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New York's Highest Court to Rule on Towns' Fracking Bans

The New York Court of Appeals, the highest court in the state, heard oral arguments this week in two cases regarding whether municipalities can use local zoning laws to prohibit hydraulic fracturing within the city boundaries, or whether the state’s law regulating oil and gas development within the state preempts a municipality’s local zoning laws. Presenting their cases before the seven judges on the bench, attorneys for the upstate New York towns of Dryden and Middlefield argued on the side of local zoning laws being able to prohibit oil and gas activities within a municipality’s boundaries, while a trustee for Oslo, Norway-based Norse Energy challenged the Dryden ban. Cooperstown Holstein, a dairy farm that leased land for drilling, challenged the ban by Middlefield. Lower courts had found no express or implied preemption. The Appellate Division, Third Department affirmed in May 2013 earlier Supreme Court decisions that dismissed both lawsuits, […]

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Tight Oil, Shale Gas to Drive Lower 48 Production

A handful of unconventional plays will drive U.S. Lower 48 oil and gas production growth, according to a recent analysis by Wood Mackenzie. Tight oil production is expected to reach 6 million barrels per day (MMbpd) by 2020 in the Lower 48, thanks to production in the Eagle Ford, Bakken and Bone Spring/Wolfcamp plays in the Permian Basin, John Dunn, who manages Wood Mackenzie’s Lower 48 upstream research, told reporters at a media briefing Wednesday in Houston. Overall U.S. liquids production in 2020 is forecast to reach nearly 9 MMbpd. Oil and condensate production from the Eagle Ford play in South Texas is expected to reach 2 MMbpd by 2020, while Bakken production is forecast to hit 1.7 MMbpd by 2020, according to Wood Mackenzie estimates. By 2020, oil and condensate production from the Bone Spring/Wolfcamp play in the Permian Basin – the new kid on the block – […]

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Chesapeake Energy Faces Charges It Misled Landowners in Michigan

Michigan’s attorney general filed criminal charges against Chesapeake Energy Corp. , alleging that the natural-gas producer misled landowners to obtain leases in the state. Prosecutors contend that Chesapeake in 2010 assured Michigan landowners that holding mortgages weren’t obstacles to signing leases allowing the company to drill for gas, but later cited those mortgages as a reason for canceling the deals. "Chesapeake therefore obtained uncompensated land options from these landowners by false pretenses, and prevented competitors from using the land," the attorney general’s office said Thursday. The complaint says that Chesapeake signed leases with as many as 800 landowners, but honored fewer than 30 leases. "We believe this action has no merit and we will vigorously contest these baseless allegations," said Gordon Pennoyer, a spokesman for the company, which is based in Oklahoma City. The charges include one felony count of conducting a criminal enterprise and eight felony counts of […]

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Shale gas gives North American petchem companies a competitive edge: S&P analyst

North America-based petrochemical companies are likely to enjoy a competitive advantage over their rivals based elsewhere for the next several years as a result of the US shale gas revolution, which provides both inexpensive feedstocks and fuel for the petchems industry, a senior Standard & Poor’s analyst said Tuesday. "The ability to extract low-cost ethane and put it through a steam cracker and create ethylene and all the derivatives, that’s been very favorable for companies that have operated in North American versus companies in other parts of the world," Henry Fukuchi, director of ratings and analytics at S&P, said on the sidelines of the Benposium conference in Houston. S&P and Platts are both units of McGraw-Hill Financial. Global demand for petrochemicals has historically grown about 4% annually and Fukuchi said he expects that growth rate to remain constant for the next several years, driven by economic development in China […]

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Shale gas gives North American petchem companies a competitive edge: S&P analyst

North America-based petrochemical companies are likely to enjoy a competitive advantage over their rivals based elsewhere for the next several years as a result of the US shale gas revolution, which provides both inexpensive feedstocks and fuel for the petchems industry, a senior Standard & Poor’s analyst said Tuesday. "The ability to extract low-cost ethane and put it through a steam cracker and create ethylene and all the derivatives, that’s been very favorable for companies that have operated in North American versus companies in other parts of the world," Henry Fukuchi, director of ratings and analytics at S&P, said on the sidelines of the Benposium conference in Houston. S&P and Platts are both units of McGraw-Hill Financial. Global demand for petrochemicals has historically grown about 4% annually and Fukuchi said he expects that growth rate to remain constant for the next several years, driven by economic development in China […]

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Texas RRC: Oil, Gas Production Not to Blame for Well Water Contamination

Rigzone Staff 6/3/2014 URL: http://www.rigzone.com/news/oil_gas/a/133391/Texas_RRC_Oil_Gas_Production_Not_to_Blame_for_Well_Water_Contamination Water contamination from explosive gas in the water supply of a North Texas neighborhood cannot be linked to nearby drilling, the Texas Railroad Commission (RRC) said in a recent report. The investigation began after seven property owners in the neighborhood contacted the RRC about rising levels of methane in their water wells. An eighth property owner also found an increase of chloride in two water wells. In its finding that there was an insufficient link between the contamination of well water in the Silverado on the Brazos (Silverado) neighborhood in southern Parker County and drilling in the nearby Barnett Shale, the RRC, which regulates the state’s oil and gas industry, noted that the contamination has worsened in five of the eight private water wells it tested in September 2013, compared to the contamination measured in the same wells in 2010 and 2011. However, the RRC […]

