WA, NM Congress Members Visit NEPA, Impressed with Marcellus Ops
Two out-of-state Members of Congress, Rep. Dan Newhouse (Washington-04) and Rep. Yvette Herrell (New Mexico-02), both members of the Congressional Western Caucus, recently took a field trip to northeastern Pennsylvania to get a firsthand look at how Marcellus drillers and midstream companies get the job done. They came away thoroughly impressed, to the point they penned an editorial for a local newspaper that begins with this sentence: “Pennsylvania’s natural gas producers are providing safe, reliable, and affordable energy for the United States and setting an example for states across the country.”
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Conservatives (including MDN) eagerly watch election results as they came in this past Tuesday night. Conservatives rightly anticipated the Virginia governor’s race would go to the Republican, Glenn Youngkin. Conservatives had hoped for a good showing in deeply blue New Jersey, with 1.1 million more registered Democrats than Republicans. We got much more than that! The odious leftist Democrat Phil Murphy ran for reelection for another four years in the Garden State. The unknown Republican running against him, Jack Ciattarelli, came within (under) 1% of the same number of votes as Murphy. Hopefully, Ciattarelli will demand a recount. The question is, did energy have anything to do with NJ’s vote, and if Ciattarelli pulls off an upset, what might that mean for pipeline projects canceled under Murphy?
OTHER U.S. REGIONS: Venture Global signs largest-ever supply deal to export LNG to China; Smaller oil firms pay top dollar for Permian land as large players cash out; California forced to embrace natural gas; Debated natural gas pipeline brings protestors to Springfield City Hall; NATIONAL: US LNG exports climb week over week; Biden should ‘back off’ anti-oil policies, Pioneer CEO says; U.S. shale producers signal more oil coming, as OPEC counts on restraint; Gas prices are sky high and Bank of America warns $120-a-barrel oil is on the way; INTERNATIONAL: OPEC+ rejects Biden plea.
Chesapeake Energy released its third quarter update yesterday. The company has newfound energy (pun intended) since emerging from bankruptcy earlier this year and ejecting most (but not all) of its top management along with an entire refresh of the board. The company reports a net loss of $345 million during 3Q21, which is better than the $745 million net loss in 3Q20. There’s no one big reason for the loss. Revenues were down a bit ($890 million in 3Q21 vs. $960 million the year before), marketing costs were up a bit ($625 million vs. $450 million), etc. The financial loss didn’t phase investors as the stock price popped up by 3.3% from the day before.
Coterra Energy, the new name for the two merged companies that were Cabot Oil & Gas and Cimarex Energy (a Permian driller), issued its third quarter update yesterday. Cabot has been and remains one of our favorite Marcellus/Utica drillers. According to Tom Jorden, CEO of Cimarex and now CEO of the combined company, the integration of the two companies is “well underway” and has been “a full court press” since May. In the aggregate, Coterra brought 61 wells online during 3Q and plans to operate seven rigs and four completion crews during 4Q. Five of the rigs are in the Delaware Basin (in the Texas Permian), and two of the rigs are in Susquehanna County in northeast Pennsylvania. What about details for Marcellus operations during 3Q?
Gulfport Energy, the third-largest driller in the Ohio Utica Shale (by the number of wells drilled), emerged from bankruptcy in May with a new board and new top management. The company issued its third quarter update yesterday. Unfortunately, the company got hosed on hedges, losing $622 million during 3Q21 on hedges which resulted in an overall loss of $463 million for the quarter. The company produced 973 MMcf/d (million cubic feet per day) during 3Q21, down slightly from an average 992 MMcf/d a year ago. That production is across both shale plays where Gulfport drills: the Ohio Utica and Oklahoma SCOOP.
It is obvious MDN is out of step with the industry it supports and promotes. We think the federal EPA’s announcement on Tuesday that it will draft and adopt new emissions regulations aimed at reducing methane (i.e. natural gas) emissions is clearly unconstitutional (see 
It is alarming and shocking how leftist ideology has infected the financial industry worldwide. Banks and asset managers representing 40% ($130 TRILLION) of the world’s financial assets have pledged to meet the goals set out in the Paris climate agreement. More than 450 firms, holding nearly half of the money that gets invested, now belong to the Glasgow Financial Alliance for Net Zero. Their aim? To defund all fossil fuel energy. We’re kind of speechless.
We suppose it takes a lot to surprise the CEO of one of the world’s biggest pipeline companies. Yet yesterday Williams CEO Alan Armstrong expressed his surprise that even with the dramatic increase in the price of natural gas during the third quarter, demand for natural gas was “inelastic” and remained high. Translation: Williams had all it could do to keep up with flowing natural gas through it’s extensive pipeline system, even with super-high prices. Much of the demand to flow gas came from the Marcellus/Utica.
Equitrans Midstream, formerly known as EQT Midstream, issued its third quarter update yesterday. The main focus (for us) of the update is new or updated information related to the company’s all-important Mountain Valley Pipeline (MVP) project and those projects connected to MVP–including Hammerhead and Southgate. Yesterday we learned Equitrans still believes MVP, a 303-mile pipeline from West Virginia to southern Virginia, is on track to start up in “summer 2022.” The company plans to begin construction of a related extension of MVP, called Southgate (from Virginia into North Carolina) in 2022 and bring it online in early 2023.
