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    Broken Record: Wolf, Dems & RINOs Float 4% Severance Tax

    Every year it’s the same thing from “America’s most liberal governor,” PA’s Gov. Tom Wolf: propose a severance tax on natural gas production, a tax in addition to the existing impact tax (which is already the equivalent of a severance tax), and demagogue the issue in hopes of shaming/pressuring/bullying Republicans into passing such a tax. When/if such a tax is passed, give every last dime of it to teachers unions in the Philadelphia area–the people who elected Wolf to office. That’s been Wolf’s modus operandi since he assumed office. And it has just happened again, for the fourth time. Wolf, along with two liberal Democrats and two Republicans in Name Only (RINOs, from the Philly area) gathered yesterday to announce new severance bills introduced in both the PA House and Senate that will slap a Marcellus-killing 4% tax on shale production, on top of the existing ~4% impact tax. Here we go again…
    Read More “Broken Record: Wolf, Dems & RINOs Float 4% Severance Tax”

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    PA Court Rules ME2 Pipe has Power of Eminent Domain, Period

    One of the ways anti-fossil fuel groups have tried to stop the Mariner East 2 Pipeline project is by tying it up in court. Various lawsuits have been filed going back years (see our list of lawsuit stories here). One litigant, a Big Green group headquartered in Philadelphia, the so-called Clean Air Council, has tried repeatedly to get the courts to deny ME2 the right to use eminent domain in cases where landowners refuse to cooperate (see Clean Air Council’s Strange War Against Mariner East Pipeline). CAC argued that ME2 is not a “public utility” and therefore not entitled to the use of eminent domain. That argument flamed out. They also argued since ME2 crosses a state boundary–into a small part of Ohio–it’s not an intrastate but interstate project and should be subject to the Federal Energy Regulatory Commission (FERC) instead of the PA state Public Utility Commission (PUC). That argument bombed too. CAC then argued ME2 is using a public taking for a private enterprise (not for the public good). Also tossed out. A court case that began in 2015 made its way to the PA Commonwealth Court and yesterday the Commonwealth Court finally shut down the CAC’s long-running lawsuit once and for all, denying their wild claims…
    Read More “PA Court Rules ME2 Pipe has Power of Eminent Domain, Period”

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    ATF Cuts Back on Agents Hunting for Perps Who Stole Dynamite

    As we previously reported, someone(s) stole a bunch of dynamite and the blasting caps (used to ignite the dynamite) on the weekend of April 14-15 from a locked storage trailer sitting at an Atlantic Sunrise Pipeline construction site in Lancaster County, PA (see Dynamite Stolen from Atlantic Sunrise Pipe Site in Lancaster County, PA). The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) immediately swung into action, offering $20,000 for information leading to an arrest and flooding the county with agents (see ATF Doubles Reward re Stolen Dynamite; 40 Agents in Lancaster Co.). Then last week, someone discovered some, perhaps all of the stolen dynamite (see Stolen Dynamite from Atlantic Sunrise Site Discovered in Creek). The ATF has still not found a suspect. They now believe the amount of dynamite recovered was all of it. Some 10 agents are left in the county, working their way through interviewing 900 workers who had access to the site…
    Read More “ATF Cuts Back on Agents Hunting for Perps Who Stole Dynamite”

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    Atlantic Sunrise Doles Out $264,300 in Grants to Schools, Towns

    Pipeline companies are known for their largess in showering local schools, towns and nonprofit agencies with money for worthy causes. Among those who engage in this civic practice is Williams’ Atlantic Sunrise Pipeline project. Atlantic Sunrise is a $3 billion, 198-mile pipeline project running through 10 Pennsylvania counties to connect Marcellus Shale natural gas from northeastern PA with the Williams’ Transco pipeline in southern Lancaster County, PA. In 2015, the Atlantic Sunrise Community Grant Program was established to benefit community organizations in communities within the Atlantic Sunrise footprint. Since 2015, the Atlantic Sunrise has doled out more than $2 million across the 10-county project area in support of noteworthy projects. And they’ve just done it again. A total of 41 PA organizations have just received a total of $264,300 in contributions–more than a quarter of a million dollars! We have the full list below, along with information about how your organization can apply for the next round…
    Read More “Atlantic Sunrise Doles Out $264,300 in Grants to Schools, Towns”

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    1st Cove Point Marcellus Shipment to Japan Goes Thru Panama Canal

