Shale Directories Conferences
Appalachian Basin Real Estate Conference
December 11 & 12, 2019
Oglebay Resort
Wheeling, WV
http://appabasinrealestate.com/
Latest facts and a rumor from the Marcellus, Utica, and Permian, Eagle Ford Plays
Halliburton to Get Busy in the 1st Quarter 2020 in the Marcellus and Utica. Halliburton has one crew working in December and January, but is sold out in February. We do not know how many crews that is. (RUMOR)
Antero Looks Like It Will Continue Operations at Current Level. Antero has been facing some headwinds especially with the closing of its water facility. However, the drilling plans seem to be consistent with 4th quarter. (RUMOR)
Repsol Sorting Out Drilling in Tioga County, PA. Repsol is evaluating its position in Tioga County and will be determining if it’s going to be drilling in 2020 at all. (RUMOR)
Shell Cracker Plant $10 Billion. The cost of the Shell cracker plant is now at $10 billion which is higher than I thought it would be.
A number of chemical industry experts have told me that as soon as the Shell plant was up and operating, it would start the expansion. It appears that Shell is already talking about the expansion. It was one small problem. It’s somewhat land locked. (RUMOR)
Braskem Moving Closer to Sale. Braskem has announced the appointment of Roberto Simões, its current chairman, as the next CEO effective 1 January 2020. Usually this the point where the old dirty laundry is washed and new deals are quickly announced. The Parkersburg property will probably one of the priorities to be sold. Braskem has multi-million dollars in fines which are owed to the Brazilian government. (RUMOR)
Chevron Focusing on Shale. Chevron Corp. CEO Michael Wirth is preparing to make sweeping changes at the California-based oil and gas company, streamlining operations and placing more emphasis on shale, natural gas and deepwater businesses. According to a report by Reuters, the company, which has a major presence in Houston, is trying to stay ahead of a weakness in shale that has hurt other large oil exploration companies. Wirth, who took over the company in early 2018, believes the moves will increase the company’s profitability. A source told Reuters that the changes have not yet been approved.
Mountain Valley Pipeline Cancels Construction Contract. In late November, the company behind the Mountain Valley natural gas pipeline canceled the construction contract with a Texas firm that had been doing the work, Kallanish Energy has learned.
EQM Midstream Partners LP suspended the construction contract with Texas-based Trinity Energy Services, according to a report in the Beckley Register-Herald newspaper in West Virginia.
Trinity officials were unsure of why the contract had been terminated, one spokesman told the newspaper. Kallanish Energy left messages with Mountain Valley Pipeline, EQM Midstream Partners and Trinity. No messages were returned.
The pipeline is expected to be 90% complete by Dec. 31, 2019, Mountain Valley Pipeline has reported. It’s expected to be completed by late 2020. The price tag for the pipeline has increased from $4.6 billion to $5.5 billion.
Last October, a federal appeals court had ordered stays on two federal wildlife permits needed for the 303-mile pipeline. That halted construction again. Construction has been halted at times by the FERC, the federal appeals court, state agencies and the U.S. Army Corps of Engineers.
The pipeline is designed to move natural gas from the Appalachian Basin to markets. The line is owned by joint-venture partners EQM Midstream Partners, NextEra US Gas Assets, Con Edison Transmission, WGL Midstream and RGC Midstream.
The 42-inch natural gas pipeline system will run from northwestern West Virginia to southern Virginia, flowing 2 billion cubic feet per day from the Marcellus and Utica shales.
Chesapeake Back in Business. (Thank you, MDN). In an impressive feat of financial jiu-jitsu, Chesapeake Energy has just snapped closed the mouths of those who said the company was imminently heading for bankruptcy following the company’s third quarter update. Yesterday Chessy issued three press releases to announce it has swapped out some of its old debt for 70 cents on the dollar, and has arranged a 4 ½-year loan for $1.5 billion. Chesapeake stock soared 17% higher on the news.