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Market dynamics key to US LNG exports to Asia, witnesses say

US exports of LNG to Asia are more likely to be determined by overseas market dynamics than by US government policies, witnesses told a US House Foreign Affairs Committee subcommittee on May 29. The observations came as the US Department of Energy proposed giving priority in its national interest determinations to LNG export proposals that already meet National Environmental Policy act requirements ( OGJ Online, May 29, 2014 ). “I think there’s a prevailing view in the industry that LNG prices in Asia will come down to around $13[/MMbtu} and domestic gas prices will rise to around $6. That would make exports close to a wash for US producers,” Mikkal E. Herberg, research director in the National Bureau of Asian Research’s Energy Security Program, told the committee’s Asia and the Pacific Subcommittee. Jane Nakano, a fellow in the Center for Strategic and International Studies’ Energy and National Security […]

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Fracking plans submitted for British shale

British shale explorer Cuadrilla Resources, the target of heated protests, said it submitted plans for new fracking operations to Lancashire County officials. "The proposal covers the works required to drill, hydraulically fracture and test the flow of gas from up to four exploration wells on the site," the company said in a statement Thursday. When the company announced its intent to submit plans to Lancashire officials in early May, Caudrilla CEO Francis Egan said the application would be an "important milestone" for British shale. In March, the company said it believes there are 200 trillion cubic feet of shale natural gas in the Bowland basin in Lancashire. The company was the target of major demonstrations last summer when exploratory operations in the southern village of Balcombe were viewed as a prelude to fracking, though the process wasn’t carried out at the site. Caudrilla said Thursday there […]

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Are We Underestimating America's Fracking Boom?

Start with exotic Nazi technology, take a detour with South African apartheidists, and add a bit role for Iranian imams. What you have is—what else? —one of the most improbable and important American business stories of the past decade. It’s the tale of a company called , the former South African state oil company, which is embarking on what could be the single-largest foreign investment project in U.S. history. Sasol is building a 3,034-acre energy complex near a bayou in Lake Charles, La. Tapping into cheap, fracked natural gas as well as the pipeline and shipping infrastructure along the Gulf Coast, Sasol plans to spend as much as $21 billion there. It is expensive, elaborate and dirty work. Sasol plans to reduce, or "crack," the gas into ethylene, a raw chemical used in plastics, paints and food packaging. It also plans to convert the gas into high-quality diesel and […]

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Are We Underestimating America’s Fracking Boom?

Start with exotic Nazi technology, take a detour with South African apartheidists, and add a bit role for Iranian imams. What you have is—what else? —one of the most improbable and important American business stories of the past decade. It’s the tale of a company called , the former South African state oil company, which is embarking on what could be the single-largest foreign investment project in U.S. history. Sasol is building a 3,034-acre energy complex near a bayou in Lake Charles, La. Tapping into cheap, fracked natural gas as well as the pipeline and shipping infrastructure along the Gulf Coast, Sasol plans to spend as much as $21 billion there. It is expensive, elaborate and dirty work. Sasol plans to reduce, or "crack," the gas into ethylene, a raw chemical used in plastics, paints and food packaging. It also plans to convert the gas into high-quality diesel and […]

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In Fracking Hotbed, a Muted Approach to Regulation

Ohio annually processes thousands of tons of radioactive waste from hydraulic-fracturing, sending it through treatment facilities, injecting it into its old and unused gas wells and dumping it in landfills. Historically, the handling and disposal of that waste was barely regulated, with few requirements for how its potential contamination would be gauged, or how and where it could be transported and stored. With the business of fracking waste only growing, legislators in 2013 had the chance to decide how best to monitor the state’s vast amounts of toxic material, much of it being trucked into Ohio from neighboring states. But despite calls to require that the waste be rigorously tested for contamination, Gov. John Kasich and the state legislature signed off on measures that require just a fraction of the waste to be subjected to such oversight. The great majority of the byproducts creating during the drilling process – […]

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North Carolina Senate Outlaws Disclosure Of Fracking Fluid Secrets

The North Carolina Senate on Thursday voted to make it a crime to disclose the chemicals used in hydraulic fracturing, or fracking, even as big U.S. oil companies elsewhere consider releasing more information about the fluids to address public concerns about the environment. The legislation, proposed by three Republican state senators and passed by a vote of 35-12, aims to protect trade secrets about fluids used to extract oil or gas from wells using fracking, which blasts sand, water and chemicals deep beneath the earth’s surface. Environmentalists concerned about groundwater contamination and health risks want more information made public. Under the "Energy Modernization Act," a state geologist would be the custodian of confidential information about fracking fluids. The information can be given to healthcare providers, the public safety department or the fire chief in case of an emergency. The bill, which now goes to the […]

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Sanchez to buy Eagle Ford acreage from Shell for $639 million

