The Daily Digger

From Seeking Alpha's transcript of EQT's 3rd-quarter earnings call: Now for the operational update. On October 13, FERC issued the Certificate of Public Convenience and Necessity for the Mountain Valley Pipeline or MVP. The FERC Certificate is a significant step in the regulatory process and keeps us on track to achieve our targeted 2018 in-service date. The MVP team is working hard to secure the remaining federal and state permits and approvals over the coming weeks. We expect to receive the FERC notice to proceed by the end of this year and commence construction soon after. In addition to the progress we've made on the regulatory front, we've also made significant progress on the project management side. We recently awarded contracts for about 80% of the construction work and we expect to have the remaining construction work awarded soon.  Moving on to an update of the HammerHead project. As a reminder, HammerHead is a gathering header pipeline, which will feed ga

by Matt Mandel, Energy in Depth The World Bank released its  October 2017 Commodity Markets Outlook  last week, finding the average U.S. shale breakeven oil price has dropped more than 42 percent since the beginning of 2013, thanks to technological improvements. Advances in technology and drilling techniques such as hydraulic fracturing, coupled with resource rich domestic shale plays, means American producers are continuing to thrive despite lower commodity prices. Of course, technologies such as horizontal drilling and fracking have opened a wealth of oil resources that were previously unreachable just over a decade ago. In the latest data from the U.S. Energy Information Administration (EIA), shale production accounted for  over six million barrels per day  (b/d) in October of this year, up from about 1.5 million b/d at the start of 2010 – a 400 percent increase. In fact, EIA estimates producers will  best the previous total U.S. crude production record  set in 1970 next year

From Reuters: A U.S. District Court in Akron has ruled that Ohio law allows energy companies to deduct fees from payments to royalty holders whose contracts set a value at the well site, settling a widely-followed case involving Chesapeake Energy.  The decision defined for the first time what Ohio law means when it says value of energy in such contracts is established “at the well.” Plaintiffs in the lawsuit had sought class action status and other royalty cases have alleged improper deductions based on the ‘at the well’ language. Ohio has become the sixth largest natural gas producer in the United States because of the discovery in recent decades of shale gas in what has become known as the Utica shale field.  In 2009, Regis Lutz and other royalty holders sued Chesapeake, Columbia Energy Group and NiSource Inc alleging breach of contract and fraud over deductions for services that took place after the fuel left the wells on their properties. Columbia Energy Group and NiSource

From the American Gas Association: The American Gas Association (AGA) said today that natural gas customers nationwide may experience a five percent increase, on average, on their heating bills this winter compared to last year. Following two unseasonably warm winters for much of the country, residential customers are likely to use an average of three percent more natural gas this winter due to colder temperatures, which may result in a moderate increase in overall bills.  Natural gas will continue to be the most affordable option for home heating in the United States.  “Americans may use slightly more natural gas this winter to heat their homes, but due to the excellent energy value provided by natural gas, people are not likely to see a very different bill than what they have seen over the past seven years,” said Chris McGill, vice-president of Energy Analysis and Standards at AGA. “We are entering the third winter heating season following the extreme cold of 2013-2014 which in

From Livingston Daily: State environmental officials cited a pipeline company Friday for releasing gasoline into a wetland near Pinckney. Michigan Department of Environmental Quality received reports from residents Tuesday about the smell of gasoline coming from a site where Energy Transfer's Rover 42-inch natural-gas pipeline crosses wetlands east of Silver Lake near the 11000 block of Cedar Drive in Dexter Township. The multi-state natural-gas pipeline, which is not in operation, will pass through 15 miles of Livingston County, coming from the south through Washtenaw and Lenawee counties.  MDEQ analysts visited the site, noticed the smell of gasoline and collected water samples, Rebecca Taylor of the MDEQ Remediation and Redevelopment Division said Friday. Click here to continue reading. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