South Korean Consortium Buys 50% of Utopian Pipeline. A South Korean consortium of EIP Investment Co., Shinhan Investment Corp. KIAMCO, and energy firm Samtan Co. has closed the deal to take up a 50 percent ownership interest in the Utopia shale gas pipeline spanning from the United States to Canada from Riverstone Holdings, EIP Investment announced Monday.
The recently-completed 268-mile pipeline delivers ethane sourced from the Marcellus and Utica shales in Ohio to the Samica petrochemical market in Ontario in Canada. It will be able to funnel 40,000 barrels of ethane per day by 2038, almost half of the total 86,000 barrels of ethane transported from the U.S. to Canada every day. The ownership acquisition would deliver stable profits to the investors for almost two decades. Riverstone formed a joint venture with Kinder Morgan to build the pipeline in 2016. Kinder would maintain its stake.
The consortium also expects additional profits from the deal as Nova Chemicals, a plastics and chemical company based in Calgary that is a major importer of ethane from the U.S., plans to expand its manufacturing plant with an investment of $2 billion in 2021, EIP Investment said.
Financial value of the deal has not been disclosed, but market watchers estimated the price at $500 million to $600 million. The Korean consortium was named the preferred bidder for the stake sale in September after beating 10 or more institutional investors from North America.
South Koreans Moves Not Limited to Oil & Gas! Many of you saw my email blast the past week about the South Koreans moving into the Appalachian Basin to take advantage of the low energy and feedstock costs. I just saw a report that says GM has deal with a South Korean firm for an electric-vehicle facility in Lordstown, OH. The South Koreans are going to be in the Appalachian Basin in many ways we cannot yet fathom.
NY Moratorium on Hookups Ends. National Grid has reached an agreement with New York State to end its moratorium that had halted new natural gas hookups in parts of New York City and Long Island, Kallanish Energy reports.
The company has agreed to provide natural gas service to new customers in Brooklyn and Queens and Long Island for roughly the next two years in a settlement that came from negotiations with Gov. Andrew Cuomo.
It will hook up nearly 4,000 customers whose applications had been put on hold due to the moratorium and will start processing all new applications.
That could require increasing reliance on portable compressed natural gas as a fuel alternative, the company said.
The company also agreed to pay a state penalty of $36 million. Most of that money, about $20 million, will go to climate initiatives, while $8 million will go to helping customers reduce their gas use, and $7 million will go to mitigate customers who suffered adverse impacts from the moratorium.
The $36 million will be paid by National Grid shareholders, not ratepayers. The company must also hire a monitor to oversee its operations for two years and to review its compliance with the pact for the state.
National Grid had declared the moratorium last May, after the New York Department of Environmental Conservation had denied a water-quality permit sought by the company’s pipeline partner, the Williams Cos., to install 24 miles of pipeline under offshore New York waters.
The $1 billion pipeline project, known as the Northeast Supply Enhancement Project, was also rejected by New Jersey. It was designed by Transcontinental Gas Pipe Line Co., a Williams’ subsidiary, to get additional natural gas to the New York City area before the 2020-2021 heating season.
It would provide an additional 400 million cubic feet per day, or a 14% increase, to the New York City area. The project would boost deliveries to National Grid, the largest distributor of natural gas in the northeast U.S., serving 1.8 million customers in Brooklyn, Queens, Staten Island and Long Island.
National Grid has said the project is crucial because pipeline capacity to New York is at capacity and natural gas demand in the New York City region is projected to grow by 10% in the next 10 years. It had imposed a moratorium on new gas hookups until the project proceeds.
Cuomo had threatened to revoke National Grid’s state operating certificate due to the moratorium and accused the company of extortion.
The agreement resolves the matter opened by the New York State Public Service Commission relating to the moratorium and provides the necessary framework for resolving the longer-term energy supply issues.
The pipeline project remains an option for National Grid, both sides said.
Within three months, National Grid must present options to meet New York’s long-term supply needs to the communities it serves. That will include a series of public meetings in the New York City and Nassau and Suffolk counties.
