Tuesday, August 27, 2019

Utica Rig Count Climbs; Over 2,260 Wells Now Producing

WEEK ENDING 08/24/19

New permits issued last week: 8 (Previous week: 9)  -1
Total horizontal permits issued: 3148 (Previous week: 3141 +7
Total horizontal wells drilled: 2678 (Previous week: 2670)  +8
Total horizontal wells producing: 2262 (Previous week: 2246)  +16
Utica rig count: 16 (Previous week: 14)  +2

Thursday, August 22, 2019

National Assocation of Royalty Owners is Forming an Ohio Chapter

From The Times Leader:
A new land and royalty owners’ group that is part of the National Association of Royalty Owners is forming an Ohio chapter.

The National Association of Royalty Owners, or NARO, is nationwide organization that encourages and promotes exploration and production of minerals in the United States while preserving, protecting, advancing and representing the interests and rights of mineral and royalty owners. 
Over the past year, a group of Ohio mineral owners has been laying the groundwork to establish an Ohio chapter with the national office. The Ohio chapter grew out of the NARO Appalachia Chapter in order to better focus on land and mineral owner issues in Ohio. 
On Monday, the board signed paperwork to formally apply for tax-exempt status as a state and federally recognized 501(c)6 nonprofit organization. A variety of backgrounds and professions make up a board of directors leading the organization.
Continue reading this article by clicking here. 

Group Pushing for Referendum on Ohio Nuclear Bailout Prepares Revised Petition

From The Columbus Dispatch:
A group that wants voters to decide whether Ohio should bail out nuclear-power plants has submitted new summary petition language to the state after Attorney General Dave Yost rejected its initial petition Monday. 
Ohioans Against Corporate Bailouts provided the second summary petition along with 2,246 signatures to Yost and Ohio Secretary of State Frank LaRose on Friday. In rejecting the original language, Yost said the summary was not “fair and truthful” as Ohio law requires, pointing out what he said were 21 inaccuracies and omissions. 
The group wants voters to decide whether to overturn the new state law that would force electricity ratepayers to subsidize two of Akron-based FirstEnergy Solutions nuclear power plants. 
If the petition clears Yost’s office, it then would go to LaRose’s office. If approved there, the group would need to gather signatures from 265,774 registered voters from at least 44 of Ohio’s 88 counties by Oct. 21, 2019, to make the November 2020 ballot.
The whole article can be viewed by clicking right here. 

Senator Portman Completes Tour of Southern Ohio with Visit to Encino Rig

From The Times Leader:
U.S. Sen. Rob Portman continued a three-day tour of southern Ohio on Friday by visiting an Encino Energy natural gas drilling rig in Bowerston.

His JOBS Act and Workforce Tour spanned over 750 miles across 12 counties. Portman, R-Ohio, is addressing a skills gap by authoring the JOBS Act, bipartisan legislation that aims to make high-quality and rigorous short-term job training programs more affordable by expanding access to Pell Grants for low-income students. President Donald Trump included the JOBS Act in his Fiscal 2020 budget request, and Portman is working to include the measure in broader legislation to reauthorize the Higher Education Act this year. 
The stop in Bowerston occurred on the third day of the tour and was the only well site the senator visited. The tour was meant to highlight workforce development, tax reform, energy production, agriculture and how small Ohio businesses are helping secure the borders. 
Prior to the senator’s stop at the well pad, he visited Eastern Gateway Community College in Steubenville.
Click here to continue reading. 

