The following Shale Directories Members are OPEN for BUSINESS during COVID-19 related shutdown.*
Support them when and how you can!
Allison Crane & Rigging
American Energy Fabrication
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 Midstream PA 2020
New Date: December 10, 2020
State College, PA
8th Annual Utica Downstream
New Date January 21, 2020
New Location: Holiday Inn Belden Village
Latest facts and a rumor from the Marcellus, Utica, and Permian, Eagle Ford Plays
Energy Transfer to Complete Mariner East 2X by Year End. U.S. energy company Energy Transfer LP said it plans to finish work on its Mariner East 2X natural gas liquids pipeline in Pennsylvania by the end of the year and the final phase of the Mariner East projects in the second quarter of 2021.
Mariner East transports liquids from the Marcellus/Utica shale in western Pennsylvania to customers in the state and elsewhere, including international exports from Energy Transfer’s Marcus Hook complex near Philadelphia.
Sunoco started work on the $2.5 billion Mariner East expansion in February 2017 and planned to finish the 350-mile (563-km) pipeline in the third quarter of 2017.
Mariner East 2 did not enter service until December 2018 due primarily to several work stoppages by state agencies.
Since May 2017, Pennsylvania has issued 118 notices of violation to Mariner East, mostly for drilling fluid spills, including one in October.
Energy Transfer also said on its earnings call on Wednesday that it will use part of the eight-inch (20.3-centimeter) Mariner East 1 pipe for its new Pennsylvania Access project to bring refined products from the Midwest into Pennsylvania.
“This project will require minimal capital … and will add significant revenue,” Energy Transfer CFO Thomas Long said, noting early volumes will likely flow in the fourth quarter.
Mariner East 1 started service in the 1930s transporting refined products from the Philadelphia area to western Pennsylvania. It was repurposed and expanded to transport propane in 2014 and ethane in 2016.
Mariner East 2, which uses mostly 20-inch pipe, boosted total capacity of the system from 70,000 barrels per day (bpd) to 345,000 bpd.
Energy Transfer temporarily used sections of 16-inch and 12-inch pipe in Chester and Delaware counties to put Mariner East 2 into service where the 20-inch pipe was still under construction.
The 16-inch Mariner East 2X will add another 250,000 bpd to the system.
Declining DUCs. Good News!! Oil operators get DUCs in a row, adding fracking crews to boost output. U.S. frackers are bringing back equipment even as oil prices languish around $40 a barrel in a bid to boost production and tap into a backlog of drilled wells left uncompleted (DUCs) when oil prices crashed earlier this year. The number of active hydraulic fracturing fleets has climbed by nearly 50% since mid-September to 127, according to data from consultancy Primary Vision, outpacing a roughly 17% jump in the number of active drilling rigs over that same period of time. That count stands at 296.
LNG Plant Coming to Bradford County, PA. New Fortress Energy [plans] to build an LNG liquefaction plant in Bradford County, PA (northeastern part of the state), and then haul the LNG from the plant via specially-outfitted trucks and rail cars to a transloading dock/port facility New Fortress plans to build at an old DuPont dynamite factory site [colloquially known as the Gibbstown or Repauno site] in New Jersey, on the banks of the Delaware River. What we didn’t know, until now, is that the old DuPont site will also function as a transloading facility for LPG, or liquefied petroleum gas.
Williams Breaks Record in the Appalachian Region. Midstream giant Williams reported record natural gas gathering and processing (G&P) volumes in the Appalachian region during the third quarter, driven by higher prices in the region.
Gross gathering volumes for the Northeast G&P segment rose 8% year/year (y/y) to 9.4 Bcf/d, while gross processing plant inlet volumes swelled by 17% to 1.4 Bcf/d, management said during a third quarter earnings conference call. Natural gas liquids (NGL) production volumes from the segment rose 24% to 114 million b/d.
The volumes were all-time highs across the board for the Tulsa-based operator.
