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NewsLetters

Expo/Industry events for the next few months

Shale Insight
September 27-28, 2017
David Lawrence Center
Pittsburgh, PA
http://shaleinsight.com/

West Virginia Energy Expo
October 4, 2017
Morgantown, WV

http://www.wvenergyexpo.com/ 

Utica Summit
October 11, 2017
Walsh University

North Canton, OH
http://www.uticasummit.com/ 

Midstream PA 2017
October 19, 2017
Penn Stater Conference Center

State College, PA
|
http://midstreampa.com/

For other events visit http://www.shaledirectories.com/site/oil-and-gas-expo-information.html

Latest facts and a rumor from the Marcellus, Utica, Permian, Eagle Ford, Bakken and Niobrara Shale Plays

Alta Resources Information.  I want to thank two readers who responded with the latest information about Alta.  First, Alta will be bringing one rig up to the Appalachian Basin probably in Lycoming County, PA.  Second, when looking at permit information, if you see the E&P Company as ARD, it is Alta. 

Yes!!  It’s Approved! Atlantic Sunrise Pipeline.  Williams Partners L.P. reported that the Pennsylvania Department of Environmental Protection (PADEP) and U.S. Army Corps of Engineers have issued required permits for the Atlantic Sunrise pipeline project – an expansion of the existing Transco natural gas pipeline to connect abundant Marcellus gas supplies with markets in the Mid-Atlantic and Southeastern U.S.

PADEP & USACE Permits

The company received the Chapter 105 (Water Obstruction and Encroachment) and Chapter 102 (Erosion and Sediment Control) permits from PADEP on Aug. 30 and the Clean Water Act Section 404 permit from the U.S. Army Corps of Engineers on Aug. 29.

The receipt of these remaining state and federal permits will allow the company to immediately commence the process of requesting a Notice to Proceed with construction from the Federal Energy Regulatory Commission (FERC), targeting commencing greenfield pipeline construction in Pennsylvania this fall. The full project capacity is scheduled to be placed into service in mid-2018.

Early Partial Mainline Service

The company also reported today that, in advance of the greenfield portion of the project coming into service, it has received Federal Energy Regulatory Commission (FERC) approval to place a portion of the project into service early and, accordingly, expects to begin partial service Sept. 1, providing 400,000 dth/day of firm transportation service on Transco’s existing mainline facilities to various delivery points as far south as Choctaw County, Alabama. The partial service milestone is the result of recently completed modifications to existing Transco facilities in Virginia and Maryland designed to further accommodate bi-directional flow on the existing Transco pipeline system.

Company Perspective

“We are very pleased to have reached these important milestones for the Atlantic Sunrise project,” said Alan Armstrong, Williams’ president and chief executive officer. “This vital project will leverage existing infrastructure to deliver economic growth and help millions of Americans gain access to affordable Pennsylvania-produced clean-burning natural gas.”

Michael Dunn, Williams’ executive vice president and chief operating officer, commented: “The Atlantic Sunrise project has been through a rigorous, thorough review process in Pennsylvania and we are committed to installing this important infrastructure in an environmentally responsible manner and in compliance with the state’s high environmental standards.”

The FERC authorized the project in February 2017, concluding that environmental impacts associated with the project would be reduced to “less than significant levels” with the implementation of mitigation measures proposed by the company and FERC.

About Atlantic Sunrise

Once complete, the Atlantic Sunrise expansion will help alleviate infrastructure bottlenecks in Pennsylvania, connecting abundant Marcellus gas supplies with markets in the Mid-Atlantic and Southeastern U.S. The nearly $3 billion expansion of the existing Transco natural gas pipeline is designed to increase deliveries by 1.7 billion cubic feet per day (enough to provide daily service to seven million homes). Williams Partners’ net investment in the Atlantic Sunrise project is expected to be approximately $1.9 billion. Pennsylvania State University researchers forecast the Atlantic Sunrise project to directly and indirectly support approximately 8,000 jobs in the 10 Pennsylvania counties during the project’s construction phase, resulting in an estimated $1.6 billion economic impact in the project area.

