Shale Energy Stories of Interest: Thu, Mar 26, 2020
MARCELLUS/UTICA REGION: Chevron – which is leaving the region – donates $260K to food banks, first responders; Shell’s workforce, construction drastically cut at Beaver County site; Dominion Energy will hold virtual annual meeting in 2020; NATIONAL: Democratic National Committee embraces green new deal; When and how will oil prices recover?; Economic crisis is no reason to push bad policy on the oil sector; INTERNATIONAL: Oil below $20 will wipe over 10% off many exporting countries’ GDP.
Read More “Shale Energy Stories of Interest: Thu, Mar 26, 2020”
Pennsylvania House Bill (HB) 1100, aimed at attracting new petrochemical investment to the state, was passed by the PA House and Senate earlier this year. The bill provides a tax incentive for companies to build NEW plants in the state that use Marcellus methane gas. HB 1100 was finally delivered to the desk of Gov. Tom Wolf last week (see 
The confusion over whether or not the Mariner East 2 (ME2) pipeline project has (a) shut down all construction, except certain tidying up aspects at certain locations, or (b) has permission by the state to keep on building, is still not 100% settled. On Monday we told you that ME2 construction was in the process of ceasing under orders issued by Gov. Wolf (see 
The Energy Equipment and Infrastructure Alliance (EEIA), a non-profit representing people and businesses who work in the energy infrastructure supply chain, filed an “amicus curiae” (friend of the court) brief in support of PennEast Pipeline’s request to get the U.S. Supreme Court. PennEast has asked the Supremes to overturn a lower court decision that allows states like New Jersey to usurp federal authority by blocking PennEast, a FERC-approved pipeline.
If there’s a silver lining in this tragic COVID-19 coronavirus crisis, this may be it: Radicals who want to deny everyone the right to use fossil fuels with their unending campaigns of protests and legal actions are pretty much stopped in their tracks. They can no longer make mischief to block pipelines and shale drilling and the use of natural gas by ordinary citizens (via municipal bans). The virus has stopped most court cases, public hearings, and even the right to assemble and protest. Antis are apoplectic and scared that pipeline and drilling projects will get approved and move forward because antis can’t bully public officials and courts into bending to their twisted anti-fossil fuel views.
OPEC, the Organization of the Petroleum Exporting Countries, is a pact of colluding oil-producing companies that act to artificially lower or raise the price of oil around the world based on how much the colluders are willing to pump. OPEC is the antithesis of free trade. But it does serve a purpose that (unfortunately) all oil drillers, including U.S. drillers, depend on–keeping prices high enough to be profitable. OPEC added Russia in a loose confederation for the past three years or so, something referred to as OPEC+. But then Russia recently told Saudi Arabia, the main OPEC player, to kiss off and left the OPEC+ fold, preferring to pump as much oil as they can. Saudi Arabia responded by increasing its production too, to drive prices into the basement, causing Russia (and U.S. shale drillers) pain.
A week ago we brought you the story that predicted the price of oil would go from the $30/barrel range down to the $20/barrel range–something almost unthinkable. And then it happened within a few days! Now we’re reading of warnings from Barclays, one of the biggest banks in the world, that the price of oil may go as low as (GASP) $10/barrel. At that price, there’s maybe one producer in the world that can still make at least some money–Saudi Arabia. Everyone else would be upside down and heading for bankruptcy court.
Midstream (pipeline) giant Williams issued a press release last Friday to say they’ve just swallowed a poison pill. They don’t put it in those exact terms, but that’s what it’s called. The company’s board has adopted a “limited duration stockholder rights agreement.” Why? To fend off potential hostile takeover attempts from those who would buy up a significant number of shares of stock while the company’s share price is down due to the worldwide stock market crash over COVID-19 coronavirus concerns. Williams is not for sale and the company is certainly not to be found on the discount rack.
Encino Acquisition Partners (aka Encino Energy) bought all of Chesapeake Energy’s Ohio assets for $2 billion in 2018 (see 
The double shock of less demand for oil because the COVID-19 coronavirus crisis has shut pretty much everything down (worldwide) AND the Saudis and Russians pumping oil to the outer limits, continues to cause the price of oil to remain at historically low prices. The Russians are trying to bankrupt American shale oil drillers by driving prices into the basement. The Saudis are trying to bankrupt Russia for leaving the OPEC+ fold (and the Saudis certainly don’t mind if American shale oil drillers are put out of business in the process). The low price resulting from the double shock is affecting not only big American shale oil drillers but also mom and pop conventional oil drillers too. Particularly small conventional drillers in western Pennsylvania.
Sen. Chuck Schumer and Speaker Nancy Pelosi are the lowest of the lowest. They are blocking COVID-19 aid to suffering American people and businesses, holding the aid package hostage, in a bid to play to their radicalized political base. They are holding up an aid deal in order to, among other things, fund Big Green projects. Green lard. Graft. Corporate welfare that decimates fossil fuels and favors so-called renewables. “Democrats won’t let us fund hospitals or save small businesses unless they get to dust off the Green New Deal,” said Senate Majority Leader Mitch McConnell in a floor speech yesterday. This is tragic. This is despicable. This is UNFORGIVABLE.
The American Petroleum Institute (API) wrote a letter to both President Trump and the federal Environmental Protection Agency last Friday asking for “non-essential compliance obligations” to be temporarily waived. Such obligations include “record-keeping, training and other non-safety requirements.” The oil and gas industry wants to be able to better and more quickly distribute fuel during the COVID-19 coronavirus crisis–using fewer people to do so. Government red tape is enormous. API is simply asking the government to cut some of that red tape on a temporary (not permanent) basis to get the job done during this crisis.
Last Friday MDN laid out three potential options for how the U.S. government can deal with the Saudis and Russians flooding world markets with oil, driving the price into the basement in a bid to bankrupt American shale oil drillers, a practice called dumping (see 
Before Lord Obama and the EPA Obamadroids left office, they inflicted a great deal of damage to this country via onerous and outrageous new regulations. When President Trump took office, he immediately began to roll back and rightsize regulations at the EPA (and elsewhere), scaling back overregulation to common-sense regulation. We’re talking about regs like the horrible so-called Clean Power Plan. The Obamadroids and Big Green lobby (one and the same, with gobs of money) have litigated Trump’s efforts to restore sanity to EPA regulations every square centimeter of the way.