Richmond Gas-Fired Plant Explores Building Pipeline Thru 5 Counties
MDN first told you about plans to build the Chickahominy Power Station, a 1,650 megawatt state-of-the-art natural gas-fired power plant, in June 2018 (see Huge New Marcellus-Fired Power Plant Coming Near Richmond, VA). A year later, in June 2019, the Virginia State Air Pollution Control Board approved a key permit for the project (see Virginia Approves Marcellus-Fired Power Plant Project Near Richmond). Although the application for the project said an existing 16-inch gas pipeline owned by Virginia Natural Gas crosses through the site (implying the project would use that line to feed the plant), earlier this year a subsidiary of the same company formed and is exploring building a 24-inch gas pipeline that would traverse five counties in the region.
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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.
OTHER U.S. REGIONS: Berkeley’s ban on natural gas in new buildings upheld by federal judge; NATIONAL: Oil prices snap losing streak; U.S. shale on track for one of its best years ever; Solving the plastic shortage with a new chemical catalyst.
Consumers Energy, Michigan’s second-largest power provider, will quit burning coal to produce electricity by 2025 and instead will purchase four existing natural gas-fired power plants for $1.3 billion. At least if the company can get approval from state regulators. The company says buying existing gas-fired plants (instead of building new plants) will help it transition to carbonless energy over the next 20 years. Buying instead of building means the company won’t have “stranded assets” when (we say if) they eventually foreswear using fossil fuels to generate electricity.
Back in January MDN told you that UGI Corporation, one of Pennsylvania’s largest natural gas utility companies, wants to buy Mountaineer Gas Company, one of West Virginia’s largest natural gas utility companies, for $540 million (see 
Last week MDN told you that Detroit-based utility company DTE Energy was about to spin off its pipeline assets into a new/separate company called DT Midstream (see 
Last week MDN told you about an unplanned outage at two MarkWest natural gas processing plants located in West Virginia (see 
Diversified Energy (née Diversified Gas & Oil) continues to expand *outside* of the Marcellus/Utica region. In April the company announced it had purchased ~780 net operated wells and leases in the Cotton Valley/Haynesville region of Lousiana for $135 million (see 
Patterson-UTI Energy, which operates 15 active rigs in the Marcellus/Utica (out of 45 active M-U rigs, or fully one-third of all active M-U rigs) announced yesterday it is buying a smaller competitor, Pioneer Energy Services Corp., for approximately $295 million. Patterson will add Pioneer’s fleet of 16 super-spec drilling rigs to Patterson’s own current fleet of 150 super-spec drilling rigs in the U.S. What are super-spec rigs?