    LNG Sakura – now on its way to Japan

    A sharp MDN reader recently emailed us to ask about that first shipment of Marcellus Shale LNG exported from Cove Point that is heading to Japan, wondering if the ship would transit through the Panama Canal to get to Asia. We had to say we didn’t know! But now we do know. And the answer is “yes”–that ship is going through the Panama Canal. Last week MDN reported that the second shipment of Marcellus molecules from Cove Point had been loaded onto the LNG carrier Sakura, and that the Sakura is heading to Japan (see Cove Point LNG Ships First Marcellus Cargo to Japan). Before June 2016, large LNG carriers could not pass through the Panama Canal. In 2016 new locks were installed to make it possible for larger ships, like the Sakura, to transit through. By using the Panama Canal, ships save an extra 7,800 miles, bypassing a trip around the tip of South America. Since 2016 more than 300 LNG carriers have used the Canal. Here’s the news that the Sakura is already through the Canal and now in the Pacific Ocean, steaming toward Japan…
    Read More “1st Cove Point Marcellus Shipment to Japan Goes Thru Panama Canal”

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    List of 6 NatGas-Fired Electric Plants Coming to Michigan

    Last June DTE Energy filed paperwork in Michigan to build a new “state-of-the-art” natural gas-fired power plant in St. Clair County (see DTE Energy Files to Build New Natgas-Fired Elec Plant in Michigan). The gas-fired plant will produce 1,100 megawatts of electricity, enough to power 850,000 homes. If all goes according to plan, the new $1 billion plant will go online in 2022, helping to offset three coal-fired plants set to retire by 2023. Although environmental groups launched a campaign against the project (see Michigan Anti Fossil Fuelers Oppose DTE Gas-Fired Plant Proposal), their efforts were too little too late. Last week the Michigan Public Service Commission approved the project! In addition, we spotted an article about five more natgas-fired plants planned for Michigan (full list below). As we always point out, there is a considerable amount of Utica/Marcellus gas heading into Michigan via the Rover and NEXUS pipelines. These plants are all potential customers for our gas supplies…
    Read More “List of 6 NatGas-Fired Electric Plants Coming to Michigan”

  • Other Energy Stories of Interest: Tue, May 1, 2018

    The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading: PA school wins enviro award for using propane buses; WV Chamber honors Williams; Virginians can now comment on MVP pipe permits; Canadian & M-U natgas battle for Midwest market share; why hasn’t Permian boom created a boom in o&g jobs; Tennessee city wins court case against FERC; Marathon cuts $23B deal to buy Andeavor; former Speaker Boehner aide tapped to head American Petroleum Institute; PJM says nukes & coal don’t need saving; in Europe, natgas is king; and more!
    Read More “Other Energy Stories of Interest: Tue, May 1, 2018”

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    Cabot O&G 1Q18: Important New Markets Opening Up Now

    Note: A previous version of this post incorrectly stated Cabot is pumping 3.75 Bcf/d of natural gas now. The correction is that according to the CEO, the company has the capability to pump that much as soon as all pipelines are in place and existing planned wells are online–likely in 2020. We regret the error!

    One of our favorite Marcellus drillers, Cabot Oil & Gas, provided their first quarter 2018 update on Friday. Cabot never disappoints! What did we learn from the update? For one thing, when all pipeline infrastructure is in place and all planned wells are drilled and online, the company will be pumping a massive 3.75 billion cubic feet per day (Bcf/d) of natural gas out of Susquehanna County, PA. Cabot is working with Williams to increase the capacity of their gathering system to support even more gas than 3.75 Bcf/d. It would not surprise us if Cabot becomes the first 4 Bcf/d Marcellus/Utica driller in the next few years. So Cabot has plenty of production. What about demand? Lots of production with little or no demand equals prices in the basement. There was good news on the demand front too. Cabot said there are two gas-fired electric plants starting up by June 1st–both of them powered with Cabot Marcellus gas. Add to that the now-operational Cove Point LNG export plant with Cabot’s contract to sell gas to Japan–and it equals a massive increase in demand for Cabot’s gas going into the second quarter. Later this year, in the second half sometime, Atlantic Sunrise will come online increasing Cabot’s flow to new markets even more. We’d call Cabot’s Friday 1Q18 update the “stars are finally in alignment” update for Cabot. Here are some more pickings from the update, along with a copy of the full update…
    Read More “Cabot O&G 1Q18: Important New Markets Opening Up Now”

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    EQT Pays PA DCNR $874,200 to Lease Under Ten Mile Creek