While it is widely understood there are very real natural gas constraints facing the region, a final, long-term option should be identified and agreed to with the state by June 2020 to allow a safe adequate construction and transition period and have the long-term option or options in place and functioning in about two years, the company said.
“We have worked hard to identify an innovative series of alternatives to meet growing demand. With this agreement, we will present options for long-term supply solutions that ensure our customers have the service they require and desire,” said John Bruckner, president of National Grid New York, in a statement.
Bankruptcies Occurring in 2019. In 2019 through third quarter, 32 oil and gas drillers have filed for bankruptcy, according to Haynes and Boone. Since the end of September, a gaggle of other oil and gas drillers have filed for bankruptcy, including last Monday, natural gas producer Approach Resources. This pushed the total number of bankruptcy filings of oil and gas drillers since the beginning of 2015 to over 200. Other drillers, such as Chesapeake Energy, are jostling for position at the filing counter.
Drilling Down: Shell Drills on State-Owned Lands in Permian Basin. European oil major Royal Dutch Shell filed for six horizontal drilling permits with the Railroad Commission of Texas for projects on five leases split between Winkler and Loving counties in the Permian Basin. Half of those wells target the Wolfcamp geological layer while the others target the Bone Spring formation. Total drilling depths of the projects range from 10,000 to 12,300 feet. Three of the wells are on a pair of leases in Winkler County managed by the state-owned mineral rights company University Lands. Royalties from those three wells will go to the Permanent University Fund, or PUF, a public account supporting the University of Texas and Texas A&M University systems.
$78 Billion Invested in OH’s Utica Shale. Total investment in Ohio’s Utica Shale is nearly $78 billion since tracking began in 2011, according to a new study by Cleveland State University.
Investment has grown by $7.7 billion through 2018 since the last report was completed in 2017, said the study from CSU’s Energy Policy Center at the Maxine Goodman Levin College of Urban Affairs.
The study was completed for JobsOhio, the state’s private economic development agency. Kallanish Energy reports
Drilling investments in Ohio were down slightly in the second half of 2018, compared to the first half, but total upstream investments were up, the report said.
Total shale-related investment in Ohio for the second half of 2018 was around $3.82 billion. Upstream activities in the second half of last year totaled $3.5 billion. A total of 117 new wells were drilled in that time, 40 fewer than in the first half 2018.
Longer laterals produced higher production and increased investment per well, the report said. The main drilling counties were Belmont, Monroe and Carroll.
Data indicates the volume of gas-equivalent shale production in the second half of 2018 was 17.7% higher than in the first half of the year, with total upstream spending in the second half 2018 exceeding that of the first half by roughly $173.4 million.
Ohio saw limited investment in midstream infrastructure in the second half 2018: about $231.8 million, with most of that money spent on gathering system build-outs. No new gas processing or fractionation facilities were added in Ohio in that time.
Two combined heat and power plants with a total capacity of 22.5 megawatts were built in Ohio. They represent an investment of $34.1 million. Ohio also got $3.8 million in compressed or liquefied natural gas refueling stations.
“As the upstream and midstream sectors continue to mature, our focus is to land more downstream investment,” said Matt Cybulski, director of energy and chemicals at JobsOhio, in a statement.
Such an approach helps companies already in Ohio to expand to take advantage of cheap natural gas and attracts new greenfield developments such as ethane crackers, methanol plants and other similar investments that produce construction and permanent in-plant jobs, he said.
The study is the fifth report on Ohio shale economics prepared by Cleveland State.
Marcellus and Utica NatGas Could Grow in 2020. Marcellus/Utica poised for growth as another big shale play slows down. An expected drop over the next couple of years in the country’s hot crude oil and natural gas play, the Permian Basin in Texas and New Mexico, will end up benefitting the Marcellus and Utica in the future, according to a natural gas executive. What has happened in the Permian has so far had a big impact here in Pennsylvania and the rest of Appalachia, which is the largest gas field in the country but doesn’t have the same output in crude oil. The mostly oil play has been booming over the last few years, and it has been throwing off natural gas and natural gas liquids in such quantities that it’s almost giving away natural gas and liquids. For natural gas producers in the Marcellus and Utica Shale, who are trying to make money off the gas produced here, the Permian associated gas has been dropping prices as well as competing for capital.
| PA NatGas Production Growing. While the U.S. natural gas industry is suffering under rock bottom prices and an overabundance of product, the latest data from Pennsylvania appears to go against the ongoing negative current.
