Natural gas production in the Lower 48 states was 71.76 Bcf/d in March, a 0.26 Bcf/d (0.4%) decrease compared with 72.02 Bcf/d in February, according to the Energy Information Administration‘s (EIA) latest Monthly Natural Gas Gross Production report. Texas had the largest decline at 0.15 Bcf/d (0.7%) as several operators reported shut-ins for well maintenance, EIA said. Declines in Louisiana (0.09 Bcf/d, or 1.1%) and New Mexico (0.08 Bcf/d, or 2.2%) were partially explained by well maintenance “and a few operators who cited low prices as a reason for limiting their production,” EIA said. Federal Offshore Gulf of Mexico production was 4.69 Bcf/d in March, a 0.16 Bcf/d (3.5%) increase compared with 4.53 Bcf/d in February, as production from shut-in wells resumed, EIA said. Production was down in every other category in March compared with the previous month — including the U.S. total, which was 81.75 Bcf/d (a 0.4% decline) — according to the report. Production in the “other states” category was 21.67 Bcf/d, a 0.2% decrease compared with 21.72 Bcf/d in February. Alaska production was 9.99 Bcf/d (down 0.5%); Oklahoma was 5.31 Bcf/d (down 0.2%) and Wyoming was 6.42% (down 0.6%).

Williams Partners LP is holding a nonbinding open season through June 28 for expansion of its Transcontinental Gas Pipe Line (Transco) to provide incremental firm service to markets in northern Georgia and Alabama by 2016. Transco’s Dalton Expansion Project would provide up to 600,000 Dth/d of incremental firm transportation service from interconnections accessing Marcellus Shale gas production at the Zone 6 Station 210 pooling point. The scope of the project would be determined by the open season results and is subject to federal approval. For information, contact Toi Anderson at (713) 215-4540.

ExxonMobil Chemical has made a regulatory filing to add a multi-billion-dollar ethane cracker and other facilities at its Baytown, TX, chemicals complex to take advantage of cheap ethane being thrown off by shale gas plays. Filings were made with the U.S. Environmental Protection Agency and the Texas Commission on Environmental Quality. All governmental reviews and approvals for the facility are expected to take about a year with a final investment decision following approvals. The facilities could be online in 2016. The cracker would have a capacity of up to 1.5 million tons/year and provide ethylene feedstock for two new 650,000 tons/year high-performance polyethylene lines at the company’s nearby Mont Belvieu Plastics Plant. A filing also was made to expand the Mont Belvieu plant.

Multiple companies have announced ethane-focused infrastructure projects, spurred by growing supplies of the commodity thanks to shale plays (see NGI, April 2). Shell, for instance, recently picked Pennsylvania as the location for a potential new ethane cracker that would take advantage of Marcellus Shale supplies (see NGI, March 19).

Six former presidents will be appearing in two commercials supporting natural gas that are scheduled to air in theaters before motion pictures this summer as part of an advertising campaign by the American Clean Skies Foundation (ACSF). John F. Kennedy, Lyndon Johnson and Jimmy Carter are featured in the first commercial, while the second features Dwight D. Eisenhower, Richard Nixon and Ronald Reagan. Both commercials then segue to President Obama‘s State of the Union address this year (see NGI, Jan. 30). The videos are also available for viewing on YouTube and on ACSF’s What if Challenge website. Chesapeake Energy Corp. is the nonprofit’s main financial supporter.

Beginning July 1 producers that use hydraulic fracturing (fracking) on wells in Oklahoma will be required to disclose the contents of the fluids they use, save for those contents considered trade secrets. The regulations, enacted by the Oklahoma Corporation Commission (OCC), require operators on a well-by-well basis to disclose the type of base fluid used; trade name, supplier and purpose of substances added to the base fluid; the identity, CAS (Chemical Abstracts Service) number and maximum concentration for each ingredient in each substance added to the fluid; the API (American Petroleum Institute) number of the well; the longitude and latitude of the well; and the dates on which fracking began and ended. The information may either be provided to the OCC or posted on the FracFocus website.

BP plc officials said they intend to sell the company’s lucrative stake in TNK-BP, which is owned equally with Russia’s Alfa Access Renova (AAR), a group of Russian billionaires. Analysts estimated that the sale, if completed, could garner up to $30 billion for BP, basically erasing all of its estimated financial obligations related to the Macondo well blowout in the Gulf of Mexico. In 2010 TNK-BP represented about 20% of BP’s total reserves; about one-quarter of total production and 10% group profits. BP said it had “received unsolicited indications of interest regarding the potential acquisition of its shareholding in TNK-BP” and that it had an obligation to shareholders to pursue a potential sale and had notified its Russian partners of its intention to do so. BP said there was no guarantee that the transaction would take place but it would make another announcement when and if it was appropriate. In response, AAR said it “has become apparent that the parity ownership structure has become inoperable given fundamental differences over strategy and governance between AAR and BP. AAR remains committed to the successful development of TNK-BP, including potentially increasing its shareholding in the business.”

