Public Utility Commission (PUC) in 2010 to become a public utility which would grant them the right to use eminent domain to force landowners to allow them to build a pipeline across their property.

Last month an administrative law judge ruled against Peregrine’s application, and on June 8 Peregrine withdrew the application. Although they believe they have a strong case, with the low price of natural gas and the high likelihood of an extended court battle, Peregrine has given up on public utility status.

Read More “Peregrine Pipeline Withdraws Public Utility Application”
Best of the Rest

Marcellus & Utica Shale Story Links: Thu, Jun 14, 2012
June 14, 2012June 14, 2012

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, Jun 14, 2012”
Hydraulic Fracturing | Industrywide Issues | New York | Regulation | Statewide NY

Breaking: NY Will Allow Fracking in Select (Few) Locations
June 13, 2012June 13, 2012

Breaking News: The fight over fracking in New York is about to go very local—down to the township level. The New York Times is reporting that Gov. Andrew Cuomo will soon announce a plan that will allow hydraulic fracturing in a few select counties in New York, most of them along or near the border with Pennsylvania. His plan will limit hydraulic fracturing to only those counties AND townships within those counties that actually want drilling—at least for “the next several years.”

Why limit it? To “reduce the risk of groundwater contamination.” And because he’s trying to placate both sides of the fracking debate. His environmentalist supporters are going to abandon him if he doesn’t at least make some moves to appease them.

Fait accompli. The anti-drillers will not view this as a victory, but it is—for them. This plan buys anti-drillers another two years or more to continue agitating and demagoguing the issue of hydraulic fracturing and mount wave after wave of protests at town board meetings. It’s about to be an interesting couple of years for those of us who live in New York and support drilling (not that the past four long years have been boring).

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Bradford County | Energy Services | Industrywide Issues | Inergy | Litigation | Lycoming County | Pennsylvania | Pipelines | Sullivan County

Court Clears Way to Build MARC 1 Marcellus Pipeline in PA
June 13, 2012June 13, 2012

A federal appeals court has cleared the way for the construction of the MARC 1 Marcellus Shale pipeline to be built in northeastern Pennsylvania. The court released a decision yesterday rejecting claims by “environmental” groups to stop the pipeline. Part of their argument revolved around “the broader impacts” caused by natural gas drilling—that is, pipelines make more drilling likely and that’s not a good thing (according to them). The court rejected that argument.

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Industrywide Issues | Jobs | Statewide WV | West Virginia

Does Shale Gas Drilling Create Jobs for In-State Residents?
June 13, 2012June 13, 2012

There’s no doubt that Marcellus and Utica Shale drilling creates jobs. But one of the criticisms often leveled is that jobs directly related to drilling are given to people from other states, like Texas and Louisiana and Oklahoma—states with experienced oil and gas workers who don’t need extensive training.

Recent employment numbers from West Virginia seem to lend credence to those concerns. The unemployment rate has risen slightly in WV, but more telling, employment of West Virginians who work directly in the oil and gas sector dropped slightly from 2010 to 2011. However, indirect jobs in other industries—like hotels, restaurants and retail businesses—have gone up due to drilling. It seems to be a mixed picture, at least in WV, with respect to job creation.

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Hydraulic Fracturing | Industrywide Issues | Regulation

New Fracking Rules for Federal Lands will Cost $1.5B
June 13, 2012June 13, 2012

The Western Energy Alliance says new fracking rules recently issued by the Bureau of Land Management (BLM) which will regulate hydraulic fracturing on federal public lands will cost around $1.5 billion to implement, and the Alliance is asking Secretary of Interior Ken Salazar to suspend the new rules.

Read More “New Fracking Rules for Federal Lands will Cost $1.5B”
Alternative Energy | Commodity Price | Economic Impact | Hydraulic Fracturing | Industrywide Issues

Coal Use Decreases, NatGas Increases – Renewables? Irrelevant
June 13, 2012June 13, 2012

New numbers released by IHS CERA show how far coal has fallen as the fuel of choice to generate electricity in the U.S., and how high natural gas has risen to take its place. Here are some interesting statistics:

Read More “Coal Use Decreases, NatGas Increases – Renewables? Irrelevant”
Brooke County | Chesapeake Energy | Energy Companies | Equinor/Statoil | Industrywide Issues | Lease & Royalty Payments | Litigation | Range Resources Corp | West Virginia

WV Couple Challenges Chesapeake Lease Renewal
June 13, 2012June 13, 2012

A husband and wife in Brooke County, West Virginia are suing to have their 5 year-old lease, which is now expired and up for renewal, nullified so Chesapeake (now the owner of the lease) cannot automatically renew it as they are attempting to do.

Increasingly landowners who signed leases that are now expiring after a customary 5 year period face the same issue—and drillers are trying to lock them in under the terms of lease for a new period of time.

Here’s the story of Ramon and Lois Bowen:

Read More “WV Couple Challenges Chesapeake Lease Renewal”
Hydraulic Fracturing | Industrywide Issues | Maryland | Statewide MD

Maryland Commission’s Deadline for Fracking Report Extended
June 13, 2012June 13, 2012

The Marcellus Shale Advisory Commission appointed by Maryland Gov. Martin O’Malley to “study” natural gas drilling and produce a set of “best practices” for hydraulic fracturing needs more time. An initial draft report was due this August, but the good governor has extended the deadline to the end of the year instead. (yawn)

Read More “Maryland Commission’s Deadline for Fracking Report Extended”
Energy Services | Smart Sand

Smart Sand Lands Big Name for Board of Directors
June 13, 2012June 13, 2012

Smart Sand Inc., headquartered in Fairless Hills, PA, is a supplier of industrial sand, primarily serving customers in the oil and gas industry including drillers in the Marcellus and Utica Shale region. Sand—the right kind of sand which is crystalline—is a critical part of the hydraulic fracturing process. Most of the frack sand mined in the U.S. comes from the Midwestern states of Wisconsin, Minnesota and Illinois. Smart Sand owns and operates a facility in Oakdale, WI.

What’s the big deal about Smart Sand? They’ve just landed former Minnesota Gov. Tim Pawlenty as a new board member, raising their visibility in the industry considerably. You may recall that Pawlenty ran for the Republican nomination for president not all that long ago.

Read More “Smart Sand Lands Big Name for Board of Directors”
Best of the Rest

Marcellus & Utica Shale Story Links: Wed, Jun 13, 2012
June 13, 2012June 13, 2012

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: Wed, Jun 13, 2012”
Hydraulic Fracturing | Industrywide Issues

NETL Study of Faults & Fracking, Are We Being Set Up?
June 12, 2012June 12, 2012

Using Greene County, Pennsylvania as a living laboratory, the U.S. Department of Energy’s National Energy Technology Laboratory (NETL) is testing whether or not faults, or large cracks that sometimes exist through multiple rock layers, can create a pathway for hydraulic fracturing fluids to migrate to aquifers.

That is, they’re testing whether or not fracking can pollute groundwater supplies under certain conditions.

Read More “NETL Study of Faults & Fracking, Are We Being Set Up?”