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Wednesday, August 30, 2017

Links of the Day: Get Caught Up on More of the News from the Past Week

After being off last week, we've tried to catch you up to some of the most relevant stories we missed getting a chance to post about.  There are a couple more of those coming, but here is a quick rundown of some more just to get caught up.  It's today's Links of the Day.

U.S. EIA:  Natural Gas Pipeline Projects Lead to Smaller Price Discounts in Appalachian Region   -   "As new pipeline projects and expansions are completed, the difference between the Henry Hub national benchmark price and daily spot natural gas prices at pricing hubs in the Appalachian region has narrowed. Through the first seven months of 2017, the difference between prices at the Henry Hub in Louisiana and at Dominion South in southwestern Pennsylvania averaged $0.53 per million British thermal units (MMBtu), about two-thirds..."

Rigzone:  Energy Transfer Offering Exposes Pipeline Parent Trap   -   "Investors gave a thumbs up on Tuesday to Energy Transfer Partners LP's decision to raise as much as $1.16 billion by issuing new units. They just happened to express their enthusiasm by driving up the price of a different stock, Energy Transfer Equity LP: Energy Transfer Equity is, of course, the parent of what is variously called the Energy Transfer group, complex or empire. The reason the parent's units..."

Press release:  EQT Foundation Awards Nearly $4M During First Half of 2017   -   "The EQT Foundation awarded grants and scholarships during the first and second quarters of 2017 totaling nearly $4 million. Approximately 44 non-profit organizations throughout Pennsylvania and West Virginia received funding for programs that focus on education, diversity, community & economic development, environment, and arts & culture throughout EQT Corporation’s operating..."

WTOV News:  How Can Steubenville Benefit From the Oil and Gas Industry?   -   "Mike Chadsey, director of public relations for the Ohio Oil and Gas Association was on hand to answer questions in Steubenville and provide some industry insight. He told a group of about 30 people, including council and port authority members, along with the Steubenville revitalization committee, that the industry is rebounding. The representative said what happens with the proposed cracker plant in Belmont County will be telling for the future of oil and gas in the area and that Steubenville could be..."

Washington Examiner:  New Trump Executive Order Will Hasten Oil and Gas Pipeline Permits: Industry Officials   -   "President Trump is expected to sign an executive order Tuesday afternoon that the oil and gas industry sees as essential to speeding up pipeline reviews and permitting, in addition to other energy infrastructure projects, according to senior representatives of the oil and gas industry and unions. "We also look forward to President Trump as he signs an executive order aimed at streamlining the permitting process for..."

PlasticsNews:  dlhBowles Opens Assembly Plant in Mexico, Closing Ohio Plant   -   "The opening of the Reynosa factory is not directly related to dlhBowles’ decision to close an assembly plant in Carrollton, Ohio, and lay off 94 people by March 31. Saxon said the Carrollton work will be absorbed into other existing manufacturing facilities in Ohio, Maryland and Mexico. Fracking optimism in Carrollton Carrollton is a small city southeast of Canton that has seen other recent closings that cost jobs. But a local economic development official is upbeat about luring future plastics-related companies..."

WTOV News:  PTT Global Offering Families Purchase Option Agreements   -   "PTT Global has offered several families purchase option agreements who live or own property near the footprint of the projected cracker plant site at Dilles Bottom. These individuals have the option to sell their property to the company. The families who have signed are currently receiving good faith payments. A spokesperson says eight..."

Reuters:  U.S. Gasoline Price Jumps, Crude Falls as Harvey Hits Refiners   -   "Gasoline prices surged to two-year highs on Monday as Tropical Storm Harvey knocked out several refineries and disrupted fuel production, while a back up in crude supplies pushed U.S. crude oil futures down more than 2.5 percent. Massive floods caused by the storm forced several refineries to close along the U.S. Gulf Coast. Sources said..."

