Enverus Rig Count @ 624 (+7); Marcellus @ 32 (+1), Utica @ 13 (+0)
The latest weekly Enverus U.S. rig count shows total rigs in use hitting a new post-pandemic high. For the week ending August 19, the rig count stood at 624, up 7 rigs from the previous week. That’s yet another new rig count high since April 2020. The Marcellus play regained a rig it lost from the previous week, while the Utica stayed even for a second week in a row. Collectively the M-U is currently running 45 rigs, up one rig from the previous week.
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NATIONAL: Why LNG exports from the US are off to the moon; Biden’s America-last energy policy; INTERNATIONAL: LNG will not save Europe from winter gas crunch; EU on a ‘tightrope’ as winter gas supply worries increase; Putin plays Biden with gas price hike in Europe; Australia’s biggest natural gas producer is slammed for teaching kids how to drill for oil; GALACTIC: Rocket Man – the surprising simplicity of many rocket fuels.
During the second quarter (May through June), ten of the largest oil and gas producers covered by S&P Global Market Intelligence saw their NGL (natural gas liquids) revenues grow substantially from the same period a year ago. Those ten companies, half of them drillers in the Marcellus/Utica region, saw NGL prices increase from 104% to as high as 261%. The extra money from NGLs made what turned out to be a down quarter financial-wise (because of bad bets on hedges) better than it would have otherwise been.
Mountain Valley Pipeline (MVP) is a 303-mile pipeline from West Virginia to southern Virginia that is 92% complete (in-the-ground). The pipeline is targeted to be in-service by the middle of next year. The project is currently stalled, temporarily, due to frivolous lawsuits filed by disgusting Big Green groups like the Sierra Club. MVP Southgate is an extension to MVP that will travel an additional 75 miles from southern Virginia (where the current MVP terminates) into North Carolina. MVP Southgate has not yet broken ground. The project has been opposed by North Carolina and the same mish-mash of “environmental” groups that opposed MVP. However, this week there are two fewer groups opposed to Southgate than there was last week.
We hate to keep harping on this, but we keep reading stories about a developing issue here in the Marcellus/Utica. That issue is the lack of pipeline capacity to flow an increase in gas production from the northeast to other locations. The experts at RBN Energy predict that within the next two years M-U producers will “hit the capacity wall” and run out of extra pipeline capacity for an ever-increasing amount of natural gas production. When will the Northeast run out of “exit capacity” and how bad could constraints get?
The Pennsylvania House Environmental Resources and Energy Committee held a hearing on Tuesday that investigated the economic benefits of the state’s 1,000-plus miles of gas pipelines. The adults in the room all acknowledged even if there is a transition away from fossil fuels “someday,” pipelines hauling natural gas around the state will need to be kept up and running for *at least* the next 30 years (likely longer). Pipelines are here to stay. A band of radical anti-fossil fuel nutters behaved badly during the hearing, as they so often do, and had to be ejected.
Whether we think it’s a good idea or not (we don’t), there is no denying that the Marcellus/Utica industry has collectively jumped off the RSG/ESG cliff. RSG stands for “responsibly sourced gas” and ESG is “environmental, social, governance.” Responding to pressure from investors and customers, most M-U drillers are now making moves to prove the natural gas they produce has been produced using practices that protect the environment. We say the gas has always been produced responsibly and we have nothing further to prove, but hey, who are we? Anywho, the Pittsburgh Business Times delves into the programs–Project Canary and MiQ–that M-U drillers have embraced as their preferred method of proving environmental friendliness.
“Look ma, no hands on the steering wheel!” Forget about self-steering/self-driving cars. That’s yesterday. Now we have self-steering (or “autonomous”) directional drilling–oil and gas drilling that steers itself using artificial intelligence. Brought to you by the largest oilfield services company in the world: Schlumberger.
It’s been a long, tough slog for Equitrans Midstream’s Mountain Valley Pipeline (MVP), a 303-mile pipeline from West Virginia into southern Virginia. The project is 92% done and in the ground. The final bits should be done within the next year and it will go online (if the crick don’t rise and the Lord don’t come) in mid-2022. One of the places where the pipeline was recently installed is close to a small clump of homes (called a “village”) in the Virginia mountains of Giles County. A place called Newport. A recent article in the Roanoke Times would have you believe the pipeline has somehow devastated the local community. It has not. We’re here to provide perspective on pipelines as good neighbors.
There is a very real and tangible cost to the delays coming from the Federal Energy Regulatory Commission (FERC) with respect to reviewing natural gas pipeline projects. Those delays, intentionally created by current FERC Chairman Richard “Dick” Glick, are costing West Virginians jobs and money. JB McCuskey, the state auditor for WV, should know. He audits how tax dollars are spent in the state. His office reviews and approves general operating budgets for some 700 municipalities, counties, and school districts across the state. McCuskey says FERC is tangibly hurting the state of WV by dragging its feet in reviewing pipeline projects.
Spire STL is a 65-mile pipeline that connects to and flows Marcellus/Utica gas from the Rockies Express (REX) pipeline to residents and businesses in the St. Louis, MO area. The pipeline began flowing gas in late 2019 (see 
Yale University operates a program it calls the Yale Program on Climate Change Communication. A better name would be the Joseph Goebbels Program for Climate Change Brainwashing. The chief propagandists at the once-great university are desperately trying to figure out how they can turn the public against clean-burning, abundant, and cheap natural gas. The problem, it seems, is with the word “natural.” In polling research, Yalies discovered if they could force you to stop using the phrase natural gas and instead force you to call it methane, you would begin to “think right” about this evil, filthy, vile substance. One thing Yale won’t tell you is this: Where they get money to conduct this kind of “research.” Could the funding be coming from China? Or Russia? Or Iran?
Last week both Pennsylvania and West Virginia issued permits to drill new shale wells. Ohio remained skunked for a fourth week in a row. PA issued 30 new shale permits–one of the highest weekly tallies we’ve seen. PA’s permits were issued for wells on 11 pads, meaning there were a number of multi-well permits issued. WV issued 7 new shale permits, all of them for the same pad being drilled by EQT in Wetzel County.