Recent highlights for Williams also include the partial in-service of the Southeastern Trail expansion of the flagship Transcontinental Gas Pipe Line Co. LLC (Transco) system.
The company brought 150 MMcf/d of the 296 MMcf/d expansion online Nov. 1. Up to an additional 80 MMcf/d is expected online before the end of the year, with the balance of the expansion expected in-service in early 2021.
Williams also filed a Federal Energy Regulatory Commission pre-filing application in June for the 760 MMcf/d Regional Energy Access expansion on Transco, which aims to connect Marcellus Shale gas supplies with growing Northeast demand in time for the 2023-2024 heating season.
“This strong performance is evidence of the attractive position of our Northeast business as gas market fundamentals begin to call on U.S. dry gas supplies,” CEO Alan Armstrong told analysts. He highlighted that Williams is the largest gatherer in the Appalachian Basin, the country’s most prolific source of gas production, propelled by the Marcellus and Utica shales.
“Our dedications include the most attractive acreage operated by resilient producers that continue to demonstrate their ability to continuously improve on their cost structures,” he said. “You can see this playing out as our Northeast gathering volumes grew faster than the total Northeast supplies…
“So we really are not only in the right basin, but we’re also in the right parts of the basin in the Appalachian area. We expect this trend to continue in response to the very favorable forward strip pricing in ’21 and a very well-positioned group of customers in both the Marcellus and Utica.”
Williams expects to meet its pre-Covid 2020 earnings guidance set last December. Armstrong attributed the company’s durability to “the premier positions of our natural gas infrastructure” and measures taken “to reduce leverage, increase stability and lower costs…Our gathering and processing business continues to benefit from our basin diversity, specifically in gas-directed areas where drilling remains active.
“In addition, we continue to grow services to key producers in the Gulf of Mexico deepwater, where we have major dedications.”
Williams has “been fortunate to contract for some very large and exciting new developments” in the deepwater Gulf of Mexico, including the Spruance and Taggart developments. Both are targeting first production in the first half of 2022, the CEO said. They are operated by Covington, LA-based LLOG Exploration Offshore LLC.
Amid rising global demand for liquefied natural gas (LNG), “we have confidence that producers see this as an attractive market and will be able to respond very effectively to the increasing call on gas supplies, particularly in the very best of the Marcellus, Utica and Haynesville shales…which we are so fortunate to serve.”
Prices in these gassy plays have been boosted by reduced production of oil and associated gas in oiler regions such as the Permian and Williston basins.
Armstrong said “gas demand will be driving our business and the forward market certainly is driving many of our customers to make plans for growth across a lot of our systems…”
Like many operators across the upstream and downstream energy sectors, Williams is aiming to reduce its greenhouse gas (GHG) emissions and move toward net-zero carbon emissions by 2050. The plan is to achieve a 56% absolute reduction in company-wide GHG emissions by 2030 versus 2005 levels, and net zero carbon in 30 years.
“As the world moves to a low-carbon future, we believe natural gas is key to reducing emissions on a global scale while supporting the growth of renewables and helping our customers and stakeholders meet their energy needs and climate goals,” Armstrong said.
Williams is forecasting growth capital expenditures of $1-1.2 billion for full year 2020, slightly under the high end of original guidance of $1.1-1.3 billion.
Williams reported net income of $308 million (25 cents/share) for the quarter, up from $220 million (18 cents) in 3Q2019.
Marathon Has $1 Billion Loss. Marathon Petroleum Corp. lost $1 billion during the third quarter as the company continued to face challenges due to the coronavirus pandemic.
Despite some recovery during the summer months, global demand for the Findlay-based company’s products and services remained lower than normal, executives said during a conference call with investors Monday.
Marathon’s refining and marketing segment lost $1.6 billion during the quarter, but the company’s midstream business made $960 million, up 4% from the same quarter a year ago.
The midstream results primarily reflected the business of MPLX, a partnership that counts among its assets pipelines and processing plants in the Utica and Marcellus shale regions.
