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Tuesday, August 15, 2017

Links of the Day: More 2nd Quarter Updates, Lordstown Plant Supported by Community, and More

Seeking Alpha:  Gulfport Energy's (GPOR) CEO Mike Moore on Q2 2017 Results - Earnings Call Transcript   -   "On the operations front, in the Utica the team delivered solid results experiencing significant efficiencies at the drill bit and exceeding numerous previous records set in the field. During the second quarter, we spud 28 gross wells utilizing six operated rigs. The well released during the second quarter had an average drilled lateral length of approximately 8,409 feet, up 3% over the first quarter and 12%..."

Seeking Alpha:  Rex Energy's (REXX) CEO Tom Stabley on Q2 2017 Results - Earnings Call Transcript   -   "Staying on the topic of liquidity, during the second quarter we closed on an agreement for the sale of our Salineville waterline in Warrior North Keystone Clearwater Services. The sale was for approximately $7 million in cash and an additional $1 million of water transfer work on upcoming pads in..."  Legal Efforts to Stop Gas Pipeline Dealt Blow by Magistrate   -   "A federal magistrate in Akron has dealt a significant blow to efforts by some Ohio property owners to stop a high-pressure natural gas pipeline from being built. U.S. Magistrate Kathleen Burke in a written recommendation filed Monday said the U.S. District Court in northern Ohio lacks jurisdiction to consider..."

Youngstown Vindicator:  State Board Hears Support for 2nd Clean-Energy Plant in Lordstown   -   "Bill Siderewicz, president of Clean Energy Future, the company asking the Ohio Power Siting Board to approve construction of a second gas-fired power plant at the Lordstown Industrial Park, touted the project at a hearing Thursday in Columbus. Siderewicz said he and an electrician from Lordstown who works on the first Lordstown Energy Center plant both spoke in favor..."

Sentinel-Tribune:  BG Charter Amendment to Ban Fossil Fuel Infrastructure in Flux for November Ballot   -   "There are questions about whether a proposed charter amendment that seeks to ban certain new fossil fuel infrastructure from city of Bowling Green property will appear on the November ballot. Terry Burton, a director with the Ohio Board of Elections, said the issue will be..."

WKSU:  Canton Says Water is Safe, Despite Discoloration   -   "Canton water officials are assuring residents that water coming out of their tap is safe to drink, despite any discoloration. The city reduced the amount of water it was pumping from its Sugarcreek wellfield following a spill of drilling mud in April from nearby construction on the Rover..."

Reuters:  U.S. Shale Breakeven Price Revealed Around $50   -   "U.S. shale producers need a WTI oil price around $50 per barrel to break even, according to an analysis of financial statements for the second quarter. Fifteen of the largest shale oil and gas producers reported total net losses of $470 million for the three months between April and June when benchmark WTI prices averaged..."

The Times Leader:  Monroe Chamber Prepares for Economic Growth   -   "Monroe County business leaders and government officials are counting on an upswing in the local economy, mostly due to activity in the oil and natural gas industry. Barbara Carslund of the Monroe County Chamber of Commerce said she is optimistic that jobs and industry are on their way to the county, and her organization is helping to pave the way for..."

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Monday, August 14, 2017

Utica Shale Counties Show Highest Income Growth in Ohio

by Jackie Stewart, Energy in Depth

Columbus Business First just released tax data showing that Utica Shale producing counties have the highest income growth in Ohio. And guess which county in Ohio has the highest income growth? Monroe County, home of the best natural gas producing wells in the state. The new report highlights similar reports over the past few years showing a correlation between oil and natural gas drilling and production with and the personal income growth of residents who live and work in those counties.
The report found that from 2010 to 2015 tax filers in Monroe County reported more than $200,000 in adjusted gross income, representing a staggering 855 percent jump. In fact the top six high-income growth counties are all squarely located in the core of Utica Shale development.  Recall that it was only four years ago that the Akron Beacon Journal reported, “Shale has produced 630 new millionaires in two Ohio counties.”

