Tuesday, December 2, 2008

Southwestern Energy activity


According to Southwestern Energy spokeswoman Elise Mitchell, the company has not flipped leases in the Marcellus Shale. She also said, "Southwestern Energy does utilize the services of various leasing companies to acquire leases, and we have been actively leasing in the Marcellus Shale region."

According to Mitchell, Southwestern Energy has 110,000 net acres in Pennsylvania for natural gas development.

She added, "The company has drilled its first four wells on its acreage in Bradford and Susquehanna Counties, of which two have been tested, one is waiting on completion and the other, the company’s first horizontal well, is expected to be completed in the fourth quarter 2008."

About the long-term potential of the Marcellus Shale, Mitchell said, the shale, "
has the potential to be a viable play across a significant geographical area generating economic benefits for all parties involved including the state and local governments, communities, landowners and the energy industry."




Hearings available online

Video coverage of a Nov. 18 Senate Majority Policy Committee public hearing on the opportunities and challenges of developing the Marcellus Shale are available at, www.senatorbaker.com.

Tuesday, November 18, 2008

Links to recent stories related to natural gas industry

http://www.scrantontimes.com/articles/2008/11/15/news/sc_times_trib.20081115.a.pg7.tt15wastewater_s1.2091720_loc.txt

http://www.scrantontimes.com/articles/2008/11/13/news/sc_times_trib.20081113.a.pg6.tt13susquehanna_s1.2086105_loc.txt

http://www.scrantontimes.com/articles/2008/11/10/news/sc_times_trib.20081110.a.pg1.tt10obama_s1.2077710_top2.txt

http://www.scrantontimes.com/articles/2008/11/08/editorial/sc_times_trib.20081108.a.pg12.tt08edit1_s1.2073546_edi.txt

http://www.scrantontimes.com/articles/2008/11/05/news/sc_times_trib.20081105.a.pg4.tt05state111_s1.2062381_loc.txt

http://www.scrantontimes.com/articles/2008/10/30/news/sc_times_trib.20081030.a.pg8.tt30gasrealestate_s1.2050255_loc.txt

http://www.citizensvoice.com/articles/2008/11/13/news/wb_voice.20081113.t.pg4.cv13cdcountybudget_s1.2086758_top3.txt

http://www.independentweekender.com/site/index.cfm?newsid=20183362&BRD=2279&PAG=461&dept_id=467076&rfi=8

http://www.thedailyreview.com/articles/2008/11/16/editorial/tw_review.20081116.a.pg4.tw16edit_s1.2093541_edi.txt

http://www.thedailyreview.com/articles/2008/11/14/news/tw_review.20081114.a.pg1.tw14pipeline_s1.2089961_loc.txt

http://www.thedailyreview.com/articles/2008/11/14/news/tw_review.20081114.a.pg1.tw14athens_s1.2090191_loc.txt

http://www.thedailyreview.com/articles/2008/11/13/news/doc491c6db11bc3f089894538.txt

http://www.thedailyreview.com/articles/2008/11/12/editorial/letters/tw_review.20081112.a.pg4.tw12letters_s1.2080081_let.txt

http://www.thedailyreview.com/articles/2008/11/07/news/doc4913c15f8a262861659241.txt

http://www.thedailyreview.com/articles/2008/11/05/news/tw_review.20081105.a.pg1.tw05yaw_s1.2065299_loc.txt

Lawsuit

According to Montrose attorney Michael Giangrieco, a ruling has not been made on lawsuit he filed on behalf of several landowners against Cabot Oil & Gas Corp.

The lawsuit is in the federal district court in Scranton. The landowners are attempting to have agreements they made with Cabot nullified.

The landowners are claiming the royalty clauses in the lease do not conform with state law.

Story link above in 'Link' box

Thursday, November 13, 2008

Chesapeake Energy venture


Chesapeake Energy is partnering with
StatoilHydro to develop the Marcellus Shale.
According to Chesapeake, StatoilHydro will acquire a 32.5% interest in Chesapeake's Marcellus Shale assets in Appalachia for $3.375 billion, leaving Chesapeake with a 67.5% working interest


About StatoilHydro :

StatoilHydro is a publicly traded company listed on the NYSE under the symbol, STO. The company has a 52-week trading range of, 15.51 - 43.31.

StatoilHydro has a market cap of 51.64B. In comparison, Chesapeake has a market cap of, 11.97 billion.


Formed in 1972, StatoilHydro is based in Stavanger, Norway.


StatoilHydro refines, markets, transports and develops petroleum and petroleum-derived products, including natural gas and oil. It has service stations in Scandinavia, Poland, the Baltic States of the former Soviet Union and Russia.

StatoilHydro homepage: http://www.statoilhydro.com/en/Pages/default.aspx




Friday, November 7, 2008

Natural gas workshop


Workshop information below:


THE GOVERNOR'S ADVISORY COUNCIL ON RURAL AFFAIRS
IMPORTANT MESSAGE
: PLEASE SHARE THIS INFORMATION WITH YOUR COLLEAGUES & FRIENDS


The Governor's Center for Local Government Services is pleased to announce that registrations are now open for a workshop on Natural Gas Drilling in the Marcellus Shale Region of PA. The workshop, which will focus on steps that local governments can take to prepare for the impacts of drilling in their region, will be held on November 18 in 11 sites throughout the state. Penn State University will provide a video downlink to a panel of experts on this topic. The brochure for this workshop is attached.

Please contact Kelly Lougee with any questions you have regarding the conference at klougee@psats.org or 717-763-0930.

Thursday, October 30, 2008

A committee, Cabot earnings



The Pennsylvania Oil and Gas Association and the Independent Oil and Gas Association of Pennsylvania have formed a joint Marcellus Shale Committee to represent the natural gas industry as it develops the Marcellus play.



Other Subject: Cabot Oil and Gas Corp. has reported its 3rd quarter earnings. A replay of a conference call that discussed the earning's report will be available through Saturday. The replay is accessible at, 800-642-1687 or, passcode 66519033.


At the end of the 3rd quarter, Cabot reported a net income of $67 million. Last year, the company reported a third-quarter net income of $35.5 million.

Cash flow from operations were at $148.3 million, compared with $86.8 million in last year's third quarter.
Discretionary cash flow totaled $161.0 million versus $121.7 million in last year's third quarter.


Below are excerpts from a press release issued by Cabot about its 2009 operations:


"We have always exercised significant discipline in our capital spending, regardless of general market conditions," said Dan O. Dinges, Chairman, President and Chief Executive Officer. "Over the last three years our investments have been around 120 percent of cash flow on average, working off an extremely low leverage ratio, and our 2008 organic effort will be consistent with our past discipline."


Marcellus Shale

Cabot's Marcellus play is focused in northeast Pennsylvania. During the second quarter call, the Company announced its first Marcellus production from a vertical well. Currently, Cabot has five producing wells (all vertical) with a combined average daily volume of 4-5 Mmcf per day. "Our goal was to be producing between 6-9 Mmcf per day by year-end. With the recent success of our wells, I now anticipate exceeding those early targets," commented Dinges.

The first horizontal well was completed with only three of six planned fracs. The well will be flowing to sales shortly. The Company plans to test the first three fracs and then proceed with the remaining three fracs in the next several weeks. "Right now we have two more horizontal wells cased and waiting for completion, along with five vertical wells in various stages of completion. We anticipate having all these wells flowing to sales by year- end," added Dinges.

The capital plan for 2009 is $600 million. "Much of this investment will be spent in East Texas and Pennsylvania," said Dinges. "Only nine percent of our planned expenditures is allocated to our other plays in the Company."

Dinges added, "We plan to allocate over 90 percent of our 2009 capital to the Marcellus and East Texas. In each area, we have received and continue to gather significant new data points. We have been delayed somewhat in our efforts with regulatory issues in Pennsylvania and limited quantities of frac material in East Texas. However, with that being said, we are very excited about the information we have gathered in each area and look forward to receiving test information from key wells that is imminent."



Tuesday, October 28, 2008

Citrus Energy

Profile of Citrus Energy from information gathered from company's Web site

Company Web site: http://www.citrusenergy.com


The company is private, not publicly traded. It has signed natural gas leases with the Wyoming County Landowners Group.

According to the company, operations in the Marcellus Shale will lead to an office opening in Pennsylvania. The company has offices in Castle Rock, Colo. and Plano, Tex.

Company owners are: Lance Peterson and David Oberbrockling. Oberbrockling is an engineer and Peterson, a geological engineer.

The company has operations in Oklahoma, Texas, Washington and Pennsylvania.


Oklahoma:
The company says it has drilled and completed several wells.

Texas: The company says it has a significant presence in the Barnett Shale, holding in excess of 20,000 acres.

Washington: The company says it has acquired or has options to acquire 70,000 acres in the Vader Coal Bed Methane Project. The company says it expects to begin development of the project late in 2008.

Pennsylvania: The company says it now has leasing operations and has formed a partnership with a drilling company to drill.


The company says its partners include: Oklaco Holding, a geologic/land company; Clearwater Enterprises, a gas marketing and consulting company; and, Boom Drilling.

