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Tuesday, June 30, 2015

06/30/15 Links of the Day: OPEC Oil Production Surges, Pennsylvania Dumps FracFocus, and More

Washington Times:  In a shift, fracking’s foes face a losing streak   -   "After scoring a statewide ban last year on hydraulic fracturing in New York, anti-fracking activists talked excitedly about following up in a major fossil fuel-producing state — Colorado, maybe, or California. Instead, the next state to prohibit the use of fracking..."

Gas & Oil:  Skywatch Monitors Existing Gas, Energy Pipelines   -   "For a pipeline inspection pilot, flying an aircraft low to the ground and doing several things at once comes with the job. It’s a position that isn’t for everyone who has earned their wings, but according to Steve Bechtol, president of Skywatch, it’s a job for a pilot who can safely manually fly..."

Sober Look:  Have the Saudis miscalculated the impact of lower crude prices on US production?   -   "In 2014 the Saudis could no longer accept the loss of crude oil market share as the North American production levels shot up sharply over a three-year period. The Saudi response was quite rational. Rather than cutting production to support crude oil prices, the Saudis announced that output will remain the same. In private they were planning to actually increase production in order..."

PBS News:  Oil & Gas Workers Create Boom in Market for Flame Resistant Clothing   -   "The massive expansion of domestic oil and gas production over the last five or so years is rippling across the economies where that drilling is taking place. More oil workers need more welders, more restaurants, and ... more clothes..."

Dallas Morning News:  Supreme Court strikes down EPA power plant regulations, says costs must be considered   -   "Its impact on Texas businesses is not yet clear, but the Supreme Court ruled Monday that the EPA’s 2012 rule subjecting the nation’s power plants to new restrictions on emission of pollutants, especially mercury, was illegal. The 5-4 majority held that the Clean Air Act requires the EPA to take into account the cost of regulations when determining whether..."

Farm & Dairy:  Thirteen states sue EPA, Army Corps of Engineers over definition of waterways   -   "Thirteen states filed a lawsuit June 29 against the Environmental Protection Agency and the Army Corps of Engineers over the agencies’ rule defining “waters of the United States.” The states joining the lawsuit are Alaska, Arizona, Arkansas, Colorado, Idaho, Missouri, Montana, Nebraska, Nevada, New Mexico, North Dakota, South Dakota and Wyoming. The lawsuit claims..."  New York state officially bans fracking   -   "It's official: New York has banned fracking. After more than seven years of study, the state Department of Environmental Conservation today issued the final document needed to ban the controversial drilling practice, known formally as high-volume hydraulic fracturing. "Prohibiting high-volume hydraulic fracturing is the..."

Huffington Post:  Public Reaction to EPA Report on Fracking Reveals a Fractured Society   -   "It keeps happening. A science-based report on hydraulic fracturing (fracking) has been released, and public reaction is polarized. In this case it's the EPA report on the impact of fracking on drinking water released earlier this month. Based on an exhaustive and objective assessment of existing studies, the report concluded that fracking has not caused widespread contamination..."

TribLIVE:  Drillers to submit electronic records on fracking chemicals to Pa. DEP   -   "Pennsylvania will require shale gas companies to disclose electronically the chemicals they use in hydraulic fracturing in a new state-run database by next summer. Department of Environmental Protection Secretary John Quigley said the department will end its partnership with FracFocus, an..."

Gas & Oil:  Individuals Own Mineral Rights, Not the State   -   "An argument often made by proponents for increasing taxes on oil and gas production is that the crude oil and natural gas reserves beneath the state are natural resources owned by all Ohioans and that they should benefit from their development. But this is simply not true. In the United States, individual landowners own the mineral rights associated with their property, not the state. The private ownership of..."

Energy in Depth:  MarkWest Lays Roots and Keeps Its Promise to Ohio with New Cadiz Office   -   "In August 2012, MarkWest hosted a meet and greet with the residents and officials of Harrison County, announcing their plans for Utica Shale development in eastern Ohio. This week, the company continues to keep the promise it made three years ago, and as they cut the ribbon of a 20,000 square foot corporate office in Cadiz, Ohio. The event also served as a reminder..."

Rigzone:  OPEC Crude Production Surges as Iraq Pumps at Record Pace   -   "Iraqi crude production climbed to a record this month, helping send OPEC output to the highest level since August 2012.  Output by the Organization of Petroleum Exporting Countries climbed 744,000 barrels to 32.134 million a day this month, according to a Bloomberg survey of oil companies, producers and analysts. Last month’s total was revised..." 