Sanchez Energy Corp. , Houston, has agreed to acquire 100% working interest in 106,000 net acres in Dimmit, LaSalle, and Webb Counties, Tex., from Royal Dutch Shell PLC for $639 million, effective Jan. 1. The agreement is expected to close at the end of the second quarter. The sale includes 176 operated producing wells and associated field facilities and infrastructure. The assets consist of 60 million boe of proved reserves and 24,000 boe/d of average first-quarter production, with 60% liquids. Sanchez’s total position in the Eagle Ford will amount to 226,000 acres with as many as 3,000 potential drilling locations. The company’s average production rate for this year’s first quarter will rise to 42,800 boe/d, which includes an estimated Catarina production rate of 20,000 boe/d. Total proved reserves will increase 100% to 119 million boe. The acquired assets are expected to generate a substantial amount of near-term cash flow […]

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British shale company Cuadrilla plans new campaign

British shale gas explorer Cuadrilla Resources announced its intention to submit a plan for exploration work to the county council in Lancashire. "This application could be a really important milestone for Lancashire and the U.K. as we seek to unlock Lancashire’s shale gas potential," Cuadrilla Chief Executive Officer Francis Egan said in a statement Sunday. The company said it would submit its planning application for a hydraulic fracturing campaign for four exploration wells to the Lancashire County Council before the end of May. In March, the company said it believes there are 200 trillion cubic feet of shale natural gas in the Bowland basin in Lancashire . Cuadrilla was the target of major demonstrations last summer when exploratory operations in the southern village of Balcombe were viewed as a prelude to fracking. In January, the company sent a letter to village residents, saying it was […]

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Pa. Dems fight to prove they can milk fracking for all it’s worth

Lycoming County looks like a lot of the rest of Pennsylvania: Pothole-marked roads snake through mountains and farmland, leading to little one-street towns that often contain little more than a coffee shop, a bank, a gas station and a bar. But ever since companies like Anadarko, EXCO Resources, XTO Energy and Range Resources came to town, everyday life has had a little more buzz around here. Eighteen-wheelers zip by day and night, cafes and restaurants in small cities like Williamsport are busy, and the parking lots of the Holiday Inns, Marriotts and many independent motels are packed with pickups from out of state. This is fracking country, and to supporters of the practice, Lycoming represents all the good that can come from it — jobs, economic growth and energy independence. To fracking’s detractors, Lycoming represents everything wrong with Pennsylvania, namely the state’s apparent willingness to embrace […]

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NY Policymakers Seek Ban on Fracking Waste

New York has a pending bill establishing a moratorium on the disposal of fluids used in hydraulic fracturing that occurs outside of the state, according to legislation introduced Tuesday by Democrats in the state Senate. The minority conference released four bills proposing to ban shipping hydraulic fracturing waste product into the state for treatment or disposal as well as ban the waste from being used to melt ice off roads and bar treatment facilities, and landfills from accepting the byproduct. New York, currently holding a moratorium on fracking permits until it completes an environmental impact review that launched in 2008, is reviewing whether fracking should be allowed between its borders. The state Department of Environmental Conservation (DEC) launched its review of large-scale fracturing about 6 years ago. “There is no end in sight for the ongoing 5-year review of fracking in New York,” commented Gov. Cuomo and Dr. Shah […]

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FERC issues EA for Cove Point LNG export project

The US Federal Energy Regulatory Commission has issued its environmental assessment (EA) for the Cove Point LNG liquefaction and export project ( OGJ Online, Mar. 14, 2014 ). The project is proposed by Dominion Cove Point LNG LP (DCP). FERC concluded that “approval of the proposed project, with appropriate mitigating measures, would not constitute a major federal action significantly affecting the quality of the human environment.” It also reported that potential impacts would be reduced with the implementation of DCP’s proposed minimization and mitigation measures and the 82 additional measures recommended in the EA. The project would enable DCP to export 5.75 million tonnes/year of LNG via LNG marine carriers that would dock at the existing offshore pier, FERC said. FERC also has prepared a draft general conformity determination (GCD) to assess the potential air quality impacts associated with construction and operation of the proposed project; the GCD is […]

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Water concerns could limit US oil, gas development, speakers say

The oil and gas industry needs to respond more effectively to public concerns about safe water supplies if it expects to realize US unconventional resources’ full potential, speakers at Deloitte LLP’s 2014 Washington Energy Conference warned. Hydraulic fracturing and horizontal drilling successfully changed the US from a net natural gas importer to exporter, noted Karen A. Harbert, president of the US Chamber of Commerce’s Institute for 21st Century Energy, in her May 13 remarks. “But this is not a given,” she continued. “Emotions are running high. Opponents with scare stories want those resources to stay in the ground. Colorado is at ‘Ground Zero’ with a ballot initiative that would ban all fracing and place setbacks so far that production would be uneconomic.” Following his speech about water’s growing importance in any manufacturer’s plans, Gregory J. Koch, Coca Cola Co.’s global water stewardship director, said, “Your data and government permit […]

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North Dakota breaks state record for oil production

