Columbia Pipeline Moving Forward

The Federal Energy Regulatory Commission has approved the proposed replacement of 34 miles of natural gas pipeline in southwestern Pennsylvania.

However, there are some stipulations. The project may continue as long as “mitigating measures” won’t “constitute a major federal action significantly affecting the quality of the human environment.”

Columbia Pipeline Group will replace 20-inch-diameter bare steel piping in Greene County, Washington County, and Allegheny County. The Tri-County Bare Steel Replacement Project is expected to cost $138 million.

Click here to read the entire Pittsburgh Business Times article.

Pennsylvania Contributes to a Large Portion of the Nation’s Gas Supply

Not only does Pennsylvania produce 20 percent of the national gas supply, but the Commonwealth also saw record production for the first six months of 2014.

According to David Spigelmyer, president of the Marcellus Shale Coalition, unconventional wells in 2008 were producing 25 percent of Pennsylvania’s natural gas supply. Within five years, the state is producing 20 percent of the nation’s natural gas supply.

Southwestern Pennsylvania’s Washington County was the top supplier yielding 198 billion cubic feet.

Click here to read the entire Pittsburgh Business Times article.

Marcellus Shale Coalition Releases Annual Workforce Survey

Nearly 95 percent of Pennsylvania’s Shale producers participated in the Marcellus Shale Coalition’s annual workforce survey.

Key survey highlights include:

  • 26.5 percent of new hires work in engineering and construction, 23 percent of new hires work in equipment operations; 15.2 percent in operations and maintenance, 8 percent in administration, 7 percent in land and 5 percent in environmental, health & safety;
  • 83 percent of new hires came from Marcellus Shale [Pa., Oh., W.Va., N.Y., Md.] states;
  • Positions most difficult to fill;
  • Workforce diversity; and
  • Recruitment methods and challenges, including educational and professional training needs.

Is the industry growing, stagnant or declining? Click here to read the entire study.

Looking for an Economic Powerhouse? Look to Pittsburgh

According to the Pittsburgh Business Times, the Bureau of Economic Analysis has identified Pittsburgh as a growing segment of the United States due to an increase in gross domestic product (“GDP”). Pittsburgh’s GDP has grown every year since 2001 – except for 2009, which was due to the recession.

The largest part of the GDP for Pittsburgh is the financial industry – including finance, insurance, real estate, rental and leasing activity.

Manufacturing is also on the increase and a huge boom from mining, most likely due to the Marcellus Shale.

Click this link – Pittsburgh region ranks in top 25 among US to read a pdf of the Pittsburgh Business Times article.

Pa. Commonwealth Court Act 13 Ruling

On July 17, 2014, the Commonwealth Court of Pennsylvania ruled on the issues regarding Act 13 that the Pennsylvania Supreme Court had remanded to it in the Supreme Court’s December 2013 decision. The Commonwealth Court held constitutional Act 13 provisions providing (1) notice requirements related to spills should be made to public drinking water systems, without the same notice requirement for private drinking water systems [Section 3218.1], (2) physician non-disclosure requirements, prohibiting healthcare professionals from disclosing to others regarding the composition and quantities of hydro fracturing constituents [Section 3222.1], and (3) granting certain natural gas transport, storage, or sale corporations the power of eminent domain [Section 3241(a)].

However, the Commonwealth Court determined that Section 3305, which provided the Pennsylvania Utility Commission (“PUC”) with the ability to review zoning ordinances for compliance with Pennsylvania law and to withhold distribution of impact fee funds to communities with noncompliant ordinances, was unconstitutional. As a result of the Supreme Court decision to strike down portions of Act 13, the Commonwealth Court found that municipal ordinances related to drilling remain under the jurisdiction of the respective county Courts of Common Pleas, and that Section 3305 was not severable from the remainder of Act 13.

The PUC has appealed the ruling on Section 3305 to the Pennsylvania Supreme Court.

Click here to read the Commonwealth Court decision.

A Look Ahead – What’s Next for the Oil and Gas Industry in 2014

With fewer than 125 days left in 2014, we find ourselves looking at What’s Next for the oil & gas industry in the Marcellus and Utica Shale Plays for the remainder of 2014. It has been an eventful year and with just four months until 2015, we look forward and identify key events and issues that are top of mind.

2014 Events
There are a wide range of upcoming events with programs and topics relevant to E&P, midstream, field services and downstream markets. Annual meetings, summits, roundtables and conferences provide valuable opportunities to learn from and connect with industry leaders. Click here for the entire list.

2014-2015 Legislative Issues
Those with interests in the Marcellus and Utica Shales will be actively monitoring the rulemaking process in the remainder of 2014, while preparing legislative initiatives and agendas for 2015. We take a look at prominent issues in Pennsylvania, West Virginia and Ohio that will be at the forefront. Click here to read the entire article.

Mergers, Midstream, and the Marcellus and Utica Shales

The $6 billion merger of Williams Partners and Access Midstream Partners is proving to have a major impact on the Marcellus and Utica shales.