Additional information about the Atlantic Sunrise project can be found at www.williams.com/atlanticsunrise .

Shell Is Starting its Public Outreach Program.  For the last few years, I’ve been desperately trying to get information about the Shell cracker plant.  I must admit that I had limited success.  It was tough.

Shell has just sent out a mailer which provides information about the cracker plant.  Shell states that 6,000 construction workers will be involved in the in building the cracker plant.

Click here to read the entire flyer, Shell Mailer. 

I want to thank Jeff Young, Sales Representative, and TorcUP for this information. 

Shell Reaches Accord with Environmental Groups.  Shell Chemical Appalachia has reached a settlement agreement with two environmental groups that had challenged the air permit for its new petrochemical plant being built near Pittsburgh.

The deal follows more than two years of negotiations and requires Shell to do more air quality monitoring, including installing fence line monitoring, which can quickly detect emission spikes. It also places more stringent requirements on flaring, in order to burn off pollutants.

“We are pleased to have reached this settlement,” Ate Visser, Vice President of the Shell project, said in a statement. “Now our full focus will be on delivering the facility, with its state of the art operations and environmental controls, which will bring jobs and economic benefits to many Western Pennsylvania families for decades to come.”

Attorney Joseph Minott of the Clean Air Council says the technology will make Shell’s workers and the community safer.

“I think this is a very good model for what communities should insist what all large air pollution sources now have,” he says. “The technology exists, the cost is reasonable, and the level of protection it provides is well worth it. Anyone who lives next to a facility like that will be exposed to elevated levels of hazardous air pollutants.”

Shell’s plant, known as an ethane cracker, breaks up ethane, which is a natural gas liquid from the Marcellus Shale, and turns it into material used to make plastics. It is being built in Potter Township, Beaver County, about 30 miles northwest of Pittsburgh.

“Our appeal of the air permit for the Shell facility sought to address two main pieces the permit was lacking: fence line monitoring to detect and fix leaks and better requirements to assure the facility’s flares properly control air pollution,” Adam Kron, senior attorney for the Environmental Integrity Project, said in a statement. “This settlement achieves both of these goals, and we believe the health of people living and working near this facility will be better protected as a result.”

Quorum Gives Nexus Approval.   Two new members added to the Federal Energy Regulatory Commission by President Trump (Neil Chatterjee and Rob Powelson), added to the Obama-appointed member (Cheryl LaFleur) have not wasted any time in authorizing their first major pipeline project as a group. Last week the trio voted to approve the first major pipeline project since a quorum has been reestablished–NEXUS, a $2 billion, 255-mile interstate pipeline that will run from Ohio through Michigan and eventually to the Dawn Hub in Ontario, Canada.

On August 4th, NEXUS, which is a jointly owned project between DTE Energy and Spectra Energy (now part of Enbridge), sent a letter to the new FERC quorum urging fast action. Perhaps the letter did the trick. On Friday, August 25th, the three issued a certificate of public convenience and necessity allowing the project to move forward. Because of the delay when FERC was without a quorum, NEXUS says the pipeline will now evaluate and supply a new construction schedule, but they do plan to have the pipeline up and running sometime in 2018. 

The Russians Are Funding the Antis.  (Thank You, MDN.  Great Article)  An extensive expose appearing on The Daily Signal blows the doors off collusion and money funneling from Russia to several Big Green groups using that money to oppose pipeline projects, including opposition to the Mountain Valley Pipeline and Atlantic Coast Pipeline projects here in the Marcellus/Utica region. A 29-year CIA veteran does a masterful job of connecting the dots between the Kremlin and so-called environmental groups that are using Russian money to oppose these American, much-needed pipeline projects. Group allegedly receiving Russian money include Virginia Organizing, Preserve Montgomery County and Friends of Nelson County in Virginia. Nationally, groups on the take with Russian money include the Natural Resources Defense Council, Sierra Club, and League of Conservation Voters Education Fund. Are they committing treason? We report, you decide.

