NGI The Weekly Gas Market Report

Briefs -- Aliso Canyon | Utah BLM | EVX Midstream | GOM Lease Sales | Hilcorp Alaska | Dominion Carolina Gas Transmission | Railroad Commission of Texas | SoCalGas | Railroad Commission of Texas | Westwood Group

The California Public Utilities Commission (CPUC) said it plans to start hearings in mid-April on the future of Southern California Gas Co.'s (SoCalGas) 86 Bcf Aliso Canyon natural gas underground storage facility after a four-month long storage well leak in late 2015 and early 2016. The focus of the case is what role the state's largest gas storage facility should play in ensuring gas and electric reliability, and whether SoCalGas should be allowed to resume operation of the 3,600-acre facility. A prehearing conference is set for April 17 in Los Angeles with a public participation hearing scheduled for later that evening in Northridge, near the storage site.

The U.S. Bureau of Land Management (BLM) Utah west desert district office seeks public comments on an environmental assessment completed on its plans to offer nine parcels covering 14,923 acres for oil/natural gas leases in Juab County, UT. BLM is planning to hold the lease sale in September. The public review and comment period is scheduled to be completed by the close of business May 1. Maps and additional information on the environmental assessment are available on the BLM website.

Houston-based EVX Midstream Partners LLC is expanding its Eagle Ford crude oil gathering infrastructure and has acquired additional saltwater disposal facilities. No details on the assets were provided. “The expansion of our crude oil and produced water assets will allow us to serve a broader base of customers and enhance services to our existing customer base,” said CEO Herb Chambers. “Area activity has been strong and the strategic expansion of our assets will position EVX to provide additional gathering, storage and blending opportunities.” EVX is focused on acquiring, developing and operating crude oil, natural gas, and produced water gathering, processing, treating and transportation assets in the Eagle Ford, Permian Basin, and Midcontinent.

The Interior Department's Bureau of Ocean Energy Management (BOEM) is taking comments through May 15 on proposed changes to the Gulf of Mexico (GOM) 2017-2022 Outer Continental Shelf Oil and Gas Leasing Five-Year Program. The draft supplemental environmental impact statement analyzes potential impacts from new air quality modeling and may be used to make final decisions about Lease Sales 250 and 251 scheduled for 2018. Public meetings are scheduled April 25 in New Orleans; April 27 in Houston; May 1 in Pensacola, FL; May 2 in Mobile, AL; and May 3 in Gulfport, MS. Locations and meeting times are included in the Federal Register notice. Comments may be submitted via BOEM's website or to Greg Kozlowski, Deputy Regional Supervisor, Office of Environment (GM 623E), BOEM, GOM OCS Region, 1201 Elmwood Park Blvd., New Orleans, LA 70123-2394.

A crude oil leak discovered from an undersea pipeline operated by Hilcorp Alaska in the Cook Inlet has been stopped, the company said Monday. “All oil has been removed from the pipeline and there is no indication of any further release,” the company said. The leak was discovered after workers on the Ana Platform felt an impact from an unknown source and then saw oil sheen on the water. Hilcorp said Monday that it calculated the spill to be less than three gallons of oil. No harm to wildlife has been observed, the company said, adding that repairs to the pipeline would begin as soon as possible. Hilcorp has been dealing with a leak from one of its natural gas pipelines in the Cook Inlet as well. "It has been less than a week since Hilcorp agreed to temporarily shut down oil and gas production as part of its response to a leaking gas supply line. Now, Hilcorp has reported a separate leaking oil line -- which is significantly more harmful than natural gas. I am deeply concerned about the potential impact to the environment,” Gov. Bill Walker said in a statement following discovery of the oil leak.

FERC has granted Dominion Carolina Gas Transmission LLC's (DGC) March 28 request to proceed with construction of the Dillon Pipeline, Dillon Interconnect Tie-in, Charleston Town Border Station and Caldwell Drive Meter & Regulator Station in South Carolina's Dillon and Charleston counties, for the Transco to Charleston Project [CP16-98]. The 80,000 Dth/d pipeline system project, filed by DGC a year ago andapproved by the Federal Energy Regulatory Commission in February, would involve constructing and operating facilities in South Carolina's Aiken, Charleston, Dillon, Dorchester, Greenwood, Laurens, Newberry and Spartanburg counties. Proposed facilities include 55 miles of 12-inch diameter pipeline in Spartanburg, Laurens, Newberry and Greenwood counties (the Moore to Chappells pipeline) and five miles of four-inch diameter pipeline in Dillon County (the Dillon pipeline). DGC has estimated a $119.3 million price tag, with plans to place the facilities into service by November.

The Railroad Commission of Texas is conducting a half-day educational session on the Permian Basin’s Spraberry trend and Delaware sub-basin from noon to 4 p.m. on April 25 at the Commemorative Air Force Base, 9600 Wright Dr., Midland, TX. Topics include drilling permits, completions, stacked laterals and website queries. Registration is required; seating is limited. The cost is $75/person for registrations by Tuesday (April 11) and $125/person after.

Backers of a California legislative proposal (SB 57) to keep Southern California Gas Co.'s (SoCalGas) Aliso Canyon underground natural gas storage facility closed hope to gain a two-thirds vote in the state Senate after the bill was passed and sent to the Senate Appropriations Committee. SB 57 would prevent Aliso Canyon from reopening until an ongoing root cause analysis investigation is completed and made public. The bill includes language allowing the governor to declare a state of emergency to reopen Aliso Canyon if the region faces power outages due to an inability to get gas supplies from the 86 Bcf capacity facility. If passed as written by both houses by at least two-third votes, SB 57 would become law immediately with its designation as an emergency measure.

The Railroad Commission of Texas is conducting a half-day educational session on the Permian Basin’s Spraberry trend and Delaware sub-basin from noon to 4 p.m. on April 25 at the Commemorative Air Force Base, 9600 Wright Dr., Midland, TX. Topics include drilling permits, completions, stacked laterals and website queries. Registration is required; seating is limited. The cost is $75/person for registrations by Tuesday (April 11) and $125/person after.

UK-based Westwood Global Energy Group is acquiring Houston-based Energent Group Software LLC to expand its capabilities in the U.S. onshore market. The acquisition for an undisclosed price would provide well and lifecycle data for drilling pad trends, well completions metrics, fracturing sand and downhole chemicals. "The acquisition of Energent is an important step in the formation of Westwood, as developing our presence and capability in the U.S. market is a principal component of our vision," said Chairman Gavin Prise. Westwood now is comprised of consulting firms Hannon Westwood, Richmond Energy Partners, Douglas Westwood, Novas Consulting and JSI Services. "The combination of Westwood and Energent will create a powerful offering for gaining data-driven insights into the U.S. shale market," Energent founder Todd Bush said.

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