Source: Columbus Business First

Source: Columbus Business First
The top six counties reporting the highest number of $200,000-plus tax filers were Monroe, Noble, Harrison, Carroll, Belmont and Guernsey. In terms of permits and overall statewide production of natural gas, Carroll County still leads the pack with the most 525 and highest overall statewide production of natural gas, and Belmont County has the second highest number of permits (488), with Harrison (391), Noble (213), Monroe (342), and Guernsey (203) rounding out the top six natural gas producing counties. So, there appears to be a direct connection between drilling and production and personal income for residents in those counties.
As Columbus Business First reported, “That’s not a typo.”
Another piece of evidence linking natural gas production to income growth is the reality that these same counties have realized tremendous tax revenues, thanks to property taxes paid by operators on production of oil and gas. As EID reported earlier this year, eastern Ohio has realized over $45 million, with Monroe County realizing a 340 percent increase in tax revenue.
Still not convinced? Also this week, WTOV 9 reported major upgrades to Switzerland Local Schools in Monroe County, stating,
“Each high school is participating in a campus improvement project thanks to the school board and oil and gas money.”
This is all very good news and it highlights how vital oil and natural gas development has been for Appalachia, which traditionally has included some of the poorest counties in the state.

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Youngstown Fracking Ban May Be Blocked From Seventh Time on Ballot

From the Youngstown Vindicator:
An anti-fracking charter amendment could be kept off the city’s Nov. 7 ballot by the Mahoning County Board of Elections because of a conflict with state law. 
Gov. John Kasich signed a bill in January – effective April 6 – that included an amendment giving more discretion to county boards of elections to invalidate local charter proposals that conflict with state law and/or the state constitution. 
The anti-fracking proposal, rejected six previous times by city voters, would require the city to ban hydraulic fracturing and any activity related to it including “the depositing, storage, treatment, injection, disposal, transport or processing of wastewater.” 
However, state law gives jurisdiction over fracking to the Ohio Department of Natural Resources. 
When the Ohio Senate approved the measure in December, state Sen. Kevin Bacon of Minerva Park, R-3rd, specifically mentioned the Youngstown anti-fracking proposal as a main reason to include the amendment in a bill that was designed to revise foreclosure laws, according to media reports. 
Mark Munroe, Mahoning elections chairman, said the board may be compelled to take action against the anti-fracking proposal.
Click here to read the rest of the article.

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ETP Earnings Call Provides Update on Rover Pipeline

From Seeking Alpha's transcript of Energy Transfer Partner's second quarter earnings call:
As to Rover, construction of Phase 1 is substantially complete with 100% cleared and graded and the pipes strong, welded and lowered in. We expect to be finished with the construction of Phase 1a from Cadiz to Defiance by next week and plan to immediately ask for permission to bring Phase 1a in service. On Phase 1b from Seneca to Cadiz, once we receive approval from FERC to drill under Captina Creek, we believe we will have it drilled and completed in approximately 40 days, at which point we will request FERC permission to bring this segment into service. When approved, all of Phase 1 will be in service. We are waiting on approval from FERC to resume drilling the HDDs. In the meantime, we continue construction on all phases of the pipeline except the HDDs. Assuming quick resolution by FERC regarding Phase 2, we expect to be in service by the end of November or early December with full commercial service in January. On our Revolution project, construction is scheduled to be completed in the fourth quarter of 2017.
View the entire transcript by clicking here.

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Thursday, August 10, 2017

OOGA Holds Annual Meeting in Zanesville

From WHIZ News:
The two-day meeting was a chance for more than 300 operators, suppliers, contractors and industry affiliates to get together for fun and professional development. 
Shawn Bennett, OOGA Executive Vice President, said the oil and gas industry is the third most important industry in the state of Ohio. 
“So not only do we bring energy, we provide well-paying jobs as well as royalties to land owners across the state,” said Bennett. “When you look at this industry in the state of Ohio, while it’s largely unnoticed from people outside of the oil and gas producing region it provides significant benefits for all Ohioans.” 
Bennett said the industry has seen a downturn in previous years, but that trend is expected to change.

View the original article by clicking here.