Tuesday, October 21, 2008

Times-Shamrock natural gas drilling story links

http://www.scrantontimes.com/articles/2008/10/20/editorial/sc_times_trib.20081020.a.pg14.tt20edit2_s1.2023716_edi.txt

http://www.scrantontimes.com/articles/2008/10/15/news/sc_times_trib.20081015.a.pg4.tt15wastewater_s1.2016158_loc.txt

http://www.scrantontimes.com/articles/2008/10/14/news/sc_times_trib.20081014.a.pg7.tt14chesapeake_s1.2013270_loc.txt

http://www.scrantontimes.com/articles/2008/10/12/news/sc_times_trib.20081012.a.pg5.tt12engineer_s1.2009433_loc.txt

http://www.scrantontimes.com/articles/2008/10/06/editorial/sc_times_trib.20081006.a.pg12.tt06edit1_s1.1991917_edi.txt

http://www.scrantontimes.com/articles/2008/10/03/news/sc_times_trib.20081003.a.pg4.tt03gastips_s1.1988611_loc.txt

http://www.scrantontimes.com/articles/2008/10/01/news/sc_times_trib.20081001.a.pg7.tt01cheseapeake_s1.1982900_loc.txt

http://www.citizensvoice.com/articles/2008/10/20/news/wb_voice.20081020.t.pg2.cv20cd117th_s1.2026945_top3.txt

http://www.thedailyreview.com/articles/2008/10/09/news/doc48ed80e70227d179200827.txt

http://www.thedailyreview.com/articles/2008/10/08/news/doc48ec471adef17092958657.txt

http://www.thedailyreview.com/articles/2008/10/07/news/tw_review.20081007.a.pg5.tw07tow-council_s1.1996472_loc.txt

http://www.thedailyreview.com/articles/2008/10/07/news/doc48eae2b659d64283767703.txt

http://www.thedailyreview.com/articles/2008/10/05/news/tw_review.20081005.a.pg3.tw04video_s1.1992490_loc.txt

http://www.citizensvoice.com/articles/2008/10/15/news/wb_voice.20081015.t.pg14.cv15cdmoonlake_s1.2015756_loc.txt

http://www.citizensvoice.com/articles/2008/10/05/news/wb_voice.20081005.a.pg4.cv05cdcolumn_s1.1992129_top8.txt

http://www.thedailyreview.com/articles/2008/10/17/news/doc48f8083473b49260241186.txt

http://www.thedailyreview.com/articles/2008/10/16/news/doc48f6c285dd79f493132980.txt

http://www.thedailyreview.com/articles/2008/10/16/news/doc48f6c1718689e591461377.txt

http://www.thedailyreview.com/articles/2008/10/10/news/tw_review.20081010.a.pg1.tw10video_s1.2005601_loc.txt

http://www.thedailyreview.com/articles/2008/10/10/news/tw_review.20081010.a.pg1.tw10gas-lease_s1.2003685_loc.txt

http://www.thedailyreview.com/articles/2008/10/03/news/tw_review.20081003.a.pg1.tw03commish_s1.1989186_loc.txt

http://www.thedailyreview.com/articles/2008/10/03/news/doc48e5a2917ec52560033151.txt

http://www.independentweekender.com/site/index.cfm?newsid=20164919&BRD=2279&PAG=461&dept_id=467076&rfi=8

http://www.independentweekender.com/site/index.cfm?newsid=20164910&BRD=2279&PAG=461&dept_id=467076&rfi=8

http://www.independentweekender.com/site/index.cfm?newsid=20155386&BRD=2279&PAG=461&dept_id=467076&rfi=8

http://newage-examiner.com/sections/news/archive/2008/10/16/eaton-monroe-amend-zoning-regs.aspx

Friday, October 17, 2008

Susquehanna River Basin Commission upcoming meeting

SUSQUEHANNA RIVER BASIN COMMISSION


SRBC TO HOLD HEARINGS OCTOBER 21 AND 22 ON PROPOSED CHANGES
TO STREAMLINE REVIEW OF NATURAL GAS WELL DEVELOPMENT APPLICATIONS

WHAT: The Susquehanna River Basin Commission (SRBC) is holding two public hearings to receive comment on proposed regulatory revisions that will further protect the basin’s water resources and streamline the review of consumptive water uses by the natural gas industry. The proposed regulatory changes are available on SRBC’s web site www.srbc.net/programs/projreviewmarcellus.htm.

Hearing I:
Tuesday, October 21, 2008 7:00 p.m.

Where:
Lycoming College
Academic Center
Lecture Hall Room D001
Mulberry Street
Williamsport, PA

Hearing Chaired By:
Cathleen Curran Myers
SRBC Alt. PA Commissioner


Hearing II
Wednesday, October 22, 2008 7:00 p.m.

Binghamton University SUNY
Lecture Hall Complex
Lecture Hall 1
Route 434 (Vestal Parkway East)
Binghamton, N.Y.

Hearing Chaired By:
Kenneth Lynch
SRBC Alt. NY Commissioner

DIRECTIONS:
Lycoming College
http://www.lycoming.edu/admissions/OurCampus/CampusMap.html

Binghamton University SUNY
http://www2.binghamton.edu/about/visiting-campus/maps-and-directions.html

Tuesday, October 14, 2008

Chesapeake Energy

Here is information provided by Chesapeake Energy in an Oct. 10 press release. The company is planning to discuss the topics below at its 2008 Investor and Analyst Meeting on Oct. 15 and 16.

The investor and analyst meeting is scheduled to be Web cast live from 2:30-5:45 p.m. on Oct. 15. On Oct. 16, the meeting will be on the Web from 8:30 a.m. to 1 p.m.

Replay of the meeting will happen for 30 days on the Web. The Web cast can be accessed by going to Chesapeake's Web site and selecting the "News & Events" section.

A slide show presentation is also available on the company's Web site.


============================
A) Financial Topics --

a. Sale of Leasehold and Production Properties:

The company plans to generate cases proceeds of $2.5- $3 billion in the fourth quarter from the sale of: a 25 percent interest in the Marcellus Shale; leasehold and associated production in three other areas; and a fourth volumetric production payment.

"Raising additional funds from asset sales in this environment will provide the company with more financial flexibility and the ability to either reduce debt more than previously planned or to potentially repurchase common stock," Chesapeake states in the press release.



b. Capital Spending:

In response to lower natural gas prices, "the company intends to further reduce its capital expenditures budget by approximately $1.5 billion in 2009 and 2010 through a combination of reduced drilling and lower leasehold expenditures," the company states.


B) Operational Highlights

As of Sept. 30, the company had estimated proven reserves of 12.1 trillion cubic feet of natural gas equivalent.
Chesapeake now uses 145 drilling rigs. By year's end, the company expects to operate 135-140 rigs, "and expects to keep its rig count flat to down in 2009 and 2010," the company states.


Side note, as of 12:30 p.m., Chesapeake's stock was 2.07 higher, a gain of 10.25 percent.

The company's 52-week range is, 11.99 - 74.00.

On Oct. 13, Howard Weil downgraded Chesapeake's stock from Market Outperform to Market Perform.

Jefferies & Co. rates Chesapeake's stock at a buy rating and with a $54 price target.

Friday, October 10, 2008

New publication

Penn State has developed a new publication on natural gas leasing. The publication is titled, "Natural Gas Exploration: A Landowner's Guide to Leasing Land in Pennsylvania."


The guide describes lease components, including language, length, payments, surface/subsurface rights, storage, pipelines and parties involved.

The guide also contains a question/answer section.

At http://naturalgaslease.pbwiki.com/Publications, Penn State also provides a sample lease courtesy of the National Association of Royalty Owners.


According to the NARO Web site, the organization's mission is to, "Encourage and promote exploration and production of minerals in the United States while preserving, protecting, advancing and representing the interests and rights of mineral and royalty owners through education, advocacy and assistance to our members, to NARO chapter organizations, to government bodies and to the public."

NARO is located at, http://www.naro-us.org/index.cfm?pageID=1&rnm=0.689520675843

Wednesday, October 8, 2008

Natural gas permits issued in 2008

Natural gas permits issued in 2008 by county according to DEP

Allegheny - 2


Armstrong – 380


Bradford – 22


Butler – 46


Cambria – 25


Centre – 35


Clarion – 225


Clearfield – 178


Clinton – 31


Crawford – 48


Elk - 132


Erie – 20


Fayette – 189


Forest – 8


Greene – 250


Huntingdon – 1


India – 363


Jefferson – 326


Lycoming – 51


McKean – 33


Mercer – 49


Potter – 46


Susquehanna – 44


Tioga – 13


Venango – 69


Warren – 20


Washington – 257


Wayne – 2


Westmoreland – 433

Environmental impact forum Oct. 16.



On Oct. 16:


Forum on environmental impact of natural gas drilling follows viewing of film, ‘Land Out of Time,’ that discusses the impact of gas drilling on the Rocky Mountains, at 7 p.m., at the Montrose Theater in Susquehanna County. Donation $2-4. Sponsored by Citizen's Watch and the Green Party of Pennsylvania.

Tuesday, October 7, 2008

Cabot Oil and Gas Corp

Cabot is based in Houston. As of June 30, the company had 23.2 billion cubic feet equivalent in natural gas and oil production in the Gulf Coast, West, East and Canada.

Canadian operations are based in Calgary; Western, Denver; Gulf Coast, Houston; East, Charleston, W.Va.

The company was founded in 1989. Company executives and pay: Dan Dinges, chairman and chief executive officer, $1.19 million; Scott Schroeder, chief financial officer and vice president, $595,000; Michael Walen, chief operating officer and senior vice president, $760,000.


Cabot total assest as of June 30 in thousands was $2,718,432
Cabot net income as of June 30 in thousands was $54,625
Cabot net earning per share - basic as of June 30 was 55 cents



On the stock market, Cabot around 12:30 p.m. today traded between 27.30 and 29.30. The company's 52-week high is 72.92 and low, 24.07. That's a 66.991 percent difference between high and low. Year to date, Cabot's stock is down 30.25 percent.