Russians funding the antis is nothing new.  They have been doing it for years here in America and overseas, especially in Europe.  The last thing Russia wants is an energy independent America.

Do We Need Petrochemical Production Back Up?  A third of U.S. chemical production has been disrupted by Tropical Storm Harvey, boosting prices and threatening shortages for basic industrial building blocks such as chlorine and ethylene.

Producers such as Exxon Mobil Corp. and Occidental Chemical Corp. have shut plants and cut back operations in recent days along the flood-crippled Gulf Coast. Those disruptions have affected 37 percent of U.S. capacity for making chlorine and caustic soda, salt-derived chemicals used to make vinyl and PVC pipe, according to Bloomberg Intelligence.

About 40 percent of U.S. ethylene capacity has been shut, PetroChemWire said in a report Monday. Ethylene is the most used petrochemical and largely goes into plastics such as polyethylene, used in trash bags and food packaging.

The crisis could get worse as Harvey, which made landfall Friday night in Texas, Aug 25th, as a Category 4 hurricane, is circling back into the Gulf of Mexico and could crash ashore again, this time on the Texas-Louisiana border. The full extent of Harvey’s toll won’t be known for days, with rain totals that are measured in feet rather than inches.

The largest chemical-price impact is likely to be on caustic soda as near-record exports had already driven prices up 77 percent over 16 months, Bloomberg Intelligence analysts Jason Miner and Christopher Perrella said in a note.

The birth of the Appalachian Basin cannot come too soon for plastics manufacturers.  The Bloomberg article highlights how vulnerable the petrochemical plants are on the Gulf Coast to the vagaries of weather.

We hear the petrochemical companies are snooping around the Appalachian Basin for a possible cracker plant location.  With this catastrophe, will snooping become serious searching? 

NatGas Production Up in PA.  It continues to be another banner year for natural gas production in Pennsylvania, going by the latest quarterly production report. Yesterday, the PA Independent Fiscal Office (IFO) released their latest quarterly Natural Gas Production Report for May-Jun 2017. It shows NatGas production rose 3.8% compared to the same period last year. It also shows the number of producing wells is up 7.5% from last year. Total natural gas production volume was 1,315.7 billion cubic feet (Bcf) and the number of producing wells in 2Q17 was 7,853. Perhaps the biggest news is that 1Q17 saw the highest quarterly production–ever.

Another interesting fact from the latest report: Four counties (Susquehanna, Washington, Bradford and Greene) comprised two thirds (68%) of statewide production. All counties except Greene and Lycoming registered production gains. The #1 county for NatGas production in 2Q17 is Susquehanna County. The #1 driller in that county is Cabot. You might say, with some justification that the success of Cabot’s drilling program in Susquehanna County has translated into success for all of Pennsylvania.

Shame on The University of Cincinnati.  (Thank you, MDN) The University of Cincinnati (UC) has now used $470,000 of taxpayer money for three research studies (over the past four years) to study the health effects of Utica Shale fracking. One of the studies dealing with ambient air pollution (published in March 2015) had such major errors the authors retracted it in June 2016. Kind of embarrassing.

Another study was completed 18 months ago, looking at potential issues of fracking on nearby water wells in Ohio. That study was funded, in part, by anti-organizations who didn’t like the findings–that there IS NO negative impact of fracking on groundwater. So they’ve hushed it up and have refused to allow it’s publication.

Now come leaks that a third research project has been completed at UC, once again looking at air samples near fracking sites–this time looking for elevated levels of volatile organic compounds (VOCs) and formaldehyde. The findings are that, “none of the air sample averages exceeded EPA levels of health concern.” Looks like yet another UC study that will get buried and never see the light of day. 

Who’s running that university?  Doesn’t anyone have any integrity?

3,000 Wells in Potter County, PA.  When it comes to shale drilling in the northern-tier of Pennsylvania, counties like Susquehanna (#1 producing county in the state); Bradford (#3 producing county) and event Tioga (#7 producing county) may come to mind.

