Tuesday, December 11, 2018

Conservation Groups Sue Trump Administration Over Seismic Testing In Atlantic Ocean

Environmental groups opposed to offshore drilling sued the federal government on Dec. 11 to prevent future seismic tests for oil and gas deposits in Atlantic waters off the U.S. East Coast. Seismic testing, which uses air gun blasts, violates federal laws that protect marine mammals, endangered species and national environmental policy, according to the lawsuit filed in U.S. District Court in Charleston, South Carolina, against U.S. Secretary of Commerce Wilbur Ross and the National Marine Fisheries Service. The U.S. fisheries service in November gave initial permission to five companies to conduct seismic airgun tests beneath a vast region off the East Coast. The permits allow marine wildlife to be harassed but not killed.


Mariner East Opponents Lose Before Previously Empathetic Judge

Kurt.jpegKurt Knaus

Pennsylvania Energy Infrastructure Alliance

Mariner East opponents have lost and lost miserably. Their latest maneuver before a previously empathetic PUC Administrative Law Judge Barnes just died.

An administrative law judge (ALJ) with the Pennsylvania Public Utility Commission (PUC) today struck down pipelines opponents’ last-ditch effort to shut down the Mariner East projects, ruling against a petition they filed claiming that the pipeline builder hasn’t done enough to ensure communities and emergency responders have the information they need regarding safety.


PUC Administrative Law Judge Elizabeth H. Barnes

What makes this decision so interesting is that the administrative law judge who ruled against opponents here is the very same administrative law judge who ruled in favor of opponents in May, shutting down operations of the Mariner East 1 pipeline and halting construction of Mariner East 2 pipeline for weeks on end. That judge, Elizabeth Barnes, eventually had her decisions in those earlier cases overturned by the full Public Utility Commission.

This same administrative law judge’s most recent ruling, though, builds upon a string of court decisions at every level over the years to find that Mariner East is legally permitted and that the builder is in compliance with safety requirements.

The facts in this case were clear. Previous court rulings have already established that the pipeline builder has ensured safe construction and met community planning requirements. Beyond that, the Mariner Emergency Responder Outreach (MERO) program has trained 2,350 individuals since 2013 across the pipeline’s entire footprint, giving them guidance on hazardous materials and public safety sources.

This is in addition to annual awareness and emergency response training sessions with local responders, officials and excavators. More than 2,100 attendees received training last year. These are just a few of the many points that make clear the pipeline meets safety requirements.

The administrative law judge’s ruling is the latest in a string of court decisions at every level over the years to find that Mariner East is legally permitted and that the builder is in compliance with safety requirements. The facts are clear, this is settled law, and the case is closed. It’s time to end the ideological challenges and put this project to work for Pennsylvania.

Visit the Pennsylvania Energy Infrastructure Alliance website for more details and background on this and other critical natural gas infrastructure projects.

Editor’s Note: One wonders what Senator “Absent Andy” Dinniman thinks now about Elizabeth H. Barnes, who he had lauded.

Want to support NaturalGasNOW an easy way?

Try the new Brave Browser and they’ll contribute for you!

The post Mariner East Opponents Lose Before Previously Empathetic Judge appeared first on Natural Gas Now.


