Dominion Buys Out Atlantic Coast Pipe Partner; Going Green by ’50
Yesterday Dominion Energy issued its fourth quarter and full-year 2019 update. As part of the update, Dominion’s top brass talked about 2020 and beyond. Of particular interest for us was a bunch of news about the company’s stalled Atlantic Coast Pipeline (ACP) project. In particular, Dominion has purchased a small stake in the pipeline from partner Southern Co. for $175 million. The new price tag for the project has now gone to $8 billion. Even with the delays and setbacks in court, Dominion remains 100% committed to building ACP.
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A Reuters article warns that U.S. shale gas investors are “bracing” for write-downs by major drillers, particularly in the Marcellus/Utica region. The article chronicles the write-downs we already know about (EQT, CNX, Shell and Chevron) and speculates that others (like Antero and Cabot) may make announcements in the coming days. And then, in a bit of a twist, the article ends with information about BKV (Banpu Kalnin Ventures), to say (a) Banpu’s American shale assets have already been written down before they purchased them, and (b) Banpu will not do any new drilling until the price of gas recovers to at least $3.50/Mcf. They may wait a looooong time.
Three cheers for Pennsylvania State Rep. Daryl Metcalfe (R-Butler). Hip hip hooray! Metcalfe is the Majority Chair of the House Environmental Committee. He’s not a big believer in the hoax/myth of man-made global warming, and he’s not afraid to say so. Because Metcalfe won’t bow down to the climate change worshipers and their twisted agenda, a cabal of “green” groups has colluded to demand House Speaker Mike Turzai fire Metcalfe from the Environmental Committee. When pigs fly my climate changer friends!
Powerhouse consulting firm Deloitte released its “2020 Oil and Gas M&A Outlook” report yesterday (full copy below). In something of a surprise (for us), the experts at Deloitte found that the number of mergers and acquisitions in the oil and gas space went DOWN in 2019, although the value of the deals was up (due to big deals like Occidental’s $55 billion buyout of Anadarko). What’s ahead in 2020? More of the same, according to Deloitte. Wait–aren’t drillers dropping like flies, not able to turn a profit so they’re selling and merging? No, not really.
MARCELLUS/UTICA REGION: Longtime Pennsylvania state Sen. Andy Dinniman is retiring; OTHER U.S. REGIONS: Why Shell drilled a “horseshoe” well in the Permian Basin; Holmdel residents sign petition opposing NJNG regulator station; NATIONAL: Look how low oil prices have fallen: 6 impacted industries; Tallgrass Energy announces new commercial officer, establishing Houston office; About 13% of U.S. electricity generating capacity can switch between natural gas and oil; NARUC publishes handbook on state natural gas distribution infrastructure replacement programs; People out there turnin’ natgas into gold – NGLs, gas processing and the frac spread; Money & power: new FOIA’d documents offer ugly candor about ‘green energy’; U.S. Department of Energy issues four LNG export approvals; Pew Research 2019 survey: ‘climate change’ still ranks as low priority – 17th place out of 18; INTERNATIONAL: Russia is ‘fearful’ of US competition in the European gas market, official says.
New Fortress Energy, which funds and builds LNG (liquefied natural gas) infrastructure to “help accelerate the world’s transition to clean energy,” yesterday announced it has signed a 10-year supply agreement for the purchase of 27.5 million MMBtu per annum of LNG (approximately 8 cargoes a year) to an unnamed buyer at a price indexed to Henry Hub–through January 2030. The announcement does not contain details about who the buyer may be, or what the actual price is they will receive–but we have some speculation about all that.
Nearly two weeks ago CNX Resources issued its fourth quarter and full-year 2019 update (see 
Gasmageddon, as this current low natural gas price climate is being called, is getting worse. Based on the latest weather models (the natgas market has some of the best long-range weather forecasting in the world), gas prices have crashed and are burning (pun intended). Yesterday the NYMEX futures price closed at $1.77–in the dead of winter! Spot prices for gas bought and sold in the northeast lead the loss in value. A Raymond James survey of energy executives found most execs believe we will exit 2020 with the price of gas in the $1.50-$2.00 range, and that gas will not go above an average of $2.50 this year. Although we now use 50% more natgas than just 10 years ago, prices remain stubbornly low. Why?
American Energy Partners, Inc. (AEPT), based in Allentown, PA, has just added a fifth subsidiary/division to the company. AEPT agreed to acquire 100% of the membership units of Oilfield Basics, LLC in exchange for 1,000,000 shares of American Energy’s common shares. Oilfield Basics is an educational company, providing courses and training in the oil and gas space. It’s an interesting addition to a portfolio of companies that includes drilling, remediation, water, and valuation services.
Pennsylvania Gov. Tom Wolf’s Santa Claus routine is wearing thin. As he has done year after year with his annual proposed budgets, Wolf once again is calling for a massive tax increase of $4.5 billion, assessed solely on the Marcellus Shale industry, in order to fund a panoply of projects (see 
Yesterday MDN brought you news about Democrat trade union members in Pennsylvania turning on one of their own–Gov. Tom Wolf (see 
The sale of the bankrupt former Philadelphia Energy Solutions (PES) refinery has officially become a soap opera. Last June a series of explosions and a massive fire at the facility, the East Coast’s oldest and largest oil refinery, closed it down (see 
If you add up all of the forms of energy used by the U.S.–electric power generation, transportation, home and business heating and cooling, etc.–and you measure the amount of carbon dioxide (CO2) all of that energy usage pumps into earth’s precious atmosphere, the U.S. Energy Information Administration says the CO2 we will pump out in 2050 will be 4% LESS than what we pumped out in 2019. And that’s with continued heavy use of fossil fuels. Which exposes the lie that we must dump the use of fossil fuels now, certainly by 2050, or we’ll all die from high temperatures.
It amazes us that we now have to defend perhaps the greatest advancement to the longevity of not only humankind but all species on planet earth. That advancement is PLASTICS. Yes, plastics. The invention of plastic and its uses on Mom Earth has made our lives better. Plastics, contrary to the current popular mythology, have extended human and animal life. And yet, even the companies that build giant cracker plants to create raw plastic pellets (for further use in thousands of plastic products) must now bow down before environmental crackpots to declare their concern (even dislike) of the very thing they produce: plastic. It’s bizarre.
We’re now a couple of months shy of the fifth anniversary for when PTT first announced they would consider building an ethane cracker plant in Ohio (see 
In December 2018, the Pennsylvania Supreme Court ruled that so-called “stripper wells” (low-producing wells) can be taxed under the 2012 Act 13 law, slapped with an impact tax assessment if those wells produce more than 90 thousand cubic feet per day (Mcf/d) of gas in a single month, any month (see