Monday, February 27, 2012

NYS Shale Gas Horizons: First Marcellus, Then Utica, and Now Upper Devonian?

“These increased reserves and resources are primarily the result of the enhanced geologic understanding and advanced development planning that occurred during 2011,” commented Norse CEO Mark Dice. “Newly certified shale oil resources in Western New York are an exciting addition to our asset portfolio.” commented Dice. [emphasis mine]
I connect the dots on this as follows:  Recent western PA-based exploration of such shale layers as Rhinestreet, falling within the younger-than-Marcellus Upper Devonian, is leading insiders to an upward reassessment of the potential for shale gas, shale gas liquids, and shale oil — from popularly obscure formations underlying parts of both western PA and western NY (the latter of which is host to a non-contiguous part of Norse's otherwise CNY-based leasehold).

This poses a good reason for WNY resource owners to stay much more tightly abreast of the Ongoing Shale Gas Debates, as they rage with much more ferocity in other areas of Upstate — lest they discover, five or ten years down the road, that they or their children have been unwittingly beaten out of an opportunity they didn't even realize they had.

Thursday, February 23, 2012

Cabot-Williams PA-NY Pipeline Inter-Connect: Two Proposals, Same Job, Media Confusion

[Original post February 22, 2012. Bullet at top (•) marks update Februrary 23, 2012.]
•  As forecast below — and if reports flowing Feb. 23 from in-the-loop landowners are reliable, which I think they are — El Paso-TGP's pipeline plan has been put on indefinite hold in the wake of the Cabot-Williams announcement.  This leaves hopeful Upstate landowners, and skittish others, to await presentations from Cabot-Williams, which — contrary to media reports — have not yet actually been made.  TGP's details are still relevant mainly to the extent that they generally frame this sort of project's economic impact, infrastructural need, and approximate routing.

The announcement yesterday that Cabot Oil and Gas had joined with Williams Partners on a 25-75 joint venture to connect the burgeoning Marcellus Shale Gas Fields of NEPA with high-demand East Coast markets — by a pipeline interconnect running deep into NY's Leatherstocking Region — is already generating significant confusion among Upstate media, town officials, and landowners.

First of all, Cabot-Williams' "Constitution Pipeline" is the second similar-sounding proposal to breech the surface of media coverage over the last two days.  The firstoriginally publicized by landowner-oriented computer forums, and this blog — was put forth without a press release by El Paso subsidiary Tennessee Gas Pipeline, and is labeled on that company's maps as "Northeast Exchange." 

Both lines have roughly the same beginning and end points, and both must traverse generally the same rural terrain from PA's Northern Tier, through NY's Southern Tier, and on into NY's Leatherstocking Region.  But they're not one and the same proposal, and they're not being proposed by one and the same developer.

In fact, Cabot-Williams officials have reported their agents have not yet been on the ground, talking to town officials or landowners.  According to landowners, TGP agents have been on the ground, since mid-February. 

There is a fierce private-sector competition going on here — and I do admit that that can make things complicated, and ripe for controversy.

But look at the errors already:  Albany public radio station WAMC today is broadcasting a seven-and-a-half-minute-long interview with Schoharie Town Supervisor Gene Milone — embedded on their web page alongside wire service copy on the Cabot-Williams announcement — in which the audibly riled local official recounts his so-far-disconcerting dealings... with TGP.

Both WAMC and Milone appear to have missed the fact that TGP is not Cabot-Williams, and vice versa, and that whatever routing maps TGP has displayed in-person so far are unlikely to align with whatever the other developer puts together.

[I noticed as of Feb. 24 that WAMC's text was corrected, but without acknowledging any error.]

Similarly, Steve Reilly of the Binghamton Press ran the Cabot-Williams announcement as though it represented a second pipeline destined to criss-cross the Valley of Opportunity, joining several additional on-paper or underway projects which are intended to run north only as far as the Southern Tier's Millennium Pipeline.

I conclude, however, that the Cabot-Williams thing represents a second proposal for fulfilling the same single infrastructural need.

Not yet comprehended is that, in the end, there's only going to be one of these pipelines built (unless all the economic plusses of construction must again be snuffed out by the fates of the market, or by anti-development activism, the latter of which New York State is already over-supplied).  Under the American system of both intrastate and interstate energy transmission, capitalists are forcibly restrained by the "public interest" from building whatever they cotton to — whether pipeline or powerline.  In either PA-NY interconnect case, which will be an interstate case, publicly employed specialists at the Federal Energy Regulatory Commission (FERC) will be fully empowered through a mind-numbingly involved process to make the ultimate decisions regarding "public need," and other issues, before construction.

Just that part is likely to take nearly two years.

Upstate media people — rather than immediately seeking to rally the forces of NIMBYism, as is their reflexive habit — should instead be reporting all the facts, getting them straight, and asking such fundamental questions as whether TGP's plan will soon have to be quietly withdrawn as dead in the water, given that leading NEPA natural gas producer $COG is on board with the other plan.