BISMARCK, N.D., May 14 (UPI) –Preliminary data from March show oil production in North Dakota has reached a new all-time high, the state’s Department of Natural Resources said. The North Dakota Industrial Commission, a division within state’s DNR, said March average oil production of 977,051 barrels per day was 2.6 percent higher than for February and an all-time high for the state. The commission said 94 percent of the production came from the Bakken and Three Forks area of the state. NDIC Director Lynn Helms said the number of wells completed from February to March was "up sharply," though the weather in the state was still having an impact on production. March, he said, began with a few days with temperatures below zero degrees Fahrenheit and there was at least a week when wind speeds were too high for work. At the end of the month, he added, 8 […]

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Texas mayor appeals for fracking data after earthquakes jolt town

The state agency responsible for regulating the oil and gas industry in Texas has requested that fracking companies report data related to wastewater disposal wells daily — instead of yearly — after hundreds of earthquakes hit an area with no history of seismic activity, said the mayor of a small Texas town on Tuesday. At least 300 small earthquakes have hit north Texas — home to the heavily-drilled Barnett Shale region — since January, according to United States Geological Survey (USGS) data. Critics say the state has acted too slowly in investigating the unusual seismic activity and its possible links to fracking activities. “The Texas Railroad Commission has sent a letter requesting that companies voluntarily give that information,” said Alan Brundrett, mayor of Azle, a small town of about 11,000 in north Texas that has experienced unusual earthquakes. “That’s the biggest issue, that the data is not available," Brundrett […]

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North Dakota plans LNG processing facility

North Dakota Gov. Jack Dalrymple announced startup company North Dakota LNG will build a gas processing plant in Tioga, the first of its kind for the state. North Dakota LNG said they’d start construction at the Tioga liquefied natural gas processing plant this summer. First phase operations will produce 10,000 gallons of LNG per day. Phase two operations, scheduled for 2015, will bring production levels to more than 76,000 gallons per day. The company has a contract with Hess. Corp. to receive residual gas for the Tioga feedstock. Dalrymple said LNG from the facility will be used for commercial fuel. "This is an exciting day for North Dakota," he said in a statement Wednesday. The company’s chief executive officer, Patrick Hughes, said the facility will give oil and gas operators in the Bakken oil region of the state access to a reliable alternative […]

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Shale Gas Plagued By Unusual Methane Leaks

A Feb. 2013 scientific study found an unexpectedly high methane leakage rate in the well-fractured Utah basin. Photo of Utah gas field   credit According to a spate of recent scientific studies from the United States and Australia, the shale gas industry has generated another formidable challenge: methane and radon leakage three times greater than expected. In some cases the volume of seeping methane, a greenhouse gas that traps heat 25 times more effectively than carbon dioxide, is so high it challenges the notion that shale gas can be a bridge to a cleaner energy future, as promoted by the government of British Columbia and other shale gas jurisdictions. "If natural gas is to be a ‘bridge’ to a more sustainable energy future, it is a bridge that must be traversed carefully," warned one 2014 study published in Science. "Diligence will be required to ensure that leakage rates are […]

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EIA: High value of liquids boosts wet gas production

Spurred by relatively high values of natural gas liquids (NGL), company interests have shifted from dry gas production to wet gas production, according to the US Energy Information Administration’s monthly gas liquids report. Gas prices have stayed low in recent years due to increased supply. The Henry Hub spot price averaged $3.73/MMbtu in 2013 and $2.75/MMbtu in 2012, reducing profit margins for many gas producers . NGL prices, as being traditionally linked to crude oil, are set at a significant price premium over pipeline-quality dry gas. According to EIA data, more recently, the gas plant liquids composite spot price —which approximates a value of NGL produced at processing plants—has hovered roughly halfway between WTI crude oil and gas spot prices. This liquids price premium has resulted in a faster growth rate of wet gas production compared with that of dry gas. Liquids extracted from wet gas at processing plants […]

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High value of liquids drives U.S. producers to target wet natural gas resources

In recent years, high levels of natural gas production have pushed prices down. The Henry Hub spot price averaged $3.73 per million British thermal units (MMBtu) in 2013. In 2012, the average annual Henry Hub price was $2.75/MMBtu, which reduced profit margins for many natural gas producers . The relatively high value of natural gas liquids (NGL) has led producers to target wet gas. NGL prices have traditionally been linked to crude oil, resulting in a significant price premium over pipeline-quality dry natural gas. More recently, the natural gas plant liquids composite spot price (which approximates a value of NGL produced at natural gas processing plants) has hovered roughly halfway between West Texas Intermediate (WTI) crude oil and natural gas spot prices. The result of this liquids price premium is that wet natural gas production is increasing at a faster rate than dry natural gas production. Liquids extracted from […]

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Europe Must Embrace Fracking, U.K. Energy Minister Says

The Ukraine crisis has become a “wake-up call” for European governments on the need to develop local energy resources, including natural gas from shale, U.K. Energy Minister said. The use of hydraulic fracturing, or fracking, to tap shale reserves that could meet demand for decades would provide greater security of supply at a time when Russia has threatened to curb gas shipments needed to power European economies, he said in an interview in Houston yesterday. “We have to ensure that we do maximize our indigenous resources,” Fallon said. “We can’t be reliant on dodgy parts of the world.” Escalating violence in Ukraine fanned by Russian separatists has intensified calls to develop local prospects, especially in countries such as Bulgaria that are more reliant on Russian gas, he said. Russia provides about a third of the EU’s oil and gas needs, mainly via state-controlled OAO Gazprom (GAZP) and OAO Rosneft […]