Permitting Pace Picks Up in Utica Shale as Rig Count Holds at 14

WEEK ENDING 08/17/19

New permits issued last week: 9 (Previous week: 3)  +6
Total horizontal permits issued: 3141 (Previous week: 3132 +9
Total horizontal wells drilled: 2670 (Previous week: 2664)  +6
Total horizontal wells producing: 2246 (Previous week: 2240)  +6
Utica rig count: 14 (Previous week: 14+-0

Nuclear Bailout Prompts Cancellation of $1.1 Billion Power Plant Project

From The Business Journal:
Clean Energy Future Inc. has pulled its plan to construct a third $1.1 billion combined-cycle energy plant in the village, the company announced today. 
Clean Energy President and CEO Bill Siderewicz said in a statement that the company pulled out of building a yet-to-be-named energy center because the Ohio General Assembly passed House Bill 6, which provided subsidies to the nuclear power industry. It was signed into law by Gov. Mike DeWine in July. 
“There’s sheer disappointment that this is a project we know should be built and there’s demand. But because of artificial legislation efforts, we’re basically going nowhere,” he said in a phone interview. “We’ll take all our information, including our filings with the EPA and PJM, into cardboard boxes.”

Siderewicz said Clean Energy has already spent about $1 million on preparation and permitting. The full statement is available here. Clean Energy Future developed the Lordstown Energy Center and is assembling investors for a second site, Trumbull Energy Center. 
“We’re talking with investors and lenders right now. It’ll be about a $900 million project. The question is what is going on in Ohio,” he said. “In that process, we should probably have completed by this time already, but there’s hesitation to invest in Ohio because they keep changing the rules of engagement.”
He added that plans still call for ground to be broken on Trumbull Energy Center later this year. 
Siderewicz said the costs to the Mahoning Valley are several fold, including the loss of 1,100 temporary construction jobs, $1.1 billion in new investment, $150 million in water purchases from Youngstown, $300 million in local property taxes, and $29 billion of economic benefit to the Mahoning Valley over 50 years.
Read on by clicking here. 

Monday, August 19, 2019

Princeton Study Finds That Over 75% of Leaked Methane Comes From 10% of Gas Wells

From Princeton University:
Wells that extract natural gas from underground often leak large amounts of methane, a powerful greenhouse gas, into the air. A team of Princeton University researchers has found that, in one of the biggest gas-producing regions, most of these emissions come from a tiny subset of the wells, a finding with major implications for how to control the problem.

Researchers led by Mark Zondlo, an associate professor of civil and environmental engineering, spent two years sampling emissions from the Marcellus Shale, a basin that stretches from West Virginia into New York State. In research published in the journal Environmental Science and Technology, the authors reported that 10% of wells account for more than three quarters of gas leaked into the atmosphere as a byproduct of extraction. That has the equivalent greenhouse gas effect of adding 500,000 cars, or about 2% of the U.S. auto market, to the road. 
This finding, however, may have a silver lining for mitigating impacts on the environment, Zondlo said, because fixing a relatively small number of these “superemitting” wells could lead to a major reduction in emissions. He cautioned that identifying the leakiest wells is not always easy, in part because well emissions can change over time.
Read on by clicking here. 

Cornell Professor/Anti-Drilling Activist Releases Another Anti-Drilling Study

From the Houston Chronicle:
Rising levels of the potent greenhouse gas methane in the atmosphere have been linked to emissions from the shale oil and natural gas industry, a new study from Cornell University reveals. 
In a study published this morning in the European Geosciences Union journal Biogeosciences, Cornell University Ecology Professor Robert Howarth reported that an analysis of the methane found in the Earth's atmosphere has chemical fingerprints that point to shale, an industry which uses horizontal drilling and hydraulic fracturing to unlock oil and natural gas in tight geological formations. 
A single methane molecule is made from one carbon atom at the center and four hydrogen atoms in orbit. But the study reveals that a rapidly growing amount of methane in the atmosphere is made from the carbon-13 atom, a type of carbon found in natural gas extracted from shale formations.
Click here to continue reading. 