Rice Brothers Want To Run EQT

You can’t beat a proxy fight. Listening to the bombastic charges leveled by both sides against the other, rhetoric spewed at the highest level — nothing beats a company’s management team and board facing off against outsiders. Monday morning, the wraps were pulled off a potential proxy fight in the oil and gas industry. Toby Z. and Derek A. Rice told independent producer EQT Corp. they aren’t satisfied with the direction of the Pittsburgh-based E&P player. It’s early in the potential proxy fight process; the Rices are suggesting improvements they believe will make EQT more efficient, return more on investment, and generally tighten the producer’s modus operandi. But the letter makes it clear: Should EQT pooh-pooh the Rice proposals, including installing Toby Z. as head of operations, and placing more experienced O&G people with plenty of planning expertise, are placed on the board and in the executive offices, fireworks are possible. EQT, for its part, is being polite: “EQT is a refreshed company with a new management team, new operating plan and substantially reconstituted board,” according to a requested comment from the company on the Rice boy’s moves. “The company is focused on achieving profitable growth by driving operational efficiency, solid free cash flow, balance sheet strength, disciplined capital allocation and the realization of synergies. We are confident that EQT is taking the right steps to deliver superior value.” Remember, it’s early. While the $8.2 billion cash, stock and assumed debt deal EQT put together to acquire the smaller but highly successful Rice Energy made EQT the largest natural gas producer by volume in the U.S., the Rices as EQT investors aren’t satisfied with size. Yes, they want returns on the market value of their 7-plus million shares of EQT stock, but they also need the company that carried their surname to carry on – not under that name, but in success in the field, on the pad, in the individual well drilled. “EQT must add proven operational experience to the board and senior management team – in particular, individuals with experience in large-scale operational planning,” the Rices recommend. Rice Energy before its acquisition was one of the most successful independent producers of its size in the industry. And much of that success dealt with planning – Rice executives were fanatical when it came to pre-planning of every move involved in D&C – much more than most of its peers. Its executives were often conference speakers, telling the Rice story on how efficiency leads to prosperity. “EQT should improve planning through a coordinated operations schedule to reduce costs of drilling and subsequent derivative operations (e.g., completions, production, marketing, etc.),” states the PowerPoint presentation the Rices have put together in their quest to improve EQT (found online at eqtpathforward.com). Analysts contacted by Kallanish Energy on the EQT-Rice situation said they weren‘t surprised by the Toby and Derek letter and PowerPoint, and that there was little doubt the production wasn’t spur of the moment. “The timing of the release comes before EQT’s conference call this Thursday to discuss the company’s 2019 capital program and updated analyst presentation,” Sameer Panjwani, director, Equity Research with Tudor Pickering Holt, tells Kallanish Energy. “I would be very surprised if this situation is not brought up during that call.” Panjwani told Kallanish Energy the Monday release of the letter to the board and accompanying PowerPoint will be additional pressure on EQT to reveal more details on the direction the company intends to move – and how it intends to get there. “We have a proven, detailed business plan to generate an incremental $400-$600 million of pre-tax free cash flow per year above EQT’s current plans, equaling greater than $1.0 billion of free cash flow per year,” the Rice’s presentation states.“ This plan would match EQT’s current five-year production goals but generate twice the cash flow for shareholders.” The Rice letter states that over the past few weeks, in response to repeated outreach by a number of EQT investors asking for their assistance, the Rices engaged in private discussions with EQT chairman Jim Rohr and CEO Rob McNally “to express our concerns and propose solutions, which included, among other things, inserting Toby Rice into the organization with proper authority and support to oversee operations. “Unfortunately, given the lack of reciprocal engagement – and EQT pushing forward with establishing its 2019 operational plan and budget – it has become apparent that they are unwilling to make the changes needed.” The Rices quietly state that should the EQT board and company executives refuse to act upon the Rice recommendations, “we are prepared to nominate identified director candidates for election to the EQT board, if necessary.” “We have been talking to a number of EQT investors, and there appears to be a great deal of support for the Rice team: Tudor Pickering Holt’s Panjwani told Kallanish Energy. “Their proposal is not going away anytime soon.” There is one more unique twist to the potential EQT-Rice boys’ proxy fight. Of EQT’s 12 board members — certainly one not likely to lose his seat to someone with more E&P and planning experience — is Daniel J. Rice IV, former Rice Energy CEO. Joe Barone President Shale Directories, LLC


Monday, December 10, 2018

EOG Resources’ Legacy South Texas Assets On The Market

EOG Resources Inc. (NYSE: EOG) recently put a chunk of its South Texas position on the market as the Houston-based E&P works toward strengthening its balance sheet by paying down debt. The South Texas asset package, being marketed for sale by TenOaks Energy Advisors LLC, comprises operational control in legacy fields covering 15,621 gross (13,681 net) acres. The largely contiguous, conventional asset in the prolific Frio trend area is projected to generate roughly $8.3 million of cash flow, according to TenOaks. While speaking at a conference last month, EOG’s COO, Billy Helms, said the company has laid out a strategy to strengthen its balance sheet and, as a result, plans to pay down about $3 billion of debt through 2021. As of Sept. 30, the company’s total debt outstanding was $6.4 billion and had generated more than $1 billion of free cash flow for the year.


Sunday, December 9, 2018

Mexico Energy Reform: Potential Dispute Settlement Mechanisms

On July 1, 2018, López Obrador won the Mexican presidency and his party obtained a congressional majority—sufficient to enact legislation, but not to amend the Constitution. The new president has made few statements on energy reform.  Andrés Manuel López Obrador’s advisers differ about energy reform: Some say it will remain untouched, while Secretary of Energy Rocio Nehal has called for partial counter-reform. Other voices anticipate amendments that will return Pemex to a semi-regulator role, bypassing the independent agency created in 2013. In light of this, it is relevant to review the legal framework governing investors’ oil development contracts.


Pennsylvania Supreme Court Nixes Pipeline Condemnation Challenge

17d9481.jpg?resize=75%2C85Jim Willis
Editor & Publisher, Marcellus Drilling News (MDN)


The Clean Air Council attacked Mariner East land condemnations as a way to frustrate pipeline development, but Pennsylvania Supreme Court just nixed it all.

