Biden’s Treasury Secretary Attacks Fossil Fuel Funding by Banks
How can anyone say, with a straight face, that Biden has been “better for fossil fuel companies” than Trump? Some very short-sighted individuals say we should look at the price of oil and gas, and the stock price of oil and gas companies, and pronounce that Biden has actually been better for our industry than four years of Donald Trump. Yet Biden’s own Treasury Secretary, Janet Yellen, is warning Big Banks to quit funding fossil fuel companies…or else. She is threatening them! This isn’t Stalin’s Soviet Union!! It’s the land of the free and the home of the brave. Or at least it used to be.
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According to an analysis done by S&P Global Market Intelligence, the five largest drillers in the Pennsylvania Marcellus Shale resumed their drilling in June in a big way. S&P’s analysis shows those five drillers were responsible for 51% of the new drilling permits issued last month, up from 28% of new permits issued in May. Perhaps we know why. The price of natgas at regional hubs in PA rocketed over the past month. At the Leidy Hub in the northeast’s dry gas window (centered on Susquehanna County, PA), cash prices went from a low of 93.7 cents/MMBtu on May 3 to $3.07/MMBtu at the end of June.
A natural gas-fired electric power plant planned for Charles City County (near Richmond, Va.) by NOVI Energy known as C4GT (Charles City Combined-Cycle Gas Turbine) is now officially dead. NOVI has been working on the 1,100-megawatt project for over six years. An even larger plant planned for the same general area, the 1,650 MW Chickahominy Power Station (a project of Balico) is still in the works (see 
Charlie Melançon is a former U.S. Congressman from Louisiana who played an integral role in rebuilding Louisiana’s infrastructure following the devastation caused by Hurricanes Katrina and Rita. Melançon served on the House Committee on Energy and Commerce, which oversaw energy policy and environmental quality among other issues. He sees a lot of parallels between his home state of Louisiana and Pennsylvania. Melançon has written an editorial appearing in a major PA newspaper hoping to inform and encourage Pennsylvanians to wake up to the fact that pipelines are the key to PA becoming the energy hub of the northeast. Conversely, without (more) pipelines, PA will not realize its potential. Pipelines are the key. Melançon is uniquely qualified to know.
What’s taking the shale oil industry so long to restart drilling in a big way? Shale oil production remains some 1.4 million barrels per day (15%) below pre-COVID pandemic levels despite oil prices reaching near three-year highs of $77 per barrel since the start of this year. When you dig into the numbers it becomes apparent what’s happening. A lot of shale drilling is now done by big, integrated major oil companies–the Exxons and Chevrons and BPs of the world. Shale production from the majors is 68% below pre-pandemic levels. If you look at the output of smaller independent, non-publicly traded oil drillers, their production is only 2% below pre-pandemic levels.
A few weeks ago MDN brought you the news that three far-left Democrat judges on the U.S. Court of Appeals for the D.C. Circuit overturned a Federal Energy Regulatory Commission (FERC) approval for a long-completed and flowing natural gas pipeline in the St. Louis, MO area–a pipeline that flows Marcellus/Utica gas to residents, businesses, and electric generating plants throughout the region (see 
The Tennessee Valley Authority (TVA) is a federally-owned electric utility corporation in the U.S. TVA’s service area covers all of Tennessee, portions of Alabama, Mississippi, and Kentucky, and small areas of Georgia, North Carolina, and Virginia. TVA is the sixth-largest power supplier and the largest public utility in the country. We have some GREAT news: TVA is spending over $1 billion to replace six coal-fired plants with natgas-fired turbines.
An analyst writing on the Seeking Alpha investors website confirms our concerns over the potential merger between Marcellus driller Cabot Oil & Gas and Permian driller Cimarex Energy (see 
According to S&P Global Platts, a widening gas storage deficit in the Eastern U.S. is “raising alarm in the Northeast downstream market area” where winter 2021-22 forwards prices are up sharply since the start of injection season beginning April 1st. In particular, the forward contracts (prices negotiated now for future delivery of natural gas) for January 2022 in Boston and New York City are through the roof. It’s pretty plain why this is happening–no new pipelines.
We’ve made no bones about the fact we’re dubious of most so-called ESG (environmental, social, governance) initiatives by any company, including shale oil and gas drillers. But there are many in our industry who have (seemingly overnight) embraced ESG with open arms. One of them is the chairman of the board for DJ Basin producer Civitas/managing partner at the Kimmeridge Energy Management, Ben Dell. Dell presents a vision of the shale energy future like this: There are 10-15 shale drillers nationwide, and every one of them is operating with net zero carbon emissions. What may sound like nirvana to Dell sounds like dystopia to us.
We recently spotted an article in the Wall Street Journal about the prospect of combining horizontal drilling and hydraulic fracturing (collectively called “fracking”) with geothermal energy. The article claims fracking could be used to generate energy with “no carbon emissions.” Green nirvana! At last!! But is this really possible? Is it actually economical? Let’s take a closer look.