Thursday, August 16, 2012

New Format

Unfortunately, time constraints have kept me from posting daily news updates, let alone more in-depth posts. 

For the time being then, I will tweeting the news stories on the Marcellus Shale in Pennsylvania as I find them. I hope to do news highlights posts on Sundays, as well as other posts.

I will continue to update the resources section and update meetings and events as I find out about them. 

Future plans still include expanding into overall energy issues for the Keystone state.

Sunday, August 12, 2012

Weekend Penn. Marcellus News Update, 8/12/12

As always, please click the headline to read the complete story.

Marcellus pipeline project could benefit Marcus Hook
Sunoco Logistics Partners L.P. announced on Thursday a "binding open season" for Marcellus producers to commit themselves to buying capacity on the Mariner East pipeline project. Pipeline companies typically request binding bids only when they are certain that a project will get enough commitments to proceed.
The Mariner East project, which calls for repurposing an existing Sunoco pipeline that crosses Pennsylvania, was originally conceived in 2010 as a way to find markets for Marcellus ethane by sending the material to Philadelphia for shipment by sea to Gulf Coast petrochemical plants. Those plants in Texas and Louisiana convert or "crack" ethane into a key ingredient used in the manufacturing of plastics.
But the project has been reimagined in recent months to include propane, which, like ethane, is found in abundance in the rich "wet gas" produced in the Marcellus wells in southwestern Pennsylvania.
Marcellus producers have already begun trucking propane to Sunoco's Marcus Hook location for loading on ships for export to Europe, according to MarkWest Energy Partners L.P., which is working with Sunoco on the Mariner project. Propane fetches a premium price in Europe as a heating fuel and a raw material for chemical producers.
Audubon Pennsylvania, the Ruffed Grouse Society and the Marcellus Shale Coalition have organized a series of meetings across southeastern and Central Pennsylvania to draw hunters, anglers and other outdoor enthusiasts into the discussion of post-Marcellus Shale drilling habitat restoration.
Paul Zeph, director of conservation for Audubon Pennsylvania, said the organizations hope to develop "input to the gas drilling industry regarding how they are doing, concerns, issues, etc.
"We're looking for people who can also voice support for a partner effort to work with the industry to create the kind of habitat we want when drilling is completed in the future."
Billed as "listening sessions," the meetings will follow the facilitated method of developing the questions and suggestions to be taken from the sessions to the gas industry.
Drilling into Marcellus shale deposits is banned in Pittsburgh, yet hydraulic-fracturing, or fracking, operations in the countryside nearby have helped bring in jobs and boost demand for office space in Pennsylvania’s second-biggest city. “Like eds and meds, like steel once was in Pittsburgh, it would be the industry to grow and employ people and turn the economy around,” Mayor Luke Ravenstahl, 32, said of gas extraction. Nearby drilling can provide a “growth mechanism” the city can use to propel a rebound, he said. The city faced insolvency in late 2003, as the population and employment fell.
Impressions Media has launched nepaenergyjournal.com, a new website covering the Marcellus Shale energy industry in Northeastern Pennsylvania.
The site, a companion to the quarterly NEPA Energy Journal magazine, features all of the coverage contained in the magazine, additional content from local and national sources and additional resources and information. Digital replica versions of each magazine are available free on the site.
Sunoco Logistics Partners LP on Friday begins a binding open season for Project Mariner East, a pipeline project to transport propane and ethane from the Marcellus Shale areas in western Pennsylvania to southeastern Pennsylvania.
An open season is when the developer of a pipeline accepts bids from companies that want to use it. Developers use nonbinding open seasons to determine demand for a pipeline and binding open seasons to obtain commitments for the pipeline’s use.
Even with police watching the rally, protesters seemed unfazed.
“We’re here to say: ‘This is our homeland, and we will protect it,’” said Sandra Steingraber, an ecologist and author.
Said protester Kat Stevens: “This is the place that makes the destruction of Pennsylvania possible.”
Beyond supporting drilling operations in Pennsylvania, Schlumberger is a nuisance to Horseheads residents because of the silica dust it spreads, the noise it makes and its bright overnight lights that “make Yankee Stadium look dim,” protester Ruth Young said.
The group said finding new sources of energy is important, but the focus should be on going green.
“The sooner this fracking bridge to nowhere is gone, the sooner the workers can be trained for the green-collar economy,” Young said.
The rally was organized by Shaleshock Direct Action Working Group, a coalition of community members from Chemung, Cortland, Schuyler, Seneca, and Tompkins counties. The organization’s mission is to “defend people, land and water from hydro-fracking.” Its website can be found at dontfrackwithus.org.

