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NewsLetters

  • Permit Activity. 
    • PA – 21 permits; Sullivan County seeing activity by Carrizo
    • OH – 8 permits; Antero continues permitting in Noble County
  • 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

  • Marcellus perspective.  Natural gas production from the Marcellus Shale region is growing faster than expected, according to a new federal report issued Tuesday.

    Marcellus production has now reached 12 billion cubic feet a day, the Energy Information Administration report stated. That’s the energy equivalent of about 2 million barrels of oil a day, and more than six times the 2009 production rate.

    For perspective, if the Marcellus Shale region were a country, its natural gas production would rank eighth in the world, after Russia and the rest of the U.S. The Marcellus now produces more than double Iran’s yearly natural gas output. (Associated Press, 10/22/13)
     
  • More midstream activity in Mahoning County, OH.  Pennant Midstream LLC is preparing land for two additional processing plants at its Springfield Township site in anticipation of greater demand for natural gas liquids across the Utica shale, the company reports.

    Construction of Pennant's first cryogenic processing plant is nearing completion and is expected to come online by December 2013. A plant dedication ceremony is scheduled for Monday Oct. 28 at 11 a.m., the company says. On hand will be executives from NiSource Midstream Services, the Columbiana Pipeline Group, Hilcorp Energy as well as Springfield Township and state officials.

    Pennant, a joint venture between NiSource Midstream and Hilcorp affiliate Harvest Pipeline, is investing $375 million to build a new gathering and processing system that includes 55 miles of pipelines stretching from Mercer and Lawrence counties in Pennsylvania to Columbiana County. The entire system is expected to be operational by June 2014.

    The company's long-term investment in midstream infrastructure in Ohio and Pennsylvania could top $1 billion, executives say.

    The new cryogenic plant, under construction on 90 acres along State Line Road, takes natural gas drawn from horizontal wells in the region and chills it to a point where dry gas such as methane separates from natural-gas liquids. Those liquids are then shipped for further processing where they can be converted into products such as ethane, butane or propane.

    NiSource Midstream will operate the new system, which is initially expected to provide 400 million cubic feet per day of both wet and dry gas gathering, with "significant anticipated expansion opportunities based on production activity in the area."
     
  • Chesapeake speculation.  Could Chesapeake Energy Corp., which maintains significant operations in the Marcellus Shale, be up for sale?

    Reports last week from the British newspaper The Daily Mail said both Royal Dutch Shell and BP were looking into the possibility of acquiring Chesapeake Energy (NYSE: CHK). There wasn't any confirmation, but The Daily Mail said word on the trading floor was that a potential offer would be in the range of $40 a share.

    Chesapeake was trading at $28.29 a share by 1 p.m. Monday on the New York Stock Exchange.

    Chesapeake has certainly been in a corporate shakeup since the departure last spring of founder and CEO Aubrey McClendon. Hundreds of employees have been laid off nationwide, including at least several at its local headquarters in Canonsburg.

    "Chesapeake resembles the perfect situation for a takeover by a major player for a number of reasons," said an article in Seeking Alpha published Monday. That includes the uptick in shale development in North America.

    Chesapeake Appalachia LLC is one of the largest production companies in the Marcellus Shale. It has 1,694 shale gas permitted wells in Pennsylvania, the most of any company, according to the 2013 Pittsburgh Business Times Book of Lists.

    We heard this as a rumor that BP and Shell were going to buy Chesapeake for $45.  This would make sense because Chesapeake’s leases in Northeastern PA align with Shell’s leases there.  Chesapeake’s leases in OH would certainly give BP a major greater presence in OH.

    We’ll keep you posted.

     
  • EQT experiencing strong growth driven by Marcellus drilling. Revenue rose 39 percent to $506.6 million from $364.1 million, bolstered by big increases in sales volume from the company's Marcellus shale gas wells.

    Marcellus gas accounted for 75 percent of all the company's sales, Philip P. Conti, the company's chief financial officer said. The company plans to keep accelerating Marcellus development and adding more Marcellus land, putting it at the top of its list of priorities after its annual strategy review, chief executive officer David L. Porges said.

    Officials also want to expand the company's pipeline system to transport more gas, even for other production companies. It recently spun off its pipeline holdings into a sister company, EQT Midstream Partners, which has the capital to fund an expansion, Porges said.

    “There is a tremendous need for additional gathering and takeaway capacity,” he said. “And our midstream system is strategically situated to make profitable investments.”

    The company is slowly expanding its production beyond the Marcellus. It's likely to start drilling wells into a shallower formation, the Upper Devonian, along with the Marcellus wells it drills. It also announced what officials called “encouraging” production from its first three wells in Ohio's Utica shale.

    Each of those wells produced more than 240 barrels of oil a day, selling for about $101 per barrel, according to the company's financial statement. The production was much better than when the company first started drilling Marcellus shale wells, said Steven T. Schlotterbeck, president of exploration and production.

