Operating

Two Interior Department agencies have issued updated guidance to oil and natural gas companies operating in the Gulf of Mexico Outer Continental Shelf (OCS) on how to conduct archaeological resource surveys and prepare archaeological reports, based on additional new information about the likely location of historical resources.

El Paso warned of possibly needing to declare a Strained Operating Condition, citing high linepack due to actual delivery takes being below scheduled quantities and receipts from supply basins in excess of scheduled volumes. The Washington Ranch storage facility is making maximum injections, El Paso said. It encouraged delivery point operators to take gas according to their scheduled quantities and receipt point operators to reduce and/or maintain deliveries into the system at their scheduled rates. Additionally, imbalance paybacks to the system will not be accepted as long as the high-linepack condition remains.

MarkWest Energy Partners LP, which teamed up with private equity fund The Energy & Minerals Group (EMG) three years ago to create one of the largest natural gas processing companies in the Marcellus Shale, now sees a “critical” need to create similar midstream infrastructure in the emerging Utica Shale, CEO Frank Semple said late Monday.

Rockies Express (REX) said it has been informed of potential operating restrictions on Tennessee, which could impact nominated quantities at their TENN/REX GUERNSEY interconnect. However, there is “no impact at this time due to the current level of nominations on Tennessee’s system,” REX said.

Producers operating in the Barnett Shale town Arlington, TX, will have to comply with new rules enacted Tuesday that call for greater drilling site security and improved aesthetics of drilling locations for future wells. Surveillance cameras will be required at drilling locations, and the use of diesel-powered rigs is banned within 450 feet of residences and other designated places. The vote was 7-0 in favor of the ordinance revision with one council member absent and one seat unfilled. Previously, some members had expressed reservations about the changes, saying they might be too onerous for the industry. One change that favors drillers is the allowance of concurrent applications for specific-use permits and gas well permits. Council initially approved the rules last month (see Shale Daily, Nov. 21).

El Paso warned shippers of a potential Strained Operating Condition (SOC) being declared due to high linepack caused by actual takes below scheduled deliveries and supply basin receipts in excess of scheduled volumes. The Washington Range storage facility is in maximum injection mode, El Paso said, and it has contacted two points about their actual takes versus scheduled volumes and the possibility of them being subjected to a location-specific SOC.

Nevada’s two major private-sector electric utilities, both operating under corporate parent NV Energy, will merge into one utility headquartered in Las Vegas. Sierra Pacific Power Co., a combination natural gas and electric utility in the north, will be consolidated into the larger electric-only Nevada Power Co. utility in the south, said NV Energy CEO Michael Yackira. Filings to the Nevada Public Utilities Commission and the Federal Energy Regulatory Commission are to be made by the end of this year.

A year after the gas transmission pipeline explosion in San Bruno, CA, Pacific Gas and Electric Co. (PG&E) operations are “still not where they need to be,” and another $200 million for operating expenses next year is needed to help right the ship, PG&E Corp. CEO Tony Earley told financial analysts Thursday.

Although noting that industry never wants to be taxed, one of the largest players in the Marcellus Shale said it supports an impact fee in principle.