The Pittsburgh Business Times provides insight here.

A Discussion with Dave Spigelmyer, President, Marcellus Shale Coalition

INTRODUCTION: Recently, Spilman’s Director of Energy & Transportation Services, Scott Rotruck, interviewed David Spigelmyer, president of the Marcellus Shale Coalition (MSC). Prior to his appointment to the MSC, Spigelmyer has enjoyed a long and distinguished career in the oil & natural gas industry, including tenures with fully integrated utilities, purely exploration and production companies, midstream-focused companies, and has chaired industry trade associations including The West Virginia Oil and Natural Gas Association (WVONGA). Spigelmyer is a Pennsylvania native, an Eagle Scout, a proud grad of Penn State, an active sportsman and devoted family man.

Rotruck: In October 2013, you were named the president of the MSC. With your extensive and diverse industry background, having seen so many challenges, as well as so many opportunities, what will be your top priorities?

Spigelmyer: The MSC is approximately 300 members strong, including producers, midstream companies and suppliers, who are guided in our work together by two key facts: (1) being the widespread economic and community development benefits of safe shale development across the footprint of shale and beyond and (2) being the historically validated fact that Pennsylvania, as is the case with other jurisdictions vying for investment, must remain attractive to capital long-term, have a skilled and educated workforce, and a strong regulatory regime conferring certainty of the rules of economic engagement.

Rotruck: It seems the general public has developed an awareness of shale development sufficient to be included in late-night comedy mentions about hydraulic fracturing, yet there is a yawning chasm between awareness and a true understanding – although polls do show good public support. Correct?

Spigelmyer: While public opinion polls routinely show a majority support shale development, advocacy groups opposing the work of our industry have a platform through traditional media and social media, which amplifies their voice many times their actual strength and number. This one-sided narrative, with an exaggerated projection of the number of adherents and the conviction of their message, must change and change quickly, if shale development, with its myriad benefits for so many Pennsylvanians, is to continue.

Rotruck: What are a few of those widely dispersed benefits folks need to keep top of mind, so they can appreciate and actively support safe shale development?

Spigelmyer: The Pennsylvania Department of Labor and Industry, for the second quarter of 2013, said there were 241,926 employees in the Marcellus and related industries. Furthermore, the Department noted that since 2009, core industries, which includes drilling and supporting activities, oil and gas pipeline and related structures, natural gas liquefied extraction, and other categories, have grown by 174 percent. Pennsylvanians should be encouraged to read the MSC’s 2014 edition of “Shale Fast Facts”, which shows the average core industry wage as $84,400, which is $35,600 higher than the average wage in Pennsylvania.

Rotruck: Those are amazing numbers, but is it possible yet to fully see in the labor and industry statistics the widely distributed benefits of the Marcellus?

Spigelmyer: You bet it is! Again, the Department has impressive numbers, which show that even while weathering a national recession and a sluggish economy generally, the “Ancillary Industries”, which includes among other entities, technical consultancies, such as engineering and environmental compliance, as well as site prep, transportation, and water and wastewater management, succeed. Again, turning to “Shale Fast Facts”, the Ancillary Industries wage category was $65,200, and, as I remember, that is about $16,400 higher than the average Pennsylvania wage.

Rotruck: Dave, I have known you a long time and although you are a team player and flexible, you always advised associations to have a to-do list of prioritized items. Therefore, what is on the MSC’s prioritized list?

Spigelmyer: The recent establishment of the United Shale Advocates (USA), a grassroots driven movement to optimize and maximize broad community support for shale development, is a top priority now. However, the USA is not replacing some other MSC activities, but it will be complementary and essential to accomplishing other MSC priorities.

The MSC created USA as an online neighborhood for committed advocates of shale gas and those who want to learn more about the industry. And like a neighborhood or a larger community, where people share ideas, information and stories about what is important in their daily lives, the USA online community will work best when everyone is talking with one another consistently and frequently.

Furthermore, it needs to be underscored, that the USA is not another level of membership status in the MSC, nor a separate organization, but instead it is a way of engaging the broad spectrum of supporters and those who in their enlightened self-interest should be supporters of shale development across society, but especially at the community level in areas where shale development is taking place.

Finally, the USA movement will not be exclusively done online, but will include tangible events, such as the very successful rally just held at the Capitol in Harrisburg, which was widely covered in the press, where experts were quoted saying it was one of the largest rallies ever seen in the city.

Rotruck: Dave, you have shared compelling statistics on the growing safe shale development in Pennsylvania, highlighted MSC priorities of securing wide and deep support from enlightened and engaged communities through the USA movement, while ensuring Pennsylvania is attractive to capital investment. What final thoughts would you like to share?

Spigelmyer: I feel so fortunate to see first-hand, daily, how powerful safe shale development can be for local communities and for meeting our environmental, economic and national security goals. However, to maintain long-term shale development, it is absolutely necessary that we successfully mobilize our supporters and potential supporters and convert them to ACTIVE supporters, who will tell this great story.