Though either pipeline would be likely to go somewhere through Schoharie Township — because that place is pretty close to the intended interconnects with the already-built TGP 200 west-east line, and the already-built Iroquois Gas Transmission northwest-southeast line — the situation is way too premature to be making panicky phone calls to landowners regarding parcel-specific crossings, as the Schoharie town super has already done.

Landowners Ahead of Media on Big Upstate News: Tennessee Gas has a Pipeline Planned

[Originally posted February 10, 2012.  A checkmark (√) marks an update February 23, 2012.  Bullets immediately below that (• ) mark five updates February 21, 2012.]


√  As foreshadowed below — and if reports flowing Feb. 23 from in-the-loop landowners are reliable, which I think they are — El Paso-TGP's pipeline plan has been put on indefinite hold in the wake of the Cabot-Williams announcement.  This leaves hopeful Upstate landowners, and skittish others, to await presentations from Cabot-Williams, which — contrary to media reports — have not yet actually been made.  TGP's details are still relevant mainly to the extent that they generally frame this sort of project's economic impact, infrastructural need, and approximate routing.

•  First, as you can see, I managed to get my hands on a scanned copy of the map for Tennesee Gas Pipeline's as-initially-proposed Northeast Exchange pipeline — as we now know it to be named.  At the risk of bogging down your page-loading speed, I've spliced together the two sheets and stuck the full picture above at the same resolution as was sent to me.  (Very sorry, dial-up people.)  Download it or click it into a new window for your maximum viewing edification.  (Incidentally, if you have an interest in Upstate, remain pro- or open-minded on fossil fuels, but are still unfamiliar with the resources and the philosophy of the CNY Landowner's Coalition, I cannot recommend strongly enough that you consider joining them, one way or another.)

•  I've also obtained and uploaded a landowner-scanned version of the parent El Paso Pipeline Group's preliminary presentation on this project, which should be viewable as linked off-site.  Selected details not previously reported:  7,165 job-years in just the NY portion (which works out to nearly four times greater jobs impact as TGP's already underway Northeast Upgrade Project — designed to move way more natgas from PA through NJ to markets east); $297.4 million in temporary construction-related jobs (again, four times greater); $15 million per year in property taxes (seven times as much); and, lastly, note that the envisioned route requires the crossing of Melondy Hill State Forest, situate mostly in eastern Broome County, NY.

•  After significant public and private nurging, Steve Reilly of the Upstate-heavy Gannett chain put out much more widely the news of this proposed pipeline today — together with generalized confirmations from company executives, and some words of cautious optimism from a few Upstate Landowner Coalition Sages.  (Boy, is that exactly the kind of journalism I like to see!)]

•  Hours later, these developments were amplified by Jim Willis' Marcellus Drilling News, which — over many months of barely compensated labor — has earned a remarkably huge readership for itself, a group which should include anyone with an interest in shale gas developments in the Northeast.

•  Lastly, hours later, Cabot Oil and Gas announced a 25-75 joint venture with Williams Partners to build essentially the same sort of pipeline (dubbed "Constitution Pipeline"), with essentially the same connection points, for essentially the same sort of infrastructural (and business) reasons.  If I was a paid reporter — which I'm not — I would be asking if this is truly two lines capable of ever being permitted construction, or is this the same plan spelled out by two different investment sources, or is this the Early Stages of a Competitive Free-Enterprise Struggle — over which of the two packages might ultimately be deemed "necessary" by the public-interest specialists at FERC.

Anyway, back to work...

...

Upstate New York landowners who originally organized years ago for oil and gas leasing purposes have shared some new information about having been approached by Tennessee Gas Pipeline, a subsidiary of the El Paso Corporation — in order to permit surveys, and to consider easements, for a new natgas connector pipeline, this time running deep into Upstate from Pennsylvania.

CNY Landowner's Coalition Discussion Forums and Natural Gas Forums mainstay Chasgas, working from a copy of a glossy brochure, recently posted some details, and I re-run them here in hopes of nudging a larger Google-findable and newspaper-findable audience:

Schedule:
Quarter 4 2011-Quarter 1 2012:  Select proposed route.
Quarter 1-Quarter 2 2012:  Execute commercial agreements.
Quarter 2 2012:  Civil and environmental surveys.
Quarter 2 (May 2012):  Initiate FERC pre-filing process.
Quarter 4 2012:  File FERC application; fed and state permits.
Quarter 4 2013:  Receive FERC permits; fed and state permits (request).
[Corrected Feb. 21] Quarter 1 2014:  Commence project construction.
Quarter 4 2014:  Complete construction.
Quarter 4 (Dec. 1) 2014:  Commercial in-service.

Jobs:  [Corrected Feb. 21] 7,165 job-years (NY portion only)

Size:  36" line [diameter].

Incremental volume:  650 MDth/d [I believe that represents thousands of decatherms per day].

Counties:  Susquehanna (PA), Broome, Delaware, and Schoharie.

Total route length:  114.3 miles (NY 92.2; PA 22.1).

Market:  Upstate, Downstate, and New England.

Per Chasgas' reading of the likely-generalized map:  Pipeline starts in South Montrose (PA), heads just to the east of Oakland (PA), heads north to the Millennium Pipeline (just west of Deposit, NY), tracks north just to the southeast of Sidney, then runs [northeast] and roughly parallel to Route 88 to Central Bridge, where a new compressor station is shown, and it intersects an existing TGP pipeline.