    This is a story that continues to bug us. The state of Pennsylvania, specifically the Dept. of Conservation and Natural Resources (DCNR), is grabbing money that we think belongs to private landowners. The DCNR has been, for years, claimed that under a centuries-old law that the state of PA “owns” the property under “navigable” waterways–including rivers and streams (see PA DCNR Publishes Lease Agreements for Deals Under Rivers/Creeks). We understand the state claiming the Delaware River, and maybe the Susquehanna River, is a “navigable” body of water. The DCNR uses the “navigable waterway” excuse to sign leases with drillers under much smaller waterways than the Delaware and Susquehanna–siphoning money that would have gone to landowners. A landowner might own the land on both sides of, say, Ten Mile Creek, as we’re sure happens. However, the land under Ten Mile Creek does not technically belong to them. In fact, certain long portions of the land under Ten Mile Creek are now leased to EQT, and EQT paid handsomely for it. The company leased 218.55 acres under Ten Mile Creek in Greene and Washington counties (southwestern PA) for $874,200, which works out to be exactly $4,000 per acre! Not to mention a whopping 20% royalty! That’s money that (in our opinion) should go to the landowners who own the land along the creek, not to the state. Until landowners sue or the legislature acts, the state will continue to pick the pockets of landowners who own land along PA’s waterways…
    Read More “EQT Pays PA DCNR $874,200 to Lease Under Ten Mile Creek”

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    Southwestern 1Q18: New $3.5B Line of Credit, Fayetteville Not Sold

    Last Friday Southwestern Energy, one of the biggest drillers in the Marcellus (4th largest natgas producer in the country), issued its first quarter 2018 update. Southwestern drills in two plays: The Marcellus (i.e. Appalachia), and the Fayetteville (in Arkansas). In March the company signaled it wants to sell its Fayetteville Shale assets (see Southwestern 2017: $3.5B Turnaround, Shopping Fayetteville Assets). A sale hasn’t happened yet, according to Friday’s update. In fact, Southwestern CEO Bill Way gave an elaborate “no comment” (our words) on the Fayetteville “process” currently under way with the help of JPMorgan. Southwestern reported earning $205 million in 1Q18, down 27% from the $281 million they earned in 1Q17. The company has just reorganized its debt, paying off a $1.2 billion term loan and arranging a $3.5 billion line of credit. Production in the Marcellus/Utica was 2.4 billion cubic feet equivalent per day (Bcfe/d) of natural gas gross, 159 million cubic feet equivalent per day (MMcfe/d) net. Production was up 42% in southwest Appalachia and up 24% in northeast Appalachia. Across both the M-U and Fayetteville, Southwestern drilled 32 wells, completed 29 wells, and placed 33 wells online into sales. Here’s the full 1Q18 update from Southwestern Energy…
    Read More “Southwestern 1Q18: New $3.5B Line of Credit, Fayetteville Not Sold”

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    Cabot Says 2 NEPA Gas-Fired Plants Go Operational by June 1

    Lackawanna Energy Center – concept drawing

    Tucked away in the comments made by Cabot Oil & Gas CEO Dan Dinges on an investor conference call last Friday, MDN picked up on what we consider big news: Both the Moxie Freedom (Luzerne County, Wilkes-Barre area) and Lackawanna Energy Center (Lackawanna County, Scranton area) Marcellus-fired power plants are about to go fully operational–sometime in May (by June 1). Both plants will exclusively use Marcellus gas extracted by Cabot in Susquehanna County, PA. For nearly a year the plan had been for Moxie Freedom to be built and online in May of this year, so that announcement isn’t so much a surprise as it is welcomed news (see NEPA Moxie Freedom Power Plant on Track for May 2018 Launch). However, in March we reported Lackawanna was going through a “short” commissioning stage and would be firing up at any time (see Gas-Fired Power Plant Near Scranton Nears Startup; Yellow Smoke). The Lackawanna project has faced fierce local resistance. A group of Democrats got themselves elected to the local town board in Jessup, taking office in January, trying their best to block startup of the Lackawanna project by employing a Big Green lawyer (who works for Riverkeeper) at a cost to taxpayers of $225/hour. Looks like it was wasted money as Dinges says Lackawanna will be operational, with large volumes of Cabot gas flowing to it, within weeks…
    Read More “Cabot Says 2 NEPA Gas-Fired Plants Go Operational by June 1”

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    Philly Dem Senator Tries to Shut Down ME2 Pipe Construction

