Latest facts and a rumor from the Marcellus, Utica, and Permian, Eagle Ford Plays
Manchin’s Efforts for Permit Reform Does Not Make It. End of the line for permitting bill, but 2023 fight looms. E&E News. Sen. Joe Manchin’s attempt to overhaul environmental rules for energy projects failed in the Senate on Thursday, ending a monthslong effort from the West Virginia Democrat. After the 47-47 vote, Manchin blasted Senate Republicans — most of whom voted against the measure. “Once again, Mitch McConnell and Republican leadership have put their own political agenda above the needs of the American people,” Manchin said in a statement, citing high energy costs and the Mountain Valley pipeline, a contentious natural gas project in his state whose advancement was included in the bill. The vote underscored disagreements between Democrats and Republicans about how the federal government should handle the major electric transmission projects that will be needed to add scores of new wind and solar projects to the grid. It could be a defining political issue for the energy transition over the next several years.
Cold Weather and Maintenance Push NatGas Higher. North American natural gas prices pushed higher on colder weather – Mexico spotlight. NGI. North American natural gas futures prices found some momentum this week amid colder weather across the United States. On Thursday, the January New York Mercantile Exchange gas futures contract settled at $6.970/MMBtu, up 54.0 cents day/day. February advanced 36.9 cents to $6.589.’ U.S. natural gas production also dipped below 100 Bcf/d this week on maintenance issues, aiding the upward price trend. EBW Analytics Group analyst Eli Rubin said that supply freeze-offs “could compound market tightness. While downward pressure remains likely on a seasonal basis, the coming cold blast through the end of the year could still prompt another run higher first.”
OH Legislature Call NatGas “Green Energy.” Ohio legislature passes bill opening all state land to fracking, labeling natural gas ‘green energy’. Cleveland. Legislation to spur fracking in state parks and on other state-owned land, define natural gas as a “green energy,” and prohibit local pesticide bans is on its way to Gov. Mike DeWine after clearing a final legislative vote on Tuesday. The Ohio House voted 59-33 to pass House Bill 507, which was initially introduced as a bill to reduce the number of poultry chicks that can be sold in lots before the Ohio Senate added the natural gas, drilling and pesticide provisions. The legislation, brought by the Ohio Oil and Gas Association, seeks to push the Ohio Oil and Gas Land Management Commission to stop dragging its feet on approving rules for oil and gas drilling on state lands by requiring all state agencies to open up land they control to drilling until the commission puts such rules in place. In 2011, state lawmakers opened state parks to oil and natural gas drilling and set up the commission to handle drilling applications. However, the commission has been slow to approve projects and missed a deadline last January to put leasing rules in place.
FERC in Limbo. FERC climate reviews in limbo as Glick departs. E&E News. The head of the Federal Energy Regulatory Commission had big plans at the start of the Biden administration for assessing planet-warming emissions from new gas pipelines. But with FERC Chair Richard Glick’s time at the agency likely coming to an end, the commission’s path forward on climate assessments is as murky as ever. Glick was known in the Trump era for frequent dissents on natural gas pipeline orders, which he often said were legally infirm by not assessing whether facilities would significantly contribute to climate change. When President Joe Biden shifted him from commissioner to chair in 2021 and FERC gained a Democratic majority, Glick vowed to adjust the agency’s approach to weighing pipelines’ greenhouse gas emissions. Legal experts and former commissioners are divided over whether the chair’s position — that the commission must consider how much natural gas would be burned as a result of new pipelines — is correct.
Manchin’s responsible for Glick leaving FERC.
Shale Production Growth Will Be Limited in 2023. Five reasons why U.S. shale production won’t soar in 2023. Oil & Gas 360. Opinion. Last week, the chief energy adviser to the Biden administration, Amos Hochstein, blamed institutional investors for the stalled drilling in the U.S. oil and gas industry and called it outrageous and un-American. Yet investor pressure on the companies to boost shareholder payouts at the expense of investment in new production is only part of a story that confirms recent analyses suggesting the U.S. shale oil boom is over, and there is no coming back. For the last two years, the shale oil industry, like the broader oil and gas industry, suffered the consequences of pandemic restrictions like other industries and had to curb production massively. And the industry is still dealing with some remnants of the fallout from the lockdowns, such as workforce and raw material shortages. Because in addition to some lingering effects of the pandemic, there are such things as natural depletion, government policies, and, indeed, investor pressure.
Another Reason Oil Prices Will Remain Elevated. Oil giants set to slash overseas growth plans, Evercore says. Bloomberg. Oil giants are poised to halve their international spending growth next year in response to lower crude prices, dealing another blow to a global market already facing a slowdown in production from US shale fields. Some of the world’s biggest oil and gas companies are expected to expand their international budgets by 12% in 2023, down from an increase of 26% this year, according to a survey from Evercore ISI. Spending growth in North America is also expected to be cut in half, rising about 18%. Budgets had soared this year as the industry bounced back after a pandemic-driven slump.
EOG’s Impact OH Midstream. Thanks, MDN. In 2020, EOG Resources, one of the largest oil and gas drillers in the U.S. (with international operations in Trinidad and China), sold *all* of its Marcellus assets, which were located in Bradford County, PA, to Tilden Resources for $130 million. EOG left the M-U building, so to speak. But the company couldn’t stay away. In November, we told you that EOG admitted to stealthily amassing 395,000 net acres in the Ohio Utica for very little money. EOG calls its new position the “Ohio Utica combo play.” We later told you what the company means by that phrase. Today we tackle the topic of how EOG’s Utica combo play will affect the midstream in Ohio.
