Powered by Max Banner Ads 

Pennsylvania Fracked Gas Arrives in Scotland

Constitution Pipeline - MarkindDaniel B. Markind, Esq.
Weir and Partners, LLP

 

The first ship carrying PA fracked gas has arrived in Scotland for a chemical company that said the shipment would bring them back to profitability.

Yesterday afternoon, a ship arrived in Grangemouth, Scotland carrying fracked gas from Pennsylvania.  The delivery of ethane, brought by the chemical company Ineos, was the first shipment of fracked gas in Britain.  For Ineos, it represents the fuel that will enable it to continue to operate the Grangemouth chemical facility profitably.  To the environmental community, it represents a dangerous precedent that must be stopped.  According to Friends of the Earth Scotland, “It is completely unacceptable to attempt to prop up the Grangemouth plant on the back of environmental destruction across the Atlantic.”

fracked gas

As shown in the American Presidential debate Monday night, people appear to be living two different realities.  To the environmental community, the concept of hydraulic fracturing is another nail in the earth’s environmental coffin.  To others, hydraulic fracturing gives us a chance to utilize a cleaner-burning fuel that is plentiful in North America while simultaneously limiting the power of countries like Russia and Iran.  No one, certainly not the Presidential candidates, seems able to bridge the divide.  Worse, few seem to even attempt to communicate with people who think differently.

Lest we think this divide is unique to America, the debate over hydraulic fracturing is even more acute in Europe, where much of the Continent would rather risk the hegemony of Vladimir Putin over Europe’s energy security than take a hard look at the tradeoffs needed to break that power and provide energy to Europe.  Indeed, the British Labour Party announced it would ban fracking outright if it wins the next general elections.

One world leader who may buck the trend to play solely to his base is Canadian Prime Minister Justin Trudeau.  Yesterday his government approved a $27B LNG project on British Columbia’s northwest coast.  It was the Prime Minister’s first major energy decision, and it comes despite running on a platform of doing more to help the environment.  Canadian Natural Resources Minister Jim Carr said that “helping to get Canada’s resources to market is a key responsibility, …(but) at the same time we said that economic prosperity must go hand in hand with environmental responsibility.”  Let’s hope that there are other leaders who can reach across the various aisles, honestly discuss the tradeoffs and not spend their time only preaching to their respective choirs.

Back in the United States, Rice Energy announced that it would purchase Colorado based Vantage Energy for $2.7B.  The deal would provide Rice with 85,000 net acres in Green County, Pennsylvania that will include both Marcellus and Utica dry gas acreage, along with 37,000 net acres in the Barnett Shale in Texas.  Rice claimed it was getting a multi-decade inventory of dry gas in the heart of the Marcellus and the Utica, but early returns from Wall Street were negative.  On average, Rice paid approximately $10,600/acre, well below the $12,400/acre Vantage paid recently.  Still, Rice’s stock price dropped 7% on Tuesday morning following the announcement.

Last week at the Shale Insight Conference, Pennsylvania Department of Environmental Protection Secretary Scott Perry told the audience that Pennsylvania’s new regulations for non-conventional wells, the long awaited Article 78a drilling rules, will go into effect on October 8.  On that date, the Rules will be published in the Pennsylvania Bulletin and go into effect immediately.

Questions remain on many of the regulations, and the package could be hundreds of pages thick, but the years-long process to reach this point will finally end.  As I’ve said many times, some of the rules are plain common sense, some are questionable but understandable, and some seem downright silly.  Let’s hope that reason prevails and that industry and the regulators take a collaborative approach to make the State better and not see what each side can pull out from the other.

fracked gas

Finally, a story about how natural gas can change the international scene for the better.  On Monday Noble Energy, one of the major investors in Israel’s Leviathan natural gas field in the Mediterranean, agreed to supply Jordan’s national power company with gas valued at up to $10B.  The deal is not the first collaboration between the two old antagonists – indeed one of the pillars of the 1994 Peace Treaty between the two countries was the commitment by Israel to supply Jordan with water, which it does to this day – but it deepens the cooperation between the two states.

Despite the governmental cooperation, relations among the citizenry have not improved markedly, and Jordanians remain very wary of doing any business with Israel.  With the rise of ISIS and the Civil War in Syria, views toward Israel may – may – change among the Arab population.  If so, this deepening of economic ties between Israel and Jordan might be a step along a tortuous road that one day could make a more stable Middle East, and a more stable world.  I’ll end with that hopeful note, and be proud of the potential that this natural resource may have in bringing people together and not driving them apart.

Print Friendly
Email this to someoneShare on FacebookShare on LinkedInShare on Google+Digg thisFlattr the authorShare on RedditShare on YummlyShare on StumbleUponTweet about this on TwitterShare on TumblrBuffer this pagePin on Pinterest

3 thoughts on “Pennsylvania Fracked Gas Arrives in Scotland

  1. Applying good engineering and sound economic policy to Energy and Water Issues between Israel and her neighbors will not only increase revenue but has potential to develop mutually amicable relations – leading to Middle East Please

    Please see my past