But what about the county west of Tioga–Potter County? Potter isn’t even in the top 10 producing counties in the state. But that doesn’t mean there’s not shale drilling activity. In July MDN reported that JKLM Energy (owned by Buffalo Bills owner Terry Pegula) is in the process of drilling a dozen Utica wells in Potter this year. The residents in the county are being proactive about promoting shale drilling in Potter.

Penn State’s Jim Ladlee said that Potter County could, theoretically, support 3,000+ shale wells. That certainly doesn’t mean it will ever see that many, but what it does indicate is that there is potential in Potter County far beyond the dozen or so shale wells currently planned.

Congressman Johnson Optimistic about PTTGC Cracker.  U.S. Rep. Bill Johnson of Ohio, said this week he’s “extremely optimistic” about the possible construction of an ethane cracker along the Ohio River in Belmont County.

Addressing the Ohio Valley Oil and Gas Association’s monthly meeting in St. Clairsville, Ohio, the Republican said he left a meeting in Thailand earlier this summer with potential cracker owner-operator PTT Global Chemical officials and Thailand Prime Minister Prayut Chan-o-cha feeling confident about the project.

PTT Global Chemical America officials expect to make a final decision on the project, proposed for a site along the Ohio River near Dilles Bottom, Ohio, by the end of the year, Kallanish Energy reports.

“They want to see this work,” Johnson said of PTT Global Chemical officials, the Wheeling (W.V.) Intelligencer newspaper reported. “They’re just looking for reasons to say ‘yes’.”

If the plant is built, Johnson said, it would be a “game-changer” for the area, attracting workers to the area for several years during construction and providing hundreds of long-term jobs, as well.

He added the cracker itself would be the “tip of the iceberg,” predicting plastics and textile plants would set up operations all over eastern Ohio, the Intelligencer reported.

Johnson noted the area needs to begin setting the groundwork for these new residents and jobs, as they will need infrastructure such as roads, improved water and sewage, reliable broadband internet and more to be successful in the area.

The legislator added it’s necessary to have a “broad spectrum of education” for young people in the area when it comes to the energy industry, the Intelligencer reported.

Not every student will want to attend a four-year college or university, and educators need to offer options and support for students interested in seeking jobs in the industry, he said.

Appalachian Basin Storage Hub Geology.

At our Appalachian Basin Storage Hub Conference, we discussed the business aspects of the storage hub.  This workshop provided the geological background.  We hope to get a copy of the study.  If we do, we’ll make it available to you.

A research team from West Virginia University said Tuesday a yearlong study of geologic sites in 50 counties in the region has determined there are multiple sites that would support a proposed Appalachian Storage Hub for ethane.

While details of the study are highly technical, the results show the Appalachian Basin, which now produces one-third of the nation’s natural gas and is abundant in ethane, could support the project, which is seen as a way to build out a petrochemical industry that has been long present in the region.

“Appalachia is poised for a renaissance of the petrochemical industry due to the availability of natural gas liquids,” said Brian Anderson, director of the WVU Energy Institute.

“A critical path for this rebirth is through the development of infrastructure to support the industry. The Appalachian Storage Hub study is a first step for realizing that necessary infrastructure.”

The results were discussed before more than 100 geologists, chemical engineers, oil and gas business representatives and others in academia during an all-day workshop session at Hilton Garden Inn in Southpointe.

As part of the study led by Doug Patchen, director of WVU’s Appalachian Oil and Natural Gas Consortium and the Eastern Petroleum Technology Transfer Council, researchers from the geological surveys in West Virginia, Pennsylvania and Ohio studied geologic formations that could offer suitable locations for developers to build underground facilities to store natural gas liquids from Marcellus and Utica wells.

The concept of a storage hub was introduced in June during a similar gathering at Southpointe. Patchen’s study was supported by a $100,000 grant from the Benedum Foundation and matched by contributions from numerous oil and gas companies in the region.