Permian Quake Causing Changes. Latest Permian Quake Prompts Injection Well Revisions to Texas Seismic Response Plan. An oil and natural gas operator-led response plan in West Texas, which targets seismicity from produced water injection wells in the Permian Basin, has been revised following a 5.4 magnitude earthquake last month.
The Railroad Commission of Texas (RRC) on Tuesday implemented several revisions to the seismicity reduction response plan in the Northern Culberson-Reeves Seismic Response Area (SRA). which was created earlier this year to prevent the recurrence of 3.5-plus magnitude events by the end of 2023.
“The response plan sets curtailments on the injection volumes of produced water into disposal wells,” RRC noted. “The scope of the plan is being revised following reviews of seismicity data and injection volumes.”
Under the revisions, the SRA boundary has been expanded north to the New Mexico border. The size of the area was increased to 2,601 square miles from 2,366. There are 78 active disposal wells in the revised area, according to RRC.
In addition, “the target for reducing daily injection volumes in deep disposal wells is being reduced even further,” state regulators noted.
Operators of deep disposal wells in the revised plan have agreed to reduce their collective disposal volumes to 162,000 barrels/day by June 30. The original target had been 298,000 barrels/day.
Reducing the volumes “would be about a 68% drop in disposal volume compared to January 2022 before the plan went into effect,” RRC noted.
More changes are on the way. RRC said staff are considering revisions to the shallow disposal well injection volume schedules in the SRA and “will be looking at changes along with possible new data collection efforts.”
RRC also plans to promote expanded data collection for seismicity research to inform policymakers, and protect residents and the environment.
“The data collection is to include a voluntary survey of available historical and current reservoir pressure, encouraging the use and reporting of continuous down-hole pressure monitoring data and assessing the origins of disposal volumes – whether from in-state or out-of-state sources.”
FERC Could Impact Freeport Reopening. Thanks, MDN. The Freeport LNG export facility maintains it will restart accepting feedgas by the end of December. Following a request by the Federal Energy Regulatory Commission (FERC) to Freeport to respond to a list of 64 questions, we wonder if the plant will make that deadline. We’ve lost track of how many times Freeport, which has been offline since early June following an explosion in the plant, has changed the restart date. Last week the company said the final restart would happen by the end of December. Yet yesterday, FERC handed the company an extensive list of questions/issues that must be addressed before a restart can happen.
Many analysts have commented that NatGas prices will rise with the reopening.
U.S. Becoming Shadow OPEC Member. Biden turns the U.S. into a shadow member of OPEC. WSJ. President Biden has urged the Organization of the Petroleum Exporting Countries to increase production of oil and criticized the cartel harshly when it declines to do so—most recently on Dec. 4. But actions speak louder than words. Under the Biden administration, the U.S. has been acting as shadow member of the cartel. America has committed itself to constrain its own supply through regulations and legislation, which has enabled OPEC to achieve record profits. The White House response to higher cartel profits was to double down by proposing a profit tax that would further limit U.S. supply. The new House Republican majority could help consumers by blocking further cartel-enabling policies.
Rice Brothers Latest Deal. Developer of revolutionary carbon-capturing power plant to go public via SPAC with gas-fracking Rice bros. Forbes. The Rice Brothers — Danny, Toby and Derek — have made a fortune in the business of fracking shale gas and remain dedicated to promoting gas as the fastest way to save the world by weaning us off the use of coal. In Danny Rice’s words, they are “100 percent focused on getting as much low-cost gas out of the ground as possible.” To help enable that vision, on Wednesday their second publicly traded shell company (or SPAC) called Rice Acquisition Corp II, announced it would acquire NET Power — an electric power developer with revolutionary new technology. The deal values NET at $1.46 billion. Existing shareholders including Occidental Petroleum Constellation Energy, Baker Hughes will roll their equity into the new public company. Both the Rice Family and Oxy will contribute another $100 million in equity each. It’s a serious stamp of approval from serious people who believe in the near limitless potential for power plants utilizing the so-called Allam Cycle.
New Methane Capture Incentive. Rising natural gas prices offer new incentive for methane capture. The Houston Chronicle. A rise in natural gas prices in the United States and abroad is making efforts to stop gas leaks not just good for the climate but good business, according to a study by research firm S&P Global Commodity Insights. Analysis of oil and gas fields in North America, Africa and Asia showed that 70 percent of the methane escaping into the atmosphere could be captured and sold into energy markets. Capture projects started during the next 12 months are projected to see revenues double or even triple compared with what they were before gas prices began to rise last year. “The elevated price outlook for natural gas has created a substantial economic opportunity to capture flared gas and methane emissions, especially in the near term,” said Eleonor Kramarz, a vice president at S&P.
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PA December 5, to December 15, 2022
County Township E&P Companies
1. Bradford Overton Chesapeake
2. Bradford Overton Chesapeake
3. McKean Norwich Seneca
4. Susquehanna Bridgewater Coterra
5. Susquehanna Bridgewater Coterra
6. Susquehanna Bridgewater Coterra
7. Susquehanna Bridgewater Coterra
8. Susquehanna Bridgewater Coterra
9. Susquehanna Forest Lake Coterra
10. Susquehanna Forest Lake Coterra
11. Susquehanna Great Bend SWN
12. Susquehanna Great Bend SWN
13. Susquehanna Great Bend SWN
OH Permits December 5, to December 10, 2022
County Township E&P Companies
1. No New Permits
WV Permits December 5, to December 9, 2022
1. Marshall Tug Hill
2. Ritchie Antero
3. Taylor Antero
Joe Barone 610.764.1232