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The Fracking Prostitutes of American Colleges

Lackawanna College, a two-year college in Scranton, Pa., has become a prostitute. The administration doesn’t think of themselves or their college as a prostitute. They believe they are doing a public service. Of course, streetwalkers and call-girls also believe they are doing a public service. Lackawanna College’s price is $2.5 million. That’s how much Cabot Oil & Gas paid to the School of Petroleum and Natural Gas, whose own nine-building campus is in New Milford in northeastern Pennsylvania.  On the School’s logo are now the words, “Endowed by Cabot Oil & Gas Corporation.” That would be the same Cabot Oil & Gas Corporation that has racked up more than 500 violations since it first used horizontal fracking to extract gas in the Marcellus Shale almost six years ago. That would be the same company that was found to be responsible for significant environmental and health damages in Dimock, Pennsylvania. […]

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Why Marcellus Shale Gas Doesn't Get to New England

Nearly 15 million people in New England live within driving distance of America’s biggest natural-gas field, yet heating and electricity prices reached a record for the region this winter. As states stretching from Massachusetts to Maine thaw out from bitter cold, questions linger about why New England hasn’t benefited from the energy boom in the nearby Marcellus Shale. The short answer is not enough pipelines. And the reason is an impasse between pipeline operators and power plants over how to pay for new capacity. The problem is that pipeline operators want long-term contracts in place before they spend the hundreds of millions of dollars necessary to build a new pipeline or expand an existing one. But power companies, which buy gas to fuel generators on a need-to-have-it basis, work on a different timetable. Independent power-plant operators must supply electricity to utilities at the lowest cost possible, and utilities are […]

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Why Marcellus Shale Gas Doesn’t Get to New England

Nearly 15 million people in New England live within driving distance of America’s biggest natural-gas field, yet heating and electricity prices reached a record for the region this winter. As states stretching from Massachusetts to Maine thaw out from bitter cold, questions linger about why New England hasn’t benefited from the energy boom in the nearby Marcellus Shale. The short answer is not enough pipelines. And the reason is an impasse between pipeline operators and power plants over how to pay for new capacity. The problem is that pipeline operators want long-term contracts in place before they spend the hundreds of millions of dollars necessary to build a new pipeline or expand an existing one. But power companies, which buy gas to fuel generators on a need-to-have-it basis, work on a different timetable. Independent power-plant operators must supply electricity to utilities at the lowest cost possible, and utilities are […]

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Texas: When fracking comes to town

Denton, about 40 miles northeast of Azle, is in the heart of the Barnett Shale gas patch. In rural areas the telltale sign of a gas well is a fenced-in field and signs saying, “No Trespassing” and “No Smoking.” But in cities, the placement gets more creative. In Denton, there are wells near the University of North Texas’s football stadium and on the grounds of a high school. But the prospect of a fracked future for their city has prompted a group of activists to fight back. “I didn’t set out to be a fracktivist,” says Maile Bush, a fast-talking stay-at-home mother who lives near the Ogletrees in the Meadows at Hickory Creek. “We’re moms and retirees and doctors and lawyers and nurses. We’re not some Berkeley enclave.” Bush is active in a group called Frack Free Denton, which in February began circulating a petition to outlaw hydraulic fracturing […]

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New York state shale gas: Not so much

A drilling foreman once told me, “Don’t believe ANY reserve number unless it’s linked to a price.” And, that is just what petroleum geologist and consultant Arthur Berman and his colleague Lyndon Pittinger have done in a new report on the viability of shale gas in New York state. Not surprisingly, when Berman and Pittinger considered what it would cost to extract the shale gas beneath New York state at a profit, the mammoth claims about recoverable reserves made by the oil and gas industry appeared heavily inflated. The stunning conclusion of the report is that at current prices–in the mid-$4 range per thousand cubic feet (mcf)–NONE of the natural gas trapped in the New York portion of the Marcellus can be profitably extracted. It’s possible, of course, that someone would try. But, the economics look very shaky at current prices given what we know about the nature of […]

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EIA: Marcellus gas production continues to outpace takeaway capacity

Rising production of natural gas in the Marcellus shale play in the Appalachian basin continues to outpace the growth in the region’s pipeline takeaway capacity, which has led to supply backups in the region, the US Energy Information Administration reported in a weekly gas report. Because of this fact, EIA observed, new gas production is unable to flow to areas of high demand, “placing downward pressure on prices in the region.” EIA noted that this phenomenon has also “contributed to a number of natural gas wells in Marcellus remaining backlogged, with a Feb. 28 report from Barclay’s estimating that more than 1,300 wells there are drilled but not completed.” EIA noted that several proposed and recently completed projects will provide additional pipeline infrastructure to relieve some of the Marcellus supply glut. “Projects that have recently come online, such as Transcontinental Pipeline Co.’s (Transco) Northeast Supply Link, have expanded the […]

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Very Little Cheap Natural Gas in New York Marcellus Shale, New Report Concludes