...

Another source — an intercept from the anti side — indicates the line has been explained to certain aghast NY Leatherstocking Region landowners as also continuing beyond Schoharie County, on into Albany, and then further north and northeast.  It's true the natgas would be intended to flow that way, but I suspect any such extension would be unnecessary — representing another miscomprehension by the anti forces.  TGP owns the already-built inter-connecting line running west-east through New York, roughly parallel with the Thruway-Route 20 corridor.

...

This would have to be double-checked, but the NY news may well relate to recent announcements — fairly complete versions here and here — that a separate entity, Penn Virginia Resource Partners, succeeded in buying an easement option from the seemingly green Rail-Trail Council of Northeastern PA — which holds rights to an old D&H corridor snaking through eastern Susquehanna County, PA, at least as far as the NYS line.  The project was reported as intending to link up with TGP's line, but most observers would have interpreted that to mean southerly to TGP's PA line, rather than additionally leaping all the way north to TGP's NY line.

...

But further to some perspective from me.  And to a few long-winded digressions.  And to some very real-world reasons why this development should not be allowed to turn into yet another reason for New Yorkers to find themselves freaked out by freshly riled opponents of the Entire Natural Gas Industry, of which the state currently carries a surplus:

•  At the moment there are very few qualified pipeline workers currently (unwillingly) unemployed anywhere in the Northeast.  [Here's a local and timely anecdote bearing up this assertion:  A pipeline job through New York's North Country was reported as on hold due in part to the high costs associated with high demand for the necessary specialized labor.]  But keep in mind that the lion's share of the thousands of job-years we're talking about here would run the gamut from title searchers (ahem) to heavy equipment operators, surveyors, engineers, timber crews, environmental consultants, truck drivers, landmen, and even lawyers.  You know anybody needing that kind of work?

•  Though New York State currently remains bottled up, on the cusp of Year 4 of its Supposedly Temporary Shale Gas Drilling Moratorium, this pipeline project represents a very strong and very close-to-home example of the awesome geographic sprawl economically triggered by the Shale Gas RevolutionNew York Times reporters may have spent months, cobbling together years-old fringe analyses skeptical of the Marcellus shale's ultimate production.  But the fact remains that this project means actual capitalists are poised to spend actual millions in unsubsidized, private-sector dollars to try and build this sort of thing in New York State — which is much closer to my kind of proof of reality.  Expert infrastructure analysts see a lot of natgas coming out of PA, much more than the capacity available to get it to big city markets, and I'm in no position to argue with them — and neither, frankly, are any newspaper reporters.  (If it turns out the business community might require restraint beforehand from over-building, then I'd much prefer to let the market — or the pro's at FERC/NYS Public Service Commission — make that analysis, rather than to leave it to the self-serving thoughtlessness of a NIMBY veto.)

•  The consumer market is (currently) enjoying a 10-year rollback on the glut-depressed price of natgas, inexpensively running furnaces, fireplace inserts, water heaters, stoves, and clothes dryers, to say nothing of their subtler gains from lowered electricity costs.  Folks living in these fully piped areas are showing no ideological signs whatsoever of refraining from methane use — at the exact same time as they disproportionately glom onto "kill the drill" campaigns, and support politicians who behave in similarly hypocritical ways.  (What can I say?  There's an ethical disconnect here that few East Coast observers seem to think needs calling out.)

•  A perfectly timely example of this Want-It-All Phenomenon among Urban Defenders of the Environment is a piece of proposed legislation currently making its way through Congress:  H.R. 2606, the New York City Natural Gas Supply Enhancement Act.  This below-the-radar bill calls for the Department of the Interior, overseer of the National Park Service, to refrain from throwing up its hands against pipeline construction running right through the Gateway National Recreation Area near Kennedy Airport.  When it's about shale gas drilling in Upstate (and no skin off their backs), Downstate pol's have strongly voted twice in the State Legislature to symbolically (and unnecessarily) impose overlapping moratoria.  But when it's about actual commodity supply to their own constituents — even if parkland needs to be dug up to get it done — their peers in Congress representing these very same urban areas are all for it.

•  The economics of deciding a big long-distance pipeline are very different from the economics of deciding who gets natgas supplied to their homes and businesses — and who remains stuck relying on much higher-priced fuel oil, propane, or electric.  Nonetheless, it's conceivable that certain, somewhat densely populated areas within reach of this pipeline will suddenly find themselves being asked by local utilities to think about switching over, offering them a chance to save a lot of bucks in the long-run.  (Expect opposition from the truck-delivered-fuel industry.)

•  The threat of the pipeline developer winning the power of eminent domain from state or federal authorities will undoubtedly be among the Top Three Emotional Angles deployed in the inevitable outcry against this development.  These flames are sure to be fanned by NY anti-drilling forces, who typically resort to whatever argument seems best calculated to help their side — even if it might mean calling upon a Redneck Resistance directly counter to their usual pleas that (their version of) the public interest should thwart all (their personally disapproved of) private endeavors from others.