Marathon posted a $1.1 billion profit during the same quarter just a year ago.
The company said it was on target to cut more than $1.4 billion in capital spending and reduce operating expenses by more than $950 million, and had already undertaken its previously announced plan to cut 2,050 jobs, or 12% of its workforce, across the country.
Marathon also announced it had started a renewable diesel plant in Dickinson, North Dakota, and planned to convert its idle Martinez, California, refinery to make renewable diesel.
The company said it planned to finalize its $21 billion sale of its Speedway stores to 7-Eleven during the first quarter of 2021.
Marathon Petroleum operates 16 refineries that can process a combined 3 million barrels of crude oil a day. One of those refineries is in Canton.
MPLX Update. In an ongoing effort to optimize capital spending amid the weak oil price environment, MPLX LP brought online the first segment of the Wink-to-Webster pipeline to ultimately transport more than 1 million b/d of Permian Basin crude to the Houston area.
The main segment of the 650-mile pipeline was commissioned in October, and service is expected to be available for shippers by the end of the year. Additional segments are expected to be placed in service throughout 2021.
Speaking Monday on the 3Q2020 earnings call, CEO Michael Hennigan said the joint venture partners in the project looked at how they “could optimize capital spending” during the final months of what has been an unprecedented year in the oil and gas industry. With the early completion of the main segment from Midland, TX, to Houston, they opted to bring that portion of the system online ahead of time.
“It’s part of the optimization process. Instead of waiting for the whole thing, there is a piece of the project that could start up sooner,” Hennigan said.
MPLX has a 15% equity stake in the project, with the full capacity under minimum volume commitment (MVC) contracts. Delek US, Rattler Midstream LP, ExxonMobil, Plains All American Pipeline LP and Lotus Midstream LLC are co-sponsors.
There was barely a mention of another Permian takeaway project, the Whistler natural gas pipeline that would transport 2 Bcf/d. However, management indicated Whistler is on track to start up in the second half of next year. More than 90% of the project is committed with MVCs.
West Texas has been one of the bright spots for MPLX in the gathering and processing (G&P) segment. The midstreamer indicated that West Texas was one of only two regions that reported higher G&P volumes in the third quarter. Gathered volumes in the basin rose 3% year/year.
The Marcellus Shale also was a source of growth for MPLX. Gathered volumes averaged 1.3 Bcf/d in the third quarter, also up 3% year/year. Processing volumes increased 8% year/year to a record 5.7 Bcf/d. Fractionated volumes jumped 10% to 477,000 b/d as the Hopedale 5 fractionator began operations in the quarter. This drove total fractionated volumes to an average 567,000 b/d, up 4% over 3Q2019.
Despite the pressure on commodity prices, MPLX management remains optimistic in the outlook for natural gas and natural gas liquids (NGL) demand and price recovery. CFO Pamela Beall said the recent recovery in futures prices is “beneficial” for MPLX’s natural gas and NGL producer customers, “as they can take advantage of hedging opportunities and realize a positive impact on operating results, as well as their borrowing base redetermination.”
Beall said she expects producers would “continue to apply the benefits of an improving price environment to their balance sheets to address near-term debt maturities and improve their financial flexibility.”
The CFO acknowledged that “it’s been, certainly, very challenging for the producer customers across all of our geographies” but management has “been pleased to see some of the reports from producers that have been coming out.” Furthermore, with natural gas prices moving back up to $3.00/MMBtu, the company expects the higher priced environment to be “very supportive” for the G&P segment.
“We are running at very high volumes in our Marcellus area,” Beall said. There is some capacity that could fill up in the Utica Shale as well, and the Smithburg 1 processing plant is ready to take gas “at the appropriate time.”
That said, many exploration and production companies are looking at a slower growth trajectory, “whether it’d be in the Northeast or in the Permian or any other areas,” according to Hennigan. At the same time, the CEO said because of the recent price uptick, natural gas should continue to be an important part of the energy landscape long term.
