The following Shale Directories Members are OPEN for BUSINESS during COVID-19 related shutdown.*
Support them when and how you can!
1st Choice Energy Services
Allison Crane & Rigging
EJ Breneman, L.L.C.
Frontier Group of Companies
Furbay Electric, Oil & Gas Division
Green Valley Seed
HYTORC Penn Ohio
Inland Tarp and Liner
MJ Painting Contractor Corp.
Mansfield Crane Service
Marshall County Co-Op – Southern States
NAI Ohio River Corridor
Oglebay Resort and Conference Center
Skycasters Converged Wireless
Zimmerman Steel and Supply Company, Inc.
*list subject to change
Shale Directories Conferences
8th Annual Utica Midstream
September 24, 2020
New Location: Holiday Inn, Belden Village
8th Annual Upstream PA 2020
New Date October 29, 2020
State College, PA
4th Annual Appalachian Storage Hub Conference
New Date November 5, 2020
Hilton Garden Inn
Southpointe, Canonsburg, PA
8th Annual Utica Downstream
New Date November 19, 2020
New Location: Holiday Inn Belden Village
8th Annual Midstream PA 2020
New Date: December 10, 2020
State College, PA
Latest facts and a rumor from the Marcellus, Utica, and Permian, Eagle Ford Plays
EQT Makes Bid for Chevron’s Appalachian Assets. EQT Corp, the largest U.S. natural gas producer by volume, has placed a bid on Chevron Corp’s Appalachia gas properties and a pipeline stake, people familiar with the matter said.
EQT offered $750 million for the properties, one of the people familiar with the matter said.
Chevron last year said it was considering sale of the properties and took an $8.17 billion charge to earnings to write down their value and an unrelated U.S. offshore project. Most of the impairment charge was for the gas properties.
Chevron is marketing about 800,000 acres in the Marcellus and Utica shale basins of Pennsylvania and neighboring states and a 31% non-operating interest in Laurel Mountain Midstream, which has intrastate and gathering lines servicing the Marcellus shale area.
EQT declined to comment. EQT Chief Executive Toby Rice in July described Appalachia shale as “a buyer’s market,” and called consolidation an opportunity for the Pittsburgh-based company.
Bids for the properties were received on Aug. 12 and are being evaluated, Chevron said in response to inquiries. It declined to comment on the bids.
There is no guarantee the talks will lead to a sale to EQT or another company.
The shale assets are from Chevron’s purchase of producer Atlas Energy for $4.3 billion including debt in 2010, a time when shale gas fields were selling at large premiums. A year earlier, Exxon Mobil Corp. agreed to pay $30 billion for XTO Energy, then a large Appalachian shale basin operator.
The deals soured for both companies. In addition to Chevron’s write down, Exxon later took a $2 billion write down on the value of its natural gas assets.
U.S. natural gas futures are trading at about $2.27 a million British Thermal Units (BTUs) and have languished well below their peak 12 years ago when gas traded as high as $12.78 per million British Thermal Units.
The Appalachian assets last year produced 262 million cubic feet of natural gas, on a net daily basis. EQT had average daily sales volumes of about 4.1 billion cubic feet equivalent.
Mountain Valley Pipeline Wants 2 More Years. Mountain Valley Pipeline, LLC (MVP) has requested that the Federal Energy Regulatory Commission (FERC) grant a two-year extension to complete the pipeline.
In its Aug. 25 request, MVP noted that, due to unforeseen litigation and permitting challenges with the U.S. Forest Service, Bureau of Land Management, U.S. Army Corps of Engineers, U.S. Fish and Wildlife Service, and the National Park Service, the company will not be able to complete construction of the pipeline and enter it into service by Oct. 13, 2020.
The 303-mile, 42-inch natural gas pipeline system spans from northwestern West Virginia to southern Virginia and, once completed, will be regulated by FERC as an interstate pipeline. EQM Midstream Partners, LP, based in Canonsburg, Pa., will operate the MVP, which is expected to flow 2 billion cubic feet of natural gas per day from the Marcellus and Utica shales.
