Tag Archives: Marcellus

FERC certificates several new natural gas pipelines in 2017 – Today in Energy – U.S. Energy Information Administration (EIA)

Several large natural gas interstate pipeline projects have come online in recent years to support the shifting geography of domestic natural gas production. The Marcellus and Utica shale plays in the Northeast, where production has grown and resources are abundant, are major drivers for pipeline development. In 2016, the Federal Energy Regulatory Commission (FERC) certificated 17.6 billion cubic feet per day (Bcf/d) of new natural gas pipeline capacity. So far in 2017, FERC certificated more than 7 Bcf/d of new pipeline capacity before losing its quorum following the departure of one commissioner in February, which left just two sitting commissioners and three vacant seats.FERC oversees the interstate transmission of natural gas, which includes the regulation of interstate transportation rates and services for natural gas pipelines, natural gas pipeline construction, and related pipeline environmental matters. Pipeline certification involves reviewing applications for the construction and operation of natural gas pipelines and ensuring that applicants comply with safety standards.Receiving a certificate is just one step in the process of building and operating a new pipeline; pipelines receiving certification in 2017 will not necessarily come online in 2017.The seven projects certificated during the first few weeks of 2017 include more than 1,500 miles of natural gas pipeline construction and expansions, involving combined additions of more than 7 Bcf/d of capacity. The pipeline projects are concentrated in the eastern half of the United States to improve access to markets for growing eastern natural gas production, and they have projected 2017 and 2018 in-service dates.

Source: FERC certificates several new natural gas pipelines in 2017 – Today in Energy – U.S. Energy Information Administration (EIA)

U.S. Shale Boom Finally Runs Out of Gas

The correction in U.S. natural gas production has finally arrived. Volumes are down close to 5% since peaking in late 2015, driven by declines in associated gas and higher-cost legacy areas as well as ongoing curtailments and pipeline constraints across the Northeast United States. Natural gas prices have rallied as a result, with 2017 Henry Hub futures increasing almost 15%, to an average of $3 per thousand cubic feet.

With record power burn set to moderate, however, and as new pipelines are put into service across the Northeast, tight supply conditions should ease. By 2018, we expect prices to once again be governed by the considerable productive capacity of low-cost shale plays like the Marcellus, Utica, and Haynesville. Long-term demand tailwinds still appear favorable, although we continue to believe that at our midcycle prices of $3/mcf Henry Hub and $55/barrel West Texas Intermediate, there is more than enough economically profitable resource to meet growing consumption needs. The temporary spike in natural gas prices appears to be just that: temporary. Our long-term price assumption of $3/mcf is unchanged.

 

Source: U.S. Shale Boom Finally Runs Out of Gas

Despite opposition, project expands New England natural-gas pipeline capacity – The Portland Press Herald

Clean-energy and community activists have been able to stall or kill most new natural gas pipeline proposals in New England, but one expansion project has made it.The Algonquin Incremental Market project went into service last month. It increased the region’s pipeline capacity for the first time since 2010, and represents the largest venture since 2007, according to the U.S. Energy Information Administration. The $972 million project expanded the major pipeline carrying gas from the Appalachian shale deposits into the region by upgrading compressor stations and increasing pipe size in some places.The expansion will provide an additional 342 million cubic feet of gas a day. The region burns roughly 4.5 billion cubic feet on a winter’s day – equal to 31 million gallons of heating oil – so the contribution isn’t a game changer.

Source: Despite opposition, project expands New England natural-gas pipeline capacity – The Portland Press Herald

PA Rig Count Has Jumped Nearly 70% Since June

The Baker Hughes rig count stats show the number of rigs operating in Pennsylvania has jumped nearly 70% since June! The Baker Hughes rig count, watched closely by those in the industry (the benchmark used across the world) has been trending up in the U.S. since July and in Pennsylvania since June. Baker Hughes released its venerable count for September on Friday and once again the counts have gone up—very good news indeed.Baker Hughes is reporting an average of 509 active rigs in the U.S., up 28 from August. MDN performs its own rig count for the Marcellus/Utica, using Baker Hughes numbers for Pennsylvania, Ohio and West Virginia. The Marcellus/Utica rig count was up for the second month running. In September the Marcellus/Utica rig count jumped up by 7. The biggest gainer was Pennsylvania, up by 5. West Virginia was up by 2, and Ohio stayed even.

Source: PA Rig Count Has Jumped Nearly 70% Since June

Consol puts focus on dry Utica play as wet-gas prices decline

Consol Energy Inc.’s strategy is going to include a lot more dry-gas development in the Utica Shale as some of the economics of the basin have shifted away from the wet-gas areas of the Marcellus Shale.”We believe the Utica will make up a larger portion of Consol’s development plans in the future,” COO Timothy Dugan told a crowd of industry executives at the DUG East natural gas conference in downtown Pittsburgh.Consol (NYSE: CNX) halted its drilling program in 2015 as commodity prices declined. It has yet to resume drilling in Pennsylvania, Ohio or West Virginia, where it has one of the largest acreages among exploration and production companies in the Appalachian Basin. Consol has signaled that it is close to making a decision as to when it will resume drilling, perhaps as early as the second half of this year. But no announcement was made today, and Dugan declined to say when drilling might resume or whether a rig would first go into the Utica or Marcellus shales.

