Declined

August natural gas declined slightly Wednesday as algorithmic traders showed little interest in purchases at current prices and the market awaits the release of government inventory figures. August had fallen 3.3 cents to $4.500 and September had skidded 4.2 cents to $4.469. August crude oil gained 64 cents to $98.14/bbl.

The cost to build major natural gas pipelines is rising, particularly in the Marcellus Shale, according to a new report.

August futures declined Wednesday as traders saw little impact from a Gulf of Mexico storm and expected Thursday’s government inventory report to show increases above historical averages. At the close August had fallen 3.9 cents to $4.315 and September slipped 3.9 cents as well to $4.334. August crude oil vaulted higher adding $1.88 to $94.77/bbl.

Prices declined, mostly by double digits, across the board Thursday as a relative lack of substantive cooling demand combined with the previous day’s 7.1-cent dip in July futures to bring bearish pressure on the cash market.

Canada’s environment minister indicated that the federal government in Ottawa was keeping a close eye on hydraulic fracturing (fracking) and was prepared to intervene if it thought either the provincial or territorial governments weren’t doing enough to safely regulate the procedure.

June natural gas futures declined Thursday as traders digested an inventory report about in line with expectations but well ahead of last year’s injections. A subsequent release of a government hurricane forecast did little for the bullish cause either, and prices settled at the low end of the day’s trading range.

A hearing at the Arkansas Oil and Gas Commission (AOGC) to consider whether two saltwater injection wells in the Fayetteville Shale are related to seismic activity in the region has been postponed to April 26 from March 29 at the request of the injection well owners, Oklahoma City-based Chesapeake Operating Inc. and Little Rock, AR-based Clarita Operating LLC. The wells are currently shut in and will remain so until at least the date of the hearing and maybe longer depending on what is decided at the AOGC. Both companies maintain that their wells are not related to a recent swarm of earthquakes in the area; however, since the wells were shut in, quake activity has declined somewhat (see Shale Daily, March 17).

A federal judge ruled last week that Pennsylvania landowners who signed Marcellus Shale leases with oil and gas companies — then unsuccessfully sued to have them nullified — did not “repudiate” the lease terms, and turned down the companies’ counter suit to extend the leases by two years to regain time lost during litigation.

Witnesses for Range Resources Corp. took the stand Wednesday during the first day of a hearing at the Railroad Commission of Texas (RRC) in Austin, TX, to defend the company against allegations by the Environmental Protection Agency (EPA) that its drilling activities in the Barnett Shale caused the contamination of private water wells in the area. However, EPA representatives were not in attendance.