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Subject: Marcellus Shale Posted by: Perm Dude - [154552311] Mon, Nov 23, 2009, 14:15 I'm using this thread to try to park some of the many readings on Marcellus Shale. I'm a member of the PA LWV and we're trying to form a consensus on this issue, which is becoming more and more important in PA. My particular "speciality" will be the Taxation/Regulation aspects, particularly in zone and planning regulations and severance taxation. In March I'll give a presentation to my local county LWV group on this area, and there is lots for me to read over the next several months. If anyone has anything interesting please feel free to post it. | |||||||
| 32 | C1-NRB ID: 2911103011 Tue, Dec 15, 2009, 17:31 |
The correspondance with my sister: C1-NRB: Are you doing anything in Pennsylvania right now? Could you talk about it if you are? One of my fantasy baseball guys is researching about the Marcellus Shale up there and said they don't have many pipelines for natural gas in the region; they truck it out. Would that be up your alley? Sister: We are doing stuff in the Marcellus Shale. We currently have liquids stuff running through that area, and I've done some maps showing a few other Nat Gas gathering systems. I have a coworker who last week did a map with a major Canadian pipeline showing how it crosses and comes over near the Marcellus Shale. I think some of our guys are trying to find a way to tap into the stuff and move it around. [Name redacted], who I used to work for, has pipe in the area, but it is mostly storage & such... they run the gas up there from here [Texas], and store it until winter, then send it back out. I don't know if they have started gathering some stuff up in the area now or not. Dunno if this tells you anything or not. | ||||||
| 33 | Boldwin ID: 26451820 Wed, Dec 16, 2009, 09:11 | My father worked trouble-shooting jet turbine compressors and assembling controls for the NICOR Troy Grove storage facility, so I wasn't buying that 'natural gas delivery truck' theory. | ||||||
| 34 | Boldwin ID: 26451820 Wed, Dec 16, 2009, 09:20 | And those companies running those storage facilities would have contracts to buy natural gas deliveries and as they make new ones they would buy the cheapest contracts they could obtain. Whether they would pocket the low delivery cost profits of a local field or whether the local well owners would...my guess is that the companies controlling those local wells would make out nicely. | ||||||
| 35 | Perm Dude ID: 5510572522 Wed, Dec 16, 2009, 11:53 |
Thanks again, guys. I've got a small presentation tonight in preparation for a bigger one in March, and while the distribution aspect isn't part of my component (my area is regulatory and taxation issues surrounding the Shale), this is very interesting to me as a Planner (and citizen, for that matter). We're putting together a general information discussion on this for the county in March as well, and I hope to be talking to a number of industry people on questions that are arising right now, including distribution possibilities. My early discussions on that aspect has more to do with the lack of a distributed network for natural gas to be delivered to the end users, at least in this area. More information as I get it. I really appreciate the links and help. | ||||||
| 36 | Boldwin ID: 26451820 Wed, Dec 16, 2009, 14:06 |
There is probably a CUB, [citizens utility board] with members happy and willing to get you up to speed on the issue. Not quite sure what business 'Mr Natural Gas Truck' has in guiding the great state of Pennsylvania's natural gas distribution system... Bill Buckley's "I'd rather trust the first 400 names in the NY City telephone book than some Harvard liberal" keeps ringing in my ears. | ||||||
| 37 | Boldwin ID: 26451820 Wed, Dec 16, 2009, 14:23 |
"My early discussions on that aspect has more to do with the lack of a distributed network for natural gas to be delivered to the end users, at least in this area." - PD You found an expert in that field willing to validate that assumption? | ||||||
| 38 | Perm Dude ID: 5510572522 Wed, Dec 16, 2009, 15:06 |
