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$8 Billion in Free Cash Flow for Shale Gas Drillers “Off the Table”
Free cash flow (FCF) refers to a company’s available cash repaid to creditors and as dividends and interest to investors. Companies typically use FCF to buy back shares of stock, pay fatter dividends, or pay off creditors. When the price of natural gas went through the roof last year, natural gas drillers were rolling in the FCF. Now with natgas commodity prices in the basement, FCF money has been wiped off the table. How much? For six large natural gas-focused drillers (five of them focused on the Marcellus/Utica, one on the Haynesville), some $8 billion of FCF is “now off the table” according to an article by Bloomberg.
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Energy Transfer’s (ET) Lake Charles LNG project, in Louisiana, has been plagued with trouble from the beginning. The project began life as a 50/50 joint venture with Shell. However, Shell pulled out in 2020 (see 
There is no question of a huge world appetite for U.S. LNG exports. Even so, the effort to bring new LNG projects online in the U.S. is problematic for several reasons. An extensive article in the Financial Times says “intense competition between developers” and “escalating costs” are making it hard to bring new projects online. Where do things stand? Over the next four years, six projects currently under construction will come online, delivering an extra 64.82 million tonnes per year (mn t/y) of LNG. However, there are another 11 projects that have not yet made a final investment decision (FID). Some may end up getting built, some won’t. If (by a small miracle) all of the 11 were to get built as planned, it would deliver another 110.37 mn t/y of LNG for the world to purchase and use.
New York Gov. Kathy Hochul, a true extremist, is trying to ban natural gas hookups in every single new home and business across the “Empire” State (see 
OTHER U.S. REGIONS: Oil and gas job growth continued in March, production could expand; INTERNATIONAL: U.S. energy companies could help Ukraine win energy freedom; Concerns grow re European gas storage levels and US LNG cargoes.
Last August, Columbia Gas Transmission (a subsidiary of TC Energy) filed with the Federal Energy Regulatory Commission (FERC) to build the Virginia Reliability Project (VRP), which includes two new compressor units and the replacement of 49 miles of existing pipeline (see 
S&P Global Commodity Insights reports that natural gas production in the Marcellus/Utica has fallen this month, in April, by some 400 million cubic feet per day (MMcf/d) from the average production seen during the first quarter. The most notable declines are in eastern Ohio and southwestern Pennsylvania. Why is production down? Falling demand (from mild weather) and high rates of storage (extra supply) are crashing the spot price for natural gas traded at the region’s defacto benchmark trading hub–Eastern Gas South.
Last November, one of the ten natural gas storage wells at the Equitrans Rager Mountain Gas Storage Area in Jackson Township, Cambria County (in Pennsylvania) began to leak. The well leaked roughly 100 million cubic feet per day (MMcf/d) of gas into the atmosphere (see 
We read with some amusement a column by the CEO of Qamar Energy (an OPEC-tied consultancy based in Dubai, UAE) that says yep, American shale oil output has hit its zenith. It’s all downhill from here. The Big Oil companies have taken over all of the good shale assets in the States and they plan to drill less in places like the Permian Basin (in West Texas and eastern New Mexico). This latest prediction makes us laugh out loud. How many times before have we heard the same thing uttered from noobs, both domestic and (in this case) foreign. They consistently underestimate American ingenuity. Just when everyone predicts “peak oil” and declares shale production is all over, a new discovery is made. A new piece of technology is introduced. A new shale layer is explored. A new technique is adopted. This is the American way. And it confounds the “experts” every single time. Such is the power of free enterprise and capitalism.
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Yesterday the Bidenistas at the Dept. of (In)Justice (DOJ) and the Environmental Protection Agency (EPA) announced a “settlement” (i.e. bullying) with three pipeline companies–Williams, MPLX, and Kerr-McGee Gathering. The settlement requires the three to pay a combined $9.25 million in civil penalties and make improvements at 25 gas processing plants and 91 compressor stations in 12 states, including Ohio and West Virginia, worth another $16 million. The two federal agencies claimed the pipeline companies were violating federal and state clean air laws related to leak detection and repair (LDAR) requirements for natural gas processing plants at various facilities they own and operate across the country.
We appear to finally be at the end of an eight-year road with respect to new shale drilling regulations in Pennsylvania adopted back in 2016. Two days ago, the PA Supreme Court overturned a Commonwealth Court decision that blocked the Dept. of Environmental Protection’s (DEP) ability to control shale drilling near schools and public playgrounds. In October 2016, after five years in the making, PA adopted new shale drilling regulations called Chapter 78 (see