•  Pro-drilling landowners, at least those situated in or closest to the Southern Tier, who find themselves anywhere within several miles of the proposed path should also consider that the pipeline's very existence will put all their acreage into a special class of being more prone to early development, down the road, for shale gas.  As I'm sure the developer will soon discover, there will be an element of Good News-Bad News in this realization among the populace.

•  PA and NY landowners along the once-vaguely-defined route of the Laser Northeast Gathering System have already established the method and the model for maximizing the financial return, while minimizing the impact (and the transaction costs), for hosting such infrastructure.  What they did was this:  Many months prior to any application to the governmental authorities, spelling out the final or near-final routing, landowners gathered in local fire halls; pieced together a more precise picture of the developer's preferred-but-intentionally-withheld routing (by sharing information); put out the word (on their computer forums, and by old media); reached out to absentee landowners with a little research in the county tax office; put together an LLC represented by a lawyer who worked only for them en masse — and then negotiated in as tight a block as they could, achieving equitable, best-possible deals.  Borrowing a trick from the left (hey, whatever works), let's call this what it is:  Collective bargaining by landowners!

•  The pipeline developer will possibly attempt to circumvent this Ingenious Posture From The Local Worthies by continually (and quietly) re-routing the lay of the line.  This is the same technique they will (practically speaking, due to the political fallout sure to surround any actual attempts to rely on eminent domain) be forced to deploy every time they run into a landowner who (for whatever reason) is dead-set against it.  This work-around strategy works best when land agents find landowners who are so out of the loop, or hard-up, they sign the company's form early-on for the original offer.  And so a Game of Cat and Mouse ensues, in which landowners with an open mind toward hosting — for the right price — prevail by sticking together, staying informed, and supporting the sharper dudes among them.

This whole thing can be a Huge Win-Win-Win-Win for My Upstate — pipeline developer, host landowners, working stiffs, and end consumers — and I wish all affected landowners the best in helping make it happen, peacefully.

Monday, February 20, 2012

Ten Reasons Why NY's Drilling Boom will be Really More of a Slow-Mo Boomlet

[Originally posted February 18, 2012, but later internally updated.]

Until very recently, such as this today from Jon Campbell of Gannett, I believe that Joe Citizens of New York State have been very badly misled as to the expectable pace and extent of shale gas drilling hereabouts — should their environmental regulators, and their political overseers, ever manage to get their respective acts together, regarding the permitting plan for this new enterprise.

I assert this is because both sides in the Ongoing Persuasive Contest over hydraulic fracturing are, on this point, in rare, un-conspired sync with each other — both having a hidden manipulative interest in hyping the scope and sprawl of the drilling forecast for NY. 

And this is furthermore because virtually all mainstream media observers lack the sophistication to even begin to correct for this hype. 

Here's how public perception has been led off the mark for most of the last four years: 

The anti-drilling side has desired to pump up opposition as far west, north and east as the outskirts of Buffalo, Rochester, Syracuse, Utica, and even Albany extending down into the Hudson River Valley — where much of their base comfortably resides, cozily burning inexpensive natgas all winter long (as I have done), as they sit back, clucking their tongues at the latest glossy screed from the NRDC.  To do that, the green pro's have consistently emphasized that shale gas drilling is inevitably going to be clamoring at the doors of these educated, professional, suburbanized, and more-liberalized communities.  In other words, to "win" in New York, the opposition wants as many of these far-removed folks as possible — together with even-further-removed Downstaters — thoroughly freaked out about fracking.  And, sorry to say, they have done a bang-up job of this.

Remarkably, the pro-drilling side has also nursed the same persuasive motivation, but for opposite reasons.  These message-bearers — some pro-enterprise thinkers, some hopeful landowners, some with livelihoods riding with the fortunes of industry (such as myself), and some working directly or indirectly within the PR side of industry's business — have kept alive the as-yet-unproven hopefulness that development of shale gas, from either the Marcellus or Utica formations, could eventually extend over a huge chunk of Upstate's terrain, from the Thruway south.  They want as many landowners, Chambers of Commerce, and pro-business pol's as possible, pushing the state to do its job already.  And the best way to persuade anybody is to simply tell them something they already want to hear, no matter how far flung sits their acreage, or their local economies.

Both sides have essentially wound up working together in saying shale gas in New York is going to be a huge drilling boom — an unstoppable rush — just like in PA.  And both the Sky-Is-Falling Media, and the Opportunity-Knocks Media, have amplified this message by beating either side of these very same drums. 

But, for the precious few people out there who actually care about Truly Foreseeable Reality, I'm going to spend some of my free time this Saturday talking about why New York's shale gas story won't turn out that way.  Here are Ten Reasons why New York's Long-Supposed Drilling Boom will actually turn out to be really more of a Slow-Mo Boomlet:

1) Let's start with the geology, which nobody can do anything about, anyway.  The shallower shale zones — the Utica roughly from NY's Route 20 corridor northerly, and the Marcellus running north from somewhere south of that — are way less likely to be viable on physical, economic, and regulatory grounds.  Not enough rock pressure.  And not enough of a separation between the frack layer and the groundwater layer to meet the DEC's already announced thresholds, which I'm willing to assume are reasonable.  [Despite these realities, well-meaning-but-clueless northerly local governments, such as my own City of Syracuse, have taken symbolic (and technically illegal) steps to ban hydraulic fracture from on or under their municipal limits — even though, in the case of the Salt City, the jurisdiction sits in a spot where all of the Marcellus has been washed away by glaciers long ago, and the Utica lays much too shallow to be drill-worthy.