Yes. In fact, my town has been trying to get a distributative natgas pipeline for users for some years now. And at our Strategic Planning Committee meeting tonight (of which I'm a member) I'm hoping for a little update from our Borough Council President of where we stand on that. With Sanofi Pasteur down the road one way (the makers of flu vaccines) and a huge Johnson & Johnson distribution warehouse the other way we're hoping to tap in, literally, to a pipeline through town. Most folks here heat with either oil or wood, and just behind them are propane users. Having the option for natgas would be a real benefit for homeowners, particularly those using oil or (*shudder*) electric heat. | ||||||
| 39 | Boldwin ID: 26451820 Wed, Dec 16, 2009, 15:11 | I would think the nearest natural gas company is as interested in expanding in your direction as you are in seeing it happen. Call the large utility companies in the state until you find the one in the best position to get that done. | ||||||
| 40 | Seattle Zen ID: 1410391215 Wed, Dec 16, 2009, 16:11 |
(*shudder*) electric heat. It's funny you mention that because I remember that very sentiment while I lived in Maryland. Thing is, out here in western WA, many, if not most, homes are heated with electricity. It might not get as cold here as it does in the Mid-Atlantic, but we certainly use our heaters longer, often until June. I then recently heard that electricity rates are quite different across the country. Gasoline prices are fairly steady throughout the nation, but we pay less than $.06/kilowatt hour here and I believe that the rates out East are nearly three times that. Our rates are low thanks to the Bonneville Dam on the Columbia, as well as the Grand Coulee and others. Could you imagine $3/gallon gas in one part of the country and $9/gallon elsewhere? The difference in rates makes wind power much more attractive economically out East than it does here out West. I don't know much about electricity and its grid, and I think that's because no one really talks about it much. | ||||||
| 41 | Tree ID: 248472317 Wed, Dec 16, 2009, 16:28 | from what i understand, Texas ranks among the highest in the nation in what we pay for electricity. | ||||||
| 42 | Perm Dude ID: 5510572522 Wed, Dec 16, 2009, 16:42 | Here in PA the rates are going to be deregulated starting January 1st. There is a lot of uncertainty about rates come a few weeks. | ||||||
| 43 | Seattle Zen ID: 1410391215 Wed, Dec 16, 2009, 17:10 |
How about we do an informal poll: Look at your electric bill and post what your rate is in this thread (and where you live). | ||||||
| 44 | C1-NRB ID: 2911103011 Wed, Dec 16, 2009, 17:20 |
from what i understand, Texas ranks among the highest in the nation in what we pay for electricity. Which is crazy because we're "off the grid." US Electric Grid Texas sells as much energy to the East and West grids as it produces. (citation needed) Two sources of this over-abundance of electricity are The Comanche Peak Nuclear Plant outside of Glen Rose (Southwest of Fort Worth) and the world's largest land-based wind farm in Sweetwater (as featured on the Weather Channel). | ||||||
| 45 | Pancho Villa ID: 29118157 Wed, Dec 16, 2009, 17:21 |
Thing is, out here in western WA, many, if not most, homes are heated with electricity. Never had anything but natural gas for heat and hot water during my 24 years in Utah. I wish my stove was gas, but the conversion was kind of a hassle. In the summer, my natgas bill is less than 10 bucks. The most I've ever paid in winter is about $200. My city utilities bill(includes electric, water, garbage and sewer) ranges from $250 in summer(air conditioning) to $125 spring and fall when it's light later. | ||||||
| 46 | Pancho Villa ID: 29118157 Wed, Dec 16, 2009, 17:25 |
addendum to #45 My house is roughly 2800 sq ft, and 4 people live here - me, my 18 yr old nephew, my almost 15 yr old daughter, and my 11 yr old son. Obviously house size, quality of insulation(mine sucks) and number of inhabitants is a big part of the equation. | ||||||
| 47 | Seattle Zen ID: 1410391215 Wed, Dec 16, 2009, 17:31 | Hey, Pancho, if posts 45 & 46 were in response to my 43, I am interested in what your electricity rate per kilowatt hour is in lovely Utah. | ||||||
| 48 | biliruben ID: 16105237 Wed, Dec 16, 2009, 23:04 |