Cabot has a market cap of $2.84 billion.

On Oct. 2, Cabot provided a presentation during a "Merrill Lynch Global Energy and Small Cap Conference."

The company reported that by year's end it will have 137,000 plus acres in the Marcellus Shale and 135,000 plus acres in the Haynesville Shale. The Haynesville Shale is located in parts of Texas, Louisiania and Arkansas. The Shales are described by Cabot as its core areas.



Update on Eastern Region (includes Marcellus Shale, Huron Shale and Tight Sands):
* 778 billion cubic feet equivalent, 48 percent of company
* 99 percent natural gas
* 32-year reserve life
* 3,178 gross wells
* 3,000 miles of pipeline
* Resource potential --- 4.5 to 6 trillion cubic feet equivalent for Marcellus resource

Update on Marcellus Shale:
* 4 rigs in operation
* 14 wells drilled
* 6 wells producing
* In 2009, expect to have 60-80 wells. Now 30


Total company resource: 10.5 to 16 trillion cubic feet equivalent


Linke to presentation: http://www.cabotog.com/pdf/Merrill_Lynch_08.pdf

Note: Information will be provided on other natural gas companies

Tuesday, September 30, 2008

Links to recent natural gas articles

Links to recent articles/editorials that reference or are about natural gas in Times-Shamrock papers


For the Scranton Times-Tribune go to, http://www.scrantontimes.com/articles/
..2008/09/30/news/sc_times_trib.20080930.a.pg5.tt30regbriefs_s1.1981076_loc.txt ..2008/09/28/news/sc_times_trib.20080928.a.pg1.tt28dimock_s1.1959092_top2.txt
..2008/09/27/news/sc_times_trib.20080927.a.pg6.tt27lease_s1.1974203_loc.txt
..2008/09/25/editorial/sc_times_trib.20080925.a.pg10.tt25edit1_s1.1966297_edi.txt


For the Citizens Voice go to, http://www.citizensvoice.com/articles/
..2008/09/29/news/wb_voice.20080929.t.pg5.cv29cdcandidates_s1.1978574_top4.txt


For the Towanda Daily Review go to, http://www.thedailyreview.com/articles/
..2008/09/26/editorial/tw_review.20080926.a.pg4.tw26edit_s1.1972479_edi.txt
..2008/09/20/news/tw_review.20080920.a.pg3.tw17watershed_s1.1951519_loc.txt
..2008/09/20/news/tw_review.20080920.a.pg1.tw20shale2_s1.1960445_loc.txt
..2008/09/12/news/tw_review.20080912.a.pg3.tw12gas_s1.1941269_loc.txt


For Susquehanna County Independent, http://www.independentweekender.com/site/
..index.cfm?newsid=20124607&BRD=2279&PAG=461&dept_id=467076&rfi=8
..index.cfm?newsid=20114002&BRD=2279&PAG=461&dept_id=467076&rfi=8


For Wyoming County Press Examiner go to, http://wcexaminer.com/site/
..index.cfm?newsid=20123544&BRD=2310&PAG=461&dept_id=480505&rfi=8
..index.cfm?newsid=20123646&BRD=2310&PAG=461&dept_id=480505&rfi=8

Another landowners group is forming

Important Gas Meeting for Unsigned Landowners.
Sat. Oct. 11, 2008 at 10:00 a.m.
Lenoxville Community Hall
1 mile east of Interstate 81, exit 206,
on Rt. 374
Hear from a Geologist/Petroleum Engineer
and a Natural Gas Marketing Specialist
Find out about:
- The Chesapeake pullout
- State of Affairs
- Lease structuring
- Joining our Group
- Sponsored by NEPALA


For a listing of landowner groups (and lots more) go to, http://www.pagaslease.com/directory_public.php

Today, Tuesday, testimony on natural gas drilling in Harrisburg

Recent Times-Tribune article on testimony on natural gas drilling in Harrisburg

Hearing targets water use for drilling


Published: Sunday, September 28, 2008
By Robert Swift
HARRISBURG — The House Environmental Resources and Energy Committee plans a hearing Tuesday on the natural gas boom in the Marcellus Shale formation covering a large part of Northeast Pennsylvania. Testifying will be state environmental officials and oil and gas industry representatives.

Rep. Camille George, D-74, the panel chairman, said the hearing will focus on protecting water resources during drilling. “Each drilling operation could require up to 1 million gallons of water, and in recent weeks almost $400,000 in fines have been assessed against drillers in just two counties for either withdrawing water without a permit or starting well construction without a permit,” added Mr. George.

Mr. George has sponsored a comprehensive bill to tighten state regulation of drilling activities.

Pay to play

An effort to put a dent in Pennsylvania’s “Pay-to-Play” culture is being made by a group of House Republican lawmakers. This tag refers to the age-old practice of doling out lucrative government contracts to politically influential companies and campaign contributors. While these deals skirt the quid quo pro of an outright bribe, they exemplify an attitude of “You scratch my back, I’ll scratch your back.”

Rep. Robert Godshall, R-53, tackles this practice with a bill to ban the awarding of public contracts to those who made a campaign donation within the year prior to the contract being posted for bidding.

Another bill by Rep, Mike Turzai, R-28, would ban no-bid state contracts to private law firms, an ongoing practice that acquired the nickname of “pinstripe patronage” back in the Thornburgh administration.

The package includes a bill to require competitive bidding on executive and legislative contracts over $100,000.

“We’re not trying to set the Legislature out of the scope of this,” said Rep. Douglas Reichley, R-134. “We want a clean break with the practices of the past.”

Free ride

Drunks would be able to arrange for a ride home under a state-sponsored program if a Senate bill becomes law. The “Safe Ride Home Program” was the subject of discussion at a Senate committee hearing last week.

The bill by Sen. Stewart Greenleaf, R-12, would create a program in which an intoxicated individual at a licensed liquor establishment without a ride could alert a bartender and get a ride home either by taxi or from volunteer drivers. The state Liquor Control Board would have oversight for the program designed to reduce drunken driving.

A number of details will have to be ironed out for the bill to advance, among them a funding source.

Wisconsin’s “SafeRide Program” was mentioned by LCB director Joe Conti as a possible example to follow.

This program relies on participating taverns and a $5 surcharge on drivers convicted of DUI. The surcharge revenues go to the taverns and to reimburse “good Samaritan” drivers for travel expenses.

====

Note: Testimony will also be given by people from the natural gas industry, including Stephen Rhoads, of the Pennsylvania Oil and Gas Association.


Department of Environmental Protection Acting Secretary John Hanger also testified.

In another matter, several thousand acres (at least) were placed into gas leases during a recent Wyoming County Landowners Group signing session at Shadowbrook Inn & Resort in Tunkhannock Township.

Thursday, September 25, 2008

Natural gas stocks

Here are some natural gas stocks:


Cabot Oil and Gas
In April 1990, Cabot's stock was at 4.3221. The company's stock has a 52-week range of 32.10-72.92. The company expects to announce third-quarter earnings on Oct. 29.


Chesapeake Energy
In February 1993, Chesapeake's stock stood at, 1.1223. The company's stock has a 52-week range of 34.42-74.00.


Range Resources
In January 1992, Range Resources stock was at 2.7361. The company's stock has a 52-week range of 37.17-76.81.

PUC regulating retail market

PUC press release below:

HARRISBURG – The Pennsylvania Public Utility Commission (PUC) today initiated an action plan to increase effective competition in the retail market for natural gas supply.

The Commission voted unanimously to release a report documenting the work of the Stakeholders Exploring Avenues for Removing Competition Hurdles (SEARCH) working group and begin the action plan saying that efforts to increase effective competition in the retail natural gas market should “be concentrated on changing the market structure and its operation to reduce or eliminate barriers to supplier entry and participation.”

The action plan will be implemented in two phases and is to be completed within two years. The first phase will address items that the PUC can implement immediately to facilitate the development of a competitive market such as:

Creating an Office of Competitive Market Oversight with the Commission;
Expanding purchase of receivables programs; and
Pursuing legislative changes regarding capacity assignment/release.
Phase two will include three rulemakings to address issues for natural gas distribution companies (NGDC); natural gas suppliers (NGS) and business practices. NGDC issues include price to compare; reconciliation and quarterly adjustments; purchase of receivable programs; mandatory capacity release and non-discrimination; and cost recovery of competition-related activities.

NGS issues include creditworthiness of suppliers and reasonable security requirements. Business practice issues include standardization of NGDC system operating rules; specific operation rules regarding nomination and delivery requirements, tolerance bands, cash out/penalties and standardization of electronic bulletin boards.

The PUC will complete a formal milestone review in five years to evaluate the progress in development of more competition in the retail natural gas market. The report and additional information is available on the Commission’s Web site at www.puc.state.pa.us under natural gas/issues/stakeholders working group.

The 1999 Natural Gas Choice and Competition Law allows customers to purchase gas from independent suppliers, while still having their gas physically delivered by PUC-regulated distribution companies. The law directed the PUC to investigate the level of competition five years after the law went into effect and to report its findings to the General Assembly.

In October 2005, the Commission determined that “effective competition” did not exist in the retail natural gas supply market statewide based on the lack of participation of an adequate number of natural gas suppliers and customers in the retail natural gas market, and the identification of substantial barriers in the market structure and operation that prevented the participation of these groups in the market. The PUC then convened the stakeholders in the natural gas industry to examine avenues to increase competition.