The Athens Messenger:  Highway Re-Opens After Natural Gas Fire   -   "Route 681 south of Albany re-opened to traffic at about 3 p.m. Friday after a natural gas fire was extinguished Thursday. Michael Barnes of Texas-based Enbridge Inc., an energy infrastructure company, said the fire, which started Wednesday, was put out at about 5:45 p.m. Thursday..."

Youngstown Vindicator:  Youngstown Council Votes to Accept Two Charter-Amendment Proposals   -   "The fate of two citizen-backed charter-amendment proposals now rests with the Mahoning County Board of Elections. Youngstown City Council voted Wednesday to accept the proposals and turn them over to the board of elections, which will consider putting them on the fall ballot. Council’s decision was strictly procedural as its members didn’t..."

MDN:  FERC Issues Rover 8 Commandments to Restart Horizontal Drilling   -   "Since April, FERC has blocked all new underground HDD for the Rover project. Rover has asked (begged, pleaded) FERC, several times, for permission to restart the HDD work–at least in a few select locations. In July FERC gave Rover an initial todo list to get back in its good graces, but still would not lift the ban on HDD (see Frustrated FERC Gives Rover Todo List, HDD Drilling Still Blocked). FERC has finally responded with a list of eight (big) things Rover must do before..."

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Ohio Christens a New Natural Gas Plant

by Jack Anderson, Energy in Depth

The Oregon Clean Energy Center (OCEC) opened for business in Ohio on Monday. Ohio Gov. John Kasich visited OCEC to join the ceremonial ribbon-cutting as the facility came to life, adding 870 megawatts of power to the grid. The combined-cycle natural gas fired plant is officially the most environmentally friendly power plant in the state, and provides enough electricity to power over 700,000 homes.
“We are excited to announce that the Oregon Clean Energy Center is online, providing clean, affordable reliable power to hundreds of thousands of homes, businesses and consumers,” said Peter Rigney, Projects General Manager at OCEC. “This milestone would not have been possible without the support and cooperation from the City of Oregon, from its initial approval of the project to reaching commercial operations this month.”
OCEC’s development has provided an economic boom for the surrounding region. Investments totaling $800 million were made in the area because of the plant. Construction employed 950 people over four years. Now operational, OCEC will add $20 million to the local economy on an annual basis for years to come and employ dozens of local residents. The state’s regulatory environment played a big role in facilitating the construction of OCEC and providing this economic boost to the area around the City of Oregon.
“Think about this: This plant is providing the same amount of power as one nuclear plant. And at the same time we say that, there’s no risk to it,” noted Gov. Kasich. “So this is the future here. This is a big deal. So I think it’s important that Ohio stay in a deregulated environment which brings in investors. If all of a sudden you don’t have a level playing field then you don’t have significant investment. It will go in another place.”
As one of the most technologically advanced natural gas plants in the country, OCEC’s smart design eliminated many of the environmental and safety risks associated with other forms of power generation. Because it burns locally sourced natural gas from the Marcellus shale region, OCEC produces 50 percent less carbon dioxide and just one-third of the wastewater produced by coal plants of the same size. OCEC emits 90 percent less sulfur dioxide, nitrogen oxide, mercury, and fine particulate matter than coal plants of comparable generation capacity.
Considering all the economic and environmental benefits, plenty of Ohioans have expressed their excitement and support for OCEC. State Rep. Michael P. Sheehy, a Democrat who represents the Oregon District in the state legislature, called OCEC “a tremendous asset to the region.” Sheehy applauded the “hundreds of local workers out at the plant, safely bringing low-cost, clean burning electric generation to Ohioans.”
Local officials were also exuberant about the opening of OCEC. Oregon City Administrator Mike Beazley called it “a monument to the hard work and collaboration of the investors, developers, state and local government leaders, and the thousands of area residents that helped to build it.” Commenting on the benefits offered by the natural gas plant, Beazley said, “It puts people to work while producing lower priced electrical power for Ohio businesses and homes for decades to come.”  John Minor, President of JobsOhio, an economic development organization, called OCEC a “state of the art facility” that is creating “high-paying jobs across the state.”
Unfortunately, not every state is fully enjoying the benefits of American natural gas to the extent Ohio is taking advantage of it through projects like OCEC. New York, for example, banned hydraulic fracturing and has made a habit of denying permits to natural gas pipeline and power projects that would save the state’s residents millions of dollars while creating thousands of new jobs. But many other states across the USA are making the most of the opportunities offered by shale gas, creating job opportunities galore for skilled tradesmen throughout the country. More projects like OCEC are sure to create economic, environmental and energy advantages for America in the future.