The Federal Energy Regulatory Commission‘s Office of Enforcement has preliminarily determined that Kansas City, MO-based natural gas distributor Missouri Gas Energy (MGE) violated the agency’s capacity release regulations involving a total of almost 69 Bcf of capacity. The investigation of MGE, a division of Southern Union Co., is still ongoing, and no penalty has been assessed. According to a FERC notice, MGE violated regulations when it rolled over short-term discount rate capacity to the same replacement shipper without posting the capacity for bid; failed to fully disclose the terms and conditions of a prearranged released; failed to post for competitive bidding discounted rate long-term capacity releases; used its capacity rights to park and store gas for which it did not have title in violation of the shipper-must-have-title requirement; and engaged in improper buy/sell arrangements by purchasing natural gas from a counterparty and reselling the gas back to the same counterparty.

The Pennsylvania Commonwealth Court has ruled that compressor stations fit the legal definition of “gas production” and therefore can’t be banned by localities where other aspects of natural gas production are already permitted. In a ruling filed on May 9, a three-judge panel said a compressor station operated by New Century Pipeline LLC does not run afoul of a Bradford Township zoning ordinance, reversing a decision by a McKean County, PA, judge.

Weston Solutions Inc., a private firm hired by Chesapeake Energy Corp., said in a 360-page report that drinking water sources tested by the U.S. Environmental Protection Agency (EPA) in Bradford County, PA, show no signs of any adverse impact from Marcellus Shale operations. Weston analyzed split samples collected by Chesapeake and the EPA from 14 water wells and one spring last October and November as part of the EPA’s national study on hydraulic fracturing (fracking). Chesapeake subsequently submitted Weston’s findings to the EPA, the Pennsylvania Department of Environmental Protection and landowners involved in the study.

Equitrans LP informed FERC that on April 11 it accidentally spilled about 500 gallons of drilling mud containing bentonite into Garrison Fork, a tributary of Dunkard Creek, while building the Sunrise Pipeline in Gilmore Township in Greene County, PA. An inspector with the Pennsylvania Department of Environmental Protection (DEP) found sediment measuring about six inches thick to build up in the stream for 100-200 feet. The DEP said an Equitrans crew was attempting to drill a 2,800-foot bore for a 24-inch diameter pipeline under the creek Garrison Fork at the time of the accident. A notice of violation was issued but the department had not yet determined a fine.

Fuel cells that use natural gas to chemically produce electricity with small onsite distributed generation units are receiving increased attention because of low natural gas prices, according to Danbury, CT-based FuelCell Energy Inc. (FCEL). FCEL extended contracts for operations and maintenance of Direct FuelCell power plants with four existing customers in three separate markets — education, municipal wastewater treatment and food processing. FCEL officials said the company is edging closer to being in the black, fueled by the low natural gas prices that are bringing the cost of power from one of its units down to the 15 cents/kWh level, better than solar-generated power that is averaging just under 17 cents/kWh but still higher than average utility-generated power that runs a little more than 11 cents/kWh.

Three families in western Pennsylvania have filed a 190-page complaint alleging 17 defendants, including an operator for Range Resources Corp. and two water testing labs, Microbac Laboratories Inc. and Test America Inc., alleging comprised to hide evidence of drinking water contamination caused by hydraulic fracturing from drilling wells. A Range spokesman characterized the lawsuit, which was filed May 25 in Washington County Common Pleas Court, as an attempt by unscrupulous attorneys to shake down the industry.

Citizens for Property Rights (CPR), a five-member group that opposes what members believe are too-strict restrictions on gas drilling imposed by the city of Southlake, TX, failed to get enough signatures on a petition to relax some of the rules. However, CRP Chairman Stephen Oren said the group will try again. CPR had until May 29 to get 3,348 signatures but managed to get about 2,800. CPR for now has withdrawn its petition initiative to get Southlake to amend its Gas and Oil Well Production Ordinance 880-B, which was passed by the City Council in November, and accept an amended ordinance for public vote. The petition would have required under the Texas Constitution home rule and Southlake Charter that the citizens of Southlake should have a vote over the oil and gas drilling ordinances in Southlake.

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