Thursday, August 9, 2012

Penn. Marcellus News Update 8/8/12

Marcellus to Top Shale Gas Production
The Powell Shale Digest, a Texan energy industry newsletter, stated that after considering a recent U.S. Energy Information Agency report, we can expect the Marcellus Shale to become the top producer among national gas fields.
Real drilling operations commenced on the Marcellus Shale just five years ago. However, given the massive reserves it harbors, the Marcellus Shale has a formidable momentum.
Development in Pennsylvania's Marcellus Shale accounted for one-fifth of the nation's natural gas reserve increase in 2010, and the new numbers on how much gas is trapped in the formation lead one industry group to predict the Marcellus soon will be the new leader in domestic shale plays.
Nationwide, proved reserves of natural gas increased by the biggest year-over-year margin since the Energy Information Administration began publishing estimates, with a 12.8 percent increase in 2010, the agency said in its latest annual report.
Governor Tom Corbett was joined by elected state officials and representatives of labor and business to highlight the importance of continued state efforts to bring a petrochemical complex to Pennsylvania. The Governor detailed the steps the state has taken so far to secure this project and the challenges ahead.
The proposed facility in Beaver County would create 10,000 construction jobs and more than 10,000 positions in spinoff production and manufacturing industries. Job impacts would be felt across Pennsylvania.
"If Shell decides to build this plant, that $4 billion investment will be felt statewide," Corbett said.  "Pennsylvania has the chance to become the keystone of the new industrial revolution.
Chesapeake Energy Corp. -- which has billed itself as "America's Champion of Natural Gas" and is the country's second largest natural gas producer -- said Tuesday that it has turned off the spigot and will see a 7 percent decline in its natural gas production in 2013.
"This will bring to an end our likely unprecedented public company record of 23 consecutive years of gas production growth, which has taken Chesapeake's gas production from 10 million cubic feet per day in 1993 to more than 300 times that level currently and in the process has helped transform the U.S. gas market," Chesapeake CEO Aubrey McClendon said on a conference call with analysts Tuesday morning.
By the end of 2013, Chesapeake expects its natural gas production to drop by about 430 million cubic feet per day, or 14 percent, from its peak of 3.4 billion cubic feet per day this year.
Want to know more about what a major chem­i­cal pro­cess­ing plant would mean for Beaver County? A west­ern Penn­syl­va­nia eco­nomic devel­op­ment group is hold­ing two infor­ma­tional ses­sions, aimed at answer­ing ques­tions about the ethane cracker Shell is con­sid­er­ing build­ing near Monaca.

Monday, August 6, 2012

Commmentary: Newark Basin Drilling Ban is All NIMBY


The Newark Basin in SE Pennsylvania may have only a fraction of the recoverable amounts estimated for the Marcellus Shale. This, coupled with depressed natural gas prices, make any exploratory drilling, let alone production, unlikely in the foreseeable future.  Those facts didn’t stop state senators Chuck McIlhinney (R-10) and Bob Mensch (R-24) from introducing a bill banning drilling in Montgomery, Berks and Bucks counties as soon as they heard of the USGS report on the possible reserves.  In fact the bill specifically states that the commonwealth, “may not issue well permits to engage in oil and gas operations within the geographic boundaries of the South Newark Basin as defined in the (USGS) report.”

