The State Journal reports that average residential utility bills decreased 5.3 percent in West Virginia in 2012. According to a January 9 report from the Public Service Commission of West Virginia’s Consumer Advocate Division, a decline in natural gas utility rates was the main driver for the decrease. Consumer Advocate Division Director Byron Harris indicated that the average bill in January 2011 for electricity, gas, and telephone service was $292.81 per month, and the current average is $277.22.
The Post-Gazette reports that the U.S. Energy Information Administration (EIA) released a Short-Term Energy Outlook in which the EIA predicts that the Henry Hub natural gas spot price will average $3.74 per million British thermal units (MMBtu) in 2013 and $3.90 per MMBtu in 2014. The price averaged $4.00 per MMBtu in 2011 and $2.75 per MMBtu in 2012. On the other hand, according to the Washington Post, natural gas prices fell this week after the Energy Department reported that natural gas production rose to a record 73.54 trillion cubic feet a day in October.
The Kanawha County Commission is accepting bids for the development of a compressed natural gas (CNG) fueling port to service the County’s CNG-powered Chevrolet Tahoe and future CNG-powered fleet vehicles, reports the Charleston Gazette. Kanawha County Commission President Kent Carper stated that he would like “a good portion of the fleet to go toward natural gas.” Local government and business leaders in Kanawha County created the “Kanawha Converts” consortium in January 2012 to work on initiatives to convert local fleets to CNG in order to take advantage of the economic and environmental benefits offered by the cheaper and cleaner-burning fuel.
Houston-based Plains Marketing LP purchased 40-plus acres situated on the outskirts of Toronto, Ohio from FirstEnergy for its shale-related business activity. According to the papers filed in the Jefferson County recorder’s office on December 28, 2012, Plains Marketing LP paid $2.5 million for the property. Sources close to the transaction have indicated that Plains Marketing LP intends to transport wet gases from Utica shale wells to the site, where it will be stored and eventually shipped to refineries on the Gulf Coast.
Toronto Mayor John Geddis described the site, which has been vacant since 1986, as “prime property,” with barge docking facilities and the potential for a rail spur. Mayor Geddis further indicated that the project would likely bring jobs to the area in the near future.
The domestic steel industry is drawing increased investment as a result of the surge of natural gas production across the United States, Bloomberg News reports. Not only does hydraulic fracturing require the use of steel pipes, but additionally the low cost of natural gas is a huge benefit to steel producers. United States Steel Corporation recently spent $100 million on a facility to make tubular product for gas producers. According to a press release of U.S. Steel, “Energy industry customers utilize U. S. Steel Tubular Products’ casing, tubing, line pipe and couplings to help them locate, retrieve, transport and refine the oil and natural gas products that fuel the world.” U.S. steelmaker Nucor Corporation is constructing a $750 million Direct-Reduced Iron facility in Louisiana. Nucor entered into a long-term natural gas agreement with Encana Oil & Gas (USA) Inc. in order to guarantee a reliable, low cost natural gas supply for its existing and expected future needs. The international steel industry has also noticed the benefit of the natural gas boom in the United States. Austrian steelmaker Voestalpine AG has announced that it plans to focus on investments in North America.
On December 11, 2012, seven states sent the United States Environmental Protection Agency a Notice of Intent to Sue the agency for failing to address methane, a greenhiouse gas (GHG), emissions from the natural gas industry. The states assert that, although the revised new source performance standards adopted in August 2012 will have the incidental benefit of reducing methane emissions, U.S. EPA’s “failure to consider directly controlling methane emissions resulted in the omission of controls for certain operations that emit large amounts of methane.” The states intend to file suit in a federal district court if U.S. EPA does not respond favorably within the allotted 60-day waiting period.
GHGs, which currently are being addressed under various permitting regimes, are not the only air-related subject of increased regulatory oversight. On December 20, 2012, 30 environmental groups petitioned U.S. EPA to require ozone monitoring in natural gas production areas.
The Pennsylvania Public Utility Commission and Governor Tom Corbett announced yesterday that Pennsylvania’s Act 13 impact fees have generated $204.2 million in revenue through October 15, 2012. $108.7 million dollars will be distributed directly to local governments in areas hosting unconventional wells. The remaining $72.4 million finances the Marcellus Legacy Fund, which supports several statewide funds that finance infrastructure, environmental protection, and recreation. This chart provides a breakdown of how the $204.2 million will be allocated, while this chart indicates the amounts that will be dispersed to each county and local government. Four Southwestern town townships, South Fayette, Cecil, Robinson and Mount Pleasant, will have their impact fees withheld while drilling ordinances they have passed are being reviewed by the state.
Utica East Ohio Midstream has begun site preparation for a shale gas collection and processing plant, according to Cleveland.com. The site, located on 117 acres south of Hanoverton, Columbiana County, will be the home of the $400 million plant, which is estimated to have an initial capacity of 600 million cubic feet per day. The first phase of the plant is to be operational by May of 2013.
The Pittsburgh Business Times reports that Chesapeake Energy Corp. is in talks with Giant Eagle concerning a possible joint venture which would involve the installation of compressed nature gas (CNG) refueling facilities at Giant Eagle’s GetGo gas stations. Norman Herrera, Chesapeake’s director of market development, told the Business Times that Chesapeake may be involved as an investor in the infrastructure, and may also play a role in arranging agreements with local fleets to convert to CNG and commit to refueling at GetGos.
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In July 2011, PIOGA filed a motion in the U.S. District Court for the Western District of Pennsylvania seeking to hold the United States Forest Service in contempt of court for allegedly failing to adhere to the Court’s December 2009 preliminary injunction order in the Minard Run, et al. v. United States Forest Service, et al. litigation. That order prevented the Forest Service from requiring mineral owners to prepare a NEPA document before the development of oil and gas rights in the Allegheny Forest. It also required the parties to revert to a drilling proposal process that they had used from 1980 until the litigation began in 2009.
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Tags: Cracker plant,
Energy law,
Environmental law,
Fracking,
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Natural gas,
Natural resources,
PA Act 13,
Pennsylvania,
Pipeline construction,
Shale gas,
Utica Shale
On Tuesday March 20, Williams Partners L.P., a Williams Companies, Inc. affiliate, announced an agreement to acquire Caiman Eastern Midstream LLC, a midstream subsidiary of Caiman Energy, for $2.5 billion. Caiman Eastern’s holdings include existing physical assets such as a gathering system, two processing facilities and a fractionator. Expansions to the gathering system, processing facilities and fractionator are currently under construction. An ethane pipeline is also planned. The physical assets are supported by long-term contracted commitments for 236,000 dedicated gathering acres from 10 producers in West Virginia, Ohio and Pennsylvania. Through this acquisition, Williams Partners is able to establish a major footprint in the liquids-rich area of Marcellus shale. In coordination with this acquisition, Williams Partners is also announcing its intention to participate in a new joint venture with Caiman Energy to develop midstream infrastructure in the natural gas liquids and oil-rich areas of the Utica Shale, primarily in Ohio and northwest Pennsylvania.