Third-quarter horizontal well production jumped 9.2% from the year-ago quarter, to 1.71 trillion cubic feet, from 1.57 Tcf, Kallanish Energy reports. The percentage increase is even larger 2019 vs. 2018, up an estimated 12.8%, to 5.04 Tcf, from 4.47 Tcf, data from the Pennsylvania Department of Environmental Protection reveals. The data was presented by the state’s Independent fiscal Office (IFO). Over the last nine quarters, horizontal well production in Pennsylvania has jumped 29.5%, to 1.71 Tcf in the most recent quarter, from 1.32 Tcf during the third quarter of 2017. |
| There has been a quarter-over-quarter increase in well production for 13 consecutive quarters, the IFO reported.
Average production per well likewise rose, under specific criteria: production from horizontal wells spud at least three quarters before the reporting period and no earlier than 12 quarters before that date. Under the above criteria, from the third quarter of 2017, to third quarter of 2019, well production jumped 57.2%, to 514 million cubic feet, from 327 Mmcf. Production through 2018 rose 33.9%, but through the first nine months of this year, the increase only was 6.7%. Pennsylvania’s producing horizontal well count over the last nine quarters has risen more than 20%, to 9,116, from 7,582, the IFO reported. All the data is not up, up, up. The number of horizontal wells spud dropped 22.8% in the last year, to 132, from 171, and down a whopping 64.6% from the 373 wells spud during the third quarter of 2014. |
In the last 21 quarters dating back to the third quarter of 2014, the most recent number is the third-smallest, surpassed only by the first and second quarter of 2016, 110 and 72 wells spud, respectively.
| Annual trends in Pennsylvania’s natural gas industry in three key areas have done nothing but rise for eight consecutive years, according to data from the state Department of Environmental Protection, and presented Tuesday by the Pennsylvania Independent Fiscal Office.
Since 2012, and using a full-year 2019 data forecast provided by Bentek Energy, production jumped a whopping 235.3%, to 6.8 trillion cubic feet, from 2.03 Tcf, Kallanish Energy reports. Triple-digit increases The number of producing wells likewise experienced a huge jump from 2012 and projected through 2019, 202%, to 9,300, from 3,078 producing wells. However, from 2018 to 2019, the number of producing wells is expected to rise just 6.4%, from 8,738. Average production per well from 2012 through Bentek’s forecast for 2019, is expected to “only” increase by 161.4%, to 1,874 from 717 eight years ago. Breaking production down by counties, just four counties produced over 70% of statewide production for 2018 and projected for 2019. Susquehanna leads the way Susquehanna, in the Marcellus Shale Play’s all dry gas region in northeast Pennsylvania, led the way, capturing 24.7% market share in 2019, and 16.4% year-over-year growth. Countywide production for the current year is projected at 1.25 trillion cubic feet, from 1.07 Tcf in 2018.
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| Annual trends in Pennsylvania’s natural gas industry in three key areas have done nothing but rise for eight consecutive years, according to data from the state Department of Environmental Protection, and presented Tuesday by the Pennsylvania Independent Fiscal Office.
