HH Futures Price Comes Within a Whisker of Hitting $10/MMBtu
We’re carefully watching for the day when the futures price of Henry Hub natural gas passes the important psychological barrier of closing above $10/MMBtu. We came close yesterday. Early yesterday the NYMEX September (“front month”) contract shot up to an intraday high of $9.98. But ultimately, the price closed at the end of the day at $9.68, which was up 34.4 cents from Friday’s close (and a new 14-year high). What drove the price in this latest race to the top? Dominoes.
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Tennessee Gas Pipeline’s (TGP) plan to flow more Marcellus gas to Westchester County, NY, and New York City, to be used for Consolidated Edison customers, is called the East 300 Upgrade Project. The East 300 project took a giant leap forward in April when the Federal Energy Regulatory Commission (FERC) issued permits that allow TGP to upgrade two existing compressor stations (in PA), and build a brand new compressor station in West Milford (Passaic County, NJ), just across the border and not far from Westchester County (see 
Earlier this year, one of the biggest nutjobs in Congress, Sen. Sheldon Whitehouse (Democrat-RI), introduced an excise tax, which he erroneously called a windfall profits tax, targeted at oil company profits. The bill would impose a 50% tax on the difference between the current sale price of a barrel of oil and the average price of a barrel of oil from 2015 to 2019, which was roughly $66 per barrel. It would apply to sales by companies that produce or import at least 300,000 barrels of oil per day (or did so in 2019). Whitehouse later revised his plan to a proposed 21% windfall profits tax on oil company profits over 10%. Believe it or not, Ohio appears to be debating whether or not to apply such a windfall profits tax to its energy producers.
Even with huge profits the likes of which haven’t been seen since, well, maybe forever–fossil energy companies in the U.S. are still having a tough time attracting private investment money. According to the Wall Street Journal, private equity raised $2.98 billion across seven oil and gas funds in the first half of the year. That is 40% lower than the amount raised in 12 oil and gas funds for the first half of 2021–when prices for oil and gas were half what they are now. But over in Europe, private equity investment in oil and gas is picking up!
U.S. Senator Joe Manchin, in an interview with the Associated Press, attempts to come off as the reasonable, middle-of-the-road, aw-shucks guy who sticks up for what he believes is right and the good of West Virginians. Don’t fall for it. He was pressured by the wackadoodle left in the Democrat Party, and he folded like a cheap suit. Manchin deserves to be voted out of office the instant that opportunity arises. We’re talking, of course, of Manchin’s betrayal of fossil energy through his support for one of the most destructive pieces of legislation that has passed since Joe Biden began to occupy the White House–the so-called Inflation Reduction Act (IRA), better known as the Green New Deal (aka Build Back Better). Manchin’s betrayal has profound consequences for fossil energy in this country.
We simply don’t understand the minds of liberals. They are frustratingly irrational. In June, German Chancellor Olaf Scholz spoke to Canadian Prime Minister Justin Trudeau about Germany buying LNG from Canada (see 
NATIONAL: Here’s why Buffett loves Oxy; Manchin’s permitting side deal highlights the energy transition’s central conundrum; INTERNATIONAL: German power prices smash record as energy panic engulfs Europe; Asia gas prices jump after Russia pipe work sends Europe benchmark price to record; Saudi prince says oil disconnect may force OPEC+ action; Charter rates for natural gas supertankers have surged 124%.
Morningstar provides what it calls “independent” research, ratings, and tools to help people invest. One of the so-called ratings is Morningstar’s environmental, social, and governance (ESG) investing ratings for companies. The ESG measurement is a clever way of steering investors (investors representing big funds worth billions of dollars) away from investing in fossil energy companies. Missouri Attorney General Eric Schmitt and the AGs from 18 other states (19 AGs in all) have launched an investigation into Morningstar’s ESG rating system that “plays politics with pensions and real people’s livelihoods.”
Looks like $2 billion is just too much of a temptation for Shell, Equinor (formerly known as Statoil), and U.S. Steel to resist. Those three companies have been a part of a joint effort with EQT, Williams, Southwestern Energy, and a few other companies in a group called Appalachian Energy Future (AEF), which was supposed to be the “one ring to rule them all” group aimed at enticing a hydrogen hub to one of the three Marcellus/Utica states (see 
Now we know why Diversified Energy liked Traitor Joe Manchin’s sell-out Green New Deal law, also falsely referred to as the Inflation Reduction Act (see 
A recent survey commissioned by the Gas and Oil Association of West Virginia Inc. (GO-WV) found that 81% of West Virginians support natural gas and oil drilling in the state. That is a staggering, overwhelming majority! Nearly as many (close to 80%) favor policies that increase domestic oil and gas drilling and the completion of pipeline projects, in order to ease inflation. Some 52% of West Virginians ranked inflation as the most important issue facing the state (the top vote-getter). Although the survey results don’t mention it, we wonder how many West Virginian’s are disappointed with Sen. Manchin for his role in increasing inflation with the recent Big Green bill (aka Inflation Reduction Act) signed into law with the help of Manchin?
Along with Harvard, Yale University used to be one of the top two higher ed schools in the country. Wow, how the mighty have fallen! Yale is a husk, a shell of what it once was. Yale now puts political ideology above science and generates garbage, calling it “research.” Yale is experiencing some major cognitive dissonance. At various points over the past decade, Yale researchers have claimed fracking does NOT contaminate water aquifers (see 
Yesterday the Pennsylvania Independent Fiscal Office (IFO) released its latest quarterly Natural Gas Production Report for April through June 2022 (full copy below). There were 133 new horizontal wells spud (drilled) in 2Q22, an increase of 13 wells (10.8%) compared to 2Q21. However, natural gas production volume was 1,836 billion cubic feet (Bcf) in 2Q22, a slight decrease (-0.9%) from 2Q21. It is the second quarterly decrease in production in a row. It appears that maybe PA has hit a plateau for natural gas production.