For years, the shale industry has touted the economic benefits it can provide. An overflowing supply of domestic natural gas will help keep heating and electric bills low for American consumers, they argue, while drilling jobs and astounding royalty windfalls for landowners will reinvigorate local economies. These tantalizing promises have caught the attention of politicians in Washington, D.C. who argue that the rewards of relying on shale gas outweigh the risks, especially because harm can be minimized by the industry or by regulators. But across the U.S., communities where drilling has taken place have found that the process brings along higher costs than advertised. Even when properly done, drilling carries with it major impacts — including  air pollution , truck traffic , and plunging property values  — and when drillers make mistakes, water contamination has left residents without drinking water or cleaning up from disastrous well blow-outs . And as […]

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EPA drastically underestimates methane released at drilling sites

Drilling operations at several natural gas wells in southwestern Pennsylvania released methane into the atmosphere at rates that were 100 to 1,000 times greater than federal regulators had estimated, new research shows. Using a plane that was specially equipped to measure greenhouse gas emissions in the air, scientists found that drilling activities at seven well pads in the booming Marcellus shale formation emitted 34 grams of methane per second, on average. The Environmental Protection Agency has estimated that such drilling releases between 0.04 grams and 0.30 grams of methane per second. The study , published Monday in the Proceedings of the National Academy of Sciences, adds to a growing body of research that suggests the EPA is gravely underestimating methane emissions from oil and gas operations. The agency is expected to issue its own analysis of methane emissions from the oil and gas sector as early as Tuesday, which […]

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Fracking to thank for lower emissions, API says

The American Petroleum Institute said hydraulic fracturing of shale reserves helped lead to the gas production increase credited with lowering U.S. emissions. The Environmental Protection Agency said the amount for greenhouse gasses emitted in 2012 — the last full year for which data are available — decreased 3.4 percent from the previous year. API spokesman Zachary Cikanek said an increase in the production of cleaner-burning natural gas was in part responsible for lower reported greenhouse gas emissions. "Innovations in hydraulic fracturing and horizontal drilling have helped make the U.S. the largest producer of natural gas in the world," he said in a statement Tuesday. "America is leading the world in reducing greenhouse gasses thanks, in part, to the revolution in natural gas production." Hydraulic fracturing, known also as fracking, is highly controversial because some of the chemicals used in the process are viewed as […]

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Natural gas output from US’ Marcellus edges closer to 15 Bcf/d: EIA

Natural gas production from the Marcellus Shale in May is expected to rise 253,000 Mcf/d above April levels and move closer to the 15 Bcf/d mark, the US Energy Information Administration said Monday in its monthly report on drilling productivity. The report said gas output from the Marcellus will rise to 14.77 Bcf/d in May from 14.52 Bcf/d in April, thanks in part to a projected increase in new well production/rig to 6,501 Mcf/d in May from 6,455 Mcf/d this month. Louisiana’s Haynesville Shale has begun to show new life after drillers left the play three years ago. The agency is projecting gas production will rise to 6.615 Bcf/d in May, 11,000 Mcf/d, above April’s 6.604 Bcf/d. Production in the play peaked at about 10 Bcf/d in 2012. Article continues below… Request a free trial of: Gas Daily Gas Daily offers the most detailed […]

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Natural gas output from US' Marcellus edges closer to 15 Bcf/d: EIA

Natural gas production from the Marcellus Shale in May is expected to rise 253,000 Mcf/d above April levels and move closer to the 15 Bcf/d mark, the US Energy Information Administration said Monday in its monthly report on drilling productivity. The report said gas output from the Marcellus will rise to 14.77 Bcf/d in May from 14.52 Bcf/d in April, thanks in part to a projected increase in new well production/rig to 6,501 Mcf/d in May from 6,455 Mcf/d this month. Louisiana’s Haynesville Shale has begun to show new life after drillers left the play three years ago. The agency is projecting gas production will rise to 6.615 Bcf/d in May, 11,000 Mcf/d, above April’s 6.604 Bcf/d. Production in the play peaked at about 10 Bcf/d in 2012. Article continues below… Request a free trial of: Gas Daily Gas Daily offers the most detailed […]

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Alaska adopts strict new rules on hydraulic fracturing

Alaska’s oil and gas regulatory commission has adopted new, more stringent rules governing hydraulic fracturing that include increased testing of water wells for contamination, its chairman said Wednesday in an interview. Final regulations are now being reviewed by state attorneys and still must be signed by Lieutenant Governor Mead Treadwell. The rules will require testing of all water wells within a half-mile radius of a well to be fractured, and will mandate testing of the water wells for contamination after the fracture job is completed, said Cathy Foerster, chair of the Alaska Oil and Gas Conservation Commission, or AOGCC. In some cases, testing of water wells prior to the fracturing may be required at the discretion of the commission, Foerster said. Article continues below… Request a free trial of: Gas Daily Gas Daily offers the most detailed coverage of natural gas prices at interstate […]

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On Fracking Front, A Push To Reduce Leaks of Methane