2) The thinner Marcellus or Utica zones — basically anywhere trending toward WNY — are likely to be Plan D, or Plan E, efforts, compared to what's thicker and deeper, closer to the Route 17/Route 86 corridor,
hugging the PA line, from Corning, Elmira, Waverly, Owego, Binghamton, on into the westerly Catskills.

3) Leaving aside either depth or thickness, the Utica remains much shakier of a prospect this far into the Northeast.  There has been as yet virtually no Utica exploration in NE PA  (SW PA and OH, yes), though that could be solely because the Utica is just too deep in this area — which could become less of an economic issue, down the road.  But, so far, NE PA shale gas drilling has been practically all Marcellus, and so, as a consequence, the Utica resource's richness on either side of the PA-NY state line can really only be guessed at.  Anybody who says anything different is working more from hope or fear than data.

4) Except possibly for some as-yet-obscure, relatively shallow Upper Devonian shales (about which I've lately been hearing some intriguing whispers in NW PA and WNY), most of the Empire State's unconventional resource is virtually pure, dry, lower-valued methane.  [As referenced above, Jon Campbell's piece
focused for the first time on mainly this point, and ran in most Gannett-supplied Upstate cities Feb. 18.  For some reason, however, his own editors appeared to flinch from running this story in his own Binghamton outlet — until, that is, it came time for throwing together Binghamton's Feb. 20 edition.  That shuffle occurred about five hours after I publicly accused them of censorship on Twitter.]  Unlike OH, or SW PA, there is little significant contribution to the mix from the longer-chained, higher-valued natural gas liquids — ethane, propane, butane, pentane, and beyond (including shale oil).  The current natgas-glut-caused pricing lows, triggered by the success of the Shale Gas Technological Revolution, have already economically forced industry to shift into wetter and oilier areas.  For months, they have been in the process of (for the time-being) retreating from their dry gas prospects — at least until the supply-demand cycle comes back into proper alignment, which could be years away.  For this, and for a number of other reasons, which I'm getting to, it's entirely possible NYS could in 2012 finally open its doors to drilling permits, and the reply from industry will be something like the Deafening Sound of Crickets.

5) Given the over-wrought political dynamics in New York, the Cuomo Administration is highly likely to Slice the Baby One More Time, the same scheme of political compromise it has already adeptly wielded on a number of other nettlesome issues long haunting the Vampire State.  The way Cuomo & Company will do this will be to — sometime this Spring — announce a temporary, limited, tentative, pilot drill permitting plan for shale.  This will take the form of a temporarily limited number of permissible wells per year (justified by the not-entirely-valid excuse that — for some reason, unlike PA, or WV, or OH — NY regulators will need time to ramp up their staffing and experience).  And it will also take the form of a temporarily limited geographic extent (quietly justified by the political reality that certain areas of Upstate are basically Raring to Go on Shale Gas, while other areas are already On the Brink of Devolving into Class-Based Civil War over this issue).  Even if the economics of shale gas get back to the way they were in 2008, this is going to hold things up, needless to say.

6) There is the practical certainty of obstructive lawsuits on procedural grounds from the anti's, which might temporarily — but not permanently — hold up both drilling, and the necessary pre-cursor of leasing interest from industry.  NY will go slow, because many operators will prefer to wait until somebody else spends the time and trouble, settling all that dust.

7) A similar legal risk is posed by the activist-promoted mania for getting gullible towns to pass drill bans, gloming onto a desperate legal theory which the courts have not yet had a chance to shoot down (ruling the state has already clearly given itself supremacy over this kind of localized obstruction).  In addition to all the usual risk assessments, industry now must also measure the risk that the unthinking State Legislature will intentionally balkanize its own heartland, with bills endorsing the sounds-reasonable home rule concept.  Or it must also measure the risk that one town or another is demographically likely, come each November, to suddenly swing against the enterprise.  Either way, such turns of events have the effect of burning up all that private-sector investment in very public bonfires of free speech, smoke, and lawyer's fees.  In short, it's not good for business.  Yet more reasons to let some other operator go first.

8) There is the fact that industry is obligated, under current state law, to of course have a deal with the host owner of the drillpad location, but also to directly or indirectly have deals with at least 60 percent of the ownership of the rectangular, 600-acres-plus unit.  You can't drill in NY without getting over these requirements, the bar for which could easily be raised in the future by the already panicky State Legislature.  Because of overwhelming social and persuasive pressure in many communities of Upstate — very little of it well-informed, honest, or based in reality — these fundamental requirements will be difficult to meet in certain rural zones — at least until the populace ultimately learns firsthand that there's much less to fear than they've been so far misled to believe.