The senators provided a vague and weak rationale for their bill, claiming that Act 13, which limits the ability of local governments to regulate drilling, was meant for the northern tier counties and that the Newark Basin for some reason required further study, something that apparently not needed for the Marcellus region. 
It seems to me and many others that the reasons why this midnight moratorium was pushed through was NIMBYism and political pandering and has nothing to do with geology or scientific data.  As pointed out recently in the Pittsburgh Post-Gazette:
The issue has become a political hot potato in Bucks County, where many communities have strict zoning and saw the new law as jeopardizing their suburban way of life.
People in Bucks were still fuming at the April meeting where Mr. McIlhinney said he announced his intentions for a moratorium. Things got so loud that he and other elected officials there could barely get a word in.
Some in the crowd felt they had been sold a bill of goods -- that they had been assured Act 13 wouldn't apply to their communities. According to news reports of the meeting, Mr. McIlhinney, too, said he had believed that when he voted for Act 13. He promised to get the law amended so that it wouldn't apply outside Marcellus Shale areas.
Defending the moratorium to Senate colleagues late last month, Mr. McIlhinney reiterated that he had been unaware of Act 13's reach.
Seems many voters in those counties weren't concerned about Act 13 when they thought it only stripped some poor rural communities of local control, an attitude that changed they realized it applied to them too. Throw in the recent USGS report and the specter of gas drilling in well-heeled communities suddenly became a too real for many.  Thus the Senators pushed through a NIMBY amendment to placate voters and shore up their support.

Now, maybe the senators and their constituents suddenly developed concerns over drinking water contamination and became anti-fracking activists, although these concerns seem to vanish past the county lines.* But even if the wells ran unattended and emitted fresh air and water as byproducts, some people in these burbs would be up in arms.  Look at the opposition in wealthier areas to threat of having to merely look at wind turbines. More likely, the mere thought of industrial-type facilities populated by rough-hewn blue-collar workers and serviced by large trucks popping up in their communities was too much to bear -think of the effects on real estate values.  No, in my opinion this ban has little to do with the need for reasonable study and planning and worries about groundwater pollution, it’s all about NIMBYism.  The part of America that consumes huge amounts of energy per capita and spews huge amounts of CO2 in the process doesn’t worry about the side effects of that energy production, they just don’t want it to intrude on their insulated bubble of existence.

*I fully realize that there are many voters in these counties legitamtely concerned about pollution, fracking, energy etc. on a scale greater than their immediate surroundings. Nevertheless, NIMBy rules in many communities there and in my own neck of the woods.  As long as people don't see how their sausage is made and that it's made far away they don't care.

Sunday, August 5, 2012

Weekend Penn. Marcellus News Update, 8/5/12

Pa. environmental chief locks horns with activists

Michael Krancer, Gov. Corbett's chief environmental regulator, seems to delight in doing battle with critics of the state's oversight of the Marcellus Shale gas boom.
In May, Krancer said that Delaware "smells like the tail of a dog" because of its opposition to drilling regulations proposed for the Delaware River Basin. In a congressional hearing, he challenged a Cornell University scientist to a duel over hydraulic fracturing (just kidding, Krancer said).
Then there were Krancer's snarky skirmishes with the U.S. Environmental Protection Agency over regulation of drilling, which is traditionally a function of state agencies like Pennsylvania's Department of Environmental Protection, the agency Krancer heads.
"We realize and recognize that EPA is very new to all of this and the EPA's understanding of the facts and science behind this activity is rudimentary," Krancer wrote to EPA Administrator Lisa Jackson this year.
In an interview last week, Krancer said he was not out to pick fights with opponents, only to engage in mutual enlightenment.