MVP announced that the project was approximately 90 percent complete as of August 2019, but has been stalled since October 2019 after a federal appeals court invalidated a crucial permit, known as a biological opinion, from the U.S. Fish and Wildlife Service. A new biological opinion is being prepared by the federal agency.
Shell Cracker Approaching 5,000 workers. The number of construction workers on site at Shell’s cracker project reached roughly 5,000 in early September, roughly 62% of the 8,000 men and women on site at the complex prior to shut down in mid-March due to the coronavirus pandemic, Shale Directories reports.
Prior to the Covid-19 temporary suspension of construction (on March 18), Shell was at peak in terms of project workforce. The site has transitioned from erecting large structures into a phase in which workers primarily were connecting the various pieces via piping and electrical wiring.
Shell is building an ethane cracker, three polyethylene units, a natural gas-fired power plant and other facilities on the 386-acre site in Beaver County Pennsylvania.
Ethane extracted from the Marcellus and Utica Shale plays will be converted into plastic pellets at the complex.
Mariner East 2 Rerouted. Not a Fatal Blow. A regulatory order requiring Energy Transfer LP to reroute part of the Mariner East 2 pipeline is likely to delay but not derail the NGL line, analysts agreed.
“I don’t think it’s going to be so prohibitive where they’re going to take the project down and not move forward with it, especially because it’s well over 90% done,” Tortoise Capital Advisors LLC’s managing director and senior portfolio manager Brian Kessons said Sept. 15. “What, frankly, is most disappointing to the company is the opportunity cost of another month of delays before they can bring it online.”
The Pennsylvania Department of Environmental Protection, or DEP, ordered Energy Transfer subsidiary Sunoco Pipeline LP to suspend work on the pipeline Sept. 11, a month after 8,000 gallons of drilling mud was inadvertently released into a stream and flowed into Marsh Creek Lake, a popular state park.
The state’s action requires Sunoco to reroute the 350-mile, 20-inch pipeline around wetlands near the lake in Chester County, Pa., by moving the line about half of a mile north of its current route to an alternate path.
DEP acknowledged that building along the new path would require Sunoco to obtain new easements and rights-of-way in a formerly rural county that has become a suburban bedroom community outside Philadelphia.
Kessons said a rule of thumb is that pipelines cost $1 million per mile, but it is likely Sunoco would have to spend a little more because of the suburban location.
“Creating a new pipeline in Pennsylvania, it’s not like a new pipeline through Texas,” Kessons said. “You got a lot of communities that you have to go around, a lot of wetlands … they are trying to drill these really long laterals, which is actually a better and safer way to drill, generally, but it is more subject to spills.”
A portion of Mariner East 2 is open for service on a reduced basis using an older 12-inch pipeline in Chester and neighboring Delaware County until the 20-inch line is completed next year, an Energy Transfer spokeswoman confirmed Sept. 15.
“We do not expect the order will impact timing on [Energy Transfer]’s 16-inch Mariner East 2X project, which is expected to bring 250,000 barrels per day of capacity online by the end of the year,” Height Securities LLC midstream analyst Josh Price told his clients Sept. 14. “However, the order may delay the final stage of the [20-inch] Mariner East 2 expansion, which is slated for completion in 2Q21.”
Energy Transfer has had no comment on the DEP’s action beyond saying it was working with regulators to finish the pipeline. “We are currently reviewing the DEP’s administrative order and will continue to work closely with the DEP on this issue as we have done throughout the duration of this project,” Energy Transfer spokeswoman Amanda Gorgueiro said in an email after the order’s Sept. 11 release.
The Mariner East family of NGL pipelines — Mariner East 1, Mariner East 2 and Mariner East 2X — share a common route through the suburban Philadelphia counties of Chester and Delaware before arriving at the Marcus Hook terminal on the Delaware River. At the terminal, ethane, butane and propane are transferred to ships and railcars for transportation to downstream users, such as European plastics manufacturers. Several Appalachian shale gas drillers, notably Antero Resources Corp. and anchor shipper Range Resources Corp., use the Mariner lines to realize better NGL prices overseas and narrow the difference between the local market and the U.S.’s major NGL market, the Texas Gulf Coast.