“We’re looking at $3-plus natural gas pricing now compared to where we were six months ago, and I think there is a different outlook going forward that also blends into the evolving energy landscape,” Hennigan said.
The midstreamer has established incremental initiatives to reduce greenhouse gas emissions intensity to 30% below 2014 levels by 2030. It has established a 2025 goal to lower methane emissions intensity from the G&P business to 50% below 2016 levels. It also has reduced freshwater withdrawal intensity by more than 10% since 2015, with plans to reduce it by another 10% in 10 years.
With mergers and acquisitions (M&A) gaining momentum in the upstream sector, MPLX management said it was encouraged by the consolidation by producers, “which should result in counterparties with a stronger financial profile.” However, Beall said the company doesn’t “have a currency that I think would be very effective in consolidation.”
While MPLX would evaluate opportunities moving forward, its priority in the near term is to use free cash to buy back units and “keep our debt in check here.” Management is “not going to be blind to what’s happening in the space,” but how consolidation shakes out in the midstream space is “difficult to predict,” Beall said. “I’m not saying that we are actively engaging in M&A at this point in time, but certainly we’ll keep an eye on how that unfolds.”
MPLX reported third quarter net income of $665 million (68.75 cents/share), up from $629 million (67.75 cents) last year. Distributable cash flow was about $1.07 billion, versus nearly $1.03 billion a year ago.
Range Is Sitting Tight. Range remaining disciplined despite improving natural gas outlook. Range Resources Corp. has ended production curtailments imposed in September and October in response to weak Appalachian natural gas prices, but even with an improved outlook, there are no plans to increase activity. Range cut 210 MMcf/d of natural gas production during the second half of September and most of October as Appalachian storage levels remained high and maintenance on multiple infrastructure projects squeezed takeaway capacity.
MVP Delays Cost More. Another delay, cost increase for the Mountain Valley Pipeline. The Mountain Valley Pipeline has once again pushed its completion date back and the project cost up. Equitrans Midstream Corp., the lead partner in a joint venture of five energy companies that has faced repeated environmental problems while building the natural gas pipeline, made the announcement early Tuesday. Rather than completing construction early next year, the company said it is now targeting a full in-service date “during the second half of 2021,” a news release stated.
Permitting Fee Increase in PA. Increase in Pennsylvania gas permitting fee could create drag on state economy. Center Square. As Election Day draws near, both presidential candidates have spent significant time in the battleground state of Pennsylvania, which has also seen conflict between proponents of unconventional natural gas and clean energy sources. While the state passed a law, Act 66, in July that provides tax credits to manufacturers of dry natural gas products, the Department of Environmental Protection hiked the cost of unconventional gas permit fees Aug. 1 from $5,000 per nonvertical unconventional well permit and $4,200 per vertical unconventional well permit to $12,500 for either type.
SWN To Close Montage 11/12. Southwestern Energy Company released its third-quarter 2020 update last Friday. The company previously announced it is buying out and merging in Marcellus/Utica driller Montage Resources. During the 3Q conference call, CEO Bill Way said the company expects to close on the deal immediately after Montage Resources shareholders vote on the deal November 12.
Flaring Becoming Big Issue in TX. Texas E&Ps must justify reasons to flare/vent natural gas, says RRC. Producers working Texas oilfields will be required to show why they need permission to flare or vent natural gas under updated rules approved by state regulators Wednesday. However, the three-member Railroad Commission of Texas (RRC) stopped short of imposing more stringent requirements to limit emissions. For months the RRC has weighed how to balance exploration and production (E&P), particularly in the oilfields in the Permian Basin and Eagle Ford Shale, with constraints wrought by low prices and/or a lack of infrastructure.
Pioneer 3rd Qtr. Update. Oil and gas producer Pioneer Natural Resources Co PXD.N reported a lower-than-expected quarterly profit on Wednesday, as the COVID-19 pandemic muted fuel demand and hit crude prices. Easing of coronavirus-related travel restrictions helped oil prices tick upwards in the third quarter from their April record lows, but a recent surge in infections around the world has stymied the recovery.