Wall Street Journal:  Remember All That Oil in Storage? Here It Comes   -   "Refineries around the world are using more crude oil. To get the cheapest supplies around, they don’t have to look any further than their own storage tanks. When a global glut of crude oil sent prices plunging to near-six-year lows in the first quarter of the year, refineries started stocking up. The market gave them an incentive to do so: Oil prices for later in 2015 were higher than immediate prices, making refiners..."

FrackFeed:  10 Priceless Responses to EPA's Study Finding No Widespread Water Pollution From Fracking

Columbus Business First:  Texas company sees Utica rebound, will build 5th gas processing plant   -   "A Dallas company is planning a fifth cryogenic processing plant in the Utica shale region as drillers prepare to ramp up activity again. Blue Racer Midstream LLC's fourth plant came online just this month. The fifth was delayed..."

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Federal Report: 35,000 Oil and Gas Jobs Lost From October 2014 to April 2015

From the U.S. Energy Information Administration (EIA):
Employment in oil and natural gas extraction and support activities in the United States reached nearly 538,000 in October 2014, but then it declined by about 35,000 jobs, or 6.5%, over the following six months, through April 2015, according to data from the U.S. Bureau of Labor Statistics (BLS). 
Declines in oil and natural gas extraction and support employment tend to lag declines in crude oil prices. As prices of North Sea Brent crude oil fell from their June 2014 level of $112 per barrel, firms reduced the number of new wells drilled and the associated workforce. The count of drilling rigs in the United States, as measured by Baker Hughes, totaled 857 for the week ending June 19, 54% below the same point a year ago and the lowest level in nearly six years. 
Declines in production jobs lag oil price declines. In July 2008, Brent crude oil reached a record-high monthly spot price of $133 per barrel, before falling to $43 per barrel by February 2009. Oil and gas production jobs reached a high of 391,000 in September 2008, two months after the oil prices had started declining. Employment in drilling, extraction, and support activities then continued to decline for 13 months, when the number of production jobs dropped by more than 51,000. Most (82%) of the decline in these jobs occurred after oil prices reached the lowest monthly level and were on the rise.
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Trumbull County Officials Request Moratorium on New Injection Wells

From NGI:
Elected officials in Trumbull County, OH, voted unanimously Wednesday in favor of a resolution asking Gov. John Kasich to declare a moratorium on drilling any new wastewater injection wells in the county. 
According to an audio recording of the Trumbull County Commissioners meeting, an earlier version of the resolution called for a three-year moratorium, but the language was changed before the 3-0 vote. 
Commissioner Daniel Polivka said Trumbull County is already home to 19 injection wells, making it one of the top counties in the state for hosting them. 
"I think the biggest crime of this now is that we've lost local government money," Polivka said. "These injection wells are being drilled ... and we're getting a big zero on funding back. That definitely needs to be changed because we have [road use maintenance] agreements with oil and gas wells, [but] no agreements with these injection wells, and there's more truck activity and whatnot.
"We really requested that the formula be changed too at the state so some of that money comes back to our local communities."
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Rice Energy Pursuing Pennsylvania Utica Shale Wells, Looking to Reduce Costs

From the Pittsburgh Business Times:
The Marcellus Shale remains Rice Energy Inc.'s workhorse, but the Utica Shale is a growth area for the company, Executive Vice President of Exploration Derek Rice said Wednesday. 
Delivering the day's final address at the Hart Energy DUG East conference in Pittsburgh, Rice said the company (NYSE:RICE) is well positioned in the Utica, sitting on 60,000 acres in what the company believes to be the Utica's best portion. Being in that area is important -- the company believes that three or four Utica counties will, in the next five to 10 years, account for 90 percent of what is produced from the play.

Up until now, the company's Utica exploration has been focused on Belmont County, Ohio, one of the three counties that it is operating in. However, earlier this year, the company decided to test the deep Pennsylvania Utica in Greene County and has been working on developing a well there.
Continue reading this article by clicking here. 

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FirstEnergy Confirms Site of Potential Ohio Ethane Cracker Plant

From Columbus Business First:
The communications team at Akron power company FirstEnergy Corp. has played coy about an open secret in the energy sector. 
Publicly, the company tells reporters its plans to sell the riverside R.E. Burger power plant are premature. But industry sources have said from the beginning that the land will house a proposed ethane cracker plant in Belmont County.