Source: Consol puts focus on dry Utica play as wet-gas prices decline – Pittsburgh Business Times

Consol to Cut Another 470 Jobs in NatGas, Coal Divisions

Consol Energy Inc. on Tuesday confirmed its second round of layoffs since the beginning of the year, again citing depressed commodity prices as an impetus for its decision to this time cut 470 jobs in its natural gas and coal divisions.

Tuesday’s announcement comes in addition to a move earlier this year to lay off more than 160 workers in its gas division, CNX Gas Co., a company spokesman said (seeShale Daily, April 10).

“We continually evaluate our workforce based on current and anticipated activity levels,” said spokesman Brian Aiello. “These are very difficult but prudent decisions given the depressed nature of commodity prices. We are taking aggressive action so that Consol can continue to operate from a position of strength through the downturn and quickly capitalize on the up-cycle when it returns.”

Once a traditional coal producer, Consol has been focused on growing its gas division, with its assets in the Marcellus and Utica shales increasing in recent years as retrenchment in its coal operations has led to thousands of job cuts over the last decade on that side of the business. The company’s core gas operations are in Ohio, West Virginia and Pennsylvania, where it produced 235.7 Bcfe of natural gas last year, a 37% increase from 2013 (see Shale Daily, Jan. 30). That was followed by a record-setting first quarter in which the company produced 71.6 Bcfe (see Shale Daily, April 28).

The company confirmed that it would lay off 290 employees working in administrative positions and in its gas division. Another 180 jobs would be cut in its coal division, Consol said. Combined, the layoffs account for about 10% of the company’s workforce. At the beginning of the year, Consol said it would cut its capital budget by $80 million from 2014 spending of $1 billion.

Consol has taken other general and administrative cost-cutting measures as well this year, announcing in June that it would accelerate a plan announced last year to stop paying health benefits for more than 4,000 retirees.

 

EIA July 2015 Drilling Productivity Report

Drilling Productivity Report

http://www.eia.gov/petroleum/drilling/pdf/dpr-full.pdf

 

Three reasons to buy this oil-transport play – MarketWatch

There are plenty of ways to wring shareholder value out of a company, and the more of them that can be employed, the better. In this case, we have a company creating valuable synergies with its partners, building new pipelines and all with a nice distribution yield.

Energy Transfer Partners LP ETP, +0.42%  hiked its first-quarter distribution by about 8% from year-ago levels and generated enough cash flow to cover 118% of this higher payout. Some of this upside came from the partnership’s wheeling and dealing with its general partner, Energy Transfer Equity LP ETE, +0.74% and its sister MLP, Sunoco LP SUN, +1.55% in a series of kick-up and drop-down transactions.

For example, Energy Transfer Equity retired 30.8 million of Energy Transfer Partners’ common units in the first quarter, paid the master limited partnership (MLP) $879 million in cash and transferred a 45% interest in a pipeline project that will transport crude oil from the Bakken Shale.

In exchange, Energy Transfer Partners kicked up the bulk of its remaining general-partner interest and incentive distribution rights in Sunoco Logistics Partners LP SXL, +0.96%  to Energy Transfer Partners.

During the first quarter, Energy Transfer Partners also sold a 31.58% stake in its wholesale fuel-distribution business to Sunoco LP for $775 million in cash and 795,482 common units. Energy Transfer Partners plans to drop down the remaining interests in these assets to Sunoco LP over the next two years, providing another source of liquidity.

At some point, Energy Transfer Partners can kick up the general-partner interest in Sunoco LP to Energy Transfer Equity in exchange for more unit retirements or other considerations.

On Energy Transfer Partners’ first-quarter earnings call, management also provided an update on the opportunities created by its acquisition of Regency Energy Partners LP, which closed on April 30. We analyzed this deal at length in Energy Transfer Partners LP to acquire Regency Energy Partners LP.

Management estimated that if the transaction had closed in the first quarter, Energy Transfer Partners’ distribution coverage would have slipped to 104%, reflecting the equity issued to close the deal. However, this coverage rate improves to 110% when you factor in $165 million to $225 million in recurring synergies.

via Three reasons to buy this oil-transport play – MarketWatch.

Williams submits application for Atlantic Sunrise pipeline

Tulsa, Oklahoma-based Williams has filed a formal application with federal regulators to construct nearly 200 miles of a new interstate natural gas pipeline in Pennsylvania.

The Atlantic Sunrise project is designed to carry Marcellus Shale gas from northeastern Pennsylvania to markets along the eastern seaboard, including the Cove Point export terminal on the Chesapeake Bay. Williams began the pre-filing phase of the project more than a year ago and has made major changes to the proposed route in response to public feedback.

It’s one of many major pipeline projects underway to Pennsylvania, as the glut of shale gas has strained the capacity of existing infrastructure. If approved, the pipeline would cross 10 counties: Columbia, Lancaster, Lebanon, Luzerne, Northumberland, Schuylkill, Susquehanna, Wyoming, Clinton and Lycoming.

via Williams submits application for Atlantic Sunrise pipeline | StateImpact Pennsylvania.

Natural gas rig count jolts energy investors’ hopes – Market Realist

In the United States, the natural gas rig count was 314 for the week ended February 6, down by five compared to the previous week. In the major basins, the key reduction occurred in the Marcellus shale, where four rigs went off last week.

Natural gas rig counts have been on a downward trend for about three years. Nevertheless, the gas-targeted rig count seems to be stabilizing. It increased ten times in the last 17 weeks.

via Natural gas rig count jolts energy investors’ hopes – Market Realist.