From the Record-Courier: A pipeline worker, killed Monday when a natural gas line blew, was thrown into a fence and died instantly, the Stark County Coroner’s Office said. Coroner’s Office Investigator Rick Walters said Wesley J. Johnson, 60, of Wooster, was standing near the pipe while he and another Columbia Gas Transmission worker were completing maintenance at a metering station. The cause of the incident, in the 8500 block of Beth Avenue SW, remains under investigation, line owner TransCanda said. Investigators believe the end cap came off the pipe, spewing natural gas and other materials used in the transmission line. The pressure of the materials threw Johnson backward into the fence, Walters said. An autopsy was conducted Tuesday, with Walters saying beforehand the cause of death was massive trauma to Johnson’s chest. Read more by clicking here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

Much like the predictions from analysts about oil prices, the predictions for whether good times or difficult times are coming for U.S. shale drillers are all over the map.  Here is a sampling of the recent articles discussing various predictions about shale. From Platts: US shale oil production is unlikely to peak before the middle of next decade, but current fracking techniques may be risking the prospect of faster decline rates from tight oil than many are forecasting, a top oil industry event was told this week.  As the US shale industry continues to chase lower breakevens and boost productivity in the wake of the 2014 price downturn, shale players have turned to pumping much larger volumes of sand and water into horizontal wells.  In addition to "bigger fracks", drillers have also increased the density of their fracking stages in a bid to boost the volumes of tight oil drained from each well.  Although the techniques have raised initial flows rates by up to 30

by Jackie Stewart, Energy in Depth The Ohio Environmental Protection Agency (OEPA) hosted a first-of-its-kind oil and gas open house on Tuesday to discuss the importance of communication between regulators and industry, and provide an update on regulatory requirements and legislative changes for horizontal shale well drilling. The Ohio Department of Natural Resources (ODNR) also participated in the open house, as well as the Ohio Oil and Gas Association (OOGA), Ohio Oil and Gas Energy Education Program (OOGEEP) and Energy in Depth (EID). Ohio EPA Director Craig Butler began the open house by stating: “We knew horizontal drilling was likely to be game changer for Ohio. Ohio EPA, ODNR, and ODH were given a directive to keep the public trust and communicate with the industry and we feel we have developed one of the best programs in the country.” Caption: Ohio EPA Director Craig Butler and staff, Ohio Department of Natural Resources staff, Ohio Oil and Gas Energy Education Progra

From NGI: FERC on Friday authorized Rover Pipeline LLC to resume horizontal directional drilling (HDD) at two additional locations where work had been stopped following an April drilling fluids spill near the Tuscarawas River in Ohio.  In a letter Friday, Federal Energy Regulatory Commission staff said Rover has "developed and filed specific measures to address the recommendations" provided by J.D. Hair & Associates , the engineering firm brought in to review the Tuscarawas incident .  Based on a review of site-specific plans, FERC said Rover may resume HDDs at the Black Fork Mohican and Highway 42 crossings.  Momentum continues to build for the 713-mile, 3.25 Bcf/d Rover, which has seen its share of regulatory setbacks since beginning construction earlier this year. After issuing a moratorium in May that halted all new HDDs for the pipeline, FERC has reauthorized 15 since mid-September . Read the whole article by clicking here. Connect with us on Facebook an

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New permits issued last week:   10   (Previous week: 14 )  -4 Total horizontal permits issued:  2657   (Previous week:  2647 )  +10 Total horizontal wells drilled:  2150   (Previous week:  2145 )  +5 Total horizontal wells producing:  1716  (Previous week:  1695 )  +21 Utica rig count:  23  (Previous week:  23 )   +-0 Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

From TribLIVE: The continuing development of the Marcellus shale play, plus the expected retirement of skilled oil and gas tradesmen, will drive the need for STEM workers in Southwestern Pennsylvania into the next decade, a study said.  A steady supply of workers with skills in science, technology, engineering and math (STEM) is needed to offset predicted shortages in skilled labor in the energy and advanced manufacturing industries, the RAND Corp. study said.  The study was an analysis of the first two years of the Appalachia Partnership Initiative formed in 2014 by Chevron Appalachia, the Allegheny Conference and the Claude Worthington Benedum Foundation.  The API's goals are to increase awareness of STEM careers, improve STEM-related education from K-12, and expand workforce development opportunities for people working in STEM fields in 27 counties in Southwestern Pennsylvania, northern West Virginia and eastern Ohio. Read more by clicking here. Connect with us on Fac

