White House Likes Massachusetts Radical to Fill FERC Seat
What a disaster, with respect to regulating oil and gas, the Biden administration continues to be. Word is leaking around Washington, D.C. that the administration has vetted and likes Maria Duaime Robinson, a leftist Democrat Massachusetts state representative, to replace Federal Energy Regulatory Commissioner Neil Chatterjee (RINO). So-called renewables companies are salivating at the prospect of having one of their own putting the screws to the oil and gas industry.
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MARCELLUS/UTICA REGION: Naming names: FirstEnergy says it gave $20M to a dark money group; NATIONAL: USA oil refiners score Supreme Court victory; Thwarted Trump oil buy would have given Biden $6B; The case for a longer-term oil and gas bull market; Democrats in oil country worried by party’s natural-gas agenda; Supercritical CO2 for long-haul piping and enhanced oil recovery; Larger solar power plants increase local temperatures; INTERNATIONAL: BP looking to hydrogen expansion to ‘reinvent’ natural gas.
We’re always jazzed when we unearth information related to the Marcellus/Utica nobody else has yet discovered or highlighted. We think we’ve found something interesting related to a recently updated spreadsheet maintained by the U.S. Energy Information Administration (EIA). On Friday the EIA published a post to trumpet the news that 19 “liquids” pipeline projects are “moving toward completion in 2021.” In reviewing the list we discovered two projects related to the M-U in 2021, and a third M-U project coming in 2022. All three have an impact on the ability of M-U drillers to move NGL’s out of our region to higher-paying markets.
According to Bloomberg, the world’s importers of natural gas are waking up to a stark realization: “there isn’t enough supply to go around.” Our long, cold winter (so much for “global warming”) coupled with a warm and toasty summer has (a) depleted natural gas supplies, and (b) will keep those supplies low going into next winter. Despite all the blabbering from Europe and Asia about switching to so-called renewable energy sources, the stark fact is that natural gas supplies more heat and electricity to the world than any other single source. Period. Sooner or later the left must deal with reality and pull their collective heads out of their… fantasies.
There is no denying that permits issued to drill new wells in all of the Marcellus/Utica, including Ohio, have gone down over the past couple of years. Price is the main reason–the low price of natgas, that is. Even with all of the lower drilling budgets, less drilling, and (yes) layoffs, we spotted a statistic about Ohio that gives us encouragement. According to JobsOhio, the state’s economic development agency, “about 200,000 Ohioans are employed by the oil and gas industry.” That’s great news!
One of our main criticisms with what is supposed to be real scientific inquiry in recent years is that real science–observation and testing to verify a hypothesis–has been replaced by computer models of what “may” or is “likely” to be true. We have yet another case in the form of a study recently published by a Syracuse University researcher who says using computer models he can prove regular old conventional oil and gas drilling is just as bad for methane migration into water supplies as horizontal shale fracking. The researcher claims there’s not a dime’s worth of difference–that both are bad for groundwater supplies.
As we have pointed out more than a few times, one of the biggest problems we have with so-called ESG (environment, social, governance) programs lauded by the oil and gas industry, including those in the Marcellus/Utica, is the lack of an objective standard. Anyone can define ESG any way they want. In fact, last week we published an article in which the president at LNG Europe Institute for Methane Fuels (based in Austria) said, “ESG is an utter waste of space and money to provide a bunch of expensive consultants with ‘good for nothing’ jobs and also to provide cover for managers of mainly public companies” (see 
Cheniere Energy Inc., the biggest LNG exporter in the U.S., is using its bigness to lean on natural gas drillers (in the upstream) and pipeline companies (in the midstream) to “clean up the natural gas supply chain.” How? To force drillers and pipelines to get their operations to so-called net zero carbon emissions sooner rather than later. Given the fact Cheniere buys up 7-8% of ALL natural gas supplies in the country on any given day, they can and are throwing their weight around to force others to do what they want. The LNG tail is wagging the natural gas dog.
How’s this for serendipity? We were just thinking about the latest violation of expectations by PTT Global Chemical. In February the company adamantly said a final investment decision (FID) to build the $10 billion ethane cracker plant project in Belmont County, OH would happen by “middle of 2021” (see 
Yesterday the July NYMEX gas futures contract (the current contract) went up by 8.5 cents to settle at $3.42. The August NYMEX futures contract closed at $3.44, also up 8.5 cents on the day. The big question is why? The short answer is that less gas was put into storage than expected for this time of year. The slightly longer answer is that less gas went into storage because of the hot weather and all those air conditioners whirling using all that electricity and all that electricity gets generated in big part by burning natural gas. So the bottom line is this: Natural gas futures prices popped yesterday because of the weather.
We find it kind of amusing that anti-fossil fuelers dead set against a plan by Kinder Morgan to build a new compressor station in Passaic County, NJ, and dead set against upgrading an existing compressor station in neighboring Sussex County, NJ, were all worked up to attend a Sussex County Board of Commissioners meeting where a Tennessee Gas Pipeline representative was supposed to make a presentation, but the rep didn’t show. He had (ahem) “car trouble” and couldn’t make the meeting in person. Antis were all dressed up with nowhere to go.
The states that produce Marcellus and Utica Shale are ensuring no rogue local municipalities will get it into their heads to ban the use of natural gas like some municipalities in left-leaning states including California and New York. Both Pennsylvania and Ohio have bills that would “ban bans” of natural gas (see 
Here’s an interesting concept. What if you were to replace the natural gas flowing through a pipeline, say an old, unused pipeline, with compressed air instead? And what if you retooled an existing gas- or coal-fired power plant so the compressed air itself spins the turbines in the compressor to produce electricity? That’s the concept being floated by the appropriately named company called Breeze.
The Enverus U.S. rig count continues to break one-year records. For the week ending June 23, the rig count stood at 577–the highest number it has seen since April 2020, just as the pandemic was starting to take hold and shut everything down. The Marcellus play lost one rig, while the Utica remained even. Collectively the M-U is currently running 45 rigs.