Work on Mariner East has been halted and restarted repeatedly because of environmental violations, and Energy Transfer has racked up $15.9 million in fines from the DEP during its construction.
Hope for Pipelines in NY. (Thank you, MDN) The Federal Energy Regulatory Commission (FERC) is making official what has, until now, been unofficial (but enforceable via court orders)–state environmental agencies have exactly one year to dither around and then either grant or reject issuing a Section 401 permit for pipelines (and other projects) to cross rivers and streams and wetlands. Last week FERC issued a Notice of Proposed Rulemaking (NOPR) to make the one-year time limit (a part of law under the Federal Clean Water Act) an official part of FERC regulations too.
Washington Post Supports Fracking. Fracking is on the ballot in November. Don’t listen to the left’s calls to stop. Washington Post. Opinion. Why is it that whenever the United States achieves strategic dominance in a critical area for our national security, the left wants to disarm? In the 20th century, America’s emergence as a nuclear superpower made our victory in the Cold War possible. And what was the left’s reaction? They opposed ballistic missile defense and championed nuclear disarmament. Today, one of the great geostrategic developments of the early 21st century has been the United States’ emergence as an energy superpower.
Oil Price Recovery. Oil prices rise on signs an industrial recovery is underway. Bloomberg. Oil rose after economic data from China to the U.S. sparked optimism that an industrial recovery is underway, offsetting a bleak assessment of demand by another top energy organization. Futures gained as much as 2% in New York, alongside a rally in U.S. and European equities. Chinese retail sales rose for the first time this year in August, while industrial production expanded more than expected. In the U.S., manufacturing in New York state expanded in September at the second-fastest pace since 2018.
Shale Production Continues to Decline. Crude oil production in the U.S. shale patch is set to decline by 68,000 bpd next month, with every play registering declines in output except the Permian, the Energy Information Administration said in its latest Drilling Productivity Report. While production in the Permian is expected to increase by 23,000 bpd to 4,173 million barrels daily, output in the Niobrara shale play alone will offset this with an equal decline.
Bad News for PA. Pa. regulators advance plan to join RGGI. Pennsylvania regulators yesterday approved plans to join the Regional Greenhouse Gas Initiative (RGGI), a carbon cap-and-trade pact among Northeastern states, despite the Republican-controlled Legislature’s attempts to thwart the move. The Pennsylvania Environmental Quality Board (EQB), controlled by appointees of Gov. Tom Wolf (D), voted 13-6 to approve a draft rule that would limit carbon emissions from power plants. The proposal now moves to the state Office of the Attorney General for review and is open for public comment until Nov. 30.
Pioneer in Strong Position to Withstand the Downturn. Pioneer Natural Resources can withstand the downturn better than others. Oil prices have come under pressure again, largely due to heightened demand concerns. But Pioneer Natural Resources’ cash flows are largely immune to oil price swings since it has hedged nearly all of its estimated production for H2-2020, mainly by using swaps. Pioneer Natural Resources has the lowest debt-to-equity ratio among its close peers and strong liquidity of $1.7 billion.
Ecopetrol to Drill 100 Wells in the Permian. Colombia’s oil major plans to drill 100 wells in the Permian. Colombia’s state-held oil firm Ecopetrol, which has a strategic alliance with Occidental Petroleum to develop acreage in the Permian, plans to have drilled as many as 100 wells in the most prolific U.S. shale basin by the end of 2021, Ecopetrol’s CEO Felipe Bayon told a conference on Monday. “By the end of next year, we should have over a hundred wells,” Bayon said at a virtual conference, as carried by Reuters.
