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Monday, October 16, 2017

Ohio Holds the ‘Key Anchor’ To Appalachia’s Bright Plastics Future

by Jackie Stewart, Energy in Depth

This week, Ohio laid a stake in the ground as the “key anchor” to the Appalachian storage hub — a critical component to support an economic revolution along the Ohio River — during the Utica Shale Summit hosted by the Canton Regional Chamber. The event provided a new perspective on the next phase of Appalachian Basin oil and natural gas development, including storage, infrastructure, and the ultimate end-use of natural gas liquids that has led to a rebirth in plastics manufacturing in the U.S. As a result of the conference, local Ohio papers are asking, “Could Ohio and nearby states become petrochemical hub?”
Thanks to prolific natural gas liquids from the Utica Shale, the Ohio River Corridor, a new site selection service company, announced it’s hopeful to soon rebrand the “Rust Belt” as the “Plastic Belt.”  So how is Ohio the so-called “key anchor” to this forecasted “Plastic Belt”?
Well, as recent American Chemistry Council and West Virginia University (WVU) reports have detailed, one of the key components to unlocking plastic manufacturing is finding storage solutions for natural gas liquids. And Ohio is in fact the only state in the Appalachian Basin that has a project underway to do address storage solutions.
The Mountaineer NGL Storage project, located in Monroe County, would support 3.25 million barrels of natural gas liquids (NGLs) initially, with capacity to store as much as 10 million barrels of NGLs in a salt formation about 6,700 feet below the surface. The project would be a huge resource to support the needs of ethane cracker plants slated for the region.
According Mountaineer President David Hooker, the project is a “key anchor” to the much talked about Appalachian Storage Hub concept. The Ohio project is essential to keeping NGLs produced in the Appalachian Basin local, as it serves as warehouse for NGLs during the operation of an ethane cracker. Here’s how the company illustrates its significant role in bringing manufacturing to the region.
As you can see, prolific natural gas liquid production from shale must be separated into ethane, propane, butane, etc., through fractionation. After that, the NGLs can be stored, or warehoused, to support the ebbs and flows that the private market will ultimately dictate.  For Mountaineer’s project, that means storing NGLs in salt caverns.
How Does Salt Storage Work?
Salt storage is one of the preferred methods of hydrocarbon storage, according to the Energy Information Administration (EIA), and has been used throughout the country for over 70 years. In other words, the process is certainly not new.  Utica Shale Summit conference attendees were excited to see a new video that highlighted Mountaineer’s project and provided an education salt storage.
Keeping it Local
In order to keep the vast production coming out of the Utica Shale local, there needs to be an incredible amount of infrastructure built out to support transportation and end-use in the region. That means finding a home for dry gas, such as gas-fired power plants, and taking NGLs to market. As Team NEO, an economic develop group, stated at the Utica Shale Conference,
“Right now we’re exporting a tremendous amount of value out of the region. What I’d like to do is try to have this region benefit from that and create wealth and jobs going forward. We have a window of opportunity to seize this. We have competition all over the world.”
Hooker agreed, saying “keeping it local is the key,” which is why his company has already spent $20 million toward supporting that goal.
But keeping Utica Shale local will largely depend on major investment decisions to build crackers in the region, and additional storage and infrastructure. Of course, Shell has already announced its investment in Pennsylvania, and Ohio is anxiously awaiting a final investment decision from PTT Global Chemical, but what about others? And will plastic manufacturing companies follow suit and decide to invest in the region as well?
Time will tell, but if the first storage facility in the tri-state is any indicator of things to come, there’s certainly a lot to look forward to.  And it can’t be emphasized enough that none of these activities would be possible without production of oil and natural gas from shale.

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OPEC Urges Shale Drillers to Do Fair Share to Control Oil Market

From the Motley Fool:
The Secretary General of OPEC, Mohammed Barkindo, has a message for shale drillers. Speaking at an energy forum in India, he said, "We urge our friends in the shale basins of North America to take this shared responsibility with all the seriousness it deserves, as one of the key lessons learned from the current, unique supply-driven cycle." In other words, start sharing some of the responsibility to help keep excess supply off the market. 
His plea comes as U.S. output has staged a remarkable comeback this year and is on pace to break the 1970 record of 9.6 million barrels per day by next year. However, the message will probably fall on deaf ears, since shale drillers aren't beholden to OPEC but shareholders. So the only way for OPEC to get its message across would be to take away the one thing shale drillers need to keep drilling, which is a stable oil price -- that is, unless shareholders persuade them to use their money for something other than drilling more wells. 
How we got here 
The oil market is still trying to get back on its feet after a blistering downturn caused by a gusher of new supplies, primarily from U.S. shale drillers, that flooded the market in recent years. OPEC initially responded by unleashing its own torrent of oil, which it hoped would drown out weaker shale drillers. However, instead of killing that emerging industry, it has only made shale stronger, because good old American ingenuity drove out costs through efficiency gains and innovation. Consequently, many shale drillers are now thriving at $50 crude. 
That's a problem for OPEC, because it's trying to rebalance the oil market by coordinating a production cut to drain excess inventory. While those oil stockpiles have fallen this year, they haven't come down as quickly as hoped, because shale drillers promptly ramped back up.
Continue reading by clicking here.