Electric here is 0.0376 for the first 20 KWH and 0.0793 after that. Slightly higher for the winter. Blame Ben for the complexity. F'in economists. The previous owners dragged natural gas down from the street, and we have a nice boiler and radiant heat. Hope to get a duel fuel stove-gas for the range, electric for the oven. Priorities turned elsewhere when our washer died. Can't survive without a washer with a toddler. | ||||||
| 49 | C1-NRB ID: 5115723 Wed, Dec 16, 2009, 23:30 |
I can't find a flat rate on our past electric bills, but they seem to average between $0.144 and $0.149 per kwh. There's probably cheaper rates out there, though. Since Texas de-regulated about 15 years ago prices have gone up. (And they said competition would lower rates. Ha!) I know people that shop for a different electricity provider every 18 months, but I'm too lazy to put that much effort into saving what would amount to about $50.00/ year by my guestimation. | ||||||
| 50 | Bauxman ID: 2110171217 Thu, Dec 17, 2009, 18:23 | PD: What are some of the nat gas companies you are working with over there? | ||||||
| 52 | biliruben ID: 16105237 Thu, Dec 17, 2009, 18:29 |
Seattle Greenhouse Gas inventory.  Seattle electrical use has declined remarkably, to the point where I'm having trouble believing the decline is real. Meanwhile oil (and probably to some extent, electricity) has been replaced by natural gas and a pretty fair clip. | ||||||
| 54 | Bauxman ID: 2110171217 Thu, Dec 17, 2009, 18:49 | The forum index says you posted PD but I'm not seeing that post. | ||||||
| 55 | Perm Dude ID: 5510572522 Thu, Dec 17, 2009, 19:11 |
UGI, mostly. But much of what I'm working on these days is working with the drillers, most of whom are from Texas. In fact, over the last year or so I've dealt with at least a half-dozen guys on crews who have literally never been above the Mason-Dixon line. It is a little freaky to them to be drilling in the Poconos and elsewhere in PA. | ||||||
| 56 | Perm Dude ID: 5510572522 Thu, Dec 17, 2009, 19:11 | weird--just reposted it. | ||||||
| 57 | biliruben ID: 16105237 Thu, Dec 17, 2009, 19:13 | I prolly zapped it. I self edited the same time you posted. Sorry. | ||||||
| 58 | Perm Dude ID: 5510572522 Thu, Dec 17, 2009, 21:29 |
The lowest rate I've seen is $0.0899/kWh. I don't know if this covers the fees allowed under the current electrical tariffs ("distribution charge," "generation charge," "transmission charge" etc). My last bill had an effective rate of about $0.08593/kWh. | ||||||
| 59 | Boldwin ID: 101121213 Mon, Dec 21, 2009, 09:14 |
The Spaceghost angle on natural gas. Always nice to get a fresh perspective. | ||||||
| 60 | Pancho Villa ID: 29118157 Thu, Jan 28, 2010, 21:39 |
More inspectors, safer wells in Pa A rare instance of civility between industry and environmentalists. An industry group, the Marcellus Shale Coalition, said in a statement that it supports the state's moves, as did several environmental groups that say the drilling could put the environment and public health at risk without more protection. | ||||||
| 61 | Perm Dude ID: 5510572522 Thu, Jan 28, 2010, 22:28 |
Thanks for that. There's been a lot of concern here that there aren't enough inspectors to keep up with the drilling (DEP is responsible for inspections of all wells, including Shale wells). On another front, the state might be implementing a severance tax on the gas (booo!). My state rep tells me that of the many plans out there right now regarding taxation of the gas, the severance tax will probably get the most support, mostly because other states around us (including states from which we import gas) already have the tax. The idea is that consumers won't see a rise in the cost, but that the tax will state flowing into Harrisburg rather than other states. | ||||||
| 62 | Nuclear Gophers ID: 7115138 Sun, Mar 28, 2010, 10:26 | I am in southwestern part of Pa. 30 miles north of Pittsburgh. Rex Energy is going around my township (Lancaster) and offering $1500 per acre. I have 6.5 acres. My attorney also lives in the township and he has read the contract and says everything is OK with it.(He did sign the contract). We will probably meet with the representative next week. I have read the contract and I have a Couple of questions for him. From what I have read there are royalties involved and can get free gas up to 200,000 cubic feet. The way I understand it they pick one property and drill around to other properties. Any advise or any knowledge on these contracts would be appreciated. | ||||||