Permian Sees Rebound in NatGas and Oil. Permian natural gas, oil to rebound in October, but other U.S. basins still on decline, says EIA. The Permian Basin is the only one of the seven major producing areas of the United States forecast to see an increase in natural gas and oil output in October over September, the Energy Information Administration said Monday. In the monthly Drilling Productivity Report, EIA researchers estimated total oil production from the seven most prolific basins in the United States would decline by 68,000 b/d month/month to total 7.64 million b/d.
NatGas Power Plant Coming to OSU. Ohio State gains approval for on-campus natural gas plant. The Ohio Power Siting Board approved the construction, operation and maintenance of a natural-gas power plant on West Campus Thursday. The $278-million plant will produce thermal energy and electricity for Ohio State’s main campus, according to the project application. University spokesperson Dan Hedman said the plant will cut carbon emissions by more than 30 percent in its first year of operation while providing energy-efficient electricity, heating and cooling to Ohio State’s campus.
Pipeline to Maryland’s Eastern Shore. Natural gas pipeline was a long shot in Eastern Shore county — until state help arrived. With only a handful of large employers and Maryland’s highest poverty rate, Somerset County has come up empty for years in its efforts to attract a natural gas pipeline, which county officials view as the key to unlocking its economic potential. Now, though, a pipeline is just a few regulatory steps away from construction in the county. What changed? Not the private sector.
Columbia Gas’s New Pipeline. Columbia Gas of Ohio is planning to expand its pipeline system to meet growing demand for gas in an area that extends from northwestern Franklin County into Delaware and Union counties.
The routes that the natural gas distribution company is considering for the project would transport natural gas under the Scioto River.
Called the Northern Loop, the project begins at Hyatts Road in Delaware County, where earlier segments of the Northern Loop end.
It extends to U.S. 42 and down to U.S. 33 to McKitrick Road near Hyland Croy Road in Union County, where gas will enter existing lines.
The project will bring natural gas from pipelines on the eastern side of Franklin County, where supplies are abundant, to areas north and west of Columbus.
Columbia Gas expects construction to begin in 2022. The cost is projected at $100 million to $110 million.
“It ensures upstream capacity is available to meet the growth that continues to occur in the northwest part of our system,” said Vince Parisi, president and chief operating officer of Columbia Gas of Ohio.
Several phases of the project already have been completed, bringing the line to Delaware County. The final phase loops from southern Delaware County to southeastern Union County, where it will connect to the existing gas distribution system.
The project will consist of 11 miles of 24-inch pipe and 4 miles of 16-inch pipe.
Columbia has not settled on a final route, but the preferred and alternate routes both cross under the Scioto River.
Other utility lines in the region also are located under the river.
“Columbia is currently working with regulatory agencies regarding the Scioto River crossing to ensure that we can safely install the pipeline and minimize environmental impact,” spokeswoman Staci Perkins said. “Construction begins in early 2022 and we anticipate having all regulatory agency reviews and approvals prior to that time. These regulatory approvals will specify the methods of installation and the pipeline route by the end of 2021.”
The project, along with a separate Columbia Gas project called the Marysville Connector, a 4.78 mile, 12-inch natural gas pipeline to service new industries and residential development southeast of Marysville in Jerome and Millcreek townships, are vital to the region’s growth, said Eric Phillips, economic development director for Union County and Marysville.
Phillips also is chairman of the Ohio Gas Access Partnership, a group formed in 2019 to satisfy long-term energy needs in the region.
Union County is among the fastest growing housing markets in the country, along with being home to operations for Honda and other auto-related companies, he said.
“It sets the stage for more of that growth in the future,” Phillips said. “That’s the big win in all of this.”
PA Permits September 11, to September 17, 2020
County Township E&P Companies
- No New Permits
OH Permits September 11, to September 17, 2020
County Township E&P Companies
- Harrison Archer EAP OHIO
- Jefferson Ross EAP OHIO
- Jefferson Ross EAP OHIO
- Jefferson Ross EAP OHIO
WV Permits September 7, to September 17, 2020
- Marshall Tug Hill
- Marshall SWN