9) Upstate's ever-hopeful, as-yet-unleased landowners — God bless 'em — have been routinely running their calculators, over the past four years, every time there's another out-of-state coalition leasing deal struck, involving record bonus, or royalty, or both.  They are going to be stubbornly reluctant to sign for less, anytime soon, even though New York is Not Pennsylvania, and Now is Different than Before — and so that disappointment is going to hold things up.  (They will be entitled to their disappointment, I say, but it's not going to change the game, running forward.)

10) NY's expected regulations, fees, and oversight will be so new, so involved, so high, and so cumbersomely deployed, it will turn out the state has (wittingly or unwittingly) made drilling much more uneconomic, compared to other areas of the U.S.  This has already been warned of, but to no noticeable effect.

Anyway, when it does go, I think NY will go slow, for all these reasons.  My only hope is that this might give New Yorkers a chance to learn more, and to fear less.  (But, from what I've seen, I do have my doubts.)

Saturday, February 18, 2012

DEC Minerals Division: Job Openings in April

Jersey Girl, a regular on Ron Stamet's remarkably constructive information-sharing web site, The Natural Gas Forums, recently dug out some interesting drilling-oversight-related hiring notices posted by New York State's Department of Environmental Conservation.

Her post, and the still-building discussion afterwards, are here.  Interested job-seekers — and Squinty-Eyed Diviners of New York's Frack-Related Tea Leaves — can more directly get their hands on the original information here

(Application deadline is kinda tight, so better get cracking.)

It's true, these openings are something.  But they don't yet amount to hundreds of new Minerals Division staffers, as has been forecast over and over again by Upstate media.

As for what that all might mean, I will be putting together a separate post — touching on the understated reality that New York State's long-supposed Shale Gas Drilling Boom is really going to turn out to be more of a Slow-Motion Boomlet

Meanwhile, though — check it out — here are trimmed-down summaries zeroing in on some of the more notable job openings from the DEC:

Positions Open to Current State Employees, Reinstatement Eligibles, and Transfer Eligibles...

- - - - - - - - - - - - - - - - - - - - - - - -

Title:  Mineral Resources Specialist 2 (2 Positions)Application Due By:  2/24/12
Location:  Albany/Central Office/Mineral Resources/Oil & Gas Permitting & Management
Salary; Grade:  $56,813 - $72,076 Effective 04/10; 20
Work Hours:  Days
Work Days:  Mon. - Fri.
Employment Type:  Permanent Budgeted Item
Appointment Type:  Permanent

Open competitive minimum qualifications:  bachelor's or higher level degree in geology, engineering, petroleum engineering, geochemistry, geophysics, or geosciences.  In addition you must have one year of professional-level experience in drilling, development, or production for oil, gas, solution mining, or underground gas storage.  Note:  Experience in the drilling, development, and production of water wells is NOT qualifying experience.



- - - - - - - - - - - - - - - - - - - - - - - -

Title:  Mineral Resources Specialist 3

Application Due By:  2/24/12
Location:  Albany/Central Office/Mineral Resources/Oil & Gas Permitting & Management
Salary; Grade:  $69,911 - $88,256 Effective 04/10; 24
Work Hours:  Days
Work Days:  Mon. - Fri.
Employment Type:  Permanent Budgeted Item
Appointment Type:  Permanent

Open competitive minimum qualifications:  bachelor's or higher level degree in geology, engineering, petroleum engineering, geochemistry, geophysics, or geosciences.  In addition, you must have had three years of professional-level experience in drilling, development, or production for oil, gas, solution mining, or underground gas storage.  Note:  Experience in the drilling, development, and production of water wells is NOT qualifying experience.

- - - - - - - - - - - - - - - - - - - - - - - -

Title:  Mineral Resources Specialist 4

Application Due By:  2/24/12
Location:  Albany/Central Office/Mineral Resources/Resource Development & Reclamation
Salary; Grade:  $81,856 - $100,822 Effective 04/10; 27
Work Hours:  Days
Work Days:  Mon. - Fri.
Employment Type:  Permanent Budgeted Item
Appointment Type:  Permanent

Open competitive minimum qualifications:  bachelor's or higher level degree in geology, engineering, petroleum engineering, geochemistry, geophysics, or geosciences.  In addition, you must have had four years of professional-level experience in drilling, development, or production for oil, gas, solution mining, or underground gas storage.  Note:  Experience in the drilling, development, and production of water wells is NOT qualifying experience.

- - - - - - - - - - - - - - - - - - - - - - - -

Title:  Mineral Resources Technician 1, including Mineral Resources Technician Trainee
Application Due By:  2/24/12
Location:  Allegany/Region 9/Mineral Resources
Salary; Grade:  $34,838 - $52,552 Effective 04/10; 14/11 (Salary dependent upon qualifications of candidate)
Work Hours:  Days
Work Days:  Mon. - Fri.
Employment Type:  Permanent Budgeted Item
Appointment Type:  Permanent

Open competitive minimum qualifications:  Sixty semester credit hours, 35 of which must have been in the environmental/engineering sciences such as mathematics, physics, chemistry, geology, statics and dynamics, or strength of materials*; OR two years of engineering technician experience, one year of which must have been in drilling, development, or production for oil, gas, solution mining, or underground gas storage. * You must submit a list of qualifying courses with your application, including title, the name of the college or university, the number of semester credits per course, and the date of completion.  A copy of your college transcript may be submitted. Applications submitted without a list of courses will not be considered.

