Facts & Rumors Newsletter #444 October 23, 2021

Shale Directories Conferences

Save the Date!!

Hydrogen & Carbon Capture Conference

November 11, 2021

Hilton Garden Inn, Southpointe

Canonsburg, PA

www.appahydrogencarbon.com

Latest facts and a rumor from the Marcellus, Utica, and Permian, Eagle Ford Plays

Could It Be Old Times in OH? I was in St. Clairsville this past Wednesday night. I stopped at the Hampton Suite. I did not bother to make a reservation. I almost regretted it. The hotel was just about completely booked. I asked if the gas workers were back. The answer was “yes.”

The same is probably true in PA and WV.

PA State Senators Slam Anti’s. Three Pennsylvania state senators warned October 21 that home heating bills in the US this winter could increase by as much as 54% compared to a year ago and blamed “ill-conceived” actions by environmental groups as a main reason for the potential increases.

“The greatest threat to the affordable, clean, natural gas energy is not a lack of natural resources, a shortage of capable workers, or an unwillingness to adhere to environmental regulations,” senator Camera Bartolotta said at a Harrisburg, PA news conference. “No. The real threat comes from lawmakers and environmental extremists who do not understand or appreciate how important the oil and gas industry is in our daily lives. This is not just an issue of affordability. As we saw in Texas last winter, access to energy can mean life or death.”

She was joined at the event by senators Gene Yaw and John Yudichak and trade union executives Jim Gallagher and Matt Toomey. Together, they pointed out that actions in states surrounding Pennsylvania – home to much of the massive Marcellus shale gas field and other natural gas sources in the Appalachia basin – are contributing to a looming availability shortage for natural gas consumers throughout the US Northeast.

“The actions of surrounding states have stalled energy infrastructure development that is vital to creating new jobs and new markets for Pennsylvania natural gas and related liquids, not only here at home, but across the northeast and world,” Yaw said. “The lack of pipeline development is also contributing to the large price disparity that is putting Pennsylvania gas producers at a disadvantage, while aiding our global natural gas competitors.”

Pennsylvania’s neighboring states, he said, “thumb their nose at Pennsylvania gas” while embracing natural gas purchased from eastern Europe.

“I encourage other states to take a realistic look at where their energy needs stand and the implications of the choices they are making,” he said. “Sooner or later, the lights will go out due to unrealistic energy policy.”

Banks Are Changing with Higher Prices. Banks loosen purse strings for shale drillers amid oil rally. Banks are gradually offering more credit to U.S. shale oil and natural gas producers as the industry recovers from last year’s contraction and energy prices rally. So-called borrowing bases will increase as much as 20% during the imminent round of talks between drillers and lenders, according to most respondents in a survey conducted by law firm Haynes & Boone LLP. The findings indicate a continued improvement after the dire conditions experienced in the oil and gas sector last year, when the pandemic and global gluts led to a slump in energy prices and prompted banks to cut back on lending.

State Treasurers Fighting Biden on O&G Investments. Pa. state treasurer concerned about energy companies’ access to capital. Pennsylvania Treasurer Stacy Garrity said she joined 14 other state treasurers fighting the Biden administration’s attempts to cut off the flow of investment in the oil and gas industry because the move would harm the state economy and raise prices for the consumer. Garrity, a Republican, took office in January. In late May, West Virginia State Treasurer Riley Moore and Garrity wrote a letter to Special Presidential Envoy for Climate John F. Kerry to express dismay on the reported efforts behind the scenes to discourage investment by U.S. banks and financial institutions in coal, natural gas and oil.

Permian SPAC Deal. Permian entrepreneur hatches shale SPAC with billion-dollar ambitions. Special-purpose acquisition companies have targeted electric vehicles, fintech, healthcare and even space this year, largely avoiding oil — until now. Four years after cashing out his Permian Basin shale business for $700 million, Kentucky-born entrepreneur Rhett Bennett is headed back to the oil field with his Black Mountain Acquisition Corp. The blank-check company plans to use $240 million it raised this week to buy oil and natural gas assets, focusing on private equity-backed operators who lack the scale and deep pockets to compete with publicly traded rivals.

Sundance Energy Asset Sale. U.S. oil producer Sundance Energy explores asset sale -document. Reuters. U.S. oil and gas producer Sundance Energy, which emerged from bankruptcy protection in April, is marketing about 38,800 acres in the Eagle Ford shale basin in South Texas, according to marketing documents seen by Reuters. This year’s sharply higher oil and natural gas prices have led dozens of large and small energy companies to put properties on the market. U.S. crude was trading at over $81 a barrel on Thursday, up 68% on the year.

Halliburton 3^rd Qtr. Financials. Halliburton posts Q3 profit as drilling rebounds, eyes jump in customer spending. U.S. oilfield firm Halliburton Co (HAL.N) on Tuesday posted its third consecutive quarterly profit and said customer spending in the United States could jump 20% next year, as stronger oil prices and drilling activity boost demand for services and equipment. Oil prices have rallied to multi-year highs with global crude futures climbing 4.5% in the quarter ended Sept. 30, helped by OPEC+’s decision to maintain its planned output increase rather than raising it on global supply concerns.