    The company plans to drill eight more Utica wells this year, but it won't start rivaling the company's focus on the Marcellus, officials said. Utica land is too expensive to become an immediate priority, company officials stated.

     
  • Crosstex and Devon merging.  Crosstex Energy Inc. and Devon Energy Corp. want to combine their natural gas pipelines, processing plants and other midstream assets in a deal involving companies with interests in Ohio’s Utica and Marcellus shale plays.

    The companies said Monday the merged assets will trade publicly, with expected earnings before interest, taxes, depreciation and amortization of approximately $700 million in 2014. The transaction is expected to close in the first quarter next year.

    Crosstex and Devon have midstream facilities in many of the nation’s most active shale plays, including the Utica and Marcellus, Barnett and Eagle Ford in Texas, and Cana and Arkoma Woodford in Oklahoma.

    The new company will have its headquarters in Dallas where Crosstex is based. It will also continue to have a presence in Oklahoma City where Devon has its headquarters.

    Crosstex plans to spend more than $75 million on natural gas processing facilities in eastern Ohio. It also reactivated its rail terminal east of Newark NJ in July for the export of Utica shale condensate, a lighter grade of crude oil.

    Devon has drilled some wells in the Utica play but reportedly has been looking to sell its land leases there after disappointing drilling results.
     
  • Mayor Bloomberg loves Marcellus Shale gas.  For five years now, New York has sat on its hands regarding hydraulic fracturing. Governor Andrew Cuomo has said repeatedly that “public health” will guide his decision on whether to allow shale development to proceed, even as evidence grows that New York residents are already benefitting from clean-burning natural gas.

    But a recent announcement from Mayor Michael Bloomberg’s office in New York City may demonstrate the grandest irony of all: thanks in no small part to natural gas produced from the Marcellus Shale in Pennsylvania, the city is enjoying the cleanest air in fifty years. If shale gas is good enough for folks in New York City, then why shouldn’t hardworking upstate families be able to benefit from developing it?(Energy in Depth)
     
  • Ethane will be moving in the NE. New NGL pipeline capacity will soon come online in the US Northeast to the relief of natural gas producers facing a perplexing logistics dilemma involving unwanted ethane.

    Sunoco Logistics' Mariner West project and Enterprise's Appalachia-to-Texas Express Pipeline (ATEX) pipeline, both of which will transport a glut of unwanted ethane from the area, are expected to ramp up volumes in the next few months. (Gas Business Briefing)
     
  • Cabot bullish in 2014. The Company has reaffirmed its 2014 production growth guidance range of 30 to 50 percent, based on a capital program of $1.375 to $1.475 billion. Approximately 85 percent of the capital budget will be spent on drilling and completion activities, with over 75 percent of the drilling and completion capital focused on its Marcellus Shale operations.

    The capital budget assumes seven operated rigs in the Marcellus Shale.  The Company expects to drill 130 to 140 net wells in the Marcellus Shale.

     
  • American Energy. The company could be getting its first permit in Harrison County, OH.  (Rumor)
  • Baker Hughes Rigs count for the October 18 reporting week.  
      
    • PA Marcellus 55 – unchanged
    • PA Utica 2 – down 1
    • Ohio Utica 33 rigs – down 2
    • WV Marcellus 31 rigs  – up 1

Permit Activity. 

Expo/Event activity.

Latest facts and a rumor from the Marcellus and Utica Shale

Rig Count

PA Permits for October 18 to October 25, 2013

    County               Township                 E&P Company

1. Bradford              Burlington                Chief
2. Bradford              Burlington                Chief
3. Bradford              Burlington                Chief
4. Bradford              Burlington                Chief
5. Sullivan                Fox                          Carrizo
6. Sullivan                Fox                          Carrizo
7. Sullivan                Fox                          Carrizo
8. Sullivan                Fox                          Carrizo
9. Sullivan                Fox                          Carrizo
10. Sullivan              Fox                          Carrizo
11. Sullivan              Fox                          Carrizo
12. Sullivan              Fox                          Carrizo
13. Sullivan              Fox                          Carrizo
14. Sullivan              Fox                          Carrizo
15. Washington       Cross Creek              Range
16. Washington       Cross Creek              Range
17. Washington       Cross Creek              Range
18. Westmoreland   South Huntingdon     Chevron
19. Westmoreland   South Huntingdon     Chevron
20. Westmoreland   South Huntingdon     Chevron
21. Westmoreland   South Huntingdon     Chevron

 OH Permits – week ending October 19, 2013

    County          Township    E&P Companies

1. Belmont         Smith          Rice
2. Carroll            Lee            Chesapeake
3. Carroll            Lee            Chesapeake
4. Columbiana    Hanover     Chesapeake
5. Guernsey       Spencer      EQT
6. Noble             Center        Antero
7. Noble             Center        Antero
8. Noble             Center        Antero

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

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Joe Barone jbarone@shaledirectories.com 610.764.1232
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