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    Dominion Energy 2Q18: Cove Point, SCANA, ACP & More

    There is a LOT going on at Dominion Energy that impacts the Marcellus/Utica region. Yesterday Dominion posted its second quarter 2018 update and held a conference call with investors to discuss what happened during 2Q18, and what to expect in coming quarters. Discussed on the call: (1) The Cove Point LNG export plant went online in 2Q18 and so far has shipped 19 cargoes of LNG–60 billion cubic feet of gas! (2) The $1.3 billion Greensville County, VA gas-fired electric plant is 95% built and will go online later this year. (3) The Atlantic Coast Pipeline and Supply Header Project is under construction and on track to be online by fourth quarter of 2019. (4) The SCANA Corporation merger is moving along, and a big decision from a judge is coming by Aug. 7 about whether or not SC can unilaterally force SCANA to lower electric rates by 15%. If the judge tosses that law and the 15% price reduction is out, the merger is in. If the price reduction stays, the merger is (our conclusion) questionable. Yeah, there’s a lot going on. Below are excerpts from the quarterly conference call, the full 2Q18 update, and the latest slide deck…
    Read More “Dominion Energy 2Q18: Cove Point, SCANA, ACP & More”

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    Texas Crane Company Buying Marcellus/Utica Crane Company

    TNT Crane & Rigging, headquartered in Houston, TX, has just purchased itself a major presence in the crane/rigging market in the Marcellus/Utica. TNT announced on Tuesday it is “merging with” (i.e. buying out and merging in) Allison Crane & Rigging, located in Williamsport, PA. When you read these kinds of announcements you’re never quite sure who is buying whom. But it became clear in this announcement. TNT, which is a “portfolio company” of (i.e. majority owned by) First Reserve, a BIG private equity investment firm, owns and operates 700 cranes in 44 different branch offices across North America. Allison operates 30 cranes. That’s how we know who bought whom. Here’s the news that TNT and Allison figure they’re better together…
    Read More “Texas Crane Company Buying Marcellus/Utica Crane Company”

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    EQT Uses Big Data to Improve Truck Safety

    Trucks do a lot of the heavy lifting when it comes to the shale energy business. Water trucks and trucks hauling other materials and equipment make, we’re guessing, hundreds of thousands of trips per year throughout the Marcellus/Utica region. EQT is the largest natural gas producer in the country, following its purchase of Rice Energy last year. Trucks are a big part of what EQT does. This year alone EQT trucks will drive over 24 million miles! Safety on the roads is a “top priority” for EQT. How to accomplish better safety? Upgrades of equipment are one way EQT is tackling the safety issue. But there’s another intriguing way EQT is getting better at safety–with Big Data. EQT is using researchers from Carnegie Mellon University to gather and analyze a mountain of data from its truck operations, to figure out how to improve safety and save money. It’s working. Speeding, hard braking and other safety violations have fallen 44% since 2017…
    Read More “EQT Uses Big Data to Improve Truck Safety”

  • Energy Stories of Interest: Thu, Aug 2, 2018

    The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading: Shale gas saving PA on energy costs; Earthworks’ failure highlights perception vs reality in OH; CELDF back to selling bill of goods in Columbus; why does Geisinger continue to advance fractivist junk science?; shale reality check; Trump’s vision for world energy dominance under threat; gas prices will remain low for foreseeable future; 7 things to know about EPA’s Acting Administrator Andrew Wheeler; Rick Perry says U.S. net energy exporter in 18 months; Mexico to commit fracking suicide with ban; and more!
    Read More “Energy Stories of Interest: Thu, Aug 2, 2018”

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    Range 2Q18: Pipeline Outages Hurt; Ponders Sale of LA Acreage

    Range Resources, the very first company to sink a Marcellus well back in 2004, held their second quarter 2018 update conference call with analysts yesterday, after publishing the official 2Q18 update on Monday. On the conference call, Range’s senior VP of operations Dennis Degner admitted that two different pipeline outages in 2Q18 hurt. The Leach XPress was shut down from June 7 to July 15 following an explosion. That resulted in Range having to find “in-basin” markets for 300 million cubic feet per day (MMcf/d) of natural gas. They did it, but it means they didn’t get as much money for the gas as they would have. The second outage was the Mariner East 1 pipeline, which flows 40,000 barrels per day of Range’s NGLs (ethane and propane) to Philadelphia for export. ME1 was down for nearly two months in 2Q18 when a portion of the pipeline was exposed from a sinkhole developing due to nearby Mariner East 2 drilling activity. Again, they found other markets at a lower cost. Also interesting were comments by Range CEO Jeff Ventura who said the company is looking to sell some of its Marcellus assets in northeast and southwest PA this year. Ventura said later this year/early next year they will make a decision about possibly selling their Louisiana assets, which have been underperforming. It was only two years ago that Range paid $4.4 billion for those assets (see Range Resources Buys Louisiana Driller in Deal Worth $4.4B). Marcellus/Utica production hit 1.876 billion cubit feet per day (Bcf/d) in 2Q18…
    Read More “Range 2Q18: Pipeline Outages Hurt; Ponders Sale of LA Acreage”