There’s a Lot of NatGas in America. AGA’s latest resource estimate of 3,863 Tcf underscores U.S. natural gas bounty. The estimated natural gas resource base in the United States has reached an all-time high, the American Gas Association (AGA) reported Tuesday. During a virtual AGA event, the Potential Gas Committee (PGC) stated that its year-end 2020 technically recoverable gas resource estimate — that is, in the ground but not yet recovered — totals 3,368 Tcf.

China Locks-In NatGas. China signs huge LNG deals with U.S. supplier Venture Global. Reuters. China has agreed three huge liquefied natural gas (LNG) deals with U.S. exporter Venture Global LNG as the world’s second-biggest economy looks to secure long-term supplies amid soaring gas prices and domestic power shortages. According to documents posted on the U.S. department of energy website, the agreements with China’s state oil giant Sinopec include two 20-year deals for a combined 4 million tonnes of LNG per year.

PA Resident Appreciates PA NatGas. Letter to the editor: Natural gas saves Pa. residents thousands. Tribune-Review. While it’s easy to look at commodity pricing as a snapshot in time, it’s important to understand natural gas market fundamentals are strong and help consumers. Pennsylvania has emerged as the country’s second-largest natural gas producer, just behind Texas. This shift from energy scarcity to regional abundance has led to cost savings for all Pennsylvanians using natural gas to heat homes, cook food and dry clothes. According to state data, compared to 2008, Western Pennsylvanians are realizing average savings of 65% to 85% on the purchased natural gas cost — more than $2,200 per household each year.

Railroad Commission of TX Conducts Rigorous Inspections. TX energy regulator exceeds site inspection targets. In order to ensure protection of public safety and the environment, the Railroad Commission of TX maintains rigorous inspection programs over the various industries it regulates, and the Legislature holds the agency to those high standards by setting annual performance goals. In fact, the RRC, which has district offices throughout the state, exceeded Fiscal Year 2021 legislative goals for a broad range of inspection categories concerning oil and gas; intrastate pipelines, the alternative fuels LNG, CNG and LPG; and surface mining of coal.

Fully-Automated Rig in the Permian. Oil and gas markets surge as Permian Basin activity picks up post-COVID-19 pandemic. A fully-automated drilling rig completed its first well in the Permian Basin earlier this month as operations in the region continued to recover from the COVID-19 pandemic. Energy technology company Nabors announced it used the rig to achieve a depth of 19,917 feet, per a news release, for a well owned by ExxonMobil subsidiary XTO Energy in the Midland Basin on the eastern side of the Permian in Texas. Note: Bloomberg also reports.

DUC’s Are Disappearing. Lower 48 oil, natural gas production to rise in November as DUC drawdown continues. U.S. onshore oil and natural gas production is set to rise from October to November, propelled by supply growth in the Permian Basin and Haynesville Shale, according to updated projections Monday from the U.S. Energy Information the Anadarko, Appalachia and Permian basins, along with the Bakken, Eagle Ford, Haynesville and Niobrara shales — will grow by 257 MMcf/d from October to November to reach 87.9 Bcf/d, EIA said in its latest Drilling Productivity Report (DPR).

Drillers Can Trade Credits. Shale gas drillers can now trade credits for low methane release. Shale gas drillers can now trade credits for curbing emissions of one of the most potent agents of global warming. Methane emissions of just 0.1% or less during natural gas production will earn explorers Methane Performance Certificates under an electronic credits system launched by Xpansiv CBL Holding Group and S&P Global Platts, S&P said in an emailed statement Monday.

NatGas Contracts En Vogue Again. Energy crisis is making multi-year U.S. Gas contracts hip again. U.S. manufacturers and other large energy users are starting to lock in natural gas and power costs for at least three years or longer to buffer against price surges this winter, a practice that went out of vogue with the shale boom. With gas prices more than doubling from a year earlier during the annual shopping season for winter fuel, many factories are securing prices until 2024 to help mitigate impending surges, according to consultancy and fuel procurement firm Unified Energy Services LLC. Some are contracting power and gas even later into this decade to guard against near-term and longer-term shocks.

November Production Increase in the Permian. Oil output in U.S. Permian Basin to rise to 4.8 million bpd in Nov. -EIA. Oil production in the largest U.S. shale formation is expected to rise in November but remain below the record-high forecast given for March 2020, according to a monthly government report released on Monday. Oil output from the Permian basin of Texas and New Mexico was expected to rise 62,000 barrels per day (bpd) to 4.8 million bpd next month, the Energy Information Administration said in its drilling productivity report.

TX NatGas Industry Not Ready. Texas natural gas industry showing limited progress in winter storm prep, experts say. Efforts to get the Texas natural gas industry ready to operate through another severe winter storm like February’s are so far showing limited gains, with independent experts saying they see little evidence of companies increasing investments in weatherization and other protective measures. Since the frigid weather knocked out power to millions of Texans, state and federal officials have called on energy companies to weatherize the power grid and the natural gas system on which it relies to avoid a repeat of a disaster that led to more than 200 deaths and billions of dollars in property damage.

PA Permit October 14, to October 21, 2021

County Township E&P Companies