New permits issued last week:   14   (Previous week:  4 )  +10 Total horizontal permits issued:  2647   (Previous week:  2638 )  +9 Total horizontal wells drilled:  2145   (Previous week:  2141 )  +4 Total horizontal wells producing:  1695  (Previous week:  1695 )  +-0 Utica rig count:  23  (Previous week:  22 )   +1 Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

by Jackie Stewart, Energy in Depth This week, Ohio laid a stake in the ground as the “ key anchor” to the Appalachian storage hub  — a critical component to support an economic revolution along the Ohio River — during the Utica Shale Summit hosted by the Canton Regional Chamber. The event provided a new perspective on the next phase of Appalachian Basin oil and natural gas development, including storage, infrastructure, and the ultimate end-use of natural gas liquids that has led to a rebirth in plastics manufacturing in the U.S. As a result of the conference, local Ohio papers are  asking , “Could Ohio and nearby states become petrochemical hub?” Thanks to prolific natural gas liquids from the Utica Shale, the  Ohio River Corridor , a new site selection service company, announced it’s hopeful to soon rebrand the “Rust Belt” as the “Plastic Belt.”  So how is Ohio the so-called “key anchor” to this forecasted “Plastic Belt”? Well, as recent  American Chemistry Council  and  West

From the Motley Fool: The Secretary General of OPEC, Mohammed Barkindo, has a message for shale drillers. Speaking at an energy forum in India, he said, "We urge our friends in the shale basins of North America to take this shared responsibility with all the seriousness it deserves, as one of the key lessons learned from the current, unique supply-driven cycle." In other words, start sharing some of the responsibility to help keep excess supply off the market.  His plea comes as U.S. output has staged a remarkable comeback this year and is on pace to break the 1970 record of 9.6 million barrels per day by next year. However, the message will probably fall on deaf ears, since shale drillers aren't beholden to OPEC but shareholders. So the only way for OPEC to get its message across would be to take away the one thing shale drillers need to keep drilling, which is a stable oil price -- that is, unless shareholders persuade them to use their money for something other tha

by Jackie Stewart, Energy in Depth The Community Environmental Legal Defense Fund’s (CELDF) years-long Ohio anti-fracking campaign suffered its greatest blow yet on Friday, as the Ohio Supreme Court  rejected  the group’s appeal of the Mahoning County Board of Elections’ vote not to allow a measure aimed at banning fracking in Youngstown on the ballot for a seventh time. Six previous “Community Bill of Rights” measures had been rejected by Youngstown voters prior to Friday’s Supreme Court decision, which will ensure the measure won’t even appear on the ballot this November. CELDF, which has been the driving force behind a very small group of anti-fracking activists targeting Ohio for years, has basically thrown in everything but the kitchen sink into its efforts to abuse Youngstown voters again this November — including crowdfunding, legal disputes and parachuting an activist in from Colorado to rally the troops. But its efforts have finally hit a wall. Friday’s 4-3 Ohio Supreme C

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

From NGI: FERC issued an order Wednesday clearing Nexus Gas Transmission LLC to start construction, an expected but no less significant step forward for the delayed greenfield natural gas pipeline.  The order came the same day as the competing Rover Pipeline LLC received clearance from the Federal Energy Regulatory Commission to resume work at four horizontal directional drilling (HDD) locations where work had been stopped since May.  Rover and Nexus are not the only Northeast natural gas transmission projects to face regulatory setbacks in recent years. The regulatory climate has been particularly hostile for pipelines in New York, where developers have faced obstruction, an issue explored in NGI’s latest special report, Empire State Showdown: The NatGas Battle for New York .  FERC staff authorized Nexus to proceed with construction on the 255-mile project, excluding specific segments where the developer will need to submit additional information before work can start [CP16-2

