Showing posts from June, 2017

06/29/17 Links of the Day: Rover Asks FERC to Approve Drilling; New Ohio Injection Wells Approved; And More!

Gas & Oil:   Record Keeping Essential to Prove Lack Of Production in Paying Quantities   -    "Oil and gas leases typically include language indicating that the lease will remain in effect so long as the leased property continues to produce oil and gas in paying quantities. Ohio courts have long held that a well is producing in paying quantities if the revenues from the well exceed the expenses involved in maintaining the well. Unless production from the leased property has ceased..." Ashland Times-Gazette:   Rover Pipeline Fine Will Be Used for Work at Ashland County Courthouse   -    "Ashland County should be receiving its $50,000 payment this week as part of a settlement with one of the companies building a natural gas pipeline across Ohio. During a departmental update Thursday, building maintenance supervisor Dennis Harris told Ashland County commissioners the check was mailed Monday from Houston-based Energy Transfer Partners. The company is building the $4.

API Releases 50-State Analysis of Natural Gas Benefits

WASHINGTON, D.C., June 27, 2017 – API today released a new study on the benefits natural gas brings to the nation in terms of consumer savings, family-sustaining jobs and economic growth. The study shows that all 50 states benefit from natural gas produced domestically, including non-producing states. “From power generation for homes and businesses that benefit from affordable and reliable electricity, to the industry’s skilled workforce that produces natural gas, to pipelines and the workers who build them, the advantages of natural gas are wide-ranging,” said API President and CEO Jack Gerard. “With energy week in full swing, this study is another example of the job and consumer benefits of natural gas across the country.”  The study by ICF International examined the economic benefits and opportunities from the entire natural gas value chain, including the production of natural gas, its transportation and end uses like power generation and manufacturing. Key findings in

Stanford Geophysicist Debates Fracking with Anti-Drilling Activists

From Forbes: The benefits of fracking far outweigh its costs not only economically, but environmentally, a Stanford University geophysicist said Friday.  After teaching geophysics at Stanford for 30 years Mark Zoback took the helm of Stanford's new Natural Gas Initiative three years ago, he said, because of gas's environmental benefits.  "We did it because there were so many important and obvious environmental benefits to the utilization of natural gas," Zoback said. "So it’s somewhat ironic to be asked to argue for the notion that these benefits outweigh the environmental costs, when it’s the environmental benefits that got me into this business in the first place."  Zoback's remarks opened the annual debate at Stanford's Silicon Valley Energy Summit, and were swiftly challenged by representatives of the Sierra Club and the Natural Resources Defense Council. Click here to read more of that article. View the whole debate below. Conn

Bloomberg Chronicles the Rover Pipeline Construction Struggles

From Bloomberg: Energy Transfer Partners LP is making a mess of its biggest project since the Dakota Access pipeline.  Construction of the $4.2 billion Rover natural gas line has caused seven industrial spills, polluted fragile Ohio wetlands and angered local farmers. The company owes $1.5 million in restitution after demolishing an historic house. The Ohio Environmental Protection Agency is furious and a federal energy regulator has launched a rare public investigation that threatens to delay the pipeline’s scheduled Nov. 1 completion.  “We’ve not seen a project in Ohio with spills at this size and scale, and if we can’t even trust Rover to construct this pipeline, how can we trust them to operate it when it’s complete?” said Heather Taylor-Miesle, executive director of the Ohio Environmental Council.  Energy Transfer, the Dallas-based company led by billionaire Kelcy Warren, promised part of the 713-mile (1,147-kilometer) pipeline would open in July, but work is stalled on

DOE to Invest $20 Million in New Oil and Gas Research Projects

The U.S. Department of Energy (DOE) today announced the availability of $20 million for cost-shared oil and gas research projects to increase recovery efficiency from unconventional oil and gas wells and to prevent offshore spills and leaks. This new funding opportunity seeks projects that will advance DOE’s objective to support a more environmentally responsible, secure, and resilient U.S. energy infrastructure, while enhancing economic competitiveness and national security. “This oil and gas research funding opportunity underscores the Department’s commitment to developing all of the nation’s energy resources,” said Acting Assistant Secretary for Fossil Energy Doug Hollett. “Increased efficiency and reliability of preventative and recovery measures promote our energy security, and contribute to making the United States energy dominant.” Projects under this funding opportunity will support the Office of Fossil Energy’s efforts to ensure environmentally sustainable domestic and gl