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Citigroup: Shale Will Prevail in Battle with OPEC

From Bloomberg:
U.S. shale oil will prevail over OPEC as the two rivals compete in an oversupplied world market, Citigroup Inc.’s head of research said. 
The Organization of Petroleum Exporting Countries and its allies may have boosted oil prices by cutting production, but they’re losing revenue in the process and their position “is not sustainable over a long period,” Citigroup’s Ed Morse said in a Bloomberg television interview on Tuesday. On the other hand, U.S. shale drillers have adapted to survive prices as low as $40, he said. 
“In the end, the markets are going to win, and it’s going to be shale,” Morse said. “If we’re in a $40 to $45 world, we’ll have enough drilling to add to the surplus in the world as a whole.” 
Oil prices have lost 12 percent in London this year, trading near $50 a barrel, as output curbs by OPEC, Russia and other partners fail to drain a global surplus. U.S. shale explorers have boosted drilling and are poised to reach a record output next month, plugging some of the gap left by OPEC’s cutbacks.
Read more by clicking right here.

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Tuesday, August 29, 2017

Rice Energy Accused of Improperly Classifying Employees as Independent Contractors

From PennRecord:
A man employed as a drilling fluid engineer for an oil and natural gas company alleges that he was not paid for overtime work. 
Burton Williford filed a complaint on behalf of herself and all others similarly situated on July 18 in the U.S. District Court for the Western District of Pennsylvania, Pittsburgh Division against Rice Energy Inc. alleging violation of the Fair Labor Standards Act.

According to the complaint, the plaintiff alleges that he was improperly classified as an independent contractor and was not paid any overtime compensation during his employment from June 2014 to April. The plaintiff holds Rice Energy Inc. responsible because the defendant allegedly refused to pay overtime wages to the plaintiff despite working more than 40 hours per week and instead only paid a day rate. 
The plaintiff requests a trial by jury and seeks unpaid back wages, liquidated damages, interest, court costs and any further relief the court grants. He is represented by Joshua P. Geist of Goodrich & Geist PC in Pittsburgh.
Click here to read the whole article.

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Frackers Trying to Use Less Sand as Prices Rise

From Reuters:
U.S. shale oil companies are pulling back on the amount of sand they use to hydraulically fracture new wells, responding to rising prices of the material that are driving up costs. 
Investors worry a slowdown in sand use, combined with new mining capacity coming online, could lead to a glut of the material and bring down prices. The worries have pressured shares of sand companies. 
Sand prices soared in the last year as oil companies ramped up shale drilling and production. 
But with crude LCoC1CLC1 prices below where they started the year, oil producers are employing new well designs and chemical agents that lessen the use of sand that represents around 12 percent of the cost of drilling and fracturing. 
The price of frack sand is expected to rise 62 percent this year to average $47 a ton, according to researcher IHS Markit. That is expected to drive oilfield service price inflation to 15 percent over 2016, according to researchers at Wood Mackenzie.
Click here to read more.