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Driller Turns Tables by Suing Landowners in Dimock, PA

From Natural Gas Now:
I have joyous news for all our readers. Cabot Oil & Gas has fired a shot against the seedy trial lawyers and even seedier hustlers trying to earn fame and money with jugs of brown water and filthy accusations surrounding Dimock. Cabot has filed a lawsuit against pig farm suer Charlie Speer, his Luzerne County trial lawyer associates and Ray Kemble, the Dimock junkyard plaintiff fractivists have descended to using as an example despite his complete lack of credibility on virtually anything. 
It’s a $5 million lawsuit enjoyable to read for entertainment but, more than that and the obvious quest for justice, this is a glorious opportunity to expose some of the special interests behind fractivism. Discovery is going to be a nightmare for Speer, Kemble and allies. 
The lawsuit may be found here and I’ve highlighted the important parts. Here are some of the basics (emphasis added): 
  • Prior to 2012, Defendant Speer, a pig farm nuisance lawyer from Missouri, routinely filed suits against those in the agricultural industry based on alleged damages from odors and other purported nuisances.
  • After Missouri enacted legislation at the end of 2011 that put an end to Speer’s pig farm lawsuits, Speer set his sights on Pennsylvania and switched his focus from pigs to rigs.
  • In the process, Speer and Speer Law teamed up Ciarimboli, Boylan, and F & C to commence nuisance claim lawsuits against natural gas operators in Pennsylvania.
  • One of their new Pennsylvania clients, Kemble, had sued Cabot and GDS in 2009 and settled his claims in 2012.
  • Following the 2012 settlement agreement, Kemble spent the next five years breaching its terms.
Click here to read the whole article. 

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What Does FERC Quorum Mean for Appalachian Basin?

From BTU Analytics:
While electricity rate cases will most likely be the bulk of the commission’s backlog, a few important Appalachian pipe projects are in there as well, notably Nexus and PennEast, both of which have missed their scheduled certificate approval dates (which were due in February and July, respectively) as a result of the lack of a FERC quorum. In February 2017 when there was a push by FERC to approve projects prior to losing its quorum, both Rover and Atlantic Sunrise received their approval, while NEXUS’ decision was left out. This was based on FERC’s methodology of addressing projects by their original application date. Now with FERC’s quorum restored, there is no reason to think it will be delayed much longer. 
Atlantic Coast Pipeline and Mountain Valley are both scheduled to receive their certificate approval at the end of September. FERC should be in full swing of things by then, however any ramifications due to the backlog of approvals would put this timing at risk. 
Nevertheless, even with an approval, the path forward for all the projects above will still be bumpy as they all face obstacles beyond a FERC approval. NEXUS is facing limited commercial support with only two-thirds of its capacity subscribed, leaving it the only major greenfield in the Northeast not fully subscribed. In addition, TransCanada Mainline’s recently discounted tariff rates will make the MichCon/Dawn market even more competitive, hurting shippers’ netbacks on NEXUS.
You can read the whole article by clicking here.

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Pipeline Problems Promulgated as Rover Rankles Roger

The laundry list of problems that have occurred in connection with construction of the Rover pipeline are hardly a secret.  Spills, destruction of a home that was under consideration for registry as a historic landmark, and upsetting farmers by pumping rainwater out of trenches into fields have been a few of the stories that have marked the months since Energy Transfer Partners began working in earnest on the pipeline.

Now an article from Oil & Gas is highlighting more of the reasons that local residents are upset with ETP, as even those that fought to carefully craft their agreements with the company are finding that they have a new fight on their hands as the company rushes to complete the project.  An excerpt:
After the Rover Pipeline was announced and Roger Meggyesy learned it would bisect farmland he owns, he expressed concerns about maintaining the quality of the topsoil and proper mitigation programs to restore productivity. 
That was in 2015. Fast-forward to 2017, and Meggyesy’s fears have not been allayed, which prompted him to request a roadside meeting with a pipeline monitor and environmental inspectors. 
“We worked to get good easements and good language (in the contract), but once construction started, everyone seemed to forget,” Meggyesy told Gary Anderson, a third-party pipeline inspector who submits his reports to the Federal Energy Regulatory Commission; Damon McCarthy, who deals with right-of-way issues on the project; and inspectors from Land Stewards, including Wendell Swartzentruber, who monitors the work to minimize environmental impacts. 
Joining the makeshift meeting on the side of the road at the intersection of Blachleyville and Firestone roads were Lindsay Shoup, organizational director for the Wayne County Farm Bureau; Roger Baker, a farmer and state trustee for the Ohio Farm Bureau; and Rod Scheibe, a dairy farmer who rents land from Meggyesy. 
Because Meggyesy uses a wheelchair to get around, he sat in his vehicle the whole time. However, he had a perfect vantage point from which he could point out compliance problems. He told the group to look at his property and notice how truck tracks were present at the corner.
Read the whole article by clicking here.

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