- - - - - - - - - - - - - - - - - - - - - - - -

Title:  Mineral Resources Technician 2
Application Due By:  2/24/12
Location:  Allegany/Region 9/Mineral Resources
Salary; Grade:  —; 19
Work Hours:  Days
Work Days:  Mon. - Fri.
Employment Type:  Permanent Budgeted Item
Appointment Type:  Permanent

Open competitive minimum qualifications:  an associate's or higher-level degree in petroleum technology or petroleum engineering technology AND two years of experience in drilling, development, or production for oil, gas, solution minning, or undergroundgas storage; OR sixty semester credit hours, 35 of which must have been in the environmental/engineering sciences such as mathematics, physics, chemistry, geology, statics and dynamics, or strength of materials*; AND four years of experience in drilling, development, or production for oil, gas, solution mining, or underground gas storage. * You MUST submit a list of qualifying courses with your application, including title, the name of the college or university, the number of semester credits per course, and the date of completion. A copy of your college transcript may be submitted. Applications submitted without a list of courses will not be considered.

Saturday, February 11, 2012

Coalition Leader Dick Downey of Otego:
The Difference Is... We're Not Delusional

[Blogger's note:  This Letter to the Editor was printed and posted with the Feb. 6 Oneonta Daily Star, but — as has been my habit — I redistribute it here under an ongoing email deal I have with the author, a leader of the Unatego Area Landowners Association.  This is partly, of course, because I'm in pretty tight alignment with his views in the ongoing shale gas debate, and also because I respect the passion and the hours he's devoted to standing up for his landowners — but also because I really like the way he slings his verbiage.]

As usual, Adrian Kuzminski in his January 23 Letter to the Editor, perpetuates the misconception that those of us in favor of gas drilling are knuckle-draggers stuck in the Fifties, tooling around in our gas-guzzling Chevy convertibles, a deck of smokes rolled under the sleeve of our t-shirts, Booker T’s “Night Train“ playing on the radio.  I suggest that the farmers, hunters, recreational users, and landowners in general have a deep regard for the land they own and — by extension — the environment overall.  If energy could be economically extracted from cabbages, they’d be first in line at the cabbage patch.  Hey, they own the cabbage patch.

The difference between us and the antis is that we’re not delusional.  Cheap, clean(er) abundant, local natural gas is here under our feet, not in some “clean energy” daydream.  Until we get to Mr. Kuzminski’s renewable nirvana, somehow we still have to economically turn on the lights and heat the house.  That economical “turn on” is not going to happen by giving government life support to bankruptcy-bound Solyndras through subsidies and mandates.  Government supported, open source R&D centers, created to leapfrog the technology until renewables are competitive, might be a good idea, but that isn’t happening.

Meanwhile, Sustainable Otsego, when the sun isn’t shining, the wind isn’t blowing, the rivers aren’t dammed, the tides aren’t harnessed, the algae farms aren’t in existence, and biomass is an applause line in a Presidential speech, gas is the only game in town.

So dream on, Mr. K.  Renewables may be on that far distant shore.  Gas is how we get there.


— Dick Downey
Otego

Friday, February 10, 2012

More of the Same From Tom Wilber:
All News Must Be Spun, Rather than Reported

Former Binghamton Press reporter Tom Wilber is back in the public eye — with a book engaging in the Northeast's Shale Gas Spinfest (to be put out this Spring by none other than Cornell University Press), and a blog called Shale Gas Review.

Though I don't know why I bother anymore, I wasn't able to get all the way through what's currently his second-most-recent blog item — before finding myself transported to kill what was left of a remarkably sunny Friday afternoon in February, drafting an ever-lengthening comment. 

Due apparently to some
Blogspot-related flakiness — or possibly due to Wilber not wanting to leave his posts open to comments — I'm pretty sure whatever I had to say didn't go through.  It just sort of sat there blankly.  Anyway, though I'd like to stick this where the sun don't shine, I guess I'll have to settle, for the time-being, sticking it here.

...

"The federal EPA has determined that drilling chemicals found in some wells pose a public heath threat." 
[In a paragraph touching on the latest from the Dimock, PA, situation.]

Tom, taking a look at your blog for the first time today — this sentence is only as far as I got before I skipped directly to the comments button.  I might read some more another day — but, I've got to tell you, I will be returning with a skepticism even more heightened than before.

I challenge you to double-check reality here — much, much, much more closely — and to in fact correct your description of the EPA's "determination" connecting "drilling chemicals" with any "public health threat" in Dimock, PA, water wells.

You link to the EPA's statement, but this cagily does not say what you said it said, nor does any of the (precious-little) precise reporting out there on the Dimock case.  In fact, no journalist could possibly state any such conclusion as fact — except by doing the usual thing of quoting unsupported accusations from anti-drilling sources, or by repeating without question much of the similarly gullible or sloppy reportorial work that has gone on before.  (As you well know, there is no shortage of either sort of material available.)