Chemical Plants Helping to Revive Youngstown Manufacturing Industry

From ValueWalk: Youngstown seems like the heart of the rust belt, a former steel town with a strong union presence that saw massive job losses after changing economic conditions forced the closure of manufacturing plants in the 1970s. Industry is returning to Youngstown, however–it just looks a little different. Instead of the steel pipes and raw materials the area produced before, manufacturers are instead looking at the area as a perfect location for chemical manufacturing. This, in turn, is boosting hiring in the area.  Royal Dutch Shell is building a $6 billion cracker plant 40 miles south of Youngstown in Monaca, Pa. In addition, PTT Global, a Thai company, is considering a similar scale project in Belmont County. Plants of this scale will create thousands of construction jobs for a two to three year period, and hire a 600 person staff once completed.  These figures don’t include the thousands of jobs necessary to bring the various new plants on line. The Shell cracker pla

Permitting Slow in Utica Shale; Rig Count Holds Steady

New permits issued last week:   3   (Previous week:  6 )  -3 Total horizontal permits issued:  2536   (Previous week:  2533 )  +3 Total horizontal wells drilled:  2032   (Previous week:  2026 )  +6 Total horizontal wells producing:  1584   (Previous week:  1574 )  +10 Utica rig count:  24   (Previous week:  24 )   +-0 Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

Shale Efficiency May Have Hit Its Peak For Now

From Learning takes time and effort. But a good education pays off.  North America’s oil industry has been in school for the past three years, studying how to become more productive in a fragile $50-a-barrel world. Many companies in the class of 2017 have graduated and are now competing hard for a greater share of global barrels. Having said that, North America’s education on how to make oilfields more productive appears to be stalling. After a breathtaking uphill sprint, productivity data from the U.S. Energy Information Agency (EIA) shows that the last few thousand oil wells in top-class American plays may have hit a limit—at least for now. Our Figure this week shows a classic S-curve learning pattern in the mother lode of all oil plays: the Permian Basin. Slow improvements to rig productivity (2012 to 2015) were followed by a steep period of rapid learning (2015 to 2017). Eventually limitations set in and advancement quickly stalled upon mastering new processes (2

Utica Rig Count Drops One on Latest ODNR Report

New permits issued last week:   6   (Previous week:  8 )  -2 Total horizontal permits issued:  2533   (Previous week:  2526 )  +7 Total horizontal wells drilled:  2026   (Previous week:  2018 )  +8 Total horizontal wells producing:  1574   (Previous week:  1575 )  -1 Utica rig count:  24   (Previous week:  25 )   -1 Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

Eclipse Resources Goes Long Again with Third "Super-Lateral" Well

From an Eclipse Resources press release: The Company has recently turned its seven well Moser pad to sales, located in the Company’s Utica Shale dry gas window acreage in eastern Monroe County, Ohio. The Moser pad wells are currently producing approximately 100 MMcf per day collectively as the Company continues to implement its “engineered” flowback procedure designed to bring the wells up to target production rates while preserving fracture conductivity and minimizing formation damage. These wells were completed using a number of new completions techniques, which may form the basis of future completion designs beyond the Company’s “Generation-3” design that resulted in the Company increasing all of its Utica Shale type well expectations over the course of the year.  The Company also announced today that it has successfully drilled its third and newest “Super-Lateral” well, the Outlaw C 11H, with a total measured depth of approximately 27,750 feet and a lateral extension of approxi

EQT to Acquire Rice Energy, Become Largest Gas Producer in U.S.

