Gas prices are $3.11/MMBtu, down from a high of $3.31 last Friday, but up from a low of $2.45 a few weeks ago. Drilling rigs are at 619, down a little from 623 last month, but numbers have been pretty flat since the end of October ’23. Gas storage is at 3,336 Bcf, down of course, but above the five-year average.
CNX is pulling out of participation in the ARCH 2 hydrogen hub because of uncertainty around the implementation of a tax break CNX thought it would be able to take advantage of, and because they haven’t been able to come to reasonable terms with the company that would have been buying natural gas from them. Most articles make it sound like the tax break is the deciding factor, however.
If you’ve been happy about the lower prices for gas for your car, part of the reason is that U.S. fracking companies have been increasing oil output enough to counter the cutbacks made by OPEC+. Here’s another article saying pretty much the same thing.
Democrats in the House of Representatives have opened up an investigation into Diversified Energy, focusing on how Diversified contributes to environmental problems. Diversified does more to take care of or plug old wells than the people and companies it buys them from. This feels like political grandstanding. Also note that Diversified’s stock fell a ton after this news broke. Care to make a wild guess as to who shorted Diversified? Wasn’t you and me.
FERC has approved a rate increase for the MVP, and extended time to build the Southgate Extension portion of the MVP.
If you’d like to know a little more about how NGLs are brought to market, RBNEnergy has a good post for you.
‘Tis the Season! The season of predictions for the upcoming energy year. The usual caveat applies: all predictions are bunk, it’s the analysis that’s useful.
Oilprice thinks that U.S. production will continue to grow in 2024, setting new record highs.
RBNEnergy does a look back at it’s 2023 predictions, along with a new set of predictions for 2024.
If what I’m reading is correct, and it seems like it is, the ARCH2 hydrogen hub is in serious jeopardy. The Biden Administration has proposed a new IRS rule, 45V, which will make it so that the hydrogen hubs will only be able to get the tax credit they were promised if they use green hydrogen. The ARCH2 hub was going to use blue hydrogen, or hydrogen which is sourced from natural gas, so it wouldn’t get the tax credit. Without the tax credit, the economics of the hub just don’t work.
Diversified Energy has sold some of its Appalachian assets, retaining a 20% ownership, while continuing on as the producer. It’s an interesting financial move, but unlikely to affect anyone whose well is operated by Diversified.
The TVA has added some more natural gas fired power plants. Tennessee can have them, why can’t West Virginia? Oh, right; politics.
Hope Gas is acquiring about 460 customers in Lewis County, WV by acquiring Standard Gas and Bazzle Gas. Slowly but surely, Hope Gas is growing.
The shale industry has become more efficient, laying down rigs and increasing production.
Toby Rice spoke with CNBC about the natural gas market. The video is about four minutes long and worth the time.
Unrest in Libya has shut down an oil field there, once again. It will take about 300,000 barrels of oil per day off the market. That should push the price of oil (and gas at the pump) up just a little.
Here’s the EIA’s oil and gas prediction. The EIA, being a government agency, usually has conservative forecasts.
Chesapeake and SWN are merging! I expect there are some papers to work and some regulations to hurdle, but this sounds like a deal that is likely to go through; I’ve been seeing headlines suggesting this could happen for several weeks already. For our clients who own minerals that are currently produced by SWN, little should change. The checks will keep coming, just with a new name.
RBN Energy has a good article about the differences between gathering lines and transmission lines.
EQT will provide a Texas company with gas for LNG.