Marcellus Drilling News

New Study Says Gas Drilling in NY Will Create 54K Jobs

September 8, 2011September 8, 2011

A private study on the socio-economic impacts shale gas drilling is projected to have in New York State shows hydraulic fracturing will create some 54,000 jobs and result in $2.5 billion in economic activity. The report, titled “Economic Assessment Report for the Supplemental Generic Environmental Impact Statement on New York State’s Oil, Gas, and Solution Mining Regulatory Program,” was commissioned by the New York Department of Environmental Conservation (DEC) and researched and written by Ecology and Environment Engineering, P.C. A full copy is embedded below.

Economic Impact | Energy Companies | Industrywide Issues | Jobs | Shell

Shell Nears Decision on Where to Build $2B Cracker Plant

September 7, 2011September 7, 2011

Shell Shell Oil is “nearing a decision” on where to build a multi-billion dollar ethylene cracker plant in the Marcellus region, and states in that region—specifically Pennsylvania, West Virginia and Ohio—are aggressively competing to have the plant built in their state. (See MDN’s petrochemical primer for details on how shale gas drilling relates to the chemical industry).

The stakes are high indeed. The cost to build the plant will exceed $2 billion, and it’s estimated the plant will attract some $16 billion in associated industry expenditures and provide more than 17,000 jobs in those associated industries.

How Much Does it Cost to Drill a Single Marcellus Well? $7.6M

September 7, 2011September 7, 2011

A new 92-page study just released by the University of Pittsburgh (copy embedded below) takes a realistic look at the direct costs, and economic impacts, of drilling a single Marcellus Shale gas well. The study, called the “Economic Impact of the Value Chain of a Marcellus Shale Well,” looked in depth at an EQT-drilled well in Washington County, PA. Undergraduate and graduate students from Pitt found that a single well had direct costs of more than $7.6 million. Or think of it this way: More than $7.6 million is invested in a local community, on average, for each and every well drilled.

The costs to drill a well break down this way:

Economic Impact | Industrywide Issues | Jobs | Pennsylvania | Statewide PA

New Penn State Study on Economic Impacts of Marcellus Drilling

September 7, 2011September 7, 2011

A new 62-page study (embedded below) conducted by Penn State and the Pennsylvania College of Technology looks at the economic impact of natural gas drilling in PA. The study, titled “Economic Impacts of Marcellus Shale in Pennsylvania: Employment and Income in 2009,” uses a new (and according to the authors more accurate) methodology to calculate gas drilling’s economic impacts on local communities. The authors suggest the economic impacts of Marcellus drilling for local communities are not as big as previously reported.

Chesapeake Energy | Energy Companies | Monongalia County | West Virginia

Chesapeake Withdraws $25K Grant from Morgantown, WV

September 7, 2011September 7, 2011

Yet another gas driller has decided to vote with its pocketbook against a community that insists on banning shale gas drilling.

The 10 Largest Natural Gas Drillers in the U.S.

September 6, 2011September 6, 2011

Top 10 ProPublica recently compiled a list of the top 10 natural gas drillers in the U.S. based on daily natural gas production volume. The list includes gas drilled by both “traditional” vertical drilling as well as “non-traditional” horizontal hydraulic fracturing. Or think of it as non-shale gas and shale gas—companies who drill for both are in the list. The Marcellus Shale represents a good portion of the gas now being produced in the country, but other shale formations, like the more mature Barnett Shale (in Texas) also contribute a substantial volume of natural gas.

MDN presents this list as a useful resource for landowners. The biggest drillers are not always the best, and not always the right choice for a given landowner and situation. However, knowing who the “bigs” are can be a helpful guide—you know they have the money and the technology to get the gas out of the ground, and they have money to pay for leases and royalties.

Earthquakes | Industrywide Issues

Anti-Drillers Try to Tie VA Earthquake to Marcellus Drilling

September 6, 2011September 6, 2011

It didn’t take long for those who oppose Marcellus Shale gas drilling to try and link the recent earthquake centered near Mineral, VA on August 23 to hydraulic fracturing and horizontal drilling in the Marcellus. Blogs and internet forums said the 5.8 magnitude quake was a result of Marcellus drilling activity, but scientists have flatly stated there is no connection to be made: Marcellus drilling activity is not the cause of the quake. But is there ever a connection between shale gas drilling and earthquakes? The surprising answer is, maybe. But likely not what you think it is.

Industrywide Issues | Pennsylvania | Public Opinion | Statewide PA

PA Poll Shows Most Residents Support Marcellus Drilling

September 6, 2011September 6, 2011

Franklin & Marshall College (Lancaster, PA) conducted a statewide poll of 525 Pennsylvania residents in late August. Among the questions asked were a series of questions about Marcellus Shale drilling. The vast majority of Pennsylvanians support gas drilling in the state (66%). A slight majority believes the economic benefits of drilling outweigh the potential environmental impacts, and most think that opening more state forest land for drilling should not be done. The full questions and responses are listed below.

About MDN | MDN Weekly Update

MDN Weekly Update – Aug 21, 2011: MDN on Vacation until Labor Day

August 21, 2011

Happy Labor Day To the relief of those who oppose drilling, and the dismay of those who support it, MDN will take a vacation break for the next two weeks, starting August 22nd. We will not publish daily articles during that time. We will resume publishing on Tuesday, September 6th.

The current poll will be left open during that time, so if you haven’t yet voted, please be sure to do so. The poll asks, Who should regulate hydraulic fracturing? Register your vote along the right side of any page on the site.

Below are the most recent “top 5” lists and the calendar of Marcellus related events through September 10th.

