Marcellus Drilling News

Range Sending Natural Gas Liquids to Canadian Cracker Plant

September 9, 2011September 9, 2011

Range Resources is not waiting for a new multi-billion dollar cracker plant to be built in the Marcellus region to process the natural gas liquids they’re producing in the region. Instead, Range is going to send its natural gas liquids to Canada for cracking. Natural gas liquids contain ethane which can be processed or “cracked” to produce ethylene, a raw material used to make plastics.

Industrywide Issues | Meetings | Pennsylvania | Regulation | Statewide PA

PA DEP Sec. Krancer Addresses Shale Gas Meeting in Philly

September 9, 2011September 9, 2011

Some 1,600 people attended the Shale Gas Insight 2011 conference held Wednesday and Thursday in Philadelphia. At yesterday’s second and final day of the conference, State Department of Environmental Protection (DEP) Secretary Michael Krancer spoke in place of Gov. Tom Corbett at a lunchtime keynote because the governor was responding to the widespread flooding crisis. Among his remarks was an observation that MDN has repeatedly made—that much of the opposition to shale gas drilling is ideological and philosophical, not scientific:

Industrywide Issues | Pennsylvania | Pipelines | Statewide PA

New Marcellus Pipeline Regulations Coming to PA This Fall

September 9, 2011September 9, 2011

New regulations for the many gathering pipelines in Pennsylvania’s Marcellus Shale drilling regions will be a top priority this fall according to Republican legislators. It’s not clear under existing PA law which government agency has jurisdiction and responsibility for inspecting intrastate pipelines—and that “who’s on first” problem has led to safety lapses, including explosions.

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

NY DEC Issues Final Draft Drilling Regs – What Happens Now?

September 8, 2011September 8, 2011

What Happens Now? The New York State Department of Environmental Conservation (DEC) issued a “final” draft version of proposed new drilling regulations yesterday (see link to full copy below) after incorporating new information it received from a private study about the industrialization affects of drilling on local communities. The new draft Supplemental Generic Environmental Impact Statement (SGEIS) weighs in at 1,537 pages—a behemoth. DEC Commissioner Joe Martens set up a 90-day public comment period to end December 12th, instead of the previously promised 60-day period.

CONSOL Energy | Energy Companies | Hess | Ohio | Statewide OH

CONSOL Sells Ohio Utica Shale Rights to Hess for $593M

September 8, 2011September 8, 2011

Consol Energy Inc. has sold exploration and development rights for natural gas in the Ohio Utica Shale to Hess Corp. The $593 million deal was announced yesterday. The agreement gives Hess 50 percent of Consol’s mineral rights to some 200,000 acres. Hess will pay Consol $59 million when the deal closes in October and invest an additional $534 million in the operation over the next five years.

Chesapeake Energy | Energy Companies | Meetings

Chesapeake CEO Blasts Protesters at Shale Gas Conference

September 8, 2011September 8, 2011

MDN’s hat is off to Chesapeake Energy CEO Aubrey McClendon who spoke his mind yesterday at a shale gas conference in Philadelphia. Outside the industry event were hundreds of protesters, and McClendon had the following to say about them:

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):