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Lawmakers Get First-Hand Look at Natural Gas Lifecycles’ Impact on Ohio’s Economy

by Jackie Stewart, Energy in Depth

A group of Ohio legislators and their staffs attended a “Natural Gas Lifecycle Tour” last week that illustrated the tremendous positive economic impact Utica Shale development is making across each segment of the Buckeye State’s natural gas industry. Thanks to accommodations by companies like Ascent Resources, MarkWest and Dynegy, the tour included a first-hand look at a well pad, midstream operations and a natural gas power plant, comprehensively illustrating the importance of pipelines for takeaway capacity, the need for end users of natural gas and the significant Utica Shale investment that is creating billions of dollars in economic activity and tax revenue.
House Energy and Natural Resources Committee chairman Al Landis attended the tour and explained to EID the importance of understanding the natural gas lifecycle,
“These tours and informational meetings were very important to the process legislatively because legislators get to go on the site, on the tours hands-on so we can see first-hand what’s going on here in Ohio as far as energy and our gas production. It’s certainly valuable; when we’re in committees we’re talking about issues that concern energy in Ohio. And, so I’ve been here first-hand, met with the folks got to know them, know the operation and I just can’t say enough about it.”
Last week’s tour kicks off a series of events geared at educating the public about how natural gas is quite literally powering Ohio’s economy and providing a tremendous economic windfall. In support of those efforts, Energy In Depth has released a new infographic, “Natural Gas Lifecycle: By The Numbers,” showing that when the upstream, midstream and downstream segments are combined, the statewide investment already made and estimated to come within the next few years — in conjunction with taxes generated from those investments — are simply staggering.
Here’s some of what was seen and talked about on the tour:
Upstream
The tour included a visit to an Ascent Resources well pad, where attendees learned about the new technology and techniques that are helping Utica Shale operators become increasingly efficient. In addition to detailing safety and environmental measures taken during upstream activities, there was also an emphasis on the incredible boon to the economy that continues to occur in areas where production is taking place.
As Cleveland State University recently reported, fracking has directly poured over $39 billion into Ohio’s economy. And a recent EID report found that property taxes paid on production of oil and gas has meant $45.8 million in direct local tax payments, with another $250 million slated over the next 10 years. Additionally, six out of the 10 highest income growth counties in Ohio are squarely located in the heart of Utica Shale production, which is not a coincidence.
Here is a breakdown of those numbers:
Newly elected Ohio Sen. Frank Hoagland was one of the legislators touring the site. According to Sen. Hoagland,
“People don’t understand how much work is involved with gas and oil, how important it is to not only us as a local community, but on a national level and to the future of the global society. I believe we are extremely fortunate in this area, to have this opportunity.”
Here’s a quick video of his remarks after touring the well pad and learning about Ascent Resource’s operations:

ODNR Issues Latest Utica Shale Permitting Report; Rig Count Climbs


New permits issued last week: 6  (Previous week: 6+-0
Total horizontal permits issued: 2579  (Previous week: 2572+7
Total horizontal wells drilled: 2090  (Previous week: 2076+14
Total horizontal wells producing: 1615  (Previous week: 1613+2
Utica rig count: 28  (Previous week: 21)  +7

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The Energy Report: The Bear Market in Oil Continues

Source: Jack Chan for Streetwise Reports   08/20/2017

Technical analyst Jack Chan charts the latest moves in the multiyear bear market in oil and gas.


Our proprietary cycle indicator is down.

chanosx8-20

$OSX is on a major sell signal.

chanosx28-20

The trend remains down.

Summary

The energy sector is on a major sell signal. The trend is down; the cycle is down. The multiyear bear market continues. We closed out our long-term positions early this year and that will remain the case until conditions improve.

Jack Chan is the editor of simply profits at www.simplyprofits.org, established in 2006. Chan bought his first mining stock, Hoko Exploration, in 1979, and has been active in the markets for the past 37 years. Technical analysis has helped him filter out the noise and focus on the when, and leave the why to the fundamental analysts. His proprietary trading models have enabled him to identify the NASDAQ top in 2000, the new gold bull market in 2001, the stock market top in 2007, and the U.S. dollar bottom in 2011.