| 63 | Perm Dude ID: 5510572522 Sun, Mar 28, 2010, 11:07 |
The Pittsburgh League of Women Voters just had a public forum on Shale. I *might* have some stuff from them, but you might be able to get some good advice from them directly. They can't offer contract advice, but there is a lot of background information which might be of some use. There is currently a court case pending before the PA Supreme Court regarding the payment of royalties that your attorney should be aware of (if not, get another attorney for this contract!). The gas companies want to charge their costs against royalties and are hoping that the Court will allow them to double-dip on the costs. Your contract should ensure that royalties are paid on the gas extraction without any fees, deductions, or costs. The law in PA allows for a minimum 12.5% royalty and you should (at the very least) get that amount. Because of the way they drill, you might find it best to enter into a partnership with your neighbors to share gas royalties. As far as I know there is little case law about the extraction of gas below a neighbor's property from a well on your own, but it just seems prudent to form a co-op to sidestep any potential problems down the line. Your contract should also have clean-up/restoration clauses, should have performance bonds, and should be subject to outside agency approval in areas under their purview. | ||||||
| 64 | Nuclear Gophers ID: 7115138 Sun, Mar 28, 2010, 11:54 | Clean up and restoration clause is in there. I will investigate the coop, thats a good point.I will also investigate the royalty aspect. There is a section on royalties, but it is written in lawyers terms that I will contact my lawyer on it. Something like the health bill. lolololol | ||||||
| 65 | Nuclear Gophers ID: 7115138 Sat, Apr 10, 2010, 08:17 |
Update: The representative for Rex Energy came over last Monday night. We signed the lease. Instead of $1500 an acre he gave us $2000 an acre. I have no idea why, only to think that they are doing really well in the wells that they are drilling at near here (2 miles away). My father in-law got the $1500. Go figure. Instead of a coop, they will put my land in a 500 acre lot unit. He directed me to a Royalty calculator on the internet. He gave me figures from the wells being drilled nearby and my acreage and my royalties will be + or - $5,600 per year. If you have any questions please ask. We are happy with what we are getting. I talked to my neighbor, and he isnt going to sign. Hes afraid it may ruin his well. The way I figure is if they drill down 1 mile and my well is only 65 feet down I just cant see anything happening. Anyway if something does happen to my well they will fix it according to the lease I signed. See what happens. | ||||||
| 66 | Perm Dude in Denver ID: 1838916 Sat, Apr 10, 2010, 08:44 |
Thanks for the update. If there are no water problems it can be a pretty sweet deal for the landowners. The truck in lots and lots and lots of water for the process--it should be interesting. If possible, try to post some pictures of them working at it. I'd like to see what it actually looks like. | ||||||
| 67 | Nuclear Gophers ID: 7115138 Sat, Apr 10, 2010, 09:04 | Ill try. Maybe today I will go to the site that is close and take some. I will take some from 2 miles away and up close. | ||||||
| 68 | Nuclear Gophers ID: 7115138 Mon, Jul 12, 2010, 20:08 | Update-We got our check over Memorial day weekend. Once they start drilling on my 500 acreparcel I will take pictures. By the way PD I was up in your neck of the woods this past weekend, little town called Effort. Right off 115. My wifes brother lives there. Beautiful country. Ill bet the fall is beautiful with the color on the trees. | ||||||
| 69 | Perm Dude ID: 5510572522 Mon, Jul 12, 2010, 21:03 | Yeah--it is a beautiful part of the state. Next time you are up let me know. | ||||||
| 70 | Boldwin ID: 9631220 Mon, Jul 12, 2010, 21:26 | Petrochemical gopher! Drill baby drill! | ||||||
| 71 | astade ID: 20521919 Sat, Nov 06, 2010, 23:05 | another NY Times article about Marcellus Shale. A nice view of what happened in the South (pros and cons) and what's going on in Pennsylvania. | ||||||
