Riverkeeper/CAC/PennFuture Make the Case for PennEast & Adelphia
After we picked ourselves up off the floor from laughing so hard, it dawned on us the far-left radicals at THE Delaware Riverkeeper, Clean Air Council and PennFuture have done both the PennEast Pipeline and Adelphia Gateway pipeline projects a HUGE beneficial service. Those three nutty groups commissioned and have just released a new “study” (copy below) that uses data to show PennEast and Adelphia together, WHEN (not if) they get built, will mean that PA drillers have to drill and connect another 1,913 to 3,061 new shale wells to feed them. Well duuuh! Of course it means that!! And that’s a GREAT thing for all of PA. More economic stimulus. More jobs. More tax revenues flowing to local municipalities. (Do these groups know they’ve just handed us a new argument in favor of these pipelines?)
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Is this the beginning of a pullback from LNG projects? Scared of the impacts of the coronavirus and the price of oil crashing, Royal Dutch Shell is pulling out of a 50/50 joint venture partnership with Energy Transfer (ET) to build a new LNG export facility in Lake Charles, Louisiana. In corporate speak, Shell says, “This decision is consistent with the initiatives we announced last week to preserve cash and reinforce the resilience of our business,” and “the time is not right for Shell to invest.” Translation: We’re scared. And who can blame them? All of a sudden there are LNG cargoes sailing the oceans with no place to unload (see 
Tenaska is #3 on the list of North American gas marketers–buying and selling more natural gas throughout the country than every other company save two (BP and Macquarie, see 
MARCELLUS/UTICA REGION: Ohio AG says climate tort lawsuits put constituents at a disadvantage; Fracking once lifted Pennsylvania. Now it could be a drag.; Lackawanna College to provide compressor/engine mechanic certification; Gov. Tom Wolf’s former business keeps operating during coronavirus shutdown despite losing state waiver; Public invited to virtual public meeting regarding injection well application in Belmont County; NATIONAL: $4 natural gas by late 2021? It’s possible, says Raymond James; Could oil really fall to $0?; COVID-19 shutdowns compound weak gas demand fundamentals; Chemical manufacturers key in Covid-19 fight.
Pennsylvania Gov. Tom Wolf was less than honest when he vetoed House Bill (HB) 1100–a bill that would generate thousands of new jobs and cause money to pour into the PA economy by granting tax breaks (for a limited time) to companies willing to build *brand new* petrochemical plants ($450 million minimum investment) that use natural gas as the feedstock. In vetoing the bill on Friday, Wolf more or less blamed the coronavirus–even though he had promised to veto this bill in February, a month before the pandemic began in U.S. (see 
Last May MDN told you about JAX LNG in Jacksonville, Florida–a joint project between Pivotal LNG (a subsidiary of Southern Company Gas) and NorthStar Midstream (a pipeline company in the Bakken Shale), touted as the “first” small-scale LNG plant to be located along the shoreline, allowing it to fuel up LNG ships–ships that use LNG as fuel, instead of diesel–and also allowing the LNG to be loaded onto trucks and trains for transportation to power plants and industrial/commercial operators (see 
Nearly two weeks ago Shell, at the prompting of local officials, shut down construction of the mighty ethane cracker plant the company is building in Beaver County, PA (see 
LNG Limited, based in Australia, has been working on a couple of North American LNG export projects over the past half-decade or more. One of them, called Bear Head, would be built in Nova Scotia, Canada and (potentially) export Marcellus/Utica molecules. The other, Magnolia LNG, would be located in Louisiana and yes, potentially export M-U molecules as well. LNG Limited is in the process of selling itself and its LNG projects to Singapore investor LNG9 PTE for $75 million, a deal expected to close around the end of May. However, LNG Limited needs more cash to keep the doors open until then. First Wall Street Capital Corp. recently bailed on giving LNG Limited a bridge loan to get them through.
Everyone, and we mean everyone, is still reeling from the double shock of the COVID-19 coronavirus and its effect on the world economy, and the Saudis and Russians pumping more oil, driving oil prices into the ground. Frankly, the COVID-19 virus is the bigger deal. It will have long-lasting effects for years to come on the U.S. economy, including a big effect on the oil and gas industry. The question is, what kind of effect? Is there any way to predict what may happen in the coming couple of years and longer? No one can really predict, but if anyone could, it would be the bright minds at RBN Energy. They’ve attempted the near-impossible: Try to predict how things will change following the COVID-19 lockdown (around March 6). Try to divine how the oil and gas (and NGL and midstream) worlds will change in the coming months and years. Their assessment is sobering.
The American oil industry is in crisis. This is undeniable. Some folks will point out this isn’t the first serious downturn for the oil industry, and it won’t be the last. True enough. But this one IS different. Not in recent memory (at least a generation) has there been both a shock in the supply picture (Saudis and Russians fully opening up the taps) and a shock in the demand picture (very little travel due to the pandemic). We at MDN have taken a view in favor of a tariff on imported foreign oil to encourage better behavior. Now comes a tweak to the tariff strategy.
MDN Editor Jim Willis had the pleasure of being interviewed on The Crude Life podcast last week. Jason Spiess, an award-winning multimedia journalist, hosts several radio shows in addition to the podcast. The podcast/radio shows focus mainly on the Bakken Shale (where Jason lives and works), but he also branches out to talk with those in other plays. This isn’t Jim’s first time appearing on The Crude Life (see 
The Pittsburgh Business Times is reporting that a contractor working in EQT’s hydraulic fracturing (“completions”) operation who last worked at a site in Belmont County, OH has tested positive for COVID-19 coronavirus. Because that worker has been in contact with a number of other workers in EQT’s completions unit, the company has temporarily shut down all completions (fracking) operations. In a separate and unrelated announcement, EQT told investors they are (for now) suspending quarterly dividend payments and will use the money instead to pay down near-term debt.
Here’s a rum’un (Brit speak meaning “strange” or “odd”) if ever we’ve heard of one. Shell shut down construction activity a week ago at its mighty ethane cracker plant site in Beaver County, PA, sending nearly 8,000 people home (see 
MDN previously told you about two (of a number) of bills working their way through West Virginia’s annual 60-day legislative session that will create new tax credits aimed at luring petrochemical plants to the state (see 
The final bits of Columbia Gas Transmission’s Mountaineer XPress pipeline project (most of it located in West Virginia) went online just over one year ago (see