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CELDF’s Worst Year Yet: Ohio Supreme Court Rejects Youngstown ‘Bill of Rights’ Appeal

by Jackie Stewart, Energy in Depth

The Community Environmental Legal Defense Fund’s (CELDF) years-long Ohio anti-fracking campaign suffered its greatest blow yet on Friday, as the Ohio Supreme Court rejected the group’s appeal of the Mahoning County Board of Elections’ vote not to allow a measure aimed at banning fracking in Youngstown on the ballot for a seventh time. Six previous “Community Bill of Rights” measures had been rejected by Youngstown voters prior to Friday’s Supreme Court decision, which will ensure the measure won’t even appear on the ballot this November.
CELDF, which has been the driving force behind a very small group of anti-fracking activists targeting Ohio for years, has basically thrown in everything but the kitchen sink into its efforts to abuse Youngstown voters again this November — including crowdfunding, legal disputes and parachuting an activist in from Colorado to rally the troops. But its efforts have finally hit a wall. Friday’s 4-3 Ohio Supreme Court decision puts to bed years of debate over the validity of the ballot measure and, hopefully, will be a final end to the abuse of taxpayer funds that has already cost the City of Youngstown more than $187,000. There’s simply no question that 2017 continues to be the worst year on record for fringe environmental activists like CELDF, as Ohioans continue to reject anti-fracking initiatives across the state.
Here’s a quick recap of what’s went down in Youngstown for the past five years.
CELDF Youngstown “Bill of Rights”
After six consecutive defeats at the ballot box, the Mahoning County Board of Elections found that CELDF’s seventh attempt at getting a “Community Bill of Rights” measure on the ballot conflicts with state laws that clearly articulate that local governments in Ohio cannot regulate fracking and therefore ruled the measure to be “invalid.”
The decision was challenged by CELDF-backed groups and, as a result, the Ohio Supreme Court heard the case with haste due to the upcoming November election. If enacted, the Youngstown Bill of Rights would have essentially banned all construction activities within the city of Youngstown, as well as all oil and natural gas development.
Cost to City of Youngstown
As a reminder, CELDF has deep pockets. It can afford to be a litigation factory and abuse local municipalities at the ballot box. In 2015 alone, CELDF reported more than $1.4 million in assets, swelling its coffers by over 75 percent in just the past few years. CELDF has also consistently used Youngstown as a means to raise money, as its most recent campaign crowdfunded more than $5,000 specifically to pay for failed legal actions in Youngstown. So it’s really no surprise that CELDF has no regard for how much its efforts end up costing taxpayers, which is documented in the chart below.
CELDF Parachutes In Recruits
The Youngstown fight has been a hallmark campaign for CELDF. Its Youngstown efforts, while clearly a continued failure, have served as a battle cry throughout Ohio and even in other states as well. In fact, just days before the Ohio Supreme Court decision, CELDF parachuted in activist and Lafayette City, Colo., Councilwoman Merrily Mazza to rally the troops as part of a “Community Rising Tour.” Youngstown was Mazza’s last stop on the tour, no doubt due to the fact that Youngstown has been CELDF’s premier campaign for years. To put into perspective just how far Mazza is going to travel back home to Lafayette, using fossil fuels, take a look at this visual:
Mazza’s 3,281-mile round trip again highlights the arrogance and the “do as I say not as I do mentality” that these fringe environmental activists continue to showcase not just in Ohio but across the country.
Conclusion
This isn’t the first time the Ohio Supreme Court has struck down CELDF in Ohio and it probably won’t be the last. But for now, and for the first time since 2013, Youngstown voters won’t have to fork over thousands of dollars of taxpayer money to put the so-called “Community Bill of Rights” measure on the ballot. And for the people who actually live and work here (unlike Mazza and CELDF) we applaud the Ohio Supreme Court for its swift action to — at least temporarily — bring an end to CELDF’s costly madness.