Energy in Depth quickly responded to this study as well:

A new Park Foundation-funded methane study is generating lots of anti-fracking headlines, despite its conclusions being at odds with the bulk of the scientific community. Cornell University professor and Food and Water Watch board member, Bob Howarth, is back and this time he claims that oil and natural gas emissions are the primary cause of recent global methane spikes – a theory that many climate and atmospheric scientists have rejected. 
Howarth’s conclusions were called “far-reaching” and “premature by one of the anonymous experts tasked by Biogeosciences to review the research prior to publication, who explained: 
The advice to move as quickly as possible away from natural gas based on this study does not appear sufficiently conclusive…” 
The research, which Howarth stressed multiple times during the journal’s review process is “in the ‘Ideas & Perspectives’ category and is not a traditional research paper,” also met a healthy dose of skepticism from the scientific community. As Newsweek reports: 
“Quentin Fisher, professor of petroleum geoengineering at the U.K.’s University of Leeds, said he was ‘deeply skeptical’ about the study. ’The results are extremely sensitive to highly questionable assumptions regarding the isotopic composition of methane found in shale. The arguments made by previous studies that increase in methane in the atmosphere is from biogenic sources, such as release from wetlands and agriculture or burning of biomass, seem far more convincing.’” (emphasis added) 
Fisher’s criticism is likely the first of many if Howarth’s previous research track record of rejections is any indicator. EID has the four key facts to keep in mind when reading the study’s media coverage on EIDClimate.org.

President Trump Visits Ethane Cracker Plant in Pennsylvania

From the Pittsburgh Business Times:
President Donald Trump arrived Tuesday to get his first look at the massive construction site in Beaver County where Royal Dutch Shell is building a $6 billion petrochemical plant. 
Trump arrived in Pittsburgh in the early afternoon and traveled to Potter Township, where he spoke before thousands of workers and employees, as well as local and state leaders. He also briefly toured the site, which has been transformed by Shell over the past several years and will become operational sometime early next decade. 
In a speech that lasted more than an hour and sometimes sounded more like a campaign stop than a presidential visit, Trump honored the thousands of workers who are building the plant and said this, and other manufacturing and energy projects, wouldn't have been able to be built without the support and help of the Trump administration. 
"This would have never happened without me or us," Trump said. 
Trump touched on a number of topics, including the need for energy-friendly and manufacturing-related policies. He said that his aim was beyond energy independence from foreign supply.
The whole article can be read by clicking right here. 

Can Shale Come Back from the Brink?

From Oilprice.com:
A flurry of coverage about the gloom and outright calamity in the shale oil business appeared last week. Low prices continue to dog the industry. But so does lack of investor interest in financing loss-making operations for yet another season. Plunging stock prices portend more bankruptcies if circumstances don't change. 
I received considerable pushback last January when I asked whether U.S. shale oil had entered a death spiral. The almost constant refrain of the cheerleaders for the shale oil industry has been that increasing production demonstrates there is something wrong with my analysis and that of others who have been skeptical of the industry's claims.

We skeptics have certainly been wrong about how long the boom could go on. We could not fathom why investors kept funneling capital into businesses that were consistently consuming it with no hope of ever providing a long-term return
I can remember when Alan Greenspan, the former U.S. Federal Reserve Bank chair, opined in December 1996 about "irrational exuberance" in the U.S. stock market. His speech turned out to be only an inflection point for the technology sector boom. The tech-heavy NASDAQ stock exchange rose 288 percent between the day Greenspan spoke and the index's peak in March 2000. 
In the subsequent bust the bankruptcy courts were littered with companies that had never made dime.
Click here to read more. 

U.S. Natural Gas Demand is Hitting New Highs, But Price Keeps Dropping

From Reuters:
U.S. gas futures this week collapsed to a three-year low, while spot prices were on track to post their weakest summer in over 20 years. In other markets, such lackluster pricing would cause investment to retrench and supply to contract. 
But gas production is at a record high and expected to keep growing. Demand is rising as power generators shut coal plants and burn more gas for electricity and as rapidly expanding liquefied natural gas (LNG) terminals turn more of the fuel into super-cooled liquid for export. 
Analysts believe the natural gas market is not trading on demand fundamentals because supply growth continues to far outpace rising consumption. Energy firms are pulling record amounts of oil from shale formations and with that oil comes associated gas that needs either to be shipped or burned off. 
On the New York Mercantile Exchange, gas futures NGc1 this week dropped to $2.03 per million British thermal units (mmBtu), the lowest since May 2016. For the summer, spot gas prices at the Henry Hub NG-W-HH-SNL benchmark in Louisiana were on track to fall to their lowest since 1998.
Read more by clicking here. 