From the Pittsburgh Post-Gazette: The largest natural gas basin in the U.S. will be home to the largest natural gas producer when two of southwestern Pennsylvania’s biggest oil and gas drillers become one in a $6.7 billion acquisition.  EQT Corp., a Downtown-based firm, is buying Canonsburg-based Rice Energy Inc. in a deal that will put EQT ahead of ExxonMobil in gas production. It will also draw EQT’s focus even more to Washington and Greene counties, where much of Rice’s acreage zigzags EQT’s.  The deal includes all of Rice’s exploration and production assets, as well as its interest in midstream master limited partnerships, which operate natural gas gathering and compression assets and water pipelines.  It’s not clear yet what will happen to Rice’s 500 full-time employees, although layoffs are expected. Click here to read more. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

Ohio Laborers Report More Than 4 Million Work Hours Over 16 Months — Thanks to Shale

by Jackie Stewart, Energy in Depth The  Ohio Laborers District Council  (OLDC) recently reported that it  surpassed  2016 expectations by more than a million work hours and totaled 4.2 million work hours over a 16-month period from January 2016 to April 2017, thanks to the numerous shale-related  pipeline  and  natural gas power plant  projects taking place in the Buckeye state. Today, there are  3,000 Ohio laborers  working on various stages of oil and gas development. And not only has Ohio’s flurry of shale-related activity resulted in thousands of jobs for skilled laborers from the OLDC — which represents a large share of Laborers International Union of North America-member (LiUNA) workers — the laborers are anticipating work for years to come, 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 car

Fallout From Rover Pipeline Spills Includes Construction Delays for Energy Transfer

From TheStreet: After blitzing through Ohio's wetlands, Energy Transfer Equity ( ETE ) is once again facing a problem of its own making: pipeline construction delays. Until recently, the company's subsidiary Energy Transfer Partners ( ETP ) has defied long odds and analyst expectations in its rush to complete its new giant, Rover, a $4 billion, 713-mile natural gas pipeline designed to deliver natural gas from the Marcellus Shale to markets in the northeast. But the storyline shifted in April after the company spilled 2 million gallons of drilling fluid near the Tuscarawas River. Following the spill, the Federal Energy Regulatory Commission halted new horizontal drilling on the project. FERC then opened an investigation into the spill in June after diesel was detected in samples collected from the spill site. The halt in horizontal drilling, a type of drilling that is necessary for the project to be completed, turns into a near-impossibility the longshot bid to complete th

EPA Puts Methane Rule on Hold to Conduct a Review

From The Hill: The Environmental Protection Agency (EPA) has proposed pausing an Obama administration oil and gas pollution rule for two years while it reconsiders the regulation.  EPA officials on Tuesday formally proposed a two-year pause on implementation of the rule, which would limit methane leaks at drilling sites and set standards for equipment and employee certification within the oil and gas drilling sector.  Obama officials finalized the rule last May as part of a federal effort to cut pollution of methane, a greenhouse gas with 25 times the warming potential of carbon dioxide. Drillers contend the rule would be costly and duplicative and have urged Trump administration regulators to reconsider the measure. The EPA, under Administrator Scott Pruitt — who sued against the rule while Oklahoma attorney general — said in April that it would formally review the rule, a lengthy process that could take years to complete. Such a measure is subject to lawsuits as well. Cont

Are Conditions Ripe for Oil and Gas Mergers?

From Forbes: The sell-off of oil and gas exploration and production stocks has been brutal. Exchange-traded funds that specialize in the sector have fallen around 10% to 20% this year, versus an 8% uptick in the market overall. Blame oil prices, which have slid despite members of the Organization of the Petroleum Exporting Countries agreeing last month to keep production cuts in place for another nine months.  In a note last week, analysts at Tudor, Pickering, Holt & Co. said prices of exploration and production stocks sat at 55% of their expected targets versus 58% just a month ago. Raymond James said both the Bollinger Band and Relative Strength Index signals within its proprietary timing model breached oversold levels last week for the first time in five weeks, "indicating a strong potential buy signal."  With stock prices down so much, it might be a good time for the long-term investor to jump in. Could it also be a good time for some corporate mergers?  Ther