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SRBC Continues to Find No Water Contamination from Drilling

From the Susquehanna River Basin Commission:
The Susquehanna River Basin Commission has released a report on potential impacts to water quality from unconventional natural gas drilling and other activities in the Basin. 
A water quality monitoring network with more than 50 stations was put into place in 2010, as the natural gas industry was rapidly growing in the Basin. Most of the activity was located near headwater streams where water quality observations and data were scarce. 
To date, the Commission’s network of monitors has not detected discernible impacts on the Basin’s water resources, but continued vigilance is warranted. 
“The Commission takes very seriously its role in monitoring water quality conditions in the Basin, in order to collect the necessary data to make informed decisions,” said Executive Director Andrew Dehoff, P.E. “This report provides more information as part of the Commission’s mission to sustainably manage the water resources of the Susquehanna River in a way that supports both ecological health and economic development.”
Read the whole news release by clicking right here.

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NEXUS Pipeline Gets Construction Go-Ahead; Rover Approved for More Horizontal Directional Drilling

From NGI:
FERC issued an order Wednesday clearing Nexus Gas Transmission LLC to start construction, an expected but no less significant step forward for the delayed greenfield natural gas pipeline. 
The order came the same day as the competing Rover Pipeline LLC received clearance from the Federal Energy Regulatory Commission to resume work at four horizontal directional drilling (HDD) locations where work had been stopped since May. 
Rover and Nexus are not the only Northeast natural gas transmission projects to face regulatory setbacks in recent years. The regulatory climate has been particularly hostile for pipelines in New York, where developers have faced obstruction, an issue explored in NGI’s latest special report, Empire State Showdown: The NatGas Battle for New York
FERC staff authorized Nexus to proceed with construction on the 255-mile project, excluding specific segments where the developer will need to submit additional information before work can start [CP16-22].
Continue this article by clicking here.

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New Bill Would Give Some Ohio Counties Bigger Share of Oil and Gas Production Revenue

From The Times Leader:
Congressman Bill Johnson introduced legislation last week that, if passed, would allow oil and gas producing counties in Ohio to keep more revenue generated from production on federal lands. 
The bill, titled Providing Opportunities With Energy Revenues (or POWER) Counties Act, is similar to previous legislation introduced by Johnson in 2015 that was not enacted. The proposed legislation seeks to “amend the Mineral Leasing Act to require payment to counties of a portion of certain revenues received by the United States under Federal oil and gas leases, and for other purposes,” according to congress.gov. 
The Mineral Leasing Act, first enacted by Congress in 1920, regulates the leasing of public lands for the development of several mineral resources, including coal, oil, natural gas, other hydrocarbons and other minerals. 
“There is little doubt that Eastern and Southeastern Ohio are at the center of America’s energy renaissance,” Johnson said. “Energy development is having a positive impact on virtually every sector of our economy, including education. Our students are learning about the many job opportunities that have arrived — and will continue to arrive — resulting from the oil and gas boom. Schools are expanding their programs to help prepare students for new and exciting careers here at home, where they have been raised and educated.”
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Wednesday, October 11, 2017

Pipeline Construction is Aiding OH Utica Shale in Closing Gap on PA Marcellus

From MDN:
It’s been a few months since we’ve brought you news about the monthly average for Baker Hughes’ venerable rig count–largely because after GE completed it’s merger with Baker Hughes they quit issuing monthly press releases from their website! We spotted a story in the Pittsburgh Business Times that talks about Ohio coming close to parity in their rig count with Pennsylvania–which is a really big deal–and the reasons for it. That story sent us looking for the latest rig count numbers and indeed, it’s true. As of September, PA averaged 33 shale rigs in operation, while OH averaged 29–the closest we’ve ever seen it. If you look at the counts for last week (BH does a weekly rig count too), the numbers are even closer: PA with 31 rigs, OH with 29. We don’t typically monitor the weekly counts as they always fluctuate up and down–better to look at monthly averages. But the fact remains that PA has been pretty steady, operating between 32 and 34 rigs per month since January of this year, while OH has gone from operating an average of 20 rigs in January to 29 last month, and West Virginia has gone from operating an average of 8 rigs in January to 15 rigs last month (nearly doubling). Yet PA is static. Is there an explanation? Some experts think there is, and it can be explained in a single word: pipelines…
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Ohio Supreme Court Rules That Youngstown Fracking Ban Will Not Go on Ballot for 7th Time

From the Youngstown Vindicator:
There won’t be charter amendments to ban fracking or change how elections are conducted on Youngstown’s Nov. 7 ballot. 
In a 4-3 decision Friday, the Ohio Supreme Court rejected an appeal by officials with the two groups backing the proposals to overturn Sept. 6 votes by the Mahoning County Board of Elections not to permit either to be put in front of voters this fall. 
One proposal would have sought to ban fracking and fracking-related activities – city voters have rejected similar ballot initiatives six previous times – and the other would have changed how elections are conducted in the city, including restricting who can give campaign contributions. 
Supporters filed writs of mandamus with the Supreme Court on Sept. 7.
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