Now, an executive for the company has confirmed the site will house the plant if Thailand's PTT Global Chemical Public Co. and Japan's Marubeni Corp. decide to go through with the facility.
James Lash, president of FirstEnergy Generation, said the company is moving a machine shop from the Burger site to a spot in Canonsburg, Pennsylvania, in part because the cracker could soon take over the site, the Pittsburgh Business Times reports. Lash was in the state to open FirstEnergy's relocated machine shop.
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Blue Racer Midstream Provides Update On Operations In the Utica and Marcellus Shale

  • Blue Racer’s total nameplate processing capacity reaches 800 million cubic feet per day.
  • Fractionation capacity stands at 123,000 barrels per day.
  • Gathering system totals approximately 650 miles of pipeline spanning 13 Ohio counties with another 200 miles under construction.
DALLAS – June 24 , 2015 – Blue Racer Midstream, LLC (“Blue Racer”) announced today that it has commissioned a second cryogenic processing plant at its Berne Natural Gas Processing Complex (“Berne”) in Monroe County, Ohio. Known as Berne II, the new facility has 200 million cubic feet per day (MMcf/d) of nameplate capacity, bringing Blue Racer’s total processing capacity in the Utica and Marcellus shale plays to 800 MMcf/d. Two 200 MMcf/d plants are now in service at the Berne Complex, and two additional 200 MMcf/d plants are in service at Blue Racer’s Natrium Natural Gas Processing and Fractionation Complex (“Natrium”) in Marshall County, West Virginia. A 30-mile, Y-Grade pipeline connects the Berne Complex to Natrium. Fractionation capacity at Natrium has been expanded to 123,000 barrels per day, enough to serve at least six 200 MMcf/d cryogenic plants. Blue Racer expects to install and commission a fifth processing plant in the first half of 2016 to meet growing customer demand for additional capacity.
Over the course of the past year, Blue Racer’s processed volumes have more than tripled to their current level of 650 MMcf/d, while total gathered volumes, including lean gas, have more than doubled to over 825 MMcf/d.
Customer Dedications
Blue Racer has long-term service agreements with 14 of the leading natural gas producers in the Utica and Marcellus shales. Acreage dedications to Blue Racer’s Super System total approximately 200,000 acres, and volumetric commitments total approximately 380 MMcf/d. Services include natural gas gathering, compression and processing; condensate handling; and the fractionation, storage, transportation and marketing of natural gas liquids.

8 New Utica Shale Permits Issued Last Week as Rig Count Inches Up

After two very slow weeks of permitting in Ohio's Utica shale, the latest weekly update from the Ohio Department of Natural Resources shows that activity picked up just a hair last week.

Eight new permits were issued in the week ending Saturday the 27th.  While that level of activity is still much lower than when the play was peaking several months ago, it represents a slight uptick from the previous two weeks, which saw only 9 total permits issued.  The activity was mostly focused in Harrison County, which continues to be the most active spot for permitting over the past month or so.  Six of the eight permits last week were for Harrison County wells, with four of those going to Hess for their Cadiz D Unit.  The remaining two permits on the report were issued to Chesapeake Energy for a unit in Carroll County's Orange Township.

The number of total permits issued continues to slowly move towards the next big milestone marker, 2,000.  There are now 1,943 permits issued.  In addition, 1,520 wells have been drilled and 909 are producing.  The Utica rig count nudged up by one for the second straight week, and now stands at 20.

View the report below.

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Anti-Drilling Group Pushing for Vote to Block Nexus Pipeline in Medina County

The following is a press release from the group "Sustainable Medina County:"
Yesterday, after seven weeks of collecting petition signatures, Medina County landowners from the group Sustainable Medina County dropped off 214 petitions with over 5,600 signatures to the Medina County Board of Elections in the hopes of placing a County Charter with a Bill of Rights on the ballot in November for a direct vote from the residents. The Director of the Medina County Board of Elections said that the Board will review the signatures and they should have a decision by Thursday, July 2nd as to whether there are sufficient signatures to place the proposed charter on the ballot for a vote.

The counties of Athens, Meigs and Fulton also followed suit and dropped off signatures to their Boards of Election. 
Many residents of the County who signed the petition voiced their concerns about the effect the NEXUS high pressure natural gas pipeline (36” or 42”) would have on their property values and they also voiced their concerns about the compressor station that is to be built in Guilford township and how it could affect the health of the residents of Medina County. 
“Sustainable Medina County advocates for all residents of Medina County to have a direct voice and vote on matters affecting families, Medina County communities and the environment,” noted Kathie Jones, the group’s convenor. “All of our residents deserve protection from dangerous and unwise energy projects like the NEXUS pipeline. Re-routing NEXUS from some property owners onto other residents will not protect the environment of Medina County. We’re already seeing how in some communities it has begun to pit neighbor against neighbor. Our campaign is everyone’s campaign.” 
If enacted, the County Charter would not alter any current county orders and regulations or laws relating to or affecting the County or its officers, agencies, departments or employees. The Charter contains a Bill of Rights, including rights of initiative and referendum on the county level, which will untie the hands of our county officials by securing for the county the same level of authority as a municipality. 
To protect the residents of Medina County, we feel the vast majority of voters will again speak for the charter form of county government this November.
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