EIA Aug DPR: Shale Gas Production to Drop Second Month in Row
The latest monthly U.S. Energy Information Administration (EIA) Drilling Productivity Report (DPR) for August issued yesterday (below) shows the EIA believes shale gas production across the seven major plays tracked in the monthly DPR for September will *decrease* production from the prior month of August. This is the second month in a row EIA predicts shale gas production will decrease for the combined seven plays. EIA says combined natgas production will slide by 147 MMcf/d (million cubic feet per day). The Marcellus/Utica, called “Appalachia” in the report, is predicted to slump by 22 MMcf/d in September compared with August.
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In November of 2020, MDN told you about a deal Talen Energy cut with the odious Sierra Club, signing a pledge to convert several coal-fired power plants to use natural gas in both Maryland and Pennsylvania (see 
ECA Marcellus Trust I, the royalty interest holder in some of the wells drilled and maintained by Greylock Energy in Greene County, PA, announced it would issue no payout to unitholders for 2Q23. The company paid out 4.3 cents per unit in 1Q23; 12.4 cents per unit in 4Q22; and 18 cents per unit in 3Q22. The company continues to hold back some profits ($90,000 in 2Q23) to build a cash reserve for “future known, anticipated or contingent expenses or liabilities.” Consequently, ECA will not pay anything to unitholders for 2Q.
We’re off to the races! M2X Energy, based in Florida, announced the company’s first modular gas-to-methanol plant reached a key milestone and produced its first methanol at the Richard Childress Racing campus in Welcome, N.C. Richard Childress Racing is a motorsports organization with a long history in NASCAR racing and engine development. M2X uses methane (natural gas) that otherwise would be burned (flared) and converts the gas into methanol which is used as a chemical feedstock to create other things, like gasoline, antifreeze, plastic bottles–even LED and LCD screens.
Last December, Rice Acquisition Corp II, a special purpose acquisition company (SPAC) started by the Rice brothers (Danny, Toby, and Derek), announced a deal to acquire NET Power–an electric power developer with revolutionary new technology to capture every last molecule of carbon dioxide from natural gas-fired power plants (see 
MARCELLUS/UTICA REGION: WV PSC makes decisions on natural gas case; OTHER U.S. REGIONS: ArcLight to acquire ownership interest in Kleen Energy Systems; Why a natural gas pipeline is being built in mid-Michigan; NATIONAL: Kimmeridge sees fewer but bigger PE players in shale; Oil firms face hard choices after a year of big spending; How multibillion dollar investments in AI are driving O&G innovation; INTERNATIONAL: Oil’s push toward $90 gets lift from physical markets everywhere.
Looks like the three Democrat judges of the U.S. Court of Appeals for the Fourth Circuit (4th Circuit) value their own jobs more than defeating the Mountain Valley Pipeline (MVP) project. On Friday, the three-judge panel that has opposed MVP in just about every decision they’ve issued since 2018 dismissed the remaining two cases against MVP after being overruled by the U.S. Supreme Court two weeks ago (see 
Even though the radicalized left has been defeated in their attempts to block the 303-mile Mountain Valley Pipeline (MVP) project, they won’t go quietly (they never do). The liars of the left are trying to plant seeds of fear and doubt in the residents of West Virginia and Virginia that as soon as the remaining 6% of MVP pipe is buried in the ground and begins to flow, a piece of that newly installed pipeline will blow up because the pipe has been sitting above ground for years and the special epoxy coating that prevents corrosion has degraded by sitting in the sun. Yet another lie from the left.
It’s gettin’ ugly out there. For the fifth week in a row and the 14th in the last 15 weeks, the U.S. active rig count lost rigs. Last week the number decreased by ANOTHER five rigs, after falling five rigs the week before, and five the week before that–now down to 654 active rigs across both oil and gas. Sadly, the Marcellus dropped two rigs last week for a combined M-U rig count of 43–the lowest this year. Some 15 weeks ago, the M-U lost four rigs (going from 53 down to 49). Eight weeks ago, we lost another rig, down to 48. Two weeks ago, we lost two more rigs, down to 46. Last week we lost one. And this week, two more rigs disappeared–both gone from Pennsylvania. The trend is not our friend. We wish we had better news.
Epsilon Energy, a relatively small company, used to concentrate most of its effort on developing Marcellus Shale wells. However, over the past year, the company has expanded into other plays and now owns assets in the Anadarko (Oklahoma and Texas) and the Permian (Texas and New Mexico). The company, which is traded publicly, issued a quarterly update last week. In a first (that we’ve noticed), Seeking Alpha listened in and provided a transcription of the company’s conference call with analysts. During the Q&A portion of the call, Epsilon CEO Jason Stabell said the netback price the company gets for its production in the Marcellus during the summer is “gnarly.” During 2Q23, Epsilon received an average of $1.35/Mcf for its produced gas.
Last December, PPL Corporation subsidiaries Louisville Gas and Electric Company (LG&E) and Kentucky Utilities Company (KU) announced a plan to replace 1,500 megawatts of aging coal-fired generation (nearly one-third of Kentucky’s coal fleet!) with two 621-megawatt natural gas combined-cycle units along with several unreliable, intermittent solar projects (see 
Banpu is Thailand’s largest coal mining company. However, it is looking to reduce the amount of revenue it derives from coal from around 66% today to 50% by 2025. One of the ways Banpu is accomplishing that objective is by investing in American shale gas, American gas-fired power plants, and now, American carbon capture and sequestration (CCS). Banpu partners with Kalnin Ventures and operates BKV Corporation (Banpu Kalnin Ventures), the American arm of Banpu (96% owned by Banpu). Over the past seven years, BKV has become one of the top 20 gas-weighted natural gas producers in the U.S.
The American Gas Association (AGA) is a trade organization founded in 1918 that represents and advocates for local energy companies that deliver natural gas throughout the United States. With more than 200 members (BIG companies), the AGA educates the public about the importance of natural gas, supports natural gas utilities in their efforts to make their operations safer, more efficient, and more environmentally friendly, and serves as a resource for local, state and federal policymakers when it comes to regulating the natural gas industry. The AGA is one of the country’s premier natural gas associations. The AGA says its members “support the safe, reliable, affordable and sustainable delivery of natural gas to millions of Americans.” Although Eversource, the largest utility company in New England serving 4 million customers in Connecticut, Massachusetts, and New Hampshire, provides its customers with electricity and natural gas, it has quit its membership in the AGA.
Ascent Resources, founded as American Energy Partners by gas legend Aubrey McClendon, is a privately held company focusing 100% on the Ohio Utica Shale. Ascent, headquartered in Oklahoma City, OK, is Ohio’s largest natural gas producer (356,700 leased acres) and the 8th largest natural gas producer in the U.S. The company issued its second quarter 2023 update on Wednesday. Ascent’s net production averaged 2.1 Bcfe/d (billion cubic feet equivalent per day) during 2Q23, up 6% over 2Q22 but down from 2.2 Bcfe/d in 1Q23. The company made $250 million in profit during 2Q23, down just a bit from the $285 million it made in 2Q22.
The KeyState Natural Gas Synthesis project in Clinton County, PA, is developing the first carbon capture project in Pennsylvania, which will locally produce hydrogen, ammonia, and urea (see