One of the ways anti-fossil fuel groups have tried to stop the Mariner East 2 Pipeline project is by tying it up in court. Various lawsuits have been filed going back years. One litigant, a Big Green group headquartered in Philadelphia, the so-called Clean Air Council, has tried repeatedly to get the courts to deny Mariner East 2 the right to use eminent domain in cases where landowners refuse to cooperate. The Clean Air Council argued Mariner East 2 is not a “public utility” and, therefore, not entitled to the use of eminent domain. That argument flamed out.

Pennsylvania’s Commonwealth Court ruled, in May, that, yes,Mariner East 2 is a public utility entitled to use eminent domain if it needs to do so. The Clean Air Council had one last card to play, taking the case to the Pennsylvania Supreme Court. They played it, and lost.

Last week, the Pennsylvania Supreme Court said it will not hear the case, leaving in place the Commonwealth Court decision.

The Supreme Court of Pennsylvania refused to hear an environmental group’s allegations that a Sunoco Inc. unit abused its eminent domain power assembling land for the controversial Mariner East 2 natural gas pipeline, according to an order made public Thursday.

With its brief order issued Wednesday and made public Thursday denying the Clean Air Council’s petition for allowance of appeal, Pennsylvania’s highest appeals court left intact a Commonwealth Court ruling that blocked most of the council’s efforts to challenge the pipeline’s use of eminent domain as a state-approved public utility, though now the lower court is able to take up the group’s sole remaining claim over whether Sunoco is constrained by the state constitution’s Environmental Rights Amendment.

The state Supreme Court gave no reason for the denial.


“This ruling does not dispose of the entirety of our case,” said Alex Bomstein, senior litigation attorney for the Philadelphia-based Clean Air Council. “This was a partial loss but not a complete loss.”

Bomstein said the Commonwealth Court ruling blocked the first six of the group’s claims against Sunoco, but reserved original jurisdiction over whether Sunoco, by using the governmental power of eminent domain, also had to assume the government’s responsibility under the Environmental Rights Amendment for assessing its project’s impact on the state’s air and water.

If Sunoco could exercise government power without shouldering the same responsibility as the government, it would set a precedent that could threaten other constitutional protections, Bomstein said.

“It would be very easy for the government to avoid its constitutional requirements by delegating things to non-state actors,” he said.

Further consideration of the Clean Air Council’s remaining claim had stalled in the Commonwealth Court, which Bomstein said may have been a result of the court waiting to see what the state Supreme Court did with the rest of the case.

The rest of the Commonwealth Court’s April decision had overturned the Philadelphia Court of Common Pleas and ordered that court to grant Sunoco summary judgment on the other six claims.

The Clean Air Council had sought to have the Philadelphia trial court independently determine whether Mariner East served a valid public purpose and could therefore be certified as a public utility in order to use eminent domain, but the Commonwealth Court said such challenges needed to be brought as part of actual eminent domain proceedings.

Counsel for Sunoco declined to comment.

About the shortest and sweetest and to the point ruling we’ve ever seen:


Editor’s Note: It’s so nice to see the arguments of these gentry class shills summarily rejected by a Pennsylvania Supreme Court they were so positive would jump at this opportunity to expand the Commonwealth’s Environmental Rights Amendment into something absurd. They’re still hopeful because this very political  court “reserved original jurisdiction over whether Sunoco, by using the governmental power of eminent domain, also had to assume the government’s responsibility” under the Amendment. 

The shills will be back again, in other words, to try to pry open that crack in the door, either on the Mariner East 2 or some other pipeline case. The industry and others need to be prepared to demonstrate where such mischief would invariably lead — to chaos and some kind of hell akin to New York.

For more great articles on natural gas development every single business day, subscribe to Marcellus Drilling News using this convenient link.

Want to support NaturalGasNOW an easy way?

Try the new Brave Browser and they’ll contribute for you!

The post Pennsylvania Supreme Court Nixes Pipeline Condemnation Challenge appeared first on Natural Gas Now.


Saturday, December 8, 2018

Brazil’s Petrobras Nears Terms Over TAG Pipeline Sale

Brazil’s state-controlled oil company Petróleo Brasileiro (NYSE: PBR) could present a new sale and purchase agreement (SPA) before the end of December for the sale of the Transportadora Associada de Gás (TAG) pipeline, after a Brazilian Supreme Court injunction in July stalled the sale. The sale of TAG, which operates natural gas pipelines in Brazil’s north and northeast, could fetch Petrobras as much as US$7 billion, in one of the company’s largest-ever asset sales, three sources familiar with the process said. A new multibillion dollar syndicated loan is expected to finance the acquisition, two sources said.