The Pennsylvania Public Utility Commission balances the needs of consumers and utilities to ensure safe and reliable utility service at reasonable rates; protect the public interest; educate consumers to make independent and informed utility choices; further economic development; and foster new technologies and competitive markets in an environmentally sound manner.

For recent news releases, audio of select Commission proceedings or more information about the PUC, visit our Web site at www.puc.state.pa.us.

=============

Tuesday, September 23, 2008

Susquehanna River Basin Commission Hearings

SRBC PRESS RELEASE BELOW ABOUT HEARINGS:




SUSQUEHANNA RIVER BASIN COMMISSION



FOR IMMEDIATE RELEASE September 22, 2008

CONTACT: Susan Obleski, Director of Communications

Office: (717) 238-0423, x316 Cell: (717) 215-7278



SRBC TO CONDUCT HEARINGS ON PROPOSED CHANGES TO STREAMLINE REVIEW OF NATURAL GAS WELL DEVELOPMENT APPLICATIONS, PROTECT WATER RESOURCES
Public Comments Accepted Until October 31


HARRISBURG, Pa. – The Susquehanna River Basin Commission (SRBC) today announced it is conducting public hearings on October 21 and 22 on proposed regulatory revisions that will further protect the basin’s water resources and streamline the review of consumptive water uses by the natural gas industry. SRBC’s proposed revisions are open for public comment through October 31.



Included among the proposed revisions affecting the natural gas industry, SRBC would:

- Require all requests for consumptive water use approval to go through SRBC’s approval by rule process – an administrative procedure – rather than SRBC’s standard consumptive water use application process.

- Expand the approval by rule process to allow project sponsors to utilize a broader range of water sources as part of their consumptive use approval, including public water supplies, discharges from wastewater treatment facilities and other lesser quality water sources, and withdrawals from other sources approved separately by SRBC. (The current approval by rule process applies only to water from public water suppliers, thus making project sponsors undergo the standard consumptive use application process for all other water sources.)

- Regulate projects on a drilling pad basis, versus the current process that addresses consumptive use requests on a company-lease area basis.

- Require projects to demonstrate compliance with state and/or federal law for the treatment and disposal of flowback or produced fluids, including brines.

- Incorporate the August 14, 2008 determination by the SRBC Executive Director that all quantities of water withdrawn or used for natural gas well development be reviewed effective October 15, 2008.

- Limit SRBC approval to five years.



“We expect the demand for water from the natural gas industry to continue increasing for some time,” said SRBC Executive Director Paul Swartz. “The proposed regulatory changes will allow the Commission to address this increasing demand in a more orderly fashion.”



Swartz said, “As a water management agency, we work to achieve a balanced approach, which means we both protect and promote the use of the basin’s water resources.”



While SRBC does not regulate water quality, the proposed regulatory changes include provisions specifically related to the flowback fluids and brines produced during the hydrofracing process. In addition to requiring project sponsors to comply with all federal or state laws related to the proper treatment and disposal of fluids and brines, SRBC would require projects to separately account for all such fluids or brines.



Swartz said, “As the Commission anticipates the final adoption of these regulatory changes, we have already put into practice several of the protective measures by incorporating them as special conditions into the dockets the Commission approved at its September meeting.”



In conjunction with the public comment period, SRBC has scheduled two public hearings to explain the proposed regulatory changes and to receive public comment. The hearings will be held on:

- October 21, 7:00 p.m., Lycoming College, Academic Center, Lecture Hall Room D001, Mulberry St., Williamsport, Pa.

- October 22, 7:00 p.m., Binghamton University, SUNY, Lecture Hall Complex, Lecture Hall 1, Route 434 (Vestal Parkway East), Binghamton, N.Y.



Persons planning to present oral testimony at a public hearing should provide prior notice, if possible, to Richard Cairo, General Counsel, Susquehanna River Basin Commission, 1721 North Front Street, Harrisburg, PA, 17102, Phone: (717) 238-0423, ext 306, Fax: (717) 238-2436, E-Mail rcairo@srbc.net.



The proposed regulatory changes are available on SRBC’s web site at www.srbc.net/programs/projreviewmarcellus.htm. Written comments can be submitted on or before October 31, 2008 to Richard Cairo, whose contact information is provided above.



SRBC is scheduled to take final action on the proposed regulatory changes at its next quarterly business meeting on December 4, 2008.



More than 72 percent of the tri-state Susquehanna watershed, covering portions of New York, Pennsylvania and Maryland, are underlain by the Marcellus and other organic-rich shale formations. Advancements in technology for capturing natural gas in those shale formations require operators to inject large amounts of water under pressure several thousand feet underground to fracture the formation to stimulate the flow of gas. For more information on SRBC’s regulation of natural gas well development projects, go to SRBC’s web site at www.srbc.net/programs/projreviewmarcellus.htm.



SRBC (www.srbc.net) is the governing agency established under a 100-year compact signed on December 24, 1970 by the federal government and the states of New York, Pennsylvania and Maryland to protect and wisely manage the water resources of the Susquehanna River Basin. The Susquehanna River starts in Cooperstown, New York, and flows 444 miles to Havre de Grace, Maryland, where the river meets the Chesapeake Bay.

Delaware River Basin Commission

While the focus has been on the Susquehanna River Basin Commission (which regulates much of the area where natural gas drilling is likely to occur), the Delaware River Basin Commission has also been dealing with natural gas exploration.

The group regulates a small portion of Lackawanna and Luzerne counties, as well as most of Pike County. Monroe and Carbon counties also fall under the commission's jurisdiction. So does a part of Schuylkill County. Parts of New York State also fall under the commission's jurisdiction, including Broome County.

The Marcellus Shale runs beneath the above stated counties.


Over the summer, the DRBC told Stone Energy Corporation to halt operation in Wayne County because it had not received the commission's approval.

Here's a link to the commission's page: http://www.state.nj.us/drbc/

Friday, September 19, 2008

Weekly federal natural gas report

Sept. 18 natural gas report====
General---

Here's Energy Information Administration weekly natural gas report, verbatim:


--- Natural gas spot prices decreased at most market locations in the Lower 48 States this report week (Wednesday–Wednesday, September 10-17), even as disruptions in offshore Gulf of Mexico production continue in the aftermath of Hurricane Ike. However, price movements were not uniform, and prices increased at some trading locations directly supplied by offshore Gulf of Mexico production, which was almost entirely shut-in for most of the week. During the report week, the Henry Hub spot price increased $0.17 per million Btu (MMBtu) to $7.82.


--- At the New York Mercantile Exchange (NYMEX), the price of the near-term contract (October 2008) had decreased to its lowest price in 2008 early in the week, closing at $7.248 per MMBtu on Thursday, September 11. However, the price increased nearly $0.631 per MMBtu in yesterday’s trading session. For the week, the September 2008 contract gained 51.7 cents per MMBtu, ending trading yesterday (September 17) at $7.91.


--- During the week ending Friday, September 12, the implied net injection of natural gas into underground storage totaled 67 billion cubic feet (Bcf). Working gas in underground storage as of September 12 totaled 2,972 Bcf, which is 2.1 percent above the 5-year (2003-2007) average.


--- The price of crude oil continued its recent steep decline, decreasing 5.1 percent during the report week. Nonetheless, a sharp increase of $5.90 per barrel in the West Texas Intermediate (WTI) average price yesterday appeared linked to macroeconomic conditions. The WTI price yesterday (September 17) averaged $97.39 per barrel, or $16.79 per MMBtu, which was $5.27 per barrel higher than the previous Wednesday.


Prices--

--- Spot natural gas prices moved lower this week in most regions of the Lower 48, despite severe reductions in supplies from the Gulf of Mexico offshore as the industry continued its efforts to recover from Hurricane Ike. On a regional basis, spot markets along the Gulf Coast in Louisiana and East Texas registered an average price decrease of $0.01 and $1.06 per MMBtu, respectively. Lower prices for crude oil (which competes with natural gas in end-user markets and upstream investment), as well as lower natural gas demand and infrastructure constraints after the hurricanes, likely contributed to lower prices. For example, Houston and its environs continue to lack electric power, much of which is fueled by natural gas, following the hurricane. Across Texas, roughly 2.5 million households were without electricity immediately after the hurricane, and about 1.6 million remained without power as of 10 p.m. yesterday (September 17). Nonetheless, the direction of price movements in week-to-week comparisons was not uniform with some regional infrastructure disruptions and demand characteristics resulting in scattered price increases. The price at the Henry Hub in Erath, Louisiana, was 17 cents per MMBtu higher on the week, ending trading yesterday (September 17) at an average of $7.82. The Henry Hub, as well as other locations in Louisiana, is supplied at least partially by offshore production, which was still reduced by more than 6 Bcf per day as of yesterday, according to the Minerals Management Service (see Other Market Trends below).

--- The largest price decreases on the week occurred in the Midcontinent region, which also has the lowest current prices in the country. Available Midcontinent supplies were abundant during the week as demand in the region was likely considerably lower because of flooding (another effect of a strong weather front and the recent hurricanes). Additionally, at least one major pipeline in the region, CenterPoint Energy Gas Transmission (CEGT) has been reporting inordinately high levels of linepack on the pipeline and enforcing balancing of deliveries and nominations. Price decreases were widespread in the region, with the largest ($1.79 per MMBtu) occurring in the eastern trading pool for CEGT. The average price in the Midcontinent region declined $1.49 per MMBtu to $4.09, which was 43 cents lower than the average price in the Rockies (which often in recent years has had the lowest prices in the country).