Ohio Nuclear Plant Bailout Stumbles in Statehouse

From A proposed bailout for Ohio’s two nuclear power plants that would lead to rate increases for FirstEnergy customers appears to be stalled in the Legislature.  One legislative committee considering the idea suspended testimony last month amid protests against the plan while another committee held its fourth hearing this week without taking a vote.  Much of the written testimony submitted to lawmakers opposes a plan that could lead to $300 million a year in new charges for FirstEnergy customers, The Plain Dealer reports.  FirstEnergy’s average residential customer would pay about $5 more per month, while businesses and factories would see much larger increases if the Legislature approves the bailout.  The Akron-based utility says subsidies are needed to save the Davis-Besse and Perry plants, which sit along Lake Erie and produce 14 percent of the state’s electricity. The company has said the plants might be sold even if subsidies are approved. Click here to co

PA Landowners Continue Fight Over Chesapeake's Underpaid Royalties

From NGI: Hundreds of landowners from Northeast Pennsylvania asked a federal court this month to deny motions filed by Chesapeake Energy Corp., Anadarko Petroleum Corp., Williams Partners LP and other companies to arbitrate their antitrust claims outside of court and dismiss parts of their complaint.  The case, which pits more than 300 landowners in Bradford, Sullivan, Susquehanna and Wyoming counties against the companies, was filed in the U.S. District Court for the Middle District of Pennsylvania roughly a year ago.  It alleges that the companies conspired to "reduce, restrain or eliminate competition for gas and mineral rights, operations rights and gathering serves in multiple counties in Northern Pennsylvania." The "anticompetitive conspiracy," the plaintiffs claim, allowed the defendants to deduct "artificially inflated" post-production costs from royalty payments.  In briefs filed on Wednesday, the plaintiffs said the arbitration agreement

Hamilton County Residents Hurl Accusations, Voice Their Hatred of Duke Energy Pipeline

First, from WCPO 9 : A city leader and county leader have accused Duke Energy of using intimidation tactics to push through a natural gas pipeline.  Cincinnati Councilman P.G. Sittenfeld and Hamilton County Commissioner Todd Portune called Duke a good corporate citizen but said Monday the company's recent behavior was "alarming."  According to Portune, some people reported Duke workers came to their property and asked them to sign away their rights.  A high-pressure pipeline, proposed to run through eastern Hamilton County, is at the center of the controversy. Duke has maintained the new pipeline is essential, and that it would be operated safely. It will replace one that has been in use since the 1950s and is reaching the end of its usable life, according to the company.  The utility giant already operates more than 14,000 miles of natural gas pipelines, including 250 miles of high-pressure pipelines, in Ohio and Kentucky, spokeswoman Sally Thelen said.  But

NEXUS Pipeline Project Ready to Go, Awaiting Federal Approval

From the Canton Repository: The stalled NEXUS Gas Transmission project still could be completed before year’s end, but federal regulators would have to approve the pipeline soon to meet that target.  “We’ve got that race car sitting there revved and all ready to go, we just need that go ahead,” NEXUS President James Grech said Wednesday during the Utica Capital Midstream Seminar at Walsh University.  NEXUS was one of several pipeline projects discussed at the conference hosted by the Canton Regional Chamber of Commerce and  NEXUS is a proposed 36-inch-diameter interstate natural gas pipeline. The $2.1 billion project would cross eastern and northern Stark County and the city of Green in Summit County and carry natural gas from the Utica and Marcellus shales to users in Ohio, Michigan, Canada and other Midwestern markets.  Detroit-based DTE Energy and Spectra Energy, which merged this year with Calgary-based Enbridge, are partners in the project. This a

Agency Instrumental to Shale Boom Slated for Budget Slash by President Trump

From Bloomberg: An agency instrumental to America’s surge in energy production would lose half its funding in President Donald Trump’s proposed federal budget.  The Energy Department’s Office of Fossil Energy, whose research helped push the U.S. closer to self-sufficiency, is slated for a 58 percent cut for next year, to $280 million. The shale innovations the office develops are available to any company that can use them, including industry giants that keep results of their own studies, but they’re most beneficial to independent drillers that might otherwise find it tough to compete with behemoths such as Exxon Mobil Corp. and its $1.06 billion annual research-and-development budget .  “What the federal government, at times, has done very well is they help get experiments run that many companies may not be able to afford on their own, or wouldn’t have the moxie to pull off,” said Greg Leveille, chief technology officer for ConocoPhillips , one of the country’s biggest produce

