M-U Gas Prices Fall Due to Rising Production & Full Pipelines
Due to a severe winter storm in the nation’s midsection in February, natural gas spot prices across the country went crazy (see Cash NatGas Price in Oklahoma Hits $999/MMBtu; M-U Thru Roof Too). The price of gas traded at $1,200/MMBtu at one point in Oklahoma. Insane! Prices here in the M-U went sky-high too. But all good things must come to an end, and they did in early March (see All Good Things Come to an End: Gas Price Back to Pre-Storm Levels). Since early March, the physical spot price natgas sells for in the M-U has slumped even further. Why?
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In January EQT Corporation announced it would partner with a Denver, CO company calling itself “Project Canary” to run a test on two of its shale gas pads, to prove the natural gas produces is “certified responsibly sourced” (see 
In what can only be characterized as a complete and utter failure of a Big Green lawsuit, yesterday a Pennsylvania Public Utility Commission (PUC) judge ordered Sunoco Logistics, builder of the Mariner East pipeline system, to pay a $2,000 fine (the equivalent of a few high-priced lunches) and talk more to local groups around Philadelphia that want to complain about the project. That’s the end result of a request by seven antis that began in November 2018 asking the PUC to shut down the entire three-pipeline project (see 
There’s a lot of gum-flapping about sustainability and Environmental, Social, and Governance (ESG) these days. It seems as if every upstream and midstream company has suddenly gotten the ESG religion. But at the end of the day, what does it actually mean? How do companies really effect positive change, not just talk about it? CNX Resources doesn’t just talk a good game. CNX is investing $30 million to focus on local, underserved communities and populations in the tri-state region. CNX is looking for real results, not just pretty slide shows to show investors.
Just as we predicted, the Federal Energy Regulatory Commission (FERC) under Democrat Chairman Richard “Dick” Glick, his sidekick the former NRDC lawyer (Democrat) Allison Clements, and backstabbing, swamp-dwelling RINO Neil Chatterjee, is effectively killing off new pipeline projects. The three FERC commissioners have colluded to fundamentally change the way natural gas and oil pipelines are evaluated by including mythological man-made global warming as one of the criteria for approval.
Only Pennsylvania, of the three active Marcellus/Utica drilling states, issued new shale drilling permits last week. But PA’s permits were more than enough to make up for Ohio and West Virginia. PA issued 20 new permits in 7 different counties, scattered across the state (although most of the permits were issued in the dry gas northeastern part of the state).
MARCELLUS/UTICA REGION: Pittsburgh Regional Building Trades Council opposes Wolf’s push for RGGI participation; NATIONAL: Appeals court backs drilling protections reinstated by Biden; Nearly 400 state and local officials call for ban on new fracking permits; Kerry family jet flies to Idaho while he goes on international climate tour; Lower- and middle-class Americans will pay a fortune for Biden’s wind-power plan; Enverus/Drillinginfo sells itself to investment firm Hellman & Friedman; INTERNATIONAL: Less gas available for Canadian gas storage injection this summer; Shale oil is a dagger aimed at the heart of oil prices; Seven European countries to halt export finance for fossil fuels.
Natural gas production in the Marcellus/Utica continues to slowly turn around. The rate of decline in production is slowing and (at some point) will reverse and begin to show increases month over month. That was our takeaway from yesterday’s Drilling Productivity Report (DPR), a report issued each month by our favorite government agency, the U.S. Energy Information Administration (EIA). Two shale plays–the Haynesville in Louisiana and East Texas, and the Permian in West Texas and eastern New Mexico–will see natural gas production increase in the coming month of May, same as happened in April. That’s two months in a row both the Haynesville and Permian increased natural gas production.
For nearly every year of the past 20+ years, there has been a reliable, year-in-and-year-out #1 export (in dollar revenue) from the United States to the rest of the world. Care to hazard a guess what it has been? Aircraft, mostly from Boeing. The U.S. has a new most-valuable export in 2021 that has flown on by aircraft exports: Natural gas. The fact that natgas has dethroned aircraft exports does not square well with rabid American leftists who seek to destroy all fossil fuel markets, including natural gas. The vaunted position of natgas also presents a problem for the Biden administration and their plans to slip AOC’s Fat Green Deal through under the disguise of an “infrastructure and jobs” plan.
It should come as no surprise that a group of far-left “environmentalists” who belong to New York State’s Power Generation Advisory Panel is recommending to Lord Cuomo that the state simply ban and block any and all new natural gas-fired power generating plants from being built in the state. Why? Because they have a mental condition that causes them to irrationally hate fossil fuels, including natural gas. That’s the only explanation that makes sense. Why else would Americans (who supposedly love freedom) advocate for the unconstitutional action of blocking a legitimate and legal business?
We’re not big fans of U.S. Senator Joe Manchin (Democrat). He hails from Republican-leaning West Virginia, so he has to pass himself off as a “moderate” Democrat. When push comes to shove, we’ve noticed Manchin falls into line and obsequiously obeys Chuck Schumer’s commands. Yet perhaps, hope against hope, Manchin will show some spine and refuse to sign on to the $2 trillion shale energy-killing “infrastructure” plan Biden is pushing.
One of the brightest of the bright spots in the Marcellus/Utica shale industry has been shale’s effect on local economies and jobs, as in more money and jobs flow to shale drilling counties. To counter all that good news left-leaning “media” outlets like the Pittsburgh Post-Gazette have run hit pieces, like this article in February: 
The deed is done. On Saturday, the last day of the legislative session in 2021, the West Virginia Senate unanimously passed House Bill (HB) 2581 which changes how the State Tax Department values producing oil and gas wells for property tax purposes. As we told you last Thursday, the Senate version modified the bill from its original intent of allowing landowners to claim big deductions (see