    PA State Senator Andy Dinniman

    A Chester County, PA (Philadelphia area) Democrat State Senator by the name of Andy Dinniman (who we think looks like Tony Soprano) continues his mission to stop the Mariner East 2 (ME2) project. This is nothing new for Dinniman. He’s been agitating and lobbying and demanding and pouting for over a year in his quest to shut down ME2 (see our Dinniman stories here). According to a press release from Dinniman issued last Thursday, the Senator has filed “a formal legal complaint and a petition for interim emergency relief with the Pennsylvania Public Utility Commission (PUC) to prohibit construction of the Mariner East 2 (ME2) and Mariner East 2X (ME2X) pipelines in West Whiteland Township.” Dinniman claims Sunoco Logistics Partners (builder of ME2) has 20 days to respond to the complaint. No doubt Sunoco will respond, and there’s little doubt the PUC will not do anything about Dinniman’s request…
    Read More “Philly Dem Senator Tries to Shut Down ME2 Pipe Construction”

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    1 MVP Tree Stand Comes Down, VA Gov. Calls Sitters “Unlawful”

    Va. Gov. Ralph Northam

    An update on the ongoing situation where several radicals are sitting in the tops of trees (or on a platform) to try and stop the Mountain Valley Pipeline from cutting down said trees in order to install the pipeline. There are, by our informal count in sifting through the news, four “tree sits”–with three of them in Virginia and one in West Virginia, along with a “pole sit”–someone perched on top of a pole that is held upright by ropes to nearby trees. The pole sit is in Virginia as well. Democrat politicians in Virginia have by and large supported the illegally trespassing lawbreakers (see Virginia Democrat Lawmakers Side with Lawbreakers in MVP Protest). We pointed out the Dem lawmakers might change their tune if MDN showed up with a tent and camped out in their driveway, trespassing on their land. One can dream. At any rate, the new news is this: One of the tree sitters in Virginia decided to give up the protest. As soon as he/she was on the ground the stand was disassembled and removed by the U.S. Forest Service. So that’s one of the four tree sits gone. Everyone else is still in place. U.S. Senator from Virginia, Tim Kaine (the loser who ran with Hillary) says he supports the lawbreakers. Typical. However, Virginia Gov. Ralph Northam was more nuanced. Northam tried to have his cake and eat it too. He called the protesters “unlawful” and indicates he doesn’t support them, but then he turned around and said police should continue to feed and protect them. Typical swamp dweller response…
    Read More “1 MVP Tree Stand Comes Down, VA Gov. Calls Sitters “Unlawful””

  • Other Energy Stories of Interest: Mon, Apr 30, 2018

    The “best of the rest”–stories that caught MDN’s eye that you may be interested in reading: Rover gets limited FERC OK to start up more of the pipeline; M-U formations generate billions in investment; Marcellus fuels bright future for WV residents; WVU shale gas dev team formed; timetable to shut down 4 nukes in OH, PA; Michigan approves $1B DTE natgas power plant; VT Supreme Court wants review of pipeline costs; crude prices up, production at record high; Al Gore lectures DC media on going green, then drives away in a gas-powered car; the secret weapon to solve global warming; and more!
    Read More “Other Energy Stories of Interest: Mon, Apr 30, 2018”

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    Range Resources 1Q18: Drills 2 Longest Marcellus Wells Ever!

    Range Resources, the very first driller to sink a well in the Marcellus Shale, provided their first quarter 2018 update yesterday. And what an update it was! First thing that jumped out for us is that Range says they drilled “the two longest laterals to date by Range at 18,129 feet and 17,875 feet.” We checked, and the previous record holder for drilling the longest Marcellus well was EQT, which drilled a Marcellus well with a lateral of 17,400 feet long in Washington County last December (see EQT Drills Longest Marcellus Well Ever, Reveals 2018 Plans). Although Range isn’t claiming they’ve drilled “the longest Marcellus well ever”–they actually have! (Note to Range’s PR department–you’re missing an opportunity to toot your own horn.) Range did not say where (which county or counties) the long lateral wells were drilled–only that it was in southwestern PA. Our guess is Washington County. Range’s long laterals caught the attention of analysts on yesterday’s quarterly phone call. Range personnel were peppered with questions about the long laterals. Other news coming from yesterday’s update: The company made $49 million in profit during 1Q18, down 71% from the $170 million Range made in 1Q17. The company is still larded up with debt–$4.1 billion worth of debt. Range CEO Jeff Ventura said, “Our plan is to continue the process of high-grading our portfolio and accelerate the de-leveraging process by targeting non-core assets sales and the thoughtful monetization of under-appreciated inventory in our portfolio. We currently have processes underway, pursuing various transactions that would support our near-term goal of getting leverage below 3 times, as we ultimately move towards an investment-grade leverage profile.” Translation: We’re selling stuff as fast as we can that doesn’t make us a lot of money. Some of those sales likely will include Range’s Marcellus assets in northeastern PA…
    Read More “Range Resources 1Q18: Drills 2 Longest Marcellus Wells Ever!”