Happy Labor Day!
Jim Willis, Editor

Five Most Viewed Stories This Past Week (Aug 14 – Aug 20)

Shale Gas Drillers Spread STDs Says PA Democrat Legislator (8/17/11)
The Mighty Marcellus Roars in PA – Production Up 55% in 6 Months (8/17/11)
New Interstate Pipelines Mean Thousands of Jobs in PA (8/15/11)
Major Discovery – Chesapeake Energy Strikes Oil (and Gas) in Ohio’s Utica Shale (7/29/11)
Fracking Creates an Oil Boom – Now More Oil than Gas Rigs (8/18/11)

Five Most Viewed Stories Last 30 Days (Jul 21 – Aug 20)

Noble Energy and CONSOL to Partner on Marcellus in $3.4B Deal

August 19, 2011August 19, 2011

handshake In March 2010, CONSOL Energy (Cecil, PA) paid Dominion Resources $3.5 billion for 500,000 acres of Marcellus Shale gas leases, instantly tripling their lease holdings. Since that time, CONSOL has continued to invest in Marcellus acreage and they now have 750,000 acres under lease. But CONSOL had a problem: Not enough money to develop their vast Marcellus acreage. So they did what is now a common practice—they found a partner to invest. Yesterday, CONSOL and Noble Energy (Houston, TX) announced that Noble will buy a 50 percent interest in 663,350 net undeveloped acres and fund drilling and completion costs in a deal worth $3.4 billion over an eight-year period.

The joint venture will concentrate on ramping up development of Marcellus Shale gas wells in three areas of Pennsylvania and West Virginia (see a map of CONSOL’s acreage below):

Recent Marcellus Shale Joint Venture Deals

August 19, 2011August 19, 2011

Joint ventures are a common way for oil and gas companies to share risk, expertise and resources. Here is a list of recent deals in the Marcellus shale:

NY Attorney General Schneiderman Subpoenas Shale Drillers

August 19, 2011August 19, 2011

New York’s anti-drilling Attorney General, Eric T. Schneiderman, continues to target the shale gas industry. On May 31, he filed a lawsuit in federal court seeking to force the federal government to conduct a full environmental review of hydraulic fracturing before the Delaware River Basin Commission be allowed to permit drilling in its jurisdiction (see MDN’s story here). The federal government has since asked the judge in the case to toss out the lawsuit.

Now, based on a questionable article that appeared in the New York Times, written by anti-drilling author Ian Urbina (who used an intern as one of his main sources for the article), Schneiderman is using (misusing?) the considerable power of his office to target energy companies involved with shale gas drilling by sending them subpoenas for documents to “prove” their statements on shale gas reserves are accurate. The Times article claimed energy companies knowingly overstate the production of gas wells, understate how much it costs to get the gas, and intentionally inflate numbers for how much natural gas exists in shale formations.

Hydraulic Fracturing | Industrywide Issues

Carnegie Mellon Refutes Cornell Study on Natural Gas vs Coal

August 18, 2011August 18, 2011

coal burning A new peer-reviewed study from Carnegie Mellon University says that Marcellus gas has less impact on global warming than coal. The study, published in the Institute of Physics Aug. 5th issue of “Environmental Research Letters” is a direct refutation of the Cornell study released in April by professors Robert Howarth and Anthony Ingraffea. The Cornell study was based on sketchy data (admitted to by Howarth & Ingraffea), and pure guesswork. It made the claim that shale gas was worse for global warming and the environment than burning coal.

The Carnegie study finds that burning natural gas is 20-50 percent cleaner than burning coal when producing electricity—a conclusion most people know instinctively. It’s only by doing extreme mental gymnastics that you can say burning gas is worse for the environment than burning coal.

Commodity Price | Hydraulic Fracturing | Industrywide Issues

Fracking Creates an Oil Boom – Now More Oil than Gas Rigs

August 18, 2011August 18, 2011

Turns out that horizontal hydraulic fracturing, the process used to get natural gas from shale layers, is also a renaissance for oil production as well. According to the latest figures, the number of rigs drilling for oil in the U.S. has just surpassed the number of rigs drilling for natural gas—for the first time in 18 years—thanks to fracking.

Hydraulic Fracturing | Industrywide Issues | New York | Public Opinion | Statewide NY

Marist Releases Dubious NY Opinion Poll on Fracking

August 18, 2011August 18, 2011

Yet another opinion poll of New York State residents on the issue of drilling for natural gas in the Marcellus (and Utica) Shale. This is the third statewide poll in a month. Like the two polls before it, this one found those those who support drilling, and those who oppose it, are just about evenly split. This most recent poll was done by Marist College and of the three polls, the questions in this one are the most flawed. It’s more like a push-poll—a poll that seeks to push a political message—rather than a poll which seeks to understand public opinion. The exact wording of the four questions asked are listed below, along with MDN commentary. The entire detailed breakout of how various groups responded to each question is embedded at the bottom.

Energy Services | Industrywide Issues | Pipelines | Tennessee Gas Pipeline

NJ Residents Unhappy with Pipeline’s Power of Eminent Domain

August 18, 2011August 18, 2011

This is a cautionary story. You know that MDN is pro- but safe drilling. You may also know that MDN does not think, in general, that pipeline companies should be granted status as public utilities with the right of eminent domain—the right to condemn and take land for its own use in constructing a pipeline. But pipelines are a complex issue. Should large, interstate pipelines be granted public utility status? Perhaps. They are similar to large electric lines running through a state. But what about smaller, gathering pipelines? Should they have the right to cross any property they want? MDN says no.