--- Contrary to the general decrease in prices across the country, market prices at Northeast trading locations increased during the report week. The average spot price in the region was $7.94 per MMBtu yesterday, which was 1 cent higher on the week. Although temperatures in the Northeast were mostly mild during the report week, the slight price increase may have followed from some heating load with night-time temperatures dipping below freezing in a few locales in New England. For the week, the average spot price for delivery off Transcontinental Gas Pipe Line in the Northeast (in the Transco Zone 6, Non-New York locations) increased by $0.13 per MMBtu to $8.17, a premium of $0.35 per MMBtu to the price at the Henry Hub.



Spot Prices ---

--- At the NYMEX, the price of the near-month contract (for October delivery) increased $0.517 per MMBtu during the report week to $7.910, owing to a surge in the price on Wednesday, September 17. The daily settlement price for the near-month contract on Thursday of last week reached the low point of $7.248 per MMBtu, which was the lowest price for a near-month contract since December 27, 2007 (for the January 2008 contract), and the lowest price for the October 2008 contract since trading on August 3, 2005. However, the general decline in the price of the contract recently was reversed yesterday, as the price of the near-term contract rose 63.1 cents per MMBtu during the trading session, marking the largest single-session gain in value for any near-term contract since a gain of 79 cents on October 16, 2006 (for trading of the November 2006 contract). Despite yesterday’s gain, which occurred on a day the price of crude oil gained $5.90 per barrel, the price of the near-term contract is still substantially less than during the chaotic aftermath of Hurricane Katrina in 2005, when the October contract expired at $13.907 per MMBtu. Relative to the past 2 years, the current contract price for October is 23 and 88 percent higher than the October 2007 expiration price of $6.423 and the October 2006 expiration price of $4.201, respectively.

--- The average futures contract price for the upcoming heating season (November 2008 through March 2009) rose $0.40 per MMBtu on the week to $8.517. This price is $0.70 per MMBtu more than yesterday’s Henry Hub spot price, suggesting an economic incentive to inject natural gas into storage. Beyond March 2007, the contracts for the next year increased but at more modest increments ranging between 24 cents and 18 cents per MMBtu. The 12-month futures strip (October 2008 – September 2009) settled yesterday at $8.40 per MMBtu, which is 31.4 cents higher than last week.



Storage---

--- Working gas in storage increased to 2,972 Bcf as of Friday, September 12, 2008, according to EIA’s Weekly Natural Gas Storage Report (Weekly Natural Gas Storage Report (see Storage Figure). This report week’s implied net injection of 67 Bcf is lower than the 5-year average injection of 77 Bcf and above last year’s injection of 63 Bcf. As a result, current inventories are now 2.1 percent above the 5-year average level of 2,911 Bcf. The difference between current inventories and levels last year at this time decreased to 4.6 percent, or 142 Bcf. If net additions through the end of October equal the average rate of the past 5 years, working gas stocks at the start of the heating season would be 3,390 Bcf.

--- The net injection came during a week in which about 38 Bcf of supplies were shut-in because of evacuations and other safety precautions related to Hurricanes Gustav and Ike in the Gulf of Mexico offshore taken by the industry, according to the Minerals Management Service. Reduced demand likely counteracted the effects of the large volume of supplies that were shut-in during the week, allowing for the substantial build in storage.

--- This week’s injection partly reflects moderate temperatures across the United States, which kept demand for heating and cooling needs low. For the week ending September 11, 2008, temperatures were slightly cooler-than-normal. However, the relatively low levels of 16 heating degree-days and 45 cooling degree-days for the week ending September 11 indicate minimal heating and cooling load for the country as a whole.


Other Market Trends ---

DOE Reports on Hurricane Impacts: The U.S. Department of Energy (DOE) has continued tracking the impact of the recent hurricanes, Gustav and Ike. Hurricane Ike made landfall near Houston, Texas, at 3 a.m. EDT on September 13, 2008, as a strong Category 2 hurricane. DOE reported as of 6 a.m., September 17, that there are almost 3 million customers without electric power in several States because of the weather-related conditions. The biggest outage remains in Texas where almost 2 million customers are without power. According to the Minerals Management Service (MMS), 6,087 million cubic feet per day (MMcf/d), or 82 percent of the Federal Gulf of Mexico’s (GOM) natural gas production, remains shut in. In addition, operators have shut in about 1.2 million barrels per day (bbl/d) of oil production or 96 percent of the Federal GOM total, as of September 17. According to the MMS, Hurricane Ike destroyed 28 of the 3,800 offshore production platforms in the Gulf of Mexico. The platforms that have been destroyed produced a total of 82 MMcf/d of natural gas and 11,000 bbl/d of crude oil. Furthermore, a total of 425 production platforms, or 59 percent of the Gulf’s 717 manned platforms, remain evacuated. A total of 50 drilling rigs or 41 percent remain evacuated.


Transportation ----

--- As of September 17, at least 10 interstate pipeline companies had force majeure declarations in place, according to the U.S. Department of Energy (DOE). These pipelines include Mississippi Canyon Pipeline, Trunkline Gas Pipeline, and Black Marlin Pipeline, all of which continue to assess damage to their facilities following last week’s landfall of Hurricane Ike. However, ANR Pipeline Company reported that it has completed inspection of its southeast area facilities, which were cleared for nominations for Wednesday’s gas day, while damage assessments of its Louisiana onshore and offshore facilities continue.


--- Sabine Pipe Line, LLC, lifted the previously declared force majeure on Tuesday, September 16, for a total of 11 points along its system, including 7 at the Henry Hub. However, compression at the Henry Hub complex remains unavailable at this time and Sabine advises its customers that gas flow through the system must be received at sufficient pressure.


--- Southern Natural Gas Company reported minor damage to its interconnection with the Henry Hub (Sabine Pipe Line) as a result of Hurricane Ike and notified customers that gas flow will be allowed at reduced levels. The company expects all repairs to be completed within 3 to 5 days.

--- Spectra Energy Transmission reported that there were no significant damages or effects to their facilities as a result of Hurricanes Gustav and Ike and anticipates that remaining inspections will be completed by the end of this week. Spectra owns and operates the Texas Eastern Transmission Corp. pipeline system, which has reported that there are currently no flows on its Cameron, South Pass, and Main Pass lines in Louisiana.


--- The Energy Information Administration (EIA) has confirmed that 19 natural gas processing plants remain shut down, which includes those plants still affected by Gustav, totaling an operating capacity of 9.42 billion cubic feet (Bcf) per day (approximately 54 percent of the capacity in Hurricane Ike’s path). In addition, EIA reports that 13 plants have resumed operations at reduced or normal levels totaling 5.28 Bcf per day operating capacity and that 6 plants with 2.65 Bcf per day of operating capacity are capable of restarting once power is restored or upstream gas flow commences.



Link to EIN: www.eia.doe.gov/oil_gas/natural_gas/info_glance/natural_gas.html



Links to recent Scranton Times Tribune articles natural gas subjects:

Each address begins with http://www.scrantontimes.com/articles...

/2008/09/17/news/sc_times_trib.20080917.a.pg4.tt17naturalgas_s1.1950032_loc.txt
/2008/09/17/news/sc_times_trib.20080917.a.pg4.tt17natgas_s1.1951488_loc.txt
/2008/09/12/news/sc_times_trib.20080912.a.pg5.tt12wastewater_s1.1941010_loc.txt

Wednesday, September 17, 2008

Wyoming County Landowners Group

The Wyoming County Landowners Group has rescheduled its natural gas lease signing session for only Thursday, Sept. 18 and Friday, Sept. 19. Residents in these municipalities are represented: Braintrim Township, northwest corner of Eaton Township, Forkston Township, Mehoopany Township, Meshoppen Borough, Meshoppen Township, Monroe Township, Noxen Township, Washington Township and Windham Township.

The signings are scheduled to be held at Shadowbrook Inn & Resort. The signing session scheduled for today, Sept. 17, has been canceled.

Also, here's a link to a Wyoming County Press Examiner article that details water withdrawals in Wyoming and Susquehanna counties approved by the SRBC last week:

http://www.newage-examiner.com/site/index.cfm?newsid=20123541&BRD=2310&PAG=461&dept_id=480505&rfi=8

Tuesday, September 16, 2008

Energy Information Administration report

Below is information from a Sept. 11 Energy Information Administration report. The report covers Sept. 3 to 10.


The report can be found at, http://www.eia.doe.gov/oil_gas/natural_gas/info_glance/natural_gas.html

Natural gas spot prices increased at most market locations in the Lower 48 States this report week (Wednesday–Wednesday, September 3-10) when Hurricane Ike moved closer to the U.S.

Mandatory evacuation orders in some areas were issued. In Louisiana, mandatory evacuation orders led to the shutdown of at least two processing plants, with a total of 700 million cubic feet (MMcf) per day of processing capacity.

According to the report, prices decreased in the Northeast with mild temperatures. The administration says in the report that the availability of natural gas in storage in the eastern part of the United States stands at 6.3 percent, above the 5-year average. The administrations says that the storage capacity indicates strong supply conditions.


On a separate note, the Wyoming County Landowners Group is holding a signing Wednesday through Friday at Shadowbrook Inn & Resort. Apparently, the signing will be for people who live in the western part of the county.

