EQT to Write Down Up to $1.8 Billion in M-U Assets for 4Q19

In a Securities and Exchange Commission (SEC) filing made yesterday, EQT, the country’s largest natural gas producer, informed the SEC (and investors) it will likely take an impairment charge (“write down”) for the value of some of its Marcellus/Utica assets–by $1.4 to $1.8 billion. Which pales in comparison to Chevron’s write down of it’s M-U assets to the tune of $5+ billion (see Chevron Writes Down $5B+ in Marc/Utica Assets, Looks to Sell All).
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New IFO Report: PA Shale Drillers Paid $1.5B in Royalties in 2017

Just coming to light for us now is a report issued by the Pennsylvania Independent Fiscal Office (IFO) that estimates the amount of gas production royalties paid by drillers to landowners for calendar year 2017 (the most recent year available). It’s a fascinating report that breaks down royalty payments by the eight top gas-producing counties in the state. You may be surprised to learn the county producing the most natural gas in the state (Susquehanna County) does NOT, in fact, pay out the most in landowner royalties.
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3rd Lawsuit Filed Against Energy Transfer re Mariner Corruption

MDN previously told you about unconfirmed rumors that the FBI is investigating the PA Gov. Tom Wolf administration over how permits came to be issued for the Mariner East 2 pipeline project (see FBI Investigates Wolf Admin for Corruption re ME Pipe Permits). The allegation/rumor is that Wolf and/or members of his staff pressured the Dept. of Environmental Protection (DEP) to approve permits for the pipeline project in return for something (money or something else). Two different law firms seized on the rumor as reason enough to launch speculative class action lawsuits for shareholders, accusing Energy Transfer (the builder) of corruption (see 2nd Class Action Lawsuit Against ET/Sunoco re Mariner East Pipe). A third such lawsuit was filed last week–this one by a public employee retirement fund.
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Talen Energy Sells PA Pipeline to Adelphia Gateway for $155M

In December the Federal Energy Regulatory Commission (FERC) issued a final approval for the Adelphia Gateway pipeline project (see FERC Issues Final OK for Southeast PA Adelphia Gateway Pipeline). Adelphia is a plan to convert an old/existing oil pipeline stretching from Northampton County, PA through Bucks, Montgomery, and Chester counties, terminating in Delaware County at Marcus Hook, into a natural gas pipeline. To flow Marcellus gas to southeast PA. The builder lacked one key ingredient–the pipeline!
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Fed Court Rules Columbia has Right to Use OH Gas Storage Field

Medina, Ohio

In a phenomenally complex court case decided last July by the U.S. Court of Appeals for the Sixth Circuit, Columbia Gas (TC Energy) won the right to continue storing natural gas in an underground storage field near Medina, Ohio. The landowners, who claim Columbia owes them (more) money for using the land under their property, appealed the decision to the U.S. Supreme Court. The Supremes turned it down yesterday, meaning the Sixth Circuit ruling stands.
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Bill Separating PA Conventional from Shale Regs Advances in Senate

For years Pennsylvania’s small, independent conventional oil and gas drillers have objected to the one-size-fits-all regulations concocted by the Gov. Tom Wolf Administration that applies the same regulations to them as to big shale drillers. The two types of drilling are apples and oranges. To make small drillers jump through the same hoops as big shale drillers will bankrupt many of the smaller drillers. So in 2016, PA’s conventional drillers filed a lawsuit to block Wolf’s new regs from going into effect (see PA Conventional Drillers File Lawsuit to Stop New DEP Regulations).
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NY DEC Approves Landfill Expansion to Accept More PA Drill Cuttings

Location of C&D Hakes Landfill (click for larger version)

This no longer qualifies as a minor miracle, it’s a MAJOR miracle. The Cuomo-corrupted New York State Dept. of Environmental Conservation (DEC) has just approved the only remaining way NY benefits from the Marcellus–by allowing a landfill in Steuben County to expand so it can accept more drill cuttings from PA Marcellus drillers.
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PA Superior Court Rules Landowner Can’t Nix Lease for Shut-ins