But even going to the original data — the water test results alone, already publicly available — the facts are miles away from any such smoking gun.  Like tests of water anywhere across rural PA (or rural NY), some from Dimock show the heightened, aesthetically-less-than-desirable presence of naturally occurring minerals.  But no violations of any health-related standards (except possibly for one case of high sodium, which turns out to have come from a sample taken downstream of a water softener).

I grant you that it is possible the DEP-established, gas-well-casing-failure-caused, shallower-than-Marcellus methane migration issue may have spiked the presence of these minerals in some Dimock water wells (and in water wells near similar cases in PA).  But that's a far cry from a government "determination" connecting "drilling chemicals" with a "public health threat."

Whether due to natural conditions, or exacerbated by drilling mishaps, both minerals and methane in water are also completely treatable situations.  And, in this case, that offer has already been repeatedly made by Cabot, under its settlement with PA — but refused by those who are angry, transformed into activism, and committed to suing for more.

Possibly without realizing the hornet's nest such a conclusion would cause, the EPA has already innocently interpreted existing tests as showing the Dimock water is safe to drink and use — in a very short and to-the-point email sent to residents, and intercepted by the pro-drilling side.  This triggered a firestorm of protest from anti-drilling activists (and plaintiffs' attorneys), who were naturally hoping for much more oomph from the government in support of their respective agendas.

To this pressure, the EPA regional office readily bowed, devising a plan to go back to take their own samples, to see if maybe there might yet be discoverable any there there.  And that's where it stands today.

I had some hopes upon discovering your blog (and your upcoming book) that your work may have matured in the intervening months.  But — like most of your reporting during the years you routinely inflamed this issue for the Binghamton Press, an act for which you and that paper remain unforgiven by thousands of clear-headed Upstate New Yorkers — I find that your version of the facts continues to turn out to be way more hopeful or jaundiced than accurate.

There are facts to be conveyed here, and there are nuances to be explained, and this is unquestionably a conflict that needs continual exposition by professionals.  I would ordinarily be willing to rely on you, or Jon Campbell, or Steve Reilly, to do at least part of this job.

But this one sentence alone shows you're just not going to ever be a credible witness.

If you want to be an anti-drilling activist, or an anti-drilling writer, then that's fine — just say so, and keep writing.  But you're not going to be able to convince me you're a journalist anymore.

Thursday, February 9, 2012

Norse Energy Knock-Knock-Knocking on DEC's Door: 6th and 7th Applications are Up

[Update April 2, 2012:  I've made some changes to fix some prior locational discrepancies regarding the Mowatt J. 1H.  Also, the proposed Spacing Unit Map associated with that application has been obtained in PDF form and uploaded here.  As for the Fernandez II 1H, that unit map I've put here.]

Again, despite the NYS DEC's now-nearly-four-year-old State of Continuing Regulatory Unreadiness, we noticed this week two further, full-horizontal shale gas drilling applications on the Minerals Division's Wells Database from Norse Energy.

[Applications One, Two, Three, Four, and Five
all post-draft-SGEIS Marcellus or Utica shale requests also coming from Norse — have been previously covered on this blog, through annotated details, and occasionally maps, so feel free to poke around.]

The 6th application:

API Well Number:  31017300160000 [click to Google-map into a Sputnik's-eye-view of the proposed surface location]
Well Name:  Mowatt, J. 1H
Company Name:  Norse Energy Corp USA
Well Type:  Not Listed
Well Status:  App to Drill/Plug/Convert
Objective Formation:  Marcellus
County:  Chenango
Town:  Smithville
Status Date:  2/8/2012
Permit Application Date:  1/20/2012
Well Orientation:  Horizontal
Surface Longitude:  -75.710792
Surface Latitude:  42.399713
Bottom Hole Longitude:  -75.721674
Bottom Hole Latitude:  42.411542
True Vertical Depth:  3098
Bottom Hole Total Measured Depth:  8129
Drilled Depth:  8129
Proposed Well Type:  Gas Wildcat
Spacing Acres:  625.81
Last Modified Date:  2/8/2012


And as for the 7th:

API Well Number:  31017300150000 [click to Google-map into a Sputnik's-eye-view of the proposed surface location]
Well Name:  Fernandez II 1H
Company Name:  Norse Energy Corp USA
Well Type:  Not Listed
Well Status:  App to Drill/Plug/Convert
Objective Formation:  Marcellus
County:  Chenango
Town:  Coventry
Status Date:  2/7/2012
Permit Application Date:  2/3/2012
Well Orientation:  Horizontal
Surface Longitude:  -75.58985
Surface Latitude:  42.297599
Bottom Hole Longitude:  -75.581882
Bottom Hole Latitude:  42.286528
True Vertical Depth:  3778
Bottom Hole Total Measured Depth:  8190
Drilled Depth:  8190
Proposed Well Type:  Gas Wildcat
Spacing Acres:  152.29
Last Modified Date:  2/7/2012