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    Cabot’s Lease Terms for Ohio Landowners + Antis Stage Tiny Rally

    We spotted an article covering a “rally” of maybe 20 people (judging by the pictures) who gathered on the bank of the Clear Fork of the Mohican River in Ashland County, OH this past Sunday. The group was there to protest Cabot Oil & Gas drilling a few test wells in the area to see if there’s anything in the region worth drilling for. Out of state radicals calling themselves “pipeline fighters” who had engaged in illegal activities against the Dakota Access Pipeline where there to whip up the locals–maybe convince them to do something illegal too. That’s how this kind of insanity spreads–by human contact. Anywho, the most interesting part of the article for us was not about the machinations of antis and their big boasts of how they’ll stop fracking. Instead, the most interesting part was an explanation of how Cabot came by the acreage they’ve leased in central Ohio, and how much money Cabot is offering landowners to amend existing lease agreements…
    Read More “Cabot’s Lease Terms for Ohio Landowners + Antis Stage Tiny Rally”

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    US Senate Bill Fixes States Blocking Pipelines via Water Permits

    Once upon a time, before far-out liberal governors like NY’s Andrew Cuomo weaponized the federal Clean Water Act (CWA), states would use their federally-delegated authority under the CWA (Section 401) to provide feedback and get changes/tweaks to interstate pipelines passing through their respective states. Then Cuomo (now others) started bending the intent of their delegated authority under the CWA and began abusing it to block federal policy by blocking approved pipelines that benefit the citizens of many states. That’s why the Federal Energy Regulatory Commission (FERC) was created–to review and authorize energy projects, like pipelines, that pass through multiple states. If not for FERC, no pipelines (or electric transmission lines) would ever get built across state lines because one state will selfishly block such projects–“What’s in it for us?” Andrew Cuomo has stated publicly that he has and will continue to block interstate pipeline projects and new gas-fired electric plants (see NY Gov. Cuomo Says He’ll Block All New Gas-Fired Elec Plants). This must stop. Cuomo’s actions violate the spirit if not the letter of the law. There has been an outcry to overrule Cuomo and others abusing their CWA authority. Until now, it’s been all talk. Talk is cheap. Who will stand up to the bully Cuomo and other bullies like him? Four brave senators from the U.S. Senate, that’s who. Senators John Barrasso (R-WY), chairman of the Senate Committee on Environment and Public Works, Shelley Moore Capito (R-WV), Jim Inhofe (R-OK), and Steve Daines (R-MT) have introduced a bill called “Water Quality Certification Improvement Act of 2018” that will ensure state water quality permitting reviews for proposed pipeline projects are limited to direct water quality impacts of that pipeline, and that decisions to grant or deny a permit must be made based on water quality reasons only. It plugs loopholes currently used by Cuomo and others under the CWA 401 certification process. In other words, the senators are about to slap Andy Cuomo and those like him back into line–IF the bill passes…
    Read More “US Senate Bill Fixes States Blocking Pipelines via Water Permits”

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    WV’s Top Brass Meeting with Chinese Next Week re $83.7B Deal

    A little over two weeks ago MDN wrote a post speculating about whether or not China’s deal to invest $83.7 billion in West Virginia shale and petrochemicals is now dead, given the current “trade war” with China (see $83.7B Chinese Investment in WV Shale & Petchem Still Alive?). In June, Chinese officials were supposed to attend the Northeast U.S. Petrochemical Construction Conference in Pittsburgh to announce the first round of investments in WV. However, Brian Anderson, director of the West Virginia University Energy Institute, said given the trade war now on with China, the officials elected to stay home instead. Anderson said, “The pending trade war has put this project in jeopardy” (see Trade War Puts $83.7 Billion Chinese Investment in WV on Hold). But a few weeks later Anderson appeared to change his tune. He told a reporter, “In terms of the development process, we continue to move forward…We’re even working on the next potential visits by officials and team members, so it’s not just the high-level executives, but development teams” (see $83.7B Chinese Investment in WV Shale & Petchem Still Alive?). Now comes word that next week, on Aug. 9, both WV Congressman David McKinley and WV Gov. Jim Justice will meet with Chinese officials “to discuss the future of the investment deal.” No word on whether that meeting is in WV or in China. McKinley would not comment on specifics about the meeting, but he did say he thinks the $83.7 billion Chinese investment is still on track and will happen…
    Read More “WV’s Top Brass Meeting with Chinese Next Week re $83.7B Deal”