Tri-state effort

The latest work discussed Tuesday was conducted as part of the efforts of the Tri-State Shale Coalition, a cross-border collaboration in Ohio, Pennsylvania and West Virginia whose members say it is a critical key for unlocking the region’s economic opportunity.

The coalition was created following a collaborative agreement signed in October 2015 by governors’ offices in the tri-state. Charter members include the Benedum Foundation and Team NEO, a wing of the Jobs Ohio group; the Allegheny Conference on Community Development; and Vision Shared, all nonprofit economic development organizations in the three states.

As a public-private partnership, the coalition brings together workforce development organizations, academic institutions such as WVU and economic development groups to advance the area as a “super region” for petrochemical, plastics fabrication and advanced manufacturing jobs and investments.

Under Patchen’s direction, the team of geologic researchers identified and mapped all potential options for subsurface storage of natural gas liquids along the Ohio River from Southwestern Pennsylvania to eastern Kentucky and the Kanawha River in West Virginia. The researchers focused on three options for storage:

• Areas where Salina salt bed formations are a least 100 feet thick and are suitable for a type of mining that uses a liquid such as water injected through a borehole to dissolve and extract salts and minerals.

• The Greenbrier Limestone in areas that are 1,800 to 2,000 feet below the surface and at least 40 feet thick.

• The group also looked at opportunities in converting existing sandstone reservoirs in depleted gas fields and inactive gas storage fields to natural gas liquids storage.

During his remarks, Patchen said the study, which was released yesterday, confirmed there are multiple storage options that can be exploited.

Some industry estimates have placed the price of a storage hub at about $10 billion.

Patchen said it is possible that the hub concept may require more than one storage facility, but would depend upon which types of NGLs are being stored. The study is being made available to the natural gas industry to determine the feasibility of investment in such a project.

Major potential

During a 90-minute panel discussion, four people representing a cross-section of researchers, economic development and business executives said the concept has the potential to generate $36 billion in industrial investment in petrochemical and plastic processing facilities and create more than 100,000 jobs in the region.

Panelist Paul Boulier, vice president of industry and innovation for Ohio’s Team NEO, noted that the strategy of moving forward as a region to promote the hub gives it enormous economic clout.

He said the tri-state region represents $1.4 trillion in gross domestic product, which if viewed as a country would make it the 20th largest in the world.

And the ethane, which is the building block for all things plastic, wouldn’t be fueling a start-up industry in the region, Boulier added.

He said within a 250-mile radius that comprises the tri-state region, there are more than 17,000 petrochemical and plastics companies, including 250 that each employs more than 100 people.

Anderson said the hub is needed to bring more manufacturing to expand economic development within the Appalachian Basin.

“We’re at a tipping point in this region,” Anderson said, noting that most of the natural gas products coming out of the Marcellus and Utica shales are being exported to markets in Canada, the Midwest, the East Coast and the Gulf Coast.

“Having natural gas liquids storage capacity in the greater region is critical to fully realizing the potential of the shale gas resources found in our three states, said David Ruppersberger, president of the Pittsburgh Regional Alliance, the economic development marketing affiliate of the Allegheny Conference. “Shell’s decision to build a world-scale petrochemical facility here is game-changing and shines a spotlight on fresh opportunities in this part of the country.

“Natural gas storage will do the same, positioning us to attract additional ethane crackers and other petrochemical investments, as well as supporting further upstream and midstream development.”

Kasich Caves!!!  Ohio Gov. John Kasich (RINO) promised, five years ago, to allow shale drilling on state-owned forests and parks. He promptly then reneged on his promise. The way Kasich blocked drilling was to refuse adding new members to the Oil and Gas Commission, charged with approving potential drillers on state land. Kasich created a de facto moratorium that prevents fracking on state-owned land. In May of this year, Republican legislators, tired of Kasich’s recalcitrance, added a “little-noticed provision” in the state budget deal that will give the legislature, and not the governor, the power to select members of the Ohio Oil and Gas Commission (see Ohio Legislators Push to Allow Fracking in State Parks, Forests). Kasich vetoed the measure but legislators overrode the veto. As we reported in July, Kasich was on the verge of losing his power to block state land drilling (see Ohio Gov Kasich About to Lose Power to Stop Drilling on State Land). Faced with humiliating defeat, Kasich decided to act and is now reportedly “working hard” to get the appointments made. 

