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  • Permit Activity. 
    • PA – 52 permits; Warren and Washington counties lead in permitting
    • OH – 13 permit; Harrison seeing lots of activity by Eclipse Resources
  • Expo/Event activity.

    Utica Summit 2014 – October 23 in Canton, OH. I encourage you to attend this conference.  It will give you a forward looking perspective on the impact of lower energy costs on transportation and manufacturing.  Industry leaders, JPMorgan Chase, Caterpillar, Dow, Pepsi/Frito Lay and Timken, will give their perspectives and what it could mean to your business.
  • DUG East Conference & Exhibition, November 13-15, 2013 Pittsburgh, PA.   David L. Lawrence Convention Center

    Join Hart Energy in Pittsburgh for the 5th annual DUG East conference and exhibition. This premier Marcellus and Utica Shale event brings top executives from the most active operators in the Appalachian Basin to the stage. This year you'll hear from executives at Range Resources, EnerVest Ltd., Halcon Resources, Cabot Oil & Gas, CONSOL Energy, PDC Energy, Eclipse Energy and many more. These expert speakers will offer their unique insight on the many discoveries, technical achievements and new challenges associated with bringing the Marcellus and Utica plays to full, safe and economic production. 

    Make plans to attend today! Click here to learn more and register.
  • Advertising in Facts & Rumors – due to many inquiries, we have decided to accept advertising in Facts & Rumors.  Our newsletter goes to over 2500 businesses in the oil and gas industry in the Marcellus & Utica Shale region.  If you are interested in placing a banner ad in the newsletter, please contact me. 

Latest facts and a rumor from the Marcellus and Utica Shale

  • PA is looking very bullish.  This week’s permitting report for PA is very bullish on future drilling.  Here are some of the highlights:
    • The rig count is up to 55 which is the highest level it has been in a while.
    • There was permitting in 12 different counties with more activity occurring in Western PA.
    • 15 different E&P Companies secured permits; a few of these are new companies that have drilled in PA before
    • Warren County had 14 permits from two new drillers – McCool and SLT Productions.
    • Washington had 15 permits lead by Range and CONSOL, both of which have aggressive drilling plans in 2014.
  • Gas prices rising.  If you have not noticed recently, the gas prices have been inching up.  In the past week, the natural gas price has been ranging between $3.70 and $3.77.  We’ll have to see how the fall and winter weather unfolds.
  • New E&P Company in Muskingum County, OH.  American Energy-Utica is moving into Muskingum County, OH (Rumor)
  •  McClendon’s getting serious.  It may be the U.S. energy industry’s oddest couple: Lee Raymond, who was famously tightfisted as chief executive of Exxon Mobil Corp., now has a seat at the table in a venture headed up by Aubrey McClendon, whose aggressive spending hastened his exit as chairman at Chesapeake Energy Corp.

    Mr. Raymond has emerged as a director alongside Mr. McClendon in American Energy Ohio Holdings LLC, a closely held company that has raised $1.35 billion for Mr. McClendon’s new firm, American Energy Partners LP, according to a regulatory filing Wednesday triggered by the fundraising.

    The extent of Mr. Raymond’s participation isn’t clear; he declined to comment, as did American Energy.

    But his reputation for tough governance and devotion to return on capital could check Mr. McClendon’s free-spending ways and tolerance for risk that at times rankled Chesapeake shareholders and eventually led to his ouster. Experts said it could also lend credibility to the new venture, which is wildcatting in Ohio’s Utica Shale. (WSJ)
  • Shell cracker rumors are starting to build momentum.  Norfolk Southern is designing a rail yard for the Shell cracker plant.  Shell has supposedly already paid for the yard. (Rumor) 

    Yet to be announced is the moving of Route 18, closer to the river, and requiring a cut that will create a great deal of fill - to be provided to Shell for their cracker location.  (Rumor)
  • Midstream activity in Columbiana and Mahoning Counties, OH.  Bluegrass Pipeline LLC's new project slated for early 2015 could bring between 200 and 300 new construction jobs -- and possibly another processing plant -- to the region, officials say.

    "We have completed our survey permission process, and right now over the last 12 days, we've been on the ground acquiring rights to easements," said Jim Curry, land right-of-way project manager for Bluegrass. Bluegrass, a partnership between Williams and Boardwalk Pipeline Partners LP, is in the process of mapping out a path for 600 miles of new pipeline that stretches from Mercer County, Pa., through Mahoning and Columbiana counties, and south into Kentucky. The line would then link with an existing pipeline that runs to Louisiana.

    The pipeline would be used to transport natural gas liquids extracted from gas wells in the Marcellus and Utica shale plays in western Pennsylvania and eastern Ohio down to the Gulf of Mexico.