| 72 | astade ID: 78462922 Mon, Nov 15, 2010, 00:59 | I may be one of the few that cares... but here is video on 60 Minutes: link | ||||||
| 73 | Perm Dude ID: 5510572522 Mon, Nov 15, 2010, 01:11 | A local (Wilkes-Barre) TV station just did a short report on that. They showed they guy with explosive water. | ||||||
| 74 | Perm Dude ID: 5510572522 Sat, May 14, 2011, 11:18 | NG: How's the drilling going for you? I just got an invite from the Commonwealth to attend some planning sessions for municipal planners about Shale up in your area. Probably won't go (a bit too far for me) but they seem to be having them in places the drilling is more likely. | ||||||
| 75 | Nuclear Gophers ID: 494111411 Sat, May 14, 2011, 12:11 |
Sorry I havent been up to date so here it goes. Our township (Lancaster Township) voted in January to let them start drilling here. I am in the Goehring lot (500 acres) and they are going to start drilling real soon. My natural gas company is Rex energy and they are having a golf outting and free dinner next Saturday at a local golf course. So I am going to play golf and my wife and I are going to eat and find out more info. My son who is graduting in June applied with Rex energy and has not heard anything yet. He is also playing golf so maybe he will get more info also. Went to the outdoor show in Pittsburgh back in Febrauary and another company had a booth set up and asked them some questions about the royalties. Rex energy said I should be getting around 700 hundred a month and they seemed to think that was really low. We will see. They also said that you wont be seeing any royalty checks till you see pipe lines distributing the gas. Hopefully will get more info next week. If you do come out look me up. | ||||||
| 76 | Nuclear Gophers ID: 494111411 Sun, May 15, 2011, 09:45 | A couple of other things: The former Mayor of Pittsburgh Mayor Murphy owns a farm in our township, and is holding out for five thousand an acre. Rumor has it rex energy isnt budging and says they will drill with out him and he will be out of the loop. Also my wife talked to a guy who owns a horse farm above me. He was one of the first to lease his land 5 or 6 years ago and got 10 dollars an acre. But released at 2thousand an acre. A couple of my neigh bors told me a year ago they werent going to lease their land. But all three have in the last month or so. I will keep in touch. | ||||||
| 77 | Nuclear Gophers ID: 494111411 Tue, May 17, 2011, 14:49 | One other thing, My son who is a firefighter for Harmony told me Rex Energy is going to buy a brand new fire truck for the fire company. He told me it is going to be state of the art truck. | ||||||
| 78 | Perm Dude ID: 5510572522 Tue, May 17, 2011, 14:53 |
And it has a special attachment to fight fires coming out of water taps? :) | ||||||
| 79 | Boldwin ID: 9437170 Tue, May 17, 2011, 17:20 |
I suggest a new company subdivision for Rex Energy. eHarmony | ||||||
| 80 | Frick ID: 387512315 Wed, Sep 28, 2011, 16:34 |
PD, You might want to be careful lighting a match near your tap water. WSJ | ||||||
| 81 | Nuclear Gophers ID: 2595166 Sun, Oct 16, 2011, 07:05 |
Update: My son finally got a job with Rex Energy. He started last Monday and is training to be a Plant operator. He is working 6- 12 hour days until his training is over. then he will be working 4-12 hour days and off 4 days. The pay is really good and he likes it a lot. 5 miles to the plant. On a personal note can someone please help me to create and insert a link. I have tried several times and have failed. Thanks. | ||||||
| 82 | Boldwin ID: 35615181 Sun, Oct 16, 2011, 09:41 | Email it to me and I will put it in html. Describing how to do it is hard since posting the actual html doesn't display properly, it tries to create a link instead of show you naked html. I used to know how to display naked html but it's easier if you just email it. | ||||||
| 83 | Frick ID: 387512315 Mon, Oct 17, 2011, 14:17 |
Congrats on your son's job. If you want to insert a link here, click on the "Click here to create and insert a link" button below the reply box. Copy and paste (or type) the website URL in the first pop-up box. The 2nd box is to put a name on the link. | ||||||
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