After Several Defeats, Activists in Youngstown Hope to Rig the Laws in Their Favor

From Business Journal Daily: Opponents of oil and gas activity within the city are adopting new tactics to prohibit the industry, including a new version of the so-called Youngstown Community Bill of Rights, that would deal a blow to one of the city’s key economic development tools.  Having failed to pass the charter amendment six times — most recently last November –this time the activists are circulating petitions to place two amendments on the ballot.  “Citizens are never going to have their voices heard again unless we change the system,” said Lynn Anderson, a longtime opponent of oil and gas activity in the city and who is affiliated with the Community Bill of Rights Committee.  One petition supports a modified version of the earlier bill of rights titled the Youngstown (misspelled as “Younstown”) Drinking Water Protection Bill of Rights. The article later continues: The other petition calls for amending the city charter so it would restrict donors’ ability to make cam

Utica Rig Count Hits Highest Level Since 2015 on Latest ODNR Report

New permits issued last week:   8   (Previous week:  3 )  +10 Total horizontal permits issued:  2526   (Previous week:  2518 )  +8 Total horizontal wells drilled:  2018   (Previous week:  2014 )  +4 Total horizontal wells producing:  1575   (Previous week:  1570 )  +5 Utica rig count:  25   (Previous week:  21 )   +4 Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

Utica Shale Production in the 1st Quarter of 2017: A Closer Look

The Ohio Department of Natural Resources has now released the production data from the Utica shale for the first quarter of 2017. As always, we are going to give you a look at how the numbers compare to past quarters, past years, and how they break down among the various drillers who are active in Ohio and the counties where they are drilling. We also have the top 10 oil and gas wells detailed below. PRODUCTION RATE COMPARISONS First up, let's take a look at how the quarterly data compares from the 1st quarter of 2014 through the first quarter of 2017. As a reminder, all oil figures are 42-gallon barrels, and all gas production is measured in MCF: So, after four consecutive quarters of declining oil production (and six consecutive quarters of oil production rates falling), the first quarter of 2017 saw a quarter-to-quarter rise in total oil production and in oil per day in production as well as oil per well. Gas production was back on the rise as well after there was a

Epic Fail: Anti-Fracking Activists’ Attempt at #NODAPL Copycat Camp Lasts One Weekend

by Jackie Stewart, Energy in Depth Despite the backing of fringe national environmental groups who brought Dakota Access Pipeline organizers to Ohio to protest fracking in the Wayne National Forest, a recent #NODAPL copycat “ long-term resistance camp “ in Monroe County has proven to be nothing more than a decidedly short-term political stunt. The beautiful campsite where the so called “long-term resistance camp” was set to be held this week is absent of one single protestor and is evidence that there is in fact no “long-term resistance camp” whatsoever. This example proves beyond a shadow of a doubt that the recent public relations stunt was in fact hosted, organized and attended by people who do not actually live and work in the area. It also shows the entire fiasco was concocted for the sole purpose of generating misleading headlines to promote a movement that has no real local following. Out of Town And Out of Touch Last month, EID  took a look  at the various #NoDAPL-st

ODNR Releases 1st Quarter 2017 Utica Shale Production Figures

From the Ohio Department of Natural Resources: During the first quarter of 2017, Ohio’s horizontal shale wells produced 3,904,732 barrels of oil and 371,921,659 Mcf (371 billion cubic feet) of natural gas, according the figures released today by the Ohio Department of Natural Resources (ODNR). Natural gas production from the first quarter of 2017 showed an increase over the first quarter of 2016, while oil production was reduced for that same period.   2016 QUARTER 1 (SHALE) 2017 QUARTER 1 (SHALE) PERCENTAGE CHANGE Barrels of oil 5,485,854 3,904,732 (28.82%) Mcf of natural gas 329,537,838 371,921,659 12.86%   The ODNR quarterly report lists 1,613 horizontal shale wells, 1,560 of which reported oil and natural gas production during the quarter. Of the 1,560 reporting oil and natural gas results: The average amount of oil produced was 2,503 barrels. The average amount of natural gas produced was 238,411 Mcf. The average number of first quarter d