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    EQT Employees in Kentucky Vote to Unionize

    A group of 116 EQT production employees who live and work in Kentucky have voted to form a union to protect their jobs and benefits. It is unusual–frankly unheard of–for unions to make inroads with an exploration and production company (E&P) like EQT. Why this group and why now? The fire was lit when EQT announced it is selling its Huron Shale assets to Diversified Gas & Oil (see Diversified Gas & Oil Adds to Conventional Assets in KY, VA, WV). Those assets include transferring 250 workers (including the 116 working in Kentucky) to Diversified. The workers are afraid of what typically happens when such deals occur–“efficiencies” are sought, which usually translates into layoffs and whacking benefits. To get out ahead of that, the group voted to unionize. Here’s the story of a small group unionizing, and the prospects of unionization happening elsewhere in the Marcellus/Utica…
    Read More “EQT Employees in Kentucky Vote to Unionize”

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    Macquarie Sells NJ Gas-Fired Plant Powering NYC for $900M

    Macquarie Infrastructure Corporation, part of Macquarie Bank, is selling 100% of the Bayonne Energy Center (BEC) gas-fired power plant in Bayonne, New Jersey for $900 million to an unnamed buyer. BEC is a 644 megawatt gas-fired electric generation plant constructed in 2012 and expanded earlier this year. BEC distributes power into New York City via a cable that runs from Bayonne, NJ beneath New York Harbor to a substation in Brooklyn. Macquarie bought the plant in 2015 for $720 million, and now they’re flipping it, making $180 million in the process. Which we suppose is good news for Macquarie. But also somewhat strange–at least to us layman. In 2016, Macquarie bought most of the Lordstown Energy Center plant in Trumbull County, OH (see Lordstown, OH Gas-Powered Electric Plant Gets New Owners). And they continue to invest in other such projects. Yet now Macquarie is selling this gas-fired plant serving the largest city in the U.S. Our interest, as usual, lies in what gas powers the plant. We speculate that most, if not all, comes from the PA Marcellus…
    Read More “Macquarie Sells NJ Gas-Fired Plant Powering NYC for $900M”

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    Quebec’s Junex Says Utica Offer “Not Superior” – Merger in Doubt

    MDN told you in June that Canada’s Quebec Province announced it will commit fracking suicide by implementing a permanent frack ban (see Quebec to Ban Utica Shale Drilling, Most Other Drilling Too). Quebec’s announcement is a virtual death sentence for oil and gas companies in the province. The shale fracking ban is coupled with new drilling standards so tight that even conventional drillers will have a difficult, almost impossible time. The result was immediate. Junex, a driller headquartered in Quebec with 1 million leased acres in the St. Lawrence lowlands (where there is Utica Shale), announced it would sell out to/merge with Cuda Energy, headquartered in Calgary, Alberta. Except now the merger is in doubt. It seems the merger was Cuda’s idea and was “unsolicited.” But hey, what’s a oil/gas driller going to do if they can’t horizontally drill and frack? Junex looked the offer over in detail and says it “does not constitute a ‘Superior Proposal’.” Oh oh. Is this a negotiating tactic for a higher price/better terms? What’s Plan B for Junex if they don’t sell out to Cuda? Here’s the latest on the Cuda/Junex potential merger…
    Read More “Quebec’s Junex Says Utica Offer “Not Superior” – Merger in Doubt”

  • Energy Stories of Interest: Wed, Aug 1, 2018

    The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading: Sulfur dioxide emissions in M-U plung thx to shale; Hilcorp seeks 3 new Utica permits in Columbiana County; cleaning up NY’s peakers; Forge the Future Summit meets in Pittsburgh; SCANA approves merger with Dominion; Greenpeace launches propane-fueled blimp…to protest fossil fuels (dopes); Wisconsin frac sand wars; Florida power plant gets key backing; Williams adds former NY State investment guru to board; Europe won’t buy US LNG, but Europeans might; cities suing Big Oil should worry about damage awards from tossed lawsuits; 500 fewer wells getting drilled in Canada this year; Kuwait wants a $1.1B loan–for shale drilling; and more!
    Read More “Energy Stories of Interest: Wed, Aug 1, 2018”

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    EQT Retains Shale Rights in Recent Diversified $575M Deal in WV

