New PA Strategy on Post-Prod. Deductions – Bill Defines “Royalty”
Have you ever heard the trite but true phrase, “words mean things”? Never has that been more true than in Pennsylvania and the simple word called “royalty.” Somewhere along the way the word “royalty” got watered down and changed. A new bill being introduced by PA State Rep. Eric Davanzo (Republican from Westmoreland County) will clear up the confusion and bastardization of the term royalty, making it easy for everyone to know what can and cannot be deducted from royalties with respect to oil and gas leases.
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In July 2020, PA Gov. Tom Wolf signed into law House Bill (HB) 732, a bill that grants tax breaks to companies willing to build brand new petrochemical plants in the Keystone State–plants that use huge quantities of Marcellus Shale gas (see 
When you see the words “environmental justice,” that’s just another way of saying racist–or the new shorthand “woke.” Pennsylvania Gov. Tom Wolf’s plan to participate in the Regional Greenhouse Gas Initiative (RGGI) carbon tax scheme assumes all fossil fuel-powered electric generating plants in the state are built in communities of color or in communities that are economically poor and therefore those communities can’t fight back against the injustice of being “polluted.” RGGI presumes fossil power plants are racist and sets out to correct the injustice by eliminating those power plants via taxing them out of existence.
When key players in our industry support killing the industry they work for, is the end near? That’s what we sometimes ponder. Last Friday we told you that the biggest natural gas producer in the country, EQT Corporation, has gone over to the dark side and is publicly supporting the reinstatement of Lord Obama’s draconian and onerous (and completely unnecessary) so-called methane rule that forces companies to capture every last molecule of methane, no matter how expensive and impossible and unnecessary it is (see 
The experts at RBN Energy have, for the past five years, closely tracked the spending and production of a representative collection of 39 major public E&P (exploration & production) companies. RBN splits the companies tracked into three groups: Oil-Weighted E&Ps, Diversified E&Ps, and Gas-Weighted E&Ps. In a recent post, RBN reveals what those 39 companies have announced they will spend, and produce, in 2021. For eight of the nine gas-weighted E&Ps that produce gas in the Marcellus/Utica, the numbers show drillers will spend 15% less this year, but overall will produce 2% more natural gas than they did last year.
Who are the biggest natural gas sellers in the U.S.? You might be surprised to learn that the biggest *sellers* are not necessarily the biggest *producers* of natural gas. Oh, you might recognize some of the names of the top sellers (BP, Shell, ConocoPhillips). But others might be more of a mystery (Macquarie, Tenaska, Sequent, and J. Aron & Co.). Would it surprise you to learn that BP (i.e. British Petroleum) is the #1 seller of natural gas in the U.S. and has been for many years?
MARCELLUS/UTICA REGION: Meet “Freddy the Flame” PA’s natural gas mascot; NATIONAL: Landmen who once staked claims for oil and gas now hunt wind and sun; Last winter saw larger-than-average U.S. natural gas withdrawals from storage; Interior head Haaland revokes Trump-era orders on energy; INTERNATIONAL: Eliminating Ontario natural gas generation to inflict financial pain on consumers.
Last October Energy Transfer (Sunoco Pipeline) pushed back against a demand by the Pennsylvania Dept. of Environmental Protection (DEP) that the company’s Mariner East 2X pipeline project be rerouted one mile around Marsh Creek State Park (in Chester County, PA) following a drilling mud spill in August (see 
Some good news to share. GoExpedi, a “supply chain, e-commerce and analytics company” based in Houston, Texas, opened a 15,000 square foot warehouse in North Fayette earlier this week. The company provides supplies to oil, gas, and industrial companies. The company’s database offers more than 200,000 parts and supplies. This is the company’s first northeast hub.
The Enverus U.S. rig count continues to climb, dramatically. For the week ending April 14, the U.S. rig count climbed another 13 active rigs to 541. The Marcellus added a rig ending the week with 32 active rigs. The Ohio Utica stayed even with 13 active rigs. The M-U combined has 45 active rigs. The other major shale gas play, the Haynesville, lost one rig and now has 47 active rigs.
We hate reporting these kinds of stories because of the pain and suffering experienced by the family involved, but report it we must. A contract worker (46-year-old man) who was working at a Cabot Oil & Gas well pad off Hoag Hill Road in Rush Twp. (Susquehanna County, PA) around midnight Tuesday was injured at the pad and rushed to the hospital in Montrose, PA. He later died at the hospital.