Methanol Plant Coming to WV. Gov. Jim Justice announced Monday that a $350 million plant would be built in Pleasants County to produce methanol.
West Virginia Methanol Inc. will construct a plant to produce high-purity methanol from natural gas in Pleasants County. The plant is a $350 million investment and will provide 30 full-time jobs not counting the construction jobs needs to build the plant.
“It is another great day for West Virginia,” Justice said during the virtual announcement for the plant Monday afternoon. “We had to create an image of a state that was really moving forward and moving forward the right way. I hope that you think we’ve done it, and we’re going to continue to do it.”
Once the plant is complete, it will produce 315,000 metric tons per year — 900 metric tons per day — of high-purity methanol using 35,000 MBTU per day in natural gas with low emissions.
Lars Scott, executive vice president at West Virginia Methanol, said the Cincinnati-based company chose West Virginia for its abundant natural gas, the need for methanol in the region, and the ability of the region to support more industrial growth.
“One thing that has really attracted us to West Virginia is the people we’ve met and the workforce we know that’s here, experienced, and capable of ultimately becoming a part of our plant,” Scott said. “We think our plant and probably others that either we or people will build will continue to make this a region for more and more chemical and industrial manufacturing plants. We’re looking forward to being a part of that.”
Scott said the plant would be constructed by Haldor Topsoe and Modular Plant Solutions using what he calls an innovative design that will allow the plant to be built using modular pieces the size of shipping containers. Scott said construction could start in the first half of 2021 once the company goes through the state permitting process. The construction period could take anywhere from 27 to 30 months.
Monday’s West Virginia Methanol announcement is the second big economic development news in recent days. Nearly two weeks ago, state officials announced that Virgin Hyperloop would construction its Certification Center in Northern West Virginia.
“We thank you for your investment in the State of West Virginia,” Ed Gaunch, secretary of the Department of Commerce, said Monday. “This is another big day I would say, particularly for the Mid-Ohio Valley region. It’s another rung on our ladder for economic diversity … a very exciting day for us.”
Justice and state officials were joined virtually by representatives of the Pleasants County Development Authority and the Pleasants County Commission, who praised the project as an opportunity for the region.
“Today’s announcement is an important development for Pleasants County and for the Mid-Ohio Valley,” said Diane Braun, executive director of the Pleasants County Development Authority. “We are honored to be a partner with West Virginia Methanol and welcome them to Pleasants County.”
“We give the good Lord credit first for such a blessing,” said Pleasants County Commissioner Jay Powell. “For a small state, we’ve accomplished a lot of great things lately and this is just another one of those things. We had stiff competition. At one point we were told we were an underdog. But … the people of Pleasants County and the people of West Virginia have made this happen.”
According to the Methanol Institute, methanol is a component in many plastics and other petrochemical manufacturing, such as formaldehyde used for glues and resins, acetic acid for polyester fibers and other plastics. Methanol is also used in various fuels for cars, boats, cookstoves, biodiesel, and even fuel cells for electric vehicles. It’s even a key part of wastewater treatment facilities.
“I just think about all the possibilities here,” Justice said. “We’re much closer to the markets. Our natural gas is the cheapest. But you’ve got to have flagships. You’ve got to have the first people to put stakes in the ground. Really and truly the downstream possibilities of petrochemical manufacturing are unbelievable.
PA Permits October 29, to November 5, 2020
County Township E&P Companies
- No New Permits
OH Permits October 29, to November 5, 2020
County Township E&P Companies
- Carroll August EAP OH
WV Permits October 26, to October 30, 2020
- Marshall Tug Hill
- Marshall Tug Hill
- Monongalia Northeast Resources
- Tyler Antero
- Tyler Antero
- Tyler Antero
- Tyler Antero