Enverus Rig Count @ 770 (+10); Marcellus @ 41 (+1), Utica @ 12 (-1)
The Enverus rig count, as of Wednesday, stood at 770 (599 oil-focused rigs and 171 gas-focused rigs). That is the highest number of rigs in operation since March 2020, the dawn of the pandemic. We are only 68 rigs away from the pre-pandemic high of 838 rigs. Last week the Marcellus had 41 rigs running, and the Utica 12 rigs, for a total of 53 active rigs in the M-U. Our chief rival, the Louisiana and Texas Haynesville, operated 71 rigs last week.
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NATIONAL: USA energy chief calls for more oil output; US weekly LNG exports down by one; Chief of U.S. energy regulator gives climate endorsement to natural gas; Why Biden’s killing of Keystone XL was an energy security blunder.
Bloomberg News (not the most reliable source) is reporting that HG Energy, a Marcellus/Utica driller headquartered in Parkersburg, West Virginia, is considering selling itself for $3+ billion. HG is a privately held company established on January 1, 2011 with backing from private equity firm Quantum Energy Partners. Where are the company’s assets located?
We’ve been tracking a bill in West Virginia that will finally, after more than eight years of trying, bring forced pooling to the Mountain State for Marcellus/Utica shale wells. Senate Bill (SB) 694 sailed through the WV Senate in record time and earlier this week hit the WV House. Yesterday the full House voted to approve SB 694 with some tweaks, sending it back to the Senate. Last night the Senate approved the House changes and the bill is now officially passed and on its way to the desk of Gov. Jim Justice for his signature. Will he sign it?
You have to hand it to the Rice boys, they sure know how to make an entrance and grab the spotlight. While attending the annual CERAWeek event in Houston yesterday, EQT CEO Toby Rice unveiled a plan to “unleash” American LNG, supplying Europe and the world with our LNG, which would displace coal, lower carbon dioxide emissions planetwide, and wean the world off the energy produced by despots like Russia and Iran. It is a bold plan with specifics.
On the same day that EQT CEO Toby Rice released his plan to “unleash” American LNG (see today’s companion story), the U.S. Energy Information Administration (EIA) published a post that talks about LNG production from a decidedly “leashed” perspective. While Rice envisions new pipelines, rigs, and export facilities that will handle a huge increase in Marcellus/Utica drilling, the EIA’s vision is status quo–constrained pipelines from the M-U region.
Spanish-owed Repsol owns 214,000 net acres of leases in the Marcellus Shale, primarily located in northeastern Pennsylvania in Bradford, Susquehanna, and Tioga counties. Part of Repsol’s acreage number includes 43,000 acres recently purchased from Rockdale Marcellus (see 
The West Virginia State Legislature passed House Bill (HB) 2581 on the last day of the annual WV legislative session in April 2021. HB 2581 required the State Tax Commissioner to develop a revised methodology to value oil and natural gas properties for the purposes of assessing property taxes. The State Tax Department submitted an emergency rule last summer that was, quite frankly, a mess. The rule created a complex system that is currently mired in controversy with both drillers and landowners confused about how much of a tax bill they will owe this year. There were two competing bills in this year’s session to correct the cockup from last year. Only one of them has survived and is close to passing.
As we write about today in a couple of different posts, EQT CEO Toby Rice has a bold vision to “unleash American LNG” to, in part, supply American natural gas to our friends in Europe. Rice’s plan is not an overnight plan, but it can work and it can reduce the amount of carbon dioxide emissions floating in Mom Earth’s atmosphere (if you care about such things, we personally do not). There are currently 14 (!) LNG export facilities approved by the U.S. that could be built and come online in the next year or two. That’s enough new plants to double our current LNG exports. Why haven’t the backhoes begun to dig on any of these projects? Two roadblocks.
The good news is that the Pennsylvania Dept. of Environmental Protection’s online reporting site is back online and we were able to retrieve new shale drilling permits for two weeks ago (Feb. 21-27). The bad news is that there was a paltry four permits issued during that week. Perhaps the DEP site/system is not yet fully populated with permits issued during that time? Ohio issued two permits during the same week. And West Virginia issued (gasp) zero during that week. This has to be the lowest number of permits issued during a single week we can remember–ever.
Although he’s a lame duck and heading for the exit door later this year (being term-limited, thank God), Pennsylvania Gov. Tom Wolf has come under withering attacks from many different sources for his reluctance to clear away obstacles that would encourage more shale gas drilling (and exporting) from the Keystone State. PA House Rep. Daryl Metcalfe calls Wolf’s response to expand the state’s natural gas industry “pathetically weak.” Ouch. Matthew Brouillette, president and CEO of Commonwealth Partners Chamber of Entrepreneurs, says Wolf’s green agenda is “fueling Putin’s war machine.” Double ouch. Wolf himself is flailing about, not knowing how he should respond to being outed as a Big Green lackey.
While it may be unseemly to discuss this, U.S. LNG exports are booming because of Russia’s invasion of Ukraine. Putin is threatening to withhold natural gas flows into Europe and Europe is scrambling to try and find new sources, including imports of American LNG. The biggest winners (so far) are U.S. LNG natural gas producers and the export facilities that liquefy and ship the gas. And don’t forget the LNG container ships too. Everyone is making a LOT more money right now on LNG exports. A Reuters article says the U.S. has recorded record export volumes (and profits) over the past three months.
New York’s newest governor, Kathy Hochul, is following in the footsteps of her former boss, Andrew Cuomo, by pledging to block natural gas hookups for all new construction across New York State. It’s insane. Such a ban will cause even more people to leave the state (they’re already leaving in droves). And yet she and the leftist Democrats pulling her strings persist in this path of self-annihilation. Republicans in the NY State Senate have had enough and are fighting back.
President Joe Biden and his surrogates have been blaming U.S. oil and gas producers for not producing more in the face of prices going through the roof. Big Oil & Gas have responded that the Bidenistas refuse to even talk with them about important issues, like onerous new regulations, blocking new pipelines, etc. It looks like the Bidenistas are finally desperate enough to at least sit down and talk. According to Bloomberg (not always a reliable source) Dept. of Energy Secretary Jennifer Granholm is having conversations with several oil companies at the CERAWeek conference.
Below is the list of events we are aware of that will be of interest to those with an interest in the Marcellus/Utica shale region for 2022. Some events are in the region (PA, OH, WV). Some are not (TX, OK, CO). Some are virtual/online, but most have returned to in-person. All of them are of potential interest to the MDN audience.