Since 2012, and using a full-year 2019 data forecast provided by Bentek Energy, production jumped a whopping 235.3%, to 6.8 trillion cubic feet, from 2.03 Tcf, Kallanish Energy reports. Triple-digit increases The number of producing wells likewise experienced a huge jump from 2012 and projected through 2019, 202%, to 9,300, from 3,078 producing wells. However, from 2018 to 2019, the number of producing wells is expected to rise just 6.4%, from 8,738. Average production per well from 2012 through Bentek’s forecast for 2019, is expected to “only” increase by 161.4%, to 1,874 from 717 eight years ago. Breaking production down by counties, just four counties produced over 70% of statewide production for 2018 and projected for 2019. Susquehanna leads the way Susquehanna, in the Marcellus Shale Play’s all dry gas region in northeast Pennsylvania, led the way, capturing 24.7% market share in 2019, and 16.4% year-over-year growth. Countywide production for the current year is projected at 1.25 trillion cubic feet, from 1.07 Tcf in 2018. Four PA counties control 70% of state’s gas production
(Source: Pennsylvania Independent Fiscal Office) No. 2 in the country production list was Washington, in the southwest region of the state and including both Marcellus and Utica Shale production, with a 17.4% market share in 2019 and year-over-year growth of 1.6%. Production from 2018 to 2019 is expected to move from 862 billion cubic feet, to 876 Bcf. Greene County in Pennsylvania’s southwest corner is expected to capture a 14.9% production share, with 33.8% growth from 2018 to 2019. Actual production will jump to 749 Bcf, from 560 Bcf in 2018. Bradford County is fourth, capturing 13.1% of 2019 production, and expected to realize 19.0% growth year-over-year. The northcentral Pennsylvania county’s actual production is projected to jump to 659 Bcf, from 553 Bcf in 2018. Texas still leads the way While Pennsylvania’s production continues to point skyward, and it’s safely in the No. 2 production spot well ahead of Alaska, the “Keystone State” is not gaining on No. 1: Texas. From 2017 to 2018, the production gap between Texas and Pennsylvania was 29.6%, 8.81 Tcf, compared to 6.21 Tcf. Through the first eight months of 2019, the gap slightly widened, to 30.8%, as Texas year-to-date through August produced 6.62 Tcf, while Pennsylvania produced 4.58 Tcf, according to Energy Information Administration data. |
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NatGas Companies Support Carbon Tax. Natural gas companies call for carbon tax. Houston Chronicle. A leading natural gas trade association came out in support of carbon taxes Tuesday, as pressure increases on the oil and gas industry to better work with government on addressing climate change. Representing companies including Exxon Mobil, Chevron, ConocoPhillips, Cabot and Southwestern Energy, Natural Gas Supply Association President Dena Wiggins said member companies were unanimous in their support for taxing carbon emissions and suggested more in the industry were likely to follow. “It’s such a huge, important national conversation, every trade association has to be thinking about it,” she said. “We’re likely not going to be the last.”
PA Permits November 21, to December 5, 2019
County Township E&P Companies
- Armstrong East Franklin Snyder
- Armstrong East Franklin Snyder
- Armstrong East Franklin Snyder
- Elk Mary’s Seneca
- Elk Mary’s Seneca
- Elk Mary’s Seneca
- Elk Mary’s Seneca
- Elk Mary’s Seneca
- Elk Mary’s Seneca
- Elk Mary’s Seneca
- Elk Mary’s Seneca
- Elk Mary’s Seneca
- Elk Mary’s Seneca
- Greene Springhill EQT
- Greene Springhill Rice
- Greene Springhill Rice
- Potter Allegany JKLM
- Susquehanna Great Bend SWN
- Susquehanna Great Bend SWN
- Susquehanna Great Bend SWN
- Tioga Union Rockdale
- Tioga Union Rockdale
- Wyoming North Branch SWN
OH Permits November 23 & November 30, 2019
County Township E&P Companies
- Belmont Richland Ascent
- Belmont Colerain Ascent
- Belmont Colerain Ascent
- Belmont Wheeling Ascent
- Belmont Wheeling Ascent
- Belmont Wheeling Ascent
- Belmont Pultney Gulfport
- Belmont Pultney Gulfport
- Guernsey Wills Utica Resources
- Harrison Archer EAP OHIO
- Harrison Archer EAP OHIO
- Harrison Archer EAP OHIO
- Harrison Cadiz EAP OHIO
- Harrison Cadiz EAP OHIO
- Harrison Cadiz EAP OHIO