Scientists, engineers, and government regulators are increasingly turning their attention to solving one of the chief environmental problems associated with fracking for natural gas and oil – significant leaks of methane, a potent greenhouse gas. Loose pipe flanges. Leaky storage tanks. Condenser valves stuck open. Outdated compressors. Inefficient pneumatic systems. Corroded pipes. Forty separate types of equipment are known to be potential sources of methane emissions during the production and processing of natural gas and oil by hydraulic fracturing, or fracking, of underground shale formations. As the fracking boom continues unabated across the U.S., scientists, engineers, and government experts are increasingly focusing on the complex task of identifying the sources of these methane leaks and devising methods to stop them.   Photo credit: Tim Evanson/Flickr. "Fugitive" methane escapes from natural gas production sites, such as this one in North Dakota. "There are many, many, many possible leaking sources," said […]

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Amid showdown with energy-rich Russia, calls rise in Europe to start fracking

Europe’s newest weapon in the battle of wills with Russian President Vladimir Putin lies buried deep beneath the ancient oaks and rolling green pastures of this quintessentially English village. There, wedged in the bedrock, lie vast quantities of oil and natural gas — enough, when combined with the spoils of hundreds of other sites like it, to help kick Europe’s addiction to Russian energy. Or so says David Cameron. Ever since Russian forces took hold of Crimea last month, the British prime minister has been leading a chorus of conservative politicians and energy executives in a refrain they believe will spark a shale gas revolution in Europe: Frack, baby, frack. The push for a European boom in fracking — shorthand for hydraulic fracturing — has been underway for years, but it has taken on new urgency in recent weeks as fears grow […]

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Pa. Shale Impact Fees Reach Record Levels in 2013

As Pennsylvania shale production continues to soar, the state Public Utility Commission (PUC) announced Friday that impact fee revenue for 2013 hit record levels. With a total of 6,489 unconventional wells under development or in production as of December 31, 2013, shale producers contributed a total of $224.5 million in impact fees for the calendar year. This brings total impact fee revenue to more than $630 million over the past three years, in addition to the more than $2.1 billion in state tax revenue generated by the industry since 2008.    Marcellus Shale Coalition president Dave Spigelmyer issued this statement following the release of this data:   “This new stream of revenue is having a positive and real impact in communities with shale development as well as those without active Marcellus production. Whether these funds are invested in bridge and road projects, the purchase of new firefighting equipment, key environmental programs, […]

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Britain Confronts Gas Mother Lode With Fracking by Lord Browne

The hills of Lancashire, England, sit atop a mother lode of shale gas that may be extracted with hydraulic fracturing, or fracking. Photograph: Alan Clarke/Bloomberg Markets Close The hills of Lancashire, England, sit atop a mother lode of shale gas that may be extracted with hydraulic… Read More The hills of Lancashire, England, sit atop a mother lode of shale gas that may be extracted with hydraulic fracturing, or fracking. Photograph: Alan Clarke/Bloomberg Markets Close John Browne, a former CEO of BP, is a prime mover behind efforts exploit Britain’s natural gas through fracking. … Read More John Browne, a former CEO of BP, is a prime mover behind efforts exploit Britain’s natural gas through fracking. Photograph: Alan Clarke/Bloomberg Markets Close Andrew Pemberton, who keeps 130 cows, says he’s worried that his dairy business is located downstream from a proposed… Read More Andrew Pemberton, who keeps […]

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Cuadrilla: UK Could Produce Shale Gas in 4 Years in Emergency

LONDON, April 2 (Reuters) – Shale gas production in Britain could begin within four years if the current crisis in Ukraine escalates to such an extent that a national state of emergency is declared, the chief executive of Cuadrilla Resources said. Britain is in the early stages of exploring for shale gas to counter its growing dependence on imports, and geologists have estimated it could have shale resources equivalent to several hundred years of demand. Cuadrilla is the only company in Britain so far to have used hydraulic fracturing, or fracking, in test wells in Lancashire. It is two to three years away from establishing whether its British shale gas operations are commercially viable, Chief Executive Francis Egan said at an event at think-tank Chatham House on Tuesday evening. If the Ukraine crisis worsens dramatically and Britain declares a state of national emergency and removes all constraints, "it would […]

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Eagle Ford Gas Draws Steelmakers to Texas’ Coastal Bend

Upstream, midstream and downstream sectors of the oil and gas industry have long contributed to the economy of South Texas’ "Coastal Bend," a 12-county region whose hub city is Corpus Christi. Not only is the region accessible to onshore and offshore oil and gas fields, but it boasts the infrastructure necessary to ship, store and process hydrocarbons and hydrocarbon products. Lured by the region’s growing port facilities and ready availability of cheap natural gas from the prolific Eagle Ford Shale play, two foreign-owned firms are bringing a newcomer – iron and steel manufacturing – into the Coastal Bend’s economic fold. "The addition of iron and steel manufacturing to the regions’ economy will further diversify and strengthen our growing economy," said Roland Mower, CEO of the Corpus Christi Regional Economic Development Corp. "In fact, this region is experiencing an uptick in interest from international manufacturers interested in leveraging our low-cost, […]

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Eagle Ford Gas Draws Steelmakers to Texas' Coastal Bend