    That project could also include the addition of a new processing plant somewhere near the pipeline's route.

    About 25 miles of the pipeline is slated to move through Columbiana County, while 1.6 miles of the line is expected to pass through Mahoning County, Curry said. Some 10% of the land leases in Columbiana County are already signed, he noted. The Columbiana County leg includes 160 tracts of land that need pieced together.

    Lease agreements along the pipeline's Mahoning Valley route could command as much as $8 million for these landowners, Curry said. "In the state of Ohio, it's in excess of $100 million for landowners in their pockets."

    Land leases should be locked up by December, and pre-construction work could begin in 2014, Curry reported. Actual construction of the pipeline wouldn't start until the first quarter of 2015, and would finish by the end of that year.
  • Hilcorp ramping up.  Hilcorp Energy Co. holds about 43,000 acres of leaseholds in Ohio, the majority of which is in Columbiana County, said Hilcorp representative David Wilkins.

    "We are starting to ramp up," he told the audience. The company has leases in Mahoning and Columbiana counties, as well as lease agreements with landowners in Lawrence and Mercer counties in western Pennsylvania.

    Hilcorp has two rigs operating, one at the Carbon Limestone Landfill in Poland Township, and the other in Lawrence County. Hilcorp has drilled 11 wells, eight of which – two in Ohio and six in Pennsylvania -- are producing.

    "So far, we are very pleased with what we've seen," Wilkins said.

    Wilkins emphasized the company's 50% stake in the Hickory Bend project, a partnership between the company and NiSource Midstream that is constructing the large processing plant in Springfield Township, along with 50 miles of pipeline beginning in Mercer County and into Columbiana County.

    And Hilcorp is doing all it can to use local vendors and workers on these construction projects, he added. "We're not going to bring up folks from the South," he remarked. "We've had to on occasions, when there were skilled positions, but I've said that we are to be looking for local jobs."
  • Marcellus gas moving to NYC.  A new "superhighway" pipeline opens next month to carry a large batch of natural gas primarily from the Marcellus Shale into New York City and surrounding suburbs, providing another outlet for the bottlenecked Appalachian production.

    But the road to New England isn't as open. While Spectra Energy, which runs major gas pipeline networks between the Gulf Coast and the Northeast, has just completed the $1.2 billion New Jersey-New York Expansion Project, it has had to scale back a planned pipeline into New England.
  • Consol accelerates drilling.  Consol chairperson and CEO Brett Harvey said in an operations report that the company's gas production growth was accelerating as it and its Marcellus Shale partner increased the rig count. Consol and Noble Energy had a record eight rigs drilling in the Marcellus Shale on their joint venture acreage, and they expected to operate at least that many rigs next year, Harvey said.

    During the third quarter, Consol Energy drilled 15 horizontal shale wells — 12 in the Marcellus Shale and three in the Utica Shale. Consol completed 21 Marcellus Shale wells and three Utica Shale wells in the third quarter. Consol turned in line 22 Marcellus Shale wells in the third quarter.

    In the dry gas areas, Consol drilled five wells in northern West Virginia during the third quarter – one each in Upshur and Barbour counties, and it drilled the final three of six wells on a pad in Barbour County.

    Consol had one horizontal rig operating in Upshur County and expected to drill three more wells, which is consistent with previous guidance provided last quarter to drill 11 wells in 2013.

    In the wet gas areas, Noble Energy drilled 15 wells: six in Marshall County, three in Doddridge County and six in Washington County.
  • Midstream activity in Luzerne County, PA.  The company managing the Marcellus Shale gas pipeline that runs through Luzerne County is poised to expand the line again.

    On Sept. 30, Williams, the Texas-based company that owns the Transco pipeline, filed an application with the Federal Energy Regulatory Commission to expand its Leidy Line, which delivers gas from central Pennsylvania to customers from New York City to Alabama.

    Williams' application for the project, the Southeast Expansion, is an important milestone in the filing process that began in January. If approved, it would mean new pipeline infrastructure in New Jersey and Pennsylvania, including a total of 16.74 miles of 42-inch pipe in Luzerne and Monroe counties.

    "The project will provide firm market access to new sources of gas supply being developed in North Central Pennsylvania, which is experiencing a dramatic increase in natural gas production," the application states.

    One 11.47-mile-loop would run through Buck, Tunkhannock and Tobyhanna townships in Monroe and Luzerne counties. This loop would run parallel to two existing lines.

    The other loop, 5.27 miles long, would run through Conyngham, Dorrance and Slocum townships in Luzerne, alongside three existing lines.