Another side note: www.pagaslease.com reports leases have been signed at as much as, $4,000. This is the link: http://www.pagaslease.com/lease_tracking_2.php

Monday, September 15, 2008

Chesapeake Energy

Chesapeake Energy publishes a newsletter quarterly for its divisions.

On Monday, I received a newsletter for the eastern division.

Titled 'Community Ties,' the newsletter is a, 'quarterly publication from Chesapeake Energy Corporation for the benefit of community leaders.'

Though I'm not a community leader (just a reporter by anyone's account so was surprised to get the newsletter!), I was glad to receive the newsletter, which highlights the company's contributions to communities located in its eastern division, including NEPA and the Southern Tier.

The newsletter is an example of how Chesapeake attempts to put out its story, unfiltered and from its point of view. It's pr.

For instance, the company says that it will be the sponsor of the "D&H Distance Run" this fall in Susquehanna County.

(Expect sponsoring of more community events by Chesapeake and other companies)

Chesapeake has also, "partnered with the Pennsylvania State University Extension Service to address questions and concerns," according to the newsletter. "Many parts of Pennsylvania and New York have experienced natural gas exploration, and Chesapeake wants to be a leader in providing accurate, balanced information to landowners and
community leaders," the newsletter states.


Chesapeake has set up a hotline for royalty owners. The call center number is, 1-877-CHK-1GAS. It is open Monday through Friday from 8 a.m. to 5 p.m.

Wednesday, September 10, 2008

Articles and more

Here's an article that recently appeared in the International Herald Tribune about the natural gas industry potential to provide home brewed energy---- http://iht.nytimes.com/articles/2008/08/25/business/gas.php.


The other day, Stacey Solie reported in the Scranton Times Tribune that Chesapeake Energy has asked Abington Township to treat wastewater. The treatment of wastewater has been discussed elsewhere in the region. In Tunkhannock, the Tunkhannock Borough Municipal Authority was also approached about treating wastewater. The TBMA, however, does not process wastewater.

In Susquehanna County, commissioners have discussed the issue, as well.

Stacey's article is at, http://www.scrantontimes.com/articles/2008/09/09/news/sc_times_trib.20080909.a.pg5.tt09abington_s1.1932950_loc.txt


Article on another natural gas in Susquehanna County Independent/Weekender (Times Shamrock) at this link:
http://www.independentweekender.com/site/index.cfm?newsid=20114002&BRD=2279&PAG=461&dept_id=467076&rfi=8

Tuesday, September 9, 2008

Court hearing, gas linke

The Times Tribune natural gas blog is listed as a resource at http://conserveland.org/pp/naturalgas. The site belongs to the Pennsylvania Land Trust Association.

Also, a hearing is scheduled for Sept. 16 in Scranton in federal court. The hearing stems from a lawsuit filed by Susquehanna County landowners against Cabot Oil and Gas
Corp. The landowners hope to nullify their contracts with Cabot.

According to court documents, the landowners claim in part that Cabot land men told them that they would never get more than what was being offered at the time. The landowners signed leases for, $25, $50 or $100 an acre.

The landowners are also claiming their contracts are void because the agreements with Cabot violate a state law that stipulates landowners are supposed to receive at least a 1/8 royalty.

--By Josh Mrozinski

Wednesday, September 3, 2008

SRBC meeting agenda

Susquehanna River Basin Commission
Notice of Commission Meeting and Public Hearing
DATE: September 11, 2008
LOCATION: Bucknell University, Elaine Langone Center, Center Room
Lewisburg, Pennsylvania
TIME: 1:00 p.m.

Agenda includes:

---- Consideration of a proposed rulemaking action regarding consumptive use by gas well development projects
---- A report on the present hydrologic conditions of the basin


Public Hearing – Natural gas well water withdrawal projects scheduled:

1. Project Sponsor and Facility: Chesapeake Appalachia, LLC (for operations in Chemung and Tioga Counties, N.Y., and Bradford, Susquehanna, and Wyoming Counties, Pa.). Application for consumptive water use of up to 2.075 mgd from various surface water sources and the following public water suppliers: Towanda Municipal Authority, Aqua Pennsylvania, Inc. – Susquehanna Division, Canton Borough Authority, Borough of Troy, and Village of Horseheads, N.Y.

2. Project Sponsor and Facility: Chesapeake Appalachia, LLC (Susquehanna River), Town of Owego, Tioga County, N.Y. Application for surface water withdrawal of up to 0.999 mgd.

3. Project Sponsor and Facility: Cabot Oil & Gas Corporation (for operations in Susquehanna and Wyoming Counties, Pa.). Application for consumptive water use of up to 3.039 mgd from various surface water sources and the following public water suppliers: Tunkhannock Borough Municipal Authority, Pennsylvania American Water Company – Montrose System, and Meshoppen Borough Council.

4. Project Sponsor and Facility: Cabot Oil & Gas Corporation (Susquehanna River), Great Bend Borough, Susquehanna County, Pa. Application for surface water withdrawal of up to 0.980 mgd.

5. Project Sponsor and Facility: Chesapeake Appalachia, LLC (Susquehanna River), Athens Township, Bradford County, Pa. Application for surface water withdrawal of up to 0.999 mgd.

6. Project Sponsor and Facility: Chesapeake Appalachia, LLC (Susquehanna River), Oakland Township, Susquehanna County, Pa. Application for surface water withdrawal of up to 0.999 mgd.

7. Project Sponsor and Facility: Cabot Oil & Gas Corporation (Susquehanna River),
Susquehanna Depot Borough, Susquehanna County, Pa. Application for surface water
withdrawal of up to 0.980 mgd.

8. Project Sponsor and Facility: Fortuna Energy Inc. (Susquehanna River), Sheshequin
Township, Bradford County, Pa. Application for surface water withdrawal of up to
0.250 mgd.

9. Project Sponsor and Facility: East Resources, Inc. (Crooked Creek), Middlebury Township,Tioga County, Pa. Application for surface water withdrawal of up to 0.036 mgd.

10. Project Sponsor and Facility: Chief Oil & Gas, LLC (for operations in Bradford County, Pa.). Application for consumptive use of water of up to 5.000 mgd.

11. Project Sponsor and Facility: Chief Oil & Gas, LLC (Sugar Creek), West Burlington Township, Bradford County, Pa. Application for surface water withdrawal of up to 0.053 mgd.

12. Project Sponsor and Facility: Fortuna Energy Inc. (Sugar Creek), West Burlington
Township, Bradford County, Pa. Application for surface water withdrawal of up to
0.250 mgd.

13. Project Sponsor and Facility: Chesapeake Appalachia, LLC (Susquehanna River), Wysox Township, Bradford County, Pa. Application for surface water withdrawal of up to 0.999 mgd.

14. Project Sponsor and Facility: Cabot Oil & Gas Corporation (Unnamed Tributary to Meshoppen Creek), Dimock Township, Susquehanna County, Pa. Application for surface
water withdrawal of up to 0.980 mgd.

15. Project Sponsor and Facility: Fortuna Energy Inc. (Towanda Creek), Franklin Township,Bradford County, Pa. Application for surface water withdrawal of up to 0.250 mg

16. Project Sponsor and Facility: Cabot Oil & Gas Corporation (Martins Creek), Lathrop Township, Susquehanna County, Pa. Application for surface water withdrawal of up to 0.980 mgd.

17. Project Sponsor and Facility: Cabot Oil & Gas Corporation (Tunkhannock Creek), Lennox Township, Susquehanna County, Pa. Application for surface water withdrawal of up to 0.980 mgd.

18. Project Sponsor and Facility: Cabot Oil & Gas Corporation (Meshoppen Creek-2), Lemon Township, Wyoming County, Pa. Application for surface water withdrawal of up to 0.980 mgd.

19. Project Sponsor and Facility: Cabot Oil & Gas Corporation (Meshoppen Creek-1), Lemon Township, Wyoming County, Pa. Application for surface water withdrawal of up to 0.980 mgd.

20. Project Sponsor and Facility: Chesapeake Appalachia, LLC (Susquehanna River),
Mehoopany Township, Wyoming County, Pa. Application for surface water withdrawal of
up to 0.999 mgd.

21. Project Sponsor and Facility: Cabot Oil & Gas Corporation (Susquehanna River), Tunkhannock Township, Wyoming County, Pa. Application for surface water withdrawal of up to 0.980 mgd.

22. Project Sponsor and Facility: Cabot Oil & Gas Corporation (Bowmans Creek), Eaton Township, Wyoming County, Pa. Application for surface water withdrawal of up to 0.980 mgd.

23. Project Sponsor and Facility: Range Resources – Appalachia, LLC (for operations in Bradford, Centre, Clinton, Lycoming, Sullivan, and Tioga Counties, Pa.). Application for consumptive water use of up to 5.000 mgd from various surface water sources and the following public water suppliers: Jersey Shore Joint Water Authority – Pine Creek and Anthony Facilities, Williamsport Municipal Water Authority, City of Lock Haven Water Department, Borough of Bellefonte, Borough of Montoursville, Milesburg Water System, and Towanda Municipal Authority.



Public Hearing – Projects Scheduled for Enforcement Action:
1. Project Sponsor and Facility: Cabot Oil & Gas Corporation; Teel, Greenwood, Ely, Lewis and Black Wells; Dimock and Springfield Townships, Susquehanna County, Pa.

2. Project Sponsor and Facility: Chief Oil & Gas, LLC; Kensinger, Spotts, and Poor Shot Wells; Mifflin, Penn and Anthony Townships, Lycoming County, Pa.