Local officials confident in Marcellus Shale zoning ruling

A panel of Commonwealth Court judges ruled July 26 that zoning provisions in Act 13 were unconstitutional, and the state cannot force towns to allow natural gas drilling and facilities in areas where local zoning rules prohibit them.
The state immediately appealed the finding to the state Supreme Court and requested an October hearing. Among plaintiffs in the lawsuit are South Fayette, Cecil, Peters, Mount Pleasant and Robinson, Washington County.
Brian Coppola, Robinson supervisors chairman, was pleased with the ruling that the statewide zoning requirements were unconstitutional.
"We got everything that we had asked for before this [Act 13] legislation had passed," Mr. Coppola said. "We got the impact fees, but we maintained local zoning control."
He was confident the Supreme Court will uphold the decision.
The Pennsylvania Housing Finance Agency will make state funds available for low-income housing projects in the Marcellus Shale region, the agency announced Wednesday.
In February, WPSU reported an uptick in homelessness and the rising cost of rent as Tioga County and others saw an influx of drillers with plenty of dollars move into the area.
That caused rent for some properties jump from $800 to $3,000 a month, according to the WPSU report, leaving some residents homeless.
Sometimes, even in politics, you have to admit you’re wrong. Gov. Tom Corbett and members of the Legislature were wrong to strip local municipalities of their zoning rights in Act 13, the Marcellus Shale law. Even zoning land “residential” would not make any difference if drillers want access to the land. That part of the Marcellus Shale bill has become so unpopular that it is being challenged in court, and the “little guys” are winning. Commonwealth Court struck down that part of the law last week, going so far as to call it “irrational.”
Alcoa AA +2.32% announced today that Alcoa Oil & Gas was awarded a contract from Pennsylvania General Energy (PGE) to produce 3,500 feet of aluminum alloy drill pipe for gas drilling in the Marcellus Shale formation of Central Pennsylvania.
Alcoa's 4.5" drill pipe will extend the reach of the carrier-mounted drilling rig used on natural gas wells in the Marcellus Shale formation to a total depth of approximately 7,500 feet. This is 1,000 feet deeper than conventional steel drill pipe can penetrate without using larger, more costly rigs.
Reserves in the Marcellus shale may be underestimated.
"I think it's possible we'll find, as production data begins to come in — Pennsylvania is a state that has significant lags in reporting of production data — we will begin to see those numbers inching up," said EIA Administrator Adam Sieminski.
Sieminski testified Aug. 2 at a hearing of the House Energy and Power Subcommittee titled "The American Energy Initiative: A Focus on Growing Differences for Energy Development on Federal vs. Non-Federal Lands." The hearing was part of the House Republicans' ongoing American Energy Initiative.
Natural gas drilling -- also called hydraulic fracturing or fracking -- recently became a more immediate concern for Montgomery and Bucks counties after a U.S. Geology Survey published in June revealed a large natural gas reserve lies beneath the densely populated region. The South Newark Basin, which stretches across central New Jersey into eastern Montgomery County, may contain up to 1.6 trillion cubic feet of gas, according to the report. That’s almost enough gas to power the country for just one month.
Local Legislative Reaction
The realization that fracking in the county was a possibility led to swift legislative action by the region’s representatives. On the last day of the session, June 30, state legislators slipped a ban on drilling in the South Newark Basin into a tax law, which passed. The ban on granting drilling permits will extend to 2018 to give the state time to evaluate the potential of the reserves and the impact on the environment.
The ban was also an attempt to protect the region from the new natural gas development law, Act 13, which negated municipal zoning regulations and gave state agencies sole authority in determining where drilling for natural gas can occur.
Penn State Extension will host a web-based seminar on Thursday exploring the ramifications of the recent court decision that struck down part of the state’s recently passed law governing Marcellus Shale natural-gas development.

Titled “A Blow to Act 13?: The Impact of the Commonwealth Court’s Decision on Local Zoning and Natural Gas Development in Pennsylvania,” the one-hour webinar will begin at 1 p.m. Free and open to the public, the session will be of special interest to municipal officials and attorneys.