    On June 19 MDN exclusively brought you the news that Diversified Gas & Oil had purchased EQT’s Huron Shale assets in Kentucky, Virginia and West Virginia for $575 million (see Diversified Gas & Oil Adds to Conventional Assets in KY, VA, WV). The original announcement didn’t name the seller–that information was available only here on MDN. It wasn’t until June 29 that EQT admitted to the world that they were the seller (see EQT Confirms Sale of Huron Shale to Diversified for $575M). EQT said the sale includes nearly 12,000 wells with 200 million cubic feet per day of natural gas production and 2.5 million (!) acres of leases and some 6,400 miles of gathering pipelines. The sale also includes 8 field offices and 250 employees. But like an onion, more details about this story keep getting peeled back one layer at a time. Here’s the newest detail that (until now) we were not aware of: The massive $575 million deal for 2.5 million acres does not include or transfer the right to drill in the deeper shale layers that may exist under that 2.5 million acres. Instead, EQT is retaining those rights…
    Read More “EQT Retains Shale Rights in Recent Diversified $575M Deal in WV”

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    Chesapeake’s $2B Exit from Ohio Utica “Is a Good Thing”

    Last week MDN shared the blockbuster news that Chesapeake Energy is exiting the Ohio Utica, selling all of its Ohio assets for $2 billion (see Stop Press: Chesapeake Sells ALL of its Ohio Utica Assets for $2B). The buyer is Encino Acquisition Partners, a joint venture between Encino Energy and the Canada Pension Plan Investment Board. At the time we speculated this may be good news for Ohio’s landowners signed with Chesapeake–that perhaps landowners now stand a better chance of seeing new drilling. That was just speculation/hope on our part. Looks like we’re not the only ones thinking that way. A couple of industry experts are saying the same thing. One of them said Chesapeake’s sale and exit “is a good thing” because it means Encino will sink money into new drilling programs in a way that Chesapeake, larded up with debt, could not…
    Read More “Chesapeake’s $2B Exit from Ohio Utica “Is a Good Thing””

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    PA Briggs “Rule of Capture” Case Turns on Concept of Drainage

    In April, MDN brought you the news that Pennsylvania Superior Court had handed down a decision (known as the “Briggs” case) that has the power to greatly restrict, perhaps even stop, Marcellus drilling in PA (see PA Superior Court Overturns “Rule of Capture” for Marcellus Well and PA “Rule of Capture” Case has Power to Limit Marcellus Drilling). The issue, in brief, is that the Superior Court decision disallows using an age-old principle called the “rule of capture” when it comes to shale drilling and fracking. It opens the door to a myriad of frivolous lawsuits claiming that a fracture, a crack created during fracking, is draining gas from a neighbor’s property without justly compensating the neighbor for the gas. Southwestern successfully argued in a lower court that the odd crack here and there that may slip under a neighbor’s property is permissible. The landowner appealed to Superior Court and three judges heard the case. Two of the three overturned the lower court and sided with the landowner. Southwestern, following that decision, petitioned the Superior Court to have all of the sitting justices (called en banc) hear the case. Sadly, in June the Superiors proved they aren’t so superior after all, declining to rehear the case (see PA Superior Court Rejects Southwestern “Briggs” Trespass Appeal). Southwestern then appealed the case to the PA Supreme Court in early July (see Southwestern Appeals “Briggs” Trespass Case to PA Supreme Court). No word yet on whether or not the Supremes will take the case. In the meantime, this case and its ultimate effect on drilling in PA and beyond is still a hot topic of discussion throughout the industry. We spotted two recent articles tackling it–one from a lawyer who does a great job of crystallizing the important elements in the case–that this case turns on the concept of drainage, and the other article which tackles the broader topic of how energy law in PA is charting its own path separate from Texas and other big oil/gas states…
    Read More “PA Briggs “Rule of Capture” Case Turns on Concept of Drainage”

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    NEXUS Pipeline Update – Now 80% Complete, on Schedule for 3Q18

    NEXUS map – click for larger version

    The NEXUS Pipeline project, owned by DTE Energy and Spectra Energy (Enbridge), is a $2 billion, 255-mile interstate pipeline that runs from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada. NEXUS got final approval for the project from the Federal Energy Regulatory Commission (FERC) in August 2017, the first major pipeline to get approved following a newly restored quorum at FERC (see New FERC Quorum Votes Final Approval for NEXUS Pipeline). However, radical environmental groups have fought the project tooth and nail. CORN (Coalition to ReRoute Nexus), and the far-left Sierra Club, launched lawsuits and regulatory actions against the pipeline. The City of Green, OH initially blocked construction, but later cut a deal to allow the pipeline through the area after NEXUS agreed to pay the city $7.5 million and donate 20 acres of land that sit next to an existing city park (see Antis of Green, OH Finally Face Reality – Will Allow NEXUS Pipe). So just how is the project doing? On a recent quarterly analyst phone call, DTE’s president and chief operating officer, Jerry Norcia, answered that question. He said, in brief, that the pipeline is now 80% built and on track to go online in the third quarter of this year…
    Read More “NEXUS Pipeline Update – Now 80% Complete, on Schedule for 3Q18”