3. Project Sponsor and Facility: EOG Resources, Inc.; Houseknecht, Olsyn and Pierce Wells; Springfield Township, Bradford County, Pa.; PHC Well, Lawrence Township, Clearfield County, Pa.; Leasgang and Pichler Wells, Jay Township, Elk County, Pa.

4. Project Sponsor and Facility: North Coast Energy, Inc.; Litke Wells, Burnside Township, Centre County, Pa.

5. Project Sponsor and Facility: Range Resources – Appalachia LLC; McWilliams, Bobst
Mountain, Ogontz, and Ulmer Wells; Cogan House, Cummings and Lycoming Townships,
Lycoming County, Pa.; Gulf USA Well, Snow Shoe Township, Centre County, Pa.; Duffey
Well, Ridgebury Township, Bradford County, Pa.

6. Project Sponsor and Facility: Turm Oil, Inc., LaRue Well, Rush Township, Susquehanna County, Pa.



FOR FURTHER INFORMATION CONTACT: Richard A. Cairo, General Counsel, telephone:
717-238-0423; Ext. 306; fax: 717-238-2436; e-mail: rcairo@srbc.net; or Stephanie L.
Richardson, Executive Assistant, telephone: 717-238-0423, Ext. 304; fax: 717-238-2436; e-mail: srichardson@srbc.net.

-- By Josh Mrozinski

Tuesday, September 2, 2008

Chesapeake Energy Corp. Arkansas Shale Play

Article on portion of a Chesapeake Shale play in Arkansas ---


http://biz.yahoo.com/ap/080902/chesapeake_energy_bp.html


-- By Josh Mrozinski

Cabot Oil & Gas Corp. tour

Last week, Cabot Oil & Gas Corp. gave a tour of its natural gas well operations in Susquehanna County. State regulators from New York and Pennsylvania attended, including Pennsylvania Agriculture Secretary Dennis Wolff. It was the first time Cabot opened its drilling operations in the county to the public. About 20 people attended, including Susquehanna County Commissioner MaryAnn Warren.

Featured during the tour were separate locations where pipe will be laid, a drill in operation, a compressor station and a gas producing well. Cabot expects to lay about 10 miles of pipe.


After the tour ended, Wolff said that he found adequate safeguards for the environment. He also said revenue created by natural gas drilling could help struggling farmers keep their farms.


-- By Josh Mrozinski

Wednesday, August 27, 2008

New rules for water withdrawals from the SRBC

Beginning on Oct. 15, the Susquehanna River Basin Commission will require that every natural gas operator that seeks to draw water from the basin to develop wells in the Marcellus Shale will need to get prior approval from the commission.

In the past, only operators that consumed an average of 20,000 gallons per day or more during any consecutive 30-day period or withdrew 100,000 gallons per day or more during any consecutive 30-day period, were required to get prior approval.

The rule change marks the first time in the commission's history that such prior approval has been imposed on a class of projects, according to commission executive director Paul Swartz. "After careful consultation with the commissioners and my technical and legal staff, I decided it would be prudent to impose the more stringent provision on the natural gas industry to give us the ability to review and regulate the industry's individual and cumulative impacts on water resources," he said in a news release on Aug. 15.

According to Paula Ballaron, the commission's regulatory program director, gas companies were taking up a lot of the commission's time asking questions about how to "just skim under the radar" of the commission's regulations. "A lot of the effort, at least initially, was being spent on avoiding the whole thing," she said. Now, the commissions' exchanges with gas companies can be directed toward ensuring proper compliance with the regulations that apply to everyone.

Because the additional applications will probably strain the commission and slow down the gas companies, the commission is proposing new rules that would provide a "more streamlined administrative procedure for reviewing consumptive water uses by the natural gas industry." Specifically, the proposed rule change calls for expanding the "approval by rule" procedure, so that it is available regardless of the water source a gas company wants to draw from. Approval by rule currently only allows companies to buy water from public water supplies while waiting for approval to draw surface water from the basin's rivers and streams.

The proposed rules will be released for public comment at the commission's quarterly public meeting on Sept. 11 at Bucknell University.

Tuesday, August 26, 2008

Potential economic impact study

Penn State Professor Timothy Kelsey has written a paper, 'Potential Economic Impacts of Marcellus Shale in Pennsylvania: Reflections on the Perryman Group Analysis from Texas.'

Kelsey's report refers to a study of the Barnett Shale in Texas by Texas-based economic consultants Perryman Group. The Perryman Group completed its study this year.


In his report, Kelsey writes that many sectors in the state's economy will benefit from natural gas exploration and drilling, with opportunities for a number of industries, including construction, retail and trade.

He says the two-fold economic challenge is:
1- Finding ways to help local businesses and workers compete for the new business opportunities arising from natural gas
2- Finding ways to encourage businesses, workers, and royalty owners to spend locally


Kelsey also states that local jurisdictions will face "higher service costs due to natural gas exploration."

He adds, "In other words, local jurisdictions with natural gas wells very likely will face higher demands for services and thus higher costs, and yet receive little new revenues to pay for those services."

Monday, August 25, 2008

Chief Oil and Gas meeting

Chief Oil and Gas LLC has scheduled a 'community meeting' for Tuesday, Aug. 25, at the Harford Fire Hall. The meeting runs from 5 to 9 p.m. According to a Chief spokeswoman, the company is holding the meeting to inform the public about Chief's operations. She noted the company holds community meetings before they begin drilling wells in an area.

The Harford fire hall is located on Fair Hill Road. Any questions, call, 1-866-770-5827


-- Josh Mrozinski

Thursday, August 21, 2008

DEP Says Municipalities Have Some Say Over Gas Development

The state Department of Environmental Protection recently weighed in on the role local municipalities can play in regulating oil and gas development.

The issue is at the heart of a Supreme Court case, scheduled to be argued in September, over oil and gas ordinances adopted in Salem Township in Westmoreland County and Oakmont Borough in Allegheny County. Those ordinances were challenged in court by gas companies or industry groups.

The state law that regulates gas drilling, the 1984 Oil and Gas Act, explicitly precludes municipalities from regulating anything already outlined in the act. How wells will be permitted and plugged, what safety features and environmental controls are necessary, and how well sites must be restored are all outside local control.

But DEP filed friend of the court briefs in the cases stating that "the Department does not support a reading of the (Oil and Gas) Act that eliminates any municipal regulation of oil and gas well activities that bear only a tangential relationship to the features" already regulated by act.

DEP also states that municipalities "retain the authority to make land use determinations" as long as they are not redundant or do not conflict with the act.

In the Oakmont case, DEP held that the Commonwealth Court was wrong to say that the Oil and Gas Act preempts a municipality's right to limit gas drilling to certain zoning districts. A municipality must allow for gas drilling to occur somewhere, but the Municipalities Planning Code-- which regulates how towns and cities make zoning laws-- "does not require that mineral development be allowed in each and every zoning district," the Department argued. In essence, DEP said that municipalities can regulate where wells are drilled, as long as they do not try to regulate any aspect of how wells are drilled.

DEP noted that the court also mistakenly conflated setback limitations in the Oil and Gas Act (which determine how far away from structures and water sources a gas well can be drilled) with an understanding that gas operators have "unconditional permission to locate oil and gas operations 'anywhere' in a municipality" outside those minimum setback distances.

This reading, if adopted by the Supreme Court, could have profound implications for municipalities seeking to limit where gas wells can be drilled, particularly since most wells are planned for agricultural or residential zones where industry is not traditionally prevalent.

The DEP was less definitive in the Salem case, which challenged a more wide-ranging ordinance that regulated everything from the placement of access roads and pipelines, to the installation of tire-cleaning surfaces, to water-quality testing associated with oil and gas development.

The court acted properly in that case, the DEP argued, except that it failed to allow for local control over grading and slope standards for wells-- a fact that had been established by a previous precedent.

DEP relied on the court's description of the Salem ordinance for its opinion and was careful to tailor its agreement with the court's decision to that "limited description."

In its decision, the Westmoreland County Court had thrown out the Salem ordinance wholesale, without addressing the particular aspects of the ordinance piece by piece-- much to the dismay of the township's solicitor who had hoped to press the court for a finding on each specific issue.

Wednesday, August 20, 2008

Wine country visit yeilds gas

I went to the Finger Lakes region to visit wineries, but saw something that reminded me of Northeastern Pennsylvania:
A four-acre drill pad overlooking Keuka Lake.
In the middle of the gravel was a cement platform with some plumbing on top, waiting for a gathering pipe to carry the precious gas away.
The pad was just down the road from the quaint farmhouse bed and breakfast I stayed at. Turns out, the co-owner Keuka Overlook Bed & Breakfast, Bob Barrett, is also on the Barrington Township Zoning Board.
The Finger Lakes region is full of very practical farmers. While some have complained as the well was being drilled and trucks hauled in gravel, Mr. Barrett said since activity there has quieted so has the grumbling.
“The gas company was very straightforward and direct,” he said. “The roads took a beating, but they said the roads will be restored.”
Mr. Barrett tells me I also passed a portion of the 77-mile natural gas pipeline known as the Empire Connector being interred nearby, but I missed that. He said those crews are restoring the land to its prior condition or better. So far, he said the gas and pipeline companies have been responsible.
“There are lots of things that will be necessary in the future that we ought to accept and sacrifice for now,” he said.
-- David Falchek

Tuesday, July 29, 2008

Signs

As the Five Man Electrical Band sang, "...sign, sign everywhere a sign, blocking out the scenery breaking my mind...."