From The Times Leader: Congressman Bill Johnson introduced legislation last week that, if passed, would allow oil and gas producing counties in Ohio to keep more revenue generated from production on federal lands.  The bill, titled Providing Opportunities With Energy Revenues (or POWER) Counties Act, is similar to previous legislation introduced by Johnson in 2015 that was not enacted. The proposed legislation seeks to “amend the Mineral Leasing Act to require payment to counties of a portion of certain revenues received by the United States under Federal oil and gas leases, and for other purposes,” according to congress.gov.  The Mineral Leasing Act, first enacted by Congress in 1920, regulates the leasing of public lands for the development of several mineral resources, including coal, oil, natural gas, other hydrocarbons and other minerals.  “There is little doubt that Eastern and Southeastern Ohio are at the center of America’s energy renaissance,” Johnson said. “Energy d

From MDN: It’s been a few months since we’ve brought you news about the monthly average for Baker Hughes’ venerable rig count–largely because after GE completed it’s merger with Baker Hughes they quit issuing monthly press releases from their website! We spotted a story in the Pittsburgh Business Times that talks about Ohio coming close to parity in their rig count with Pennsylvania–which is a really big deal–and the reasons for it. That story sent us looking for the latest rig count numbers and indeed, it’s true. As of September, PA averaged 33 shale rigs in operation, while OH averaged 29–the closest we’ve ever seen it. If you look at the counts for last week (BH does a weekly rig count too), the numbers are even closer: PA with 31 rigs, OH with 29. We don’t typically monitor the weekly counts as they always fluctuate up and down–better to look at monthly averages. But the fact remains that PA has been pretty steady, operating between 32 and 34 rigs per month since January of this

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

From OPSB: The Ohio Power Siting Board (OPSB) today separately authorized the construction of natural gas-fired, combined cycle generation facilities in Guernsey and Trumbull counties. The two facilities will add 2,040 megawatts (MW) of generation capacity to the regional transmission grid.  In Guernsey County, Guernsey Power Station, LLC will construct the 1,100 MW Guernsey Power Station in Valley Township. Guernsey Power Station plans to construct a natural gas pipeline that would supply the facility with natural gas from the Tallgrass Energy Partners Rockies Express Pipeline. The facility will interconnect to a 765 kilovolt (kV) electric transmission line owned by American Electric Power. Guernsey Power Station plans to commence construction in December 2017 and begin commercial operation by October 31, 2020.  In Trumbull County, Clean Energy Future-Trumbull, LLC will construct the 940 MW Trumbull Energy Center in the village of Lordstown. The facility will be supplied with na

From NGI: FERC on Friday authorized Rover Pipeline LLC to start up three units at its Compressor Station 1 in Carroll County, OH, putting the 3.25 Bcf/d mega project a step closer to bringing its full capacity online by 1Q2018.  The three units would increase capacity on Rover to 1.2 Bcf/d from around 680 MMcf/d currently, according to a supplemental request filed Thursday with the Federal Energy Regulatory Commission [CP15-93].  "Rover customers have indicated that they have supply available at this time to utilize this additional capacity," it said. Rover had initially requested authorization to place the units into service last month.  In its request, Rover said it has completed commissioning the units and conducted noise testing to ensure the site is in compliance with FERC regulations. Rover asked for immediate authorization. Continue reading by clicking here. Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog

New permits issued last week:   4   (Previous week:  11 )  -7 Total horizontal permits issued:  2638   (Previous week:  2633 )  +5 Total horizontal wells drilled:  2141   (Previous week:  2134 )  +7 Total horizontal wells producing:  1695  (Previous week:  1693 )  +2 Utica rig count:  22  (Previous week:  26 )   -4 Connect with us on Facebook and Twitter! Follow @EnergyNewsBlog