Dimock Landowner at the Center of Cabot Lawsuit Says He Was Used by Activists, Lawyers

From the Susquehanna Independent:
Last week’s ruling by a Susquehanna County judge in the case of the Dimock Twp. man once identified as the voice and face of the anti-fracking movement has helped narrow the focus of the breach of contract lawsuit energy giant Cabot Gas filed against him two years ago. 
In 2017, Cabot Oil & Gas Corp., of Houston, Texas, sued Raymond Kemble, of Dimock Twp., for bad mouthing the company in violation of an agreement he signed as part of a settlement in an earlier lawsuit against Cabot for polluting his property. 
In its lawsuit against Kemble, Cabot alleged that Missouri-based lawyer Charles Speer teamed up with Pennsylvania attorneys Clancy Boylan and Edward Ciaramboli in 2012 to commence nuisance claims against natural gas operators in Pennsylvania. Cabot sued Kemble after the attorneys’ lawsuit was dismissed as frivolous earlier that year. 
But as a result of a ruling by President Judge Jason Legg last week, those attorneys may not now use the traditional attorney client privilege to avoid answering questions about their representation of Kemble, normally an area off-limits to inquiry. 
Legg issued a similar ruling towards what is known as the work product privilege, writing “the work product privilege does not apply to this litigation as the underlying question becomes the knowledge and state of mind of the attorney defendants in connection with the filing of the 2017 litigation.” 
The content of their advice, conversations and research with Kemble could be crucial to Cabot’s lawsuit as Kemble has denied knowing of, or consenting to the filing of that lawsuit.
The rest of this article can be read by clicking right here. 

Columnist Calls Out Democratic Presidential Candidates for Anti-Drilling Rhetoric

From the Pittsburgh Business Times:
Last week’s second round of debates among the Democratic candidates for president yielded plenty of fodder for weekend cocktail conversation. 
But I can’t help but worry about the rhetoric from many of the candidates about energy, and the potential impacts of normalizing the vilification of the innovative, hard-working and conscientious people in the fossil fuel industry. It does not serve the good of our nation nor that of our region. 
If you didn’t catch it, Sen. Bernie Sanders exhibited his disdain for fossil fuels, saying, “we have got to be super aggressive if we love our children and if we want to leave them a planet that is healthy and is habitable. What that means is we got to take on the fossil fuel industry,” and, “what do you do with an industry that knowingly, for billions of dollars in short-term profits, is destroying this planet? I say that is criminal activity.” 
Should we assume he believes that those of us in the fossil fuel industry don’t love our children? And we don’t want a healthy planet? It shouldn’t be good politics to alienate millions of American families. 
But more chilling is the accusation that the work of an entire industry is “criminal activity.” The fossil fuel workforce is today’s target, but what is stopping tomorrow’s from being the entirety of the medical, banking or higher education industries? It can’t become acceptable for any politician to criminalize an entire sector of our economy, especially a highly regulated one and one that currently allows the majority of the population to affordably stay warm in winter, cool in summer, cook their food, drive to work and enjoy so many other basic life necessities.
Click here to continue reading. 