Signs of natural gas drilling can be found just about anywhere in Northeastern Pennsylvania, including on the roadways. The other day a truck with a tank that could hold thousands of gallons passed south through Tunkhannock on Route 29. On the truck, were words related to natural gas drilling, including brine.

Brine is water saturated with salt. And brine can be created as a by product of natural gas well development.

Other signs of natural gas drilling are the drilling sites of course. There are other items as well, such as natural gas drilling representatives staying at area hotels or attending municipal/school board meetings. And company offices. Cabot has buildings on Route 29, just north of Tunkhannock.

And then there are municipalities, who are adding language related to natural gas extraction to ordinances, including Eaton and Monroe townships.

The townships' joint planning committee is looking at adding definitions for natural gas and oil wells to zoning, among other items.

So, just look around and you'll see that natural gas well development is already starting to change the area. Post the signs you see.

Tuesday, July 22, 2008

Shale.TV

I searched the Internet recently and found an article by Ben Casselman of
the Wall Street Journal about a Web site that Chesapeake Energy Corp. expects to launch in the fall.

According to Casselman, the site is devoted to natural gas well development in the Barnett Shale in Texas.

http://online.wsj.com/article/
SB121669178244972553.html?mod=googlenews_wsj


-- Josh Mrozinski

Monday, July 21, 2008

Interscholastic Drilling

"Buy land," Mark Twain is alleged to have said, because “they aren't making anymore of it.” They aren't making any more oil either.
The university system of the State of Texas is lucky to have lots of land and the fossil fuel that goes with it. One hundred years ago, the state of Texas gave 2.1 million acres of land to the nascent state university that today includes Texas A&M and the University of Texas system.
Oil and gas bonuses and royalties from those lands in West Texas have been put into a “the Permanent University Fund,” an endowment created by the state's constitution. Over the years, that endowment has grown to $3.65 billion.
In Pennsylvania, other community groups have the potential to benefit financially from natural gas drilling activity. Tyler Memorial Hospital, school districts, municipalities, the Wyoming County Kiwanis and even the state of Pennsylvania itself have leased, or are considering leasing, mineral rights of their land to natural gas exploration companies.

-- David Falchek

Wednesday, July 16, 2008

Marcellus, meet Oriskany

Several dozen landowners in Bedford County have found themselves between a geologically formation and a hard place. They will likely be in court and tilting against a massive gas company resisting the sale of underground storage rights.

Here's a short summary of the twisted path that got them there.
They've already tapped their property natural gas once -- from the Oriskany sandstone formation. That,it seemed, could have been the end of it.

Then last year, Spectra Energy and New Jersey Resources unveiled plans for one area underlying about 40 parcels – for natural gas storage in those old Oriskany holes. The joint venture wants to pump natural gas into the ground – 12 billion cubic feet of it. The company got approval from the Federal Energy Regulatory Commission, which regulates interstate pipelines and storage.

The process has just started in federal court in Pittsburgh and a judge and a panel of experts, it is presumed, will make sure landowner are properly compensated for the underground storage rights.

Here's the problem: The landowners want to get to the natural gas in the Marcellus formation, which they also have underfoot. They fear that if the Oriskany layer is filled with natural gas, it would preclude them from teaming up with a natural gas company for getting their Marcellus gas for decades. A Marcellus lease and royalties, they figure, could end up being worth much more than a storage lease. The Oriskany layer, they say, could be productive again with modern fracking and drilling techniques.

-- David Falchek

Tuesday, July 15, 2008

Natural Gas Websites

Here's a Web site that provides information on natural gas and the natural gas industry. It's pretty informative and has a lot of information. The site is maintained by the Natural Gas Association --- http://www.naturalgas.org/

Also, apparently, YouTube has a number of videos on natural gas drilling and fracing. Search Google with "natural gas drilling" and one of the first entries is a YouTube video


--- Josh Mrozinski

Monday, July 14, 2008

DCNR Opens Bidding for Natural Gas Leases on State Forest Lands

The state Department of Conservation and Natural Resources today announced the tracts that will make up the 74,000 acres of state forest that will be available for new, deep- and medium-well natural gas exploration.

Bidding begins now and is open until Sept. 3 on the 18 parcels, which are in Lycoming and Tioga counties. The individual tracts range in size from 1,800 acres to 8,800 acres. Under DCNR well-spacing regulations, 289 possible well pad sites can be developed on the 74,000 acres, but in its environmental assessment, DCNR notes that it expects 35-50 well sites to be developed on the leased land.

Here is the Oil and Gas Lease Offering page that outlines the deal, including maps of the lease sale tracts, bid information, and a copy of the lease.

Here is the full release:

HARRISBURG (July 14, 2008) — Department of Conservation and Natural Resources Secretary Michael DiBerardinis today announced that the department will hold a lease sale for subsurface oil and gas rights on 18 tracts totaling 74,023 acres in the Loyalsock, Tiadaghton and Tioga state forests in Tioga and Lycoming counties.

“This lease sale is part of the policy announced earlier this year to focus on medium and deep gas drilling to limit the impact on the surface and on other uses of the forest,” DiBerardinis said. “We chose the tracts of land after extensive environmental reviews to protect the health of the forest now and in the future.

“Given the enormity of the nation’s energy demand, making less than an additional 4 percent of our state forest available for drilling is a reasonable decision that protects our forest ecosystem and helps meet energy demands,” DiBerardinis said.

DCNR will receive sealed bids for leases on each of the 18 tracts from pre-qualified bidders until 2 p.m. on Sept. 3. A list of bidders and the award decisions will be posted on DCNR’s Web site within 24 hours.

A lease is awarded to the highest bidder based on the amount of the first year’s land rental. A lease covers annual land rental amounts and possible royalties to be paid based on the volume of gas extracted.

“Only a small portion of the total acreage will be used for well site location,” DiBerardinis said. “For each tract, we have identified the number of well pads that are allowed, and we encourage the use of existing roads. There are portions of the tracts that cannot be developed on the surface to protect wild or natural areas, ecosystems, water bodies, recreational opportunities, or visual impacts from vistas and trails.

A comprehensive environmental review is conducted by DCNR as part of the lease sale planning process. Additional environmental reviews are done at the time of well permitting.

Lease sales are developed by first receiving nominations for the acreage from gas companies. Gas companies are required to submit competitive bids for the offered state forest acreage. Highest responsible bidders may then be issued contracts. DCNR retains ownership and complete control of the land.

The primary term of the lease is a 10-year period, which may be extended by production from the lease. A gas well may produce for several decades or more. The lease document, environmental review and maps are available at www.dcnr.state.pa.us (choose Forestry, then Oil and Gas on State Forest Lands).

Revenues generated from a lease sale go to the Oil and Gas Lease Fund, which by law must be used for conservation and recreation programs. The fund has been used to obtain the mineral rights to parts of the state forest where DCNR did not own them, to purchase the acreage for eight state parks and to expand 31 other state parks.

This lease sale responds to increased interest in the Marcellus Shale formation; a deep resource thought to contain large quantities of natural gas stretching from New York through Pennsylvania and into West Virginia. In Pennsylvania, the formation reaches the northern tier as far east as Wayne County and as far south and west as Greene County and the Pittsburgh area. New technology and increased gas prices have made it possible to recover the hard-to-reach fuel.

Since 1947, the department has held 72 lease sales, the last of which was in 2002. Currently, about 207,000 acres of the 2.1-million-acre state forest are under lease for gas production, with about 650 wells in production.

Thursday, July 10, 2008

There's a New Alliance in Town

The Rail-Trail Council of Northeastern PA; the Wayne County Oil and Gas Group; the Elk Gas Group; and the Thompson Area Oil and Gas Group announced on June 29 that they are forming a coalition to negotiate gas leases. This new alliance is called Susquehanna Wayne Oil and Gas Group, otherwise known at SWOGG.

SWOGG joins the Northern Wayne Property Owners Alliance and the Lower Wayne Property Owners’ Association, which are looking to negotiate leases that protect the land.

Here the link to SWOGG’s press release:

http://www.swogg.org/files/SWOGG_press_release_Final3.pdf

And here’s the address for the SWOGG Web site:

http://www.swogg.org/

Wednesday, July 9, 2008

Wansacz Bill Would Allow Gas Rights Owners Better Access to Production Data

State Rep. James Wansacz (D- Old Forge) recently introduced legislation that would amend the 1984 Oil and Gas Act to give property owners greater access to information about the amount of gas produced from wells on their land.

House Bill 2620 mandates that gas operators install a secured meter at each well head to display the volume of gas produced. It allows property owners to access the meters once every six months for a reading. It also includes protections so that competing operators can't sneak a peak at the meters ("the meter shall include an overlaying locked box or other mechanism to prevent the meter's being read without an access device").

The bill also amends the section on well reporting requirements to allow property owners to review the annual production reports operators submit to the Department of Environmental Protection. Owners are allowed to review the part of the report that relates to their properties once every six months.

What the bill does not change is the fact that gas operators are allowed to keep their production data confidential for five years- a rarity among gas-producing states, which tend to have more frequent- often monthly- public reporting requirements.

The bill, and another by Rep. Sandra Major (see below), may be part of a larger effort by lawmakers to overhaul oil and gas laws in the state. As reported by R.B. Swift, the Times-Tribune's Harrisburg bureau chief, last week, Mr. Wansacz said that lawmakers are planning a comprehensive review of the Oil and Gas Act now that a drilling boom is under way in Northeastern Pennsylvania.