    Transco also intends to put in a new 16,000-horsepower compressor unit at its Compression Station 515 in Buck Township in Luzerne County and two compressors with a combined horsepower of 33,400 at station 517 in Columbia County.

    The project also includes a new 20,500-horsepower compressor at station 520 in Lycoming County.
  • GM announces CNG Impala. Capitalizing on America’s abundant supply of clean-burning, low-cost natural gas, General Motor said it will build a Chevrolet Impala sedan that can operate on either gasoline or compressed natural gas and travel up to 500 miles between fill-ups.

    The bi-fuel Impala, which goes on sale in the summer as a 2015 model, could be the start of something big. Honda Motor has been selling a natural gas-powered Civic since 2011 and while still modest, sales have been steadily rising. The Japanese carmaker is on track to sell about 2,500 CNG Civics this year, up from 1,900 in 2012 and 1,200 the year before. In July, Ford Motor F 0% said its most popular vehicle, the F-150 pickup, will be offered with a compressed natural gas engine starting in the 2014 model year.
  • Gulfport still adding acreage. Gulfport’s early successes have resulted in its desire to acquire more acreage in the Utica.  It recently added another 9,000 acres. 

Rig Count

  • Baker Hughes Rigs count for the October 11 reporting week.
    • PA Marcellus 55 – up 3
    • PA Utica 3 rig – up 1
    • Ohio Utica 35 rigs – up 1
    • WV Marcellus 30 rigs  – down 4

PA Permits for October 10 to October 17, 2013

     County           Township    E&P Company

1. Armstrong           Gilpin                  MDS Energy
2. Bradford              Asylum               Chesapeake
3. Bradford              Smithfield           Chesapeake
4. Bradford              Wysox                Chesapeake
5. Clearfield             Bigler                  Campbell Oil & Gas
6. Elk                       Jones                  Hunt Marcellus
7. Elk                       Jones                  Seneca
8. Lycoming             McNett                Carrizo
9. Lycoming             McNett                Carrizo
10. Sullivan             Cherry                 Chief
11. Sullivan             Cherry                 Chief
12. Sullivan             Cherry                 Chief
13. Sullivan             Cherry                 Chief
14. Sullivan             Cherry                 Chief
15. Susquehanna   Apolacon              Talisman
16. Susquehanna   Jessup                  Carrizo
17. Susquehanna   Jessup                  Carrizo
18. Tioga                Duncan                 EQT
19. Tioga                Duncan                 Shell
20. Warren             Mead                    McCool
21. Warren             Mead                    McCool
22. Warren             Mead                    McCool
23. Warren             Sheffield               SLT Production
24. Warren             Sheffield               SLT Production
25. Warren             Sheffield               SLT Production
26. Warren             Sheffield               SLT Production
27. Warren             Sheffield               SLT Production
28. Warren             Sheffield               SLT Production
29. Warren             Sheffield               SLT Production
30. Warren             Sheffield               SLT Production
31. Warren             Sheffield               SLT Production
32. Warren             Sheffield               SLT Production
33. Warren             Sheffield               SLT Production
34. Washington      Cross Creek         Range
35. Washington      Cross Creek         Range
36. Washington      Cross Creek         Range
37. Washington      Donegal               Range
38. Washington      Donegal               Range
39. Washington      Donegal               Range
40. Washington      Morris                  CONSOL
41. Washington      Morris                  CONSOL
42. Washington      Morris                  CONSOL
43. Washington      Morris                  CONSOL
44. Washington      Morris                  CONSOL
45. Washington      Mt. Pleasant        Range
46. Washington      Mt. Pleasant        Range
47. Washington      South Strabene   Range
48. Washington      South Strabene   Range
49. Westmoreland  Donegal              Williams
50. Wyoming           Lemon                 Carrizo
51. Wyoming           North Branch       Chesapeake
52. Wyoming           North Branch       Chesapeake

 OH Permits – week ending October 12, 2013

    County       Township        E&P Companies

1. Belmont            Smith          Rice
2. Carroll              Fox              Chesapeake
3. Carroll              Fox              Chesapeake
4. Harrison           Stock            Eclipse Resources
5. Harrison           Stock            Eclipse Resources
6. Harrison           Stock            Eclipse Resources
7. Harrison           Stock            Eclipse Resources
8. Harrison           Stock            Eclipse Resources
9. Monroe            Seneca          Antero
10. Monroe          Seneca          Antero
11. Trumbull         Lordstown    Halcon
12. Trumbull         Lordstown    Halcon
13. Washington   Waterford     PDC

Take advantage of the bullish outlook and become a member in now or and secure your budget for membership in 2014.

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Joe Barone 610.764.1232
Vera Anderson 570.337.7149
Andrea Bagnell 610.256.1898


Utica Summit 2019