Want to read more Energy Report articles like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see a list of recent articles with industry analysts and commentators, visit our Streetwise Articles page.

Disclosure:
1) Statements and opinions expressed are the opinions of Jack Chan and not of Streetwise Reports or its officers. Jack Chan is wholly responsible for the validity of the statements. Streetwise Reports was not involved in any aspect of the article preparation or editing so the author could speak independently about the sector. The author was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
2) Jack Chan: We do not offer predictions or forecasts for the markets. What you see here is our simple trading model, which provides us the signals and set-ups to be either long, short, or in cash at any given time. Entry points and stops are provided in real time to subscribers, therefore, this update may not reflect our current positions in the markets. Trade at your own discretion. We also provide coverage to the major indexes and oil sector.
3) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
4) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their families are prohibited from making purchases and/or sales of those securities in the open market or otherwise during the up-to-four-week interval from the time of the interview until after it publishes.
Charts courtesy of Jack Chan


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Monday, August 28, 2017

New Study Shows Business is Booming for Skilled Trades, Thanks to Pipelines

by Nicole Jacobs, Energy in Depth

The Oil and Gas Industry Labor-Management Committee, led by the American Petroleum Institute (API) and North America’s Building Trades Unions, released a report this week showing the tremendous amount of work the pipeline industry provided to skilled trades unions from 2006 to 2015. Now that the Federal Energy Regulatory Commission (FERC) officially has a quorum to approve $13 billion worth of projects – equating to 23,000 construction jobs – that have been in limbo while FERC awaited confirmation of new commissioners, this trend of growth and opportunity for local unions should continue in 2017 and 2018. As Jack Gerard, API president and CEO, said in a statement,
 “As the new study confirms, building new pipelines will create thousands of jobs for America’s skilled craft professionals across all 50 states. These are good-paying, middle class-sustaining jobs that do not rely on taxpayer dollars.
“By delivering affordable, reliable energy to homes and businesses, energy infrastructure will continue to generate economic benefits for decades – making it an especially valuable long-term investment.”
Compiling information from Industrial Information Resources, LLC, the Bureaus of Census and Labor and the skilled trade unions – including United Association (UA), International Union of Operating Engineers (IUOE), Laborers International Union of North America (LIUNA), and International Brotherhood of Teamsters’ Building Materials and Construction Trades Division (IBT) – the report found that during this time period pipeline construction created around 41,700 full-time equivalent (FTE) jobs annually for union members, amounting to $2.3 billion in wages per year.
Further, annual investments in new pipelines or additions and reconstructing of existing pipelines ranged from $6 billion to $28 billion Total construction costs alone reached a milestone $14 billion in 2016. And all of this investment creates more employment opportunities.
 
From the study:
“Industrial Info Research, LLC estimates the investment value of major pipelines constructed during 2008-2015 averaged $8.8 billion dollars per year, or $79.0 billion for the entire periodActivity was heavily weighted toward southwestern states (Oklahoma, Texas); together they  comprised 39% of the overall total for the 29 states included in the sample. The Great Lakes (Illinois, Indiana, Michigan, Ohio, Wisconsin) account for 19% of activity, the Northeast (New York, New Jersey, Pennsylvania) follow with 15%, while the Midwest (Iowa, Minnesota, North Dakota, South Dakota) comprised 9% of the 7,547 plumbers, 5,408 operators, 24,765 laborers, and 4,006 teamsters for a U.S. total of twenty-nine state total.”
The importance of energy infrastructure like pipelines cannot be understated, as Ohio Laborers Training Center executive director Robert Chatterson recently stated,
“The distribution work in gas pipelines is a 25-year project. Conceivably a young person can go into distribution work and work their whole career and retire with a great pension.”
A U.S. Chamber report from earlier this year also found that if pipelines are not built in the Northeastern states of Pennsylvania, New York, New Jersey, Ohio and West Virginia, it would mean nearly 78,400 jobs lost by 2020, more than $4.4 billion in labor income off the table and the loss of a whopping nearly $7.6 billion in GDP, in addition to higher electricity and heating costs.
In Ohio alone, the Ohio Laborers District Council (OLDC) recently reported that it had 4.2 million work hours over a 16-month period from January 2016 to April 2017, surpassing 2016 expectations by more than a million work hours. Achieving that level of work wouldn’t have been possible without pipeline infrastructure projects.
In fact, research from Energy In Depth earlier this month, showed that five Ohio pipeline projects – totaling 1,241 miles – will create over 26,000 jobs, generate over $1.2 billion in local tax revenues during the first five years the lines are in operation, and move 7.65 billion cubic feet(Bcf) of natural gas daily.
As this latest API report and accounts from local unions have shown, the oil and gas industry is creating jobs – and they aren’t just on the well pad. Construction of pipelines, natural gas-fired power plants, petrochemical facilities and other midstream and downstream investments are creating opportunities for employment and economic development.