A recently decided court case, while not precendential (doesn’t apply to anyone else other than the landowners/drillers in this case), is still instructive. This story begins when the Wilson family in Armstrong County, PA (western part of the state) leased three different tracts of land totaling 473 acres to Synder Brothers in 2003 for vertical drilling.
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Big Green Tries to Whip Up Opposition to PTT Ohio Cracker

Big Green is doing its best to stir up opposition to PTT Global Chemical’s proposed ethane cracker plant in Belmont County, Ohio. Big Green is also trying to hide its involvement and pass itself off as organic, local community opposition. Not true. Last week the same so-called community organizer addressed an anti meeting at a local church and organized a “protest” a few days later.
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Logistics Co. Opens Warehouse in Bradford, PA Targeting Marcellus

Phoenix Logistics, headquartered in Milwaukee, Wisconsin, targets supply chain companies in a number of industries with warehousing, distribution, and transportation. One of the industries they target is the oil and gas sector. Phoenix has just opened a new 400,000 square foot warehousing facility in Athens (Bradford County), PA, targeting companies in the Marcellus.
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New Fortress Energy Gets $800M Loan to Build LNG Projects

New Fortress Energy has a unique business model. The company builds the plants to liquefy and export natural gas (LNG), the facilities (in other countries) to import the LNG, and even some of the gas-fired power plants that will use the gas to produce electricity in those countries. Our primary interest in New Fortress is a series of LNG export plants they are building in landlocked northeastern Pennsylvania (see Work Continues to Clear Site for NEPA Landlocked LNG Export Plant). The company has just signed a deal for $800 million loan to fund its LNG “terminals and infrastructure around the world.”
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THE Dela. Riverkeeper Tries to Shame FERC to Reject PennEast Pipe

Last week three Big Green groups–the New Jersey Conservation Foundation, The Watershed Institute, and THE Delaware Riverkeeper–asked the Federal Energy Regulatory Commission via a joint letter to not issue an extension to the PennEast Pipeline, long-delayed largely because of those groups’ ongoing lawsuits (see Big Green Groups Ask FERC to Deny PennEast Pipe More Time). Two days later THE Delaware Riverkeeper sent a followup letter to FERC to make “further comments” bashing PennEast.
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NY AG Gives Up on Trying to Shake Down Exxon After Court Decision

As we reported in December, New York Attorney General Tish James and her highly-paid associates were thoroughly, completely, 100% humiliated in court when their case against Exxon Mobil accusing the company of screwing shareholders by keeping secret knowledge they are toasting Mom Earth, is itself toast (see Judge Finds Exxon Not Guilty in Fraud Case – NY AG Humiliated). Exxon is being sued by other states, including Massachusetts, for the same thing. Those cases are also close to collapse. The good news is that Tish has had enough humiliation–she won’t appeal the Exxon case to a higher court. That is, NY has lost, Exxon has won. There is still justice in the wacky world of New York State–who knew?
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Shale Energy Stories of Interest: Mon, Jan 13, 2020

NATIONAL: E&Ps continuing to pull back as U.S. rig count plunges further; Energy sector predictions for 2020; Mild winter sends U.S. natural gas prices tumbling; INTERNATIONAL: BC authorities investigating deadly traps discovered along Coastal GasLink route; Russian gas pipeline to Europe faces delay due to U.S. sanctions.
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IFO Projects 2019 PA Impact Fee Revenue Fell by $53.6M (21%)

In 2019 Pennsylvania raised a record high of $247 million from its version of a severance tax, called an impact fee, based on drilling activity from 2018 (see PA IFO Report Says Record High Impact Tax for 2018 – $247M). The state’s Independent Fiscal Office (IFO) is out with projections for how much revenue will be raised this year (based on drilling in 2019). Given we hit a downturn last year, you won’t be surprised to learn the impact fee will drop by $53.6 million (21%), to a projected $198.2 million.
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