Upstream, midstream and downstream sectors of the oil and gas industry have long contributed to the economy of South Texas’ "Coastal Bend," a 12-county region whose hub city is Corpus Christi. Not only is the region accessible to onshore and offshore oil and gas fields, but it boasts the infrastructure necessary to ship, store and process hydrocarbons and hydrocarbon products. Lured by the region’s growing port facilities and ready availability of cheap natural gas from the prolific Eagle Ford Shale play, two foreign-owned firms are bringing a newcomer – iron and steel manufacturing – into the Coastal Bend’s economic fold. "The addition of iron and steel manufacturing to the regions’ economy will further diversify and strengthen our growing economy," said Roland Mower, CEO of the Corpus Christi Regional Economic Development Corp. "In fact, this region is experiencing an uptick in interest from international manufacturers interested in leveraging our low-cost, […]

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Well integrity a fracking concern, British study finds

March 25 (UPI) — A study published Tuesday in the British journal Marine and Petroleum Geology finds underground wells used for shale exploration may cause water contamination. A study from Research Fracking in Europe, or ReFINE, finds the structural casing of underground wells may present a risk to underground water supplies. In the Marcellus shale play in the United States, the study found around 6 percent of the 8,000 wells had some sort of well integrity issue. In the United Kingdom, it found about one half of one percent of active wells showed evidence of failure. With European countries looking to replicate U.S. success with shale exploration, the study found the data on well failure rates of onshore wells in Europe were "scarce." Richard Davies, the project’s leader from Durham University, said well integrity will be an issue if the shale narrative evolves in Europe. "The data from the […]

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London sees energy security through shale

British Energy Secretary Michael Fallon said the British economy needs to rely more on domestic energy reserves like shale gas for national security’s sake. "We have to develop more home grown energy like shale," Fallon said in an interview with the Sunday Telegraph. The British Geological Survey in June estimated the Bowland shale formation in the north of the country contains 1.3 quadrillion cubic feet of natural gas. The government says shale could ensure energy security for a country where net natural gas imports are on pace to increase from 45 percent of demand in 2011 to 76 percent by 2030. Protesters last year staged several demonstrations to protest shale operations. The practice is seen as a threat to the environment. The newspaper reported the British economy has relied on imported natural gas since output from the North Sea began its decline in 2005. Fallon said Russia’s grip on […]

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CNPC JV Starts Shale Gas Development in Sichuan

A joint venture of China National Petroleum Corp (CNPC) and domestic companies has started drilling its first shale gas well in the southwest Sichuan province, CNPC said on Wednesday. Sichuan Changning Natural Gas Development Co last week started drilling the Changning H3-6 well in Changning block and is expected to finish drilling in 70 days, CNPC said on its website (news.cnpc.com.cn). Sichuan Changning Natural Gas Development Co was founded in Dec 2013 by CNPC, Sichuan Energy Investment Co, Yibin State Assets Operation Co and a Beijing investment fund. The company is China’s first joint venture by an oil major and domestic companies dedicated for shale gas development, it said. CNPC, parent of PetroChina , plans to drill some 50 shale gas wells in Changning block this year. Shale gas production in Changning block is expected to be 1.0 billion cubic metres in 2015, it […]

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China’s Shale Gas Development Potential

; China’s potential in shale gas production is nearly as staggering as its potential growth in demand  for natural gas. The U.S. Energy Information Administration estimates that China possesses by far the world’s largest reserves of technically recoverable shale gas. Although China’s shale gas industry is not as advanced  as the United States’, it could be the most advanced outside of North America. China’s target is to produce 60 billion to 100 billion cubic meters of shale gas by 2020, but there are severe limitations to hitting the target. China is more likely to produce somewhere around 25 billion cubic meters of shale gas by then. In total, China will realistically be able to access 275 billion cubic meters to perhaps 300 […]

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Hess starting up North Dakota natgas plant, may boost Bakken output

Hess Corp will begin selling natural gas from its Tioga, North Dakota, plant this month, firing up the station weeks after severe weather delayed its expansion, the company said Friday. The plant’s start-up may help boost oil production from the prolific Bakken shale after about 100 producing wells had to be shut earlier this year to minimize flaring due to the delays, the state Industrial Commission said this week. "Due to the unusually harsh winter weather, we’re slightly behind our initial plans, but we expect to start selling residue gas this month," Hess spokesman John Roper said. The plant will be able to process 250 million cubic feet per day (mmcfd) when it starts operating, nearly twice as much as its initial design. The station had been shut since late last year as Hess worked on the expansion. North Dakota flares nearly 36 […]

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Technology to Create New Water Source for Marcellus Operators

Oil and gas producers working in the Marcellus shale play near Pittsburgh now have a new option for water resources for hydraulic fracturing operations. Winner Water Services, a Pennsylvania-based joint venture between privately owned technology company Winner Global LLC and Columbus, Ohio-based Memorial Battelle Institute, a private, non-profit applied science and technology development company, was formed a year ago to provide water management services for oil and gas, including source water and water treatment. Initially focused on the Marcellus and Utica shale plays, Winner treats acid mine drainage water, which can be used in hydraulic fracturing in place of fresh water drawn of Pennsylvania’s lakes and streams. Using technology licensed from Battelle to the Winner family to treat acid mine drainage water, Sharon, Pennsylvania-based Winner has designed and is ready to install its first treatment system next month just outside of Pittsburgh, said John Ontiveros, Winner president and CEO, […]

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