Federal Court Allows Landowners Bilked Out of Royalties to Continue with Lawsuit

From Law360:
The Sixth Circuit affirmed class certification Thursday for landowners claiming Total E&P USA Inc. and Chesapeake Exploration LLC withheld payments from thousands of royalty owners, saying differences among the natural gas and oil wells did not overly complicate the common question of whether the company made improper payment deductions. 
A three-member panel ruled that the question of whether Total and Chesapeake improperly paid royalties after deducting costs associated with processing the gas so it could be sold on the market was common among the landowners. As such, a lower court properly determined that the language of each lease and when the gas could be deemed marketable was a common question at the heart of determining liability, the panel said. 
“The case will turn on whether the lease language is deemed to invoke the at-the-well rule, the marketable-product rule, or a different valuation system entirely. This question will have a common answer that turns on the court’s interpretation of the lease language under Ohio law,” U.S. Circuit Judge Ronald Lee Gilman wrote in the published opinion. 
Chesapeake told the appeals court in January that its practice of calculating royalties known as the “netback” method, which allows gas companies to deduct fees they pay to lessors when a contract sets the value “at the well,” does not violate the leases and that the lessors can’t establish liability without individual inquiries into Chesapeake’s use of the method. An Ohio federal judge recently determined that Ohio law follows the “netback” method.
Continue reading by clicking here. 

August Well Activity Maps Released by ODNR

Permitting at a Crawl, Rig Count Declining in Utica Shale

WEEK ENDING 08/03/19

New permits issued last week: 0 (Previous week: 1)  -1
Total horizontal permits issued: 3129 (Previous week: 3129 +-0
Total horizontal wells drilled: 2662 (Previous week: 2654)  +8
Total horizontal wells producing: 2238 (Previous week: 2238)  +-0
Utica rig count: 15 (Previous week: 17)  -2

WEEK ENDING 08/10/19

New permits issued last week: 3 (Previous week: 0)  +3
Total horizontal permits issued: 3132 (Previous week: 3129 +3
Total horizontal wells drilled: 2664 (Previous week: 2662)  +2
Total horizontal wells producing: 2240 (Previous week: 2238)  +2
Utica rig count: 14 (Previous week: 15)  -1

Friday, August 16, 2019

Ohio AG Kills Off Referendum to Overturn Nuclear Bailout

From Cleveland.com:
A group seeking a statewide referendum to overturn Ohio’s new nuclear-power bailout law will have to restart their efforts, as Ohio Attorney General Dave Yost on Monday rejected their proposed ballot summary. 
Yost, a Columbus-area Republican, wrote in a rejection letter to the group Ohioans Against Corporate Bailout that he found 21 errors with the group’s proposed summary language – a succinct explanation of the proposal provided to voters asked to sign a petition supporting the measure. 
The errors he cited range from inaccurate definitions of terms such as “electric distribution utility” and “operation risks” to misstating the size of energy projects that are eligible for a property tax exemption. (The proposed summary states that projects generating less than 20 megawatts are eligible, while the new law states the tax exemption is for projects greater than 20 megawatts.) 
The proposed summary, Yost asserted, also misstates the powers given by the new law to the Public Utilities Commission of Ohio and the newly created Ohio Air Quality Development Authority, the latter of which will oversee the distribution of $150 million per year (raised from a new $1 surcharge on every Ohio ratepayer’s bill) to Ohio’s Davis-Besse and Perry nuclear plants, both of which are owned by FirstEnergy Solutions, a subsidiary of FirstEnergy Corp. that is in bankruptcy proceedings as part of an attempt to become a separate company.
Click here if you'd like to read the whole article. 

Tuesday, August 6, 2019

Investigators Seeking to Determine Cause of Large Pipeline Explosion in Kentucky

From WKU Public Radio:
Federal investigators have taken over the site of Thursday’s natural gas pipeline explosion that killed one person and left five injured south of Danville. 
The blast ejected 30 feet of pipeline into the air, scorched railroad tracks and burned mobile homes, forcing the evacuation of about 75 people after midnight on Thursday morning. Firefighters battled the 300-foot blaze for hours before extinguishing it. 
Investigators with the National Transportation Safety Board took over the scene Thursday and will begin looking for a cause. 
“Our mission is to understand not just what happened, but why it happened and to recommend changes to prevent it from reoccurring again,” said Mike Hiller, NTSB senior accident investigator on Friday. 
The Lincoln County Coroner has identified the deceased woman as Lisa Denise Derringer, 58, of Stanford. Hiller said residents will likely be able to return to the site to gather their belongings on Saturday.
Click here to read more.