Tetco Pipelines Ad 1 BCF Daily of Capacity.  Four Texas Eastern Transmission (Tetco) pipeline projects are expected to be completed by the end of this year and when they are, they will together flow an extra 1 billion cubic feet per day of Marcellus/Utica gas to more profitable markets in the South, as far away as the Gulf Coast. The four Tetco projects are: Gulf Markets Expansion Phase 2, Access South, Adair Southwest and Lebanon Extension. As fate would have it, Tetco experienced a fire while drilling under a highway for what we believe is the Adair Southwest project. Three of the four projects–Access South, Adair Southwest and Lebanon Extension–are part of the same umbrella filing with the Federal Energy Regulatory Commission (FERC). Those three together will flow an extra 662 million cubic feet (MMcf) per day of gas to Ohio, Kentucky and Mississippi. Some of that gas will then catch a ride on the Gulf Markets Expansion Phase 2, flowing gas to Louisiana and Texas. Here’s the exciting part: Some of that gas will go to LNG export facilities, and some will go by pipeline from Texas to Mexico. Cool! Marcellus/Utica gas finding its way to other countries via the Tetco pipeline. Which means some Marcellus/Utica drillers will get higher prices for their gas.

How Much Crude Is in the Bakken?  Officials in North Dakota are pushing the U.S. Geological Survey to update its four-year-old estimate showing how much oil and natural gas can be produced using today’s technology from the state’s Bakken and Three Forks plays.

In 2008, the USGS studied the Bakken and projected the shale play contained 3.7 billion barrels (BBbl) of extractable crude.

Then in 2013, the survey was repeated, this time including the Three Forks formation, and USGS doubled the amount of crude extractable – a whopping 7.4 BBbl.

Why the huge jump?

“Because of the advent of new technologies such as hydraulic fracturing and directional drilling,” Walter Guidroz, energy resources program coordinator with the USGS, told Inside Energy.

Republican Sen. John Hoeven of North Dakota said the jump in his state’s 2013 estimate meant energy companies had confidence investing there would pay off. That confidence helped usher in a whole host of services, business and jobs to booming oil patch communities, such as pipelines, trains, new roads, housing, restaurants and other amenities, he said.

Now, Hoeven is urging the USGS to re-do the survey to see what the latest projection is, Kallanish Energy learns. “To continue to make those investments, we have to continue to make the case this play is going to continue to be here a long time, 10, 20, 30, 50 years,” he said, Inside Energy reported.

But there’s no guarantee a new estimate would be positive for North Dakota’s oil future. “The numbers could go up, they could remain about the same, they could go down,” Guidroz said.

A new estimate would rely in part on data gathered by the oil and gas industry since 2013, such as the number of new wells and how much oil they produce.

USGS officials said they will reach a decision this week on whether to update their estimate for North Dakota’s oilfields.

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Permits

PA Permits August 17, to August 24, 2017

            County                                   Township                                          E&P Companies

  1. Susquehanna                            Brooklyn                                            Cabot
  2. Susquehanna                            Brooklyn                                            Cabot
  3. Susquehanna                            Brooklyn                                            Cabot
  4. Susquehanna                            Brooklyn                                            Cabot

OH Permits for week August 26, 2017

             County                                   Township                                          E&P Companies

  1. Guernsey                                    Wills                                                   Eclipse
  2. Guernsey                                    Wills                                                   Eclipse
  3. Harrison                                       Moorefield                                         Ascent
  4. Monroe                                        Salem                                                 Eclipse
  5. Monroe                                        Salem                                                 Eclipse

Joe Barone jbarone@shaledirectories.com 610.764.1232
Vera Anderson vera@shaledirectories.com 570.337.7149

DUG Technology