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Tuesday, August 22, 2017

Availability is Limited This Week

Our availability for sharing new posts this week as limited, as I am tied up with some special training courses.  I will try to share a few posts later in the week to get caught up on some of the news that we are missing.

I apologize for the inconvenience.  We'll be back to our regular schedule next week!

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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..."

Cleveland.com:  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.
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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.
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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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Antero Resources Continuing Utica Shale Development

From Seeking Alpha's transcript of Antero Resources' second quarter earnings call:
Holly Stewart 
Okay and then maybe, final one for me. Since you hit on Rover, the delays. I know you guys have kind of shifted some activity back to the Utica in preparation for that project coming online has this delay impacted any thoughts on kind of the development schedule? 
Paul Rady 
Not really, those Utica wells and pads are being drilled down, so we're timing the completion to dovetail with Rover Phase 1 as it arrives at Seneca, our latest estimate and obviously we're in contact with both energy transfer on the Rover project as well as with regulatory people on the other side and do see that the project is moving forward. We expect Rover Phase 1 to get to Seneca in September, October and so we'll time the completion of our pads there in the Utica to that. And then we would expect Rover Phase 2, it's probably a month or two behind that. So we're thinking October, November for Phase 2 to come to sure would, that certainly will have plenty of production that will be moving through Phase 2 Rover, when it arrives in the third and fourth quarters.
Read the whole transcript by clicking here. 

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ETP Suggests Possibility That Diesel Fuel in Spilled Drilling Mud May Have Been Sabotage

From Reuters:
Energy Transfer Partners LP said on Friday sabotage or an accident might have caused diesel to get into drilling fluid that spilled into an Ohio wetland during construction of its Rover natural gas pipeline, but opponents of the project disagreed with the sabotage theory. 
U.S. energy regulators banned ETP from new horizontal directional drilling in May until the company explains how diesel, prohibited under its permit, got into 2 million gallons of drilling fluid that spilled into the Tuscarawas River wetland. 
Environmental agencies are probing whether ETP's contractor may have used diesel to lubricate the drill to make it easier to cut through rock when crossing large obstacles like highways and rivers. 
ETP said it did not believe the contractor used diesel. 
"Rover theorizes that these diesel concentrations could have been caused by an inadvertent and unreported spill or leak from equipment operating during the clean-up, or it could have been the deliberate or malicious act of individuals opposed to the project," the company told FERC in a filing Friday, noting the data was inconclusive.
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Wednesday, August 9, 2017

ODNR Releases August 2017 Utica and Marcellus Shale Activity Maps




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Rig Count Drops in Utica; Number of Producing Wells Increases by 23


New permits issued last week: 6  (Previous week: 24-18
Total horizontal permits issued: 2572  (Previous week: 2566+6
Total horizontal wells drilled: 2076  (Previous week: 2063+13
Total horizontal wells producing: 1613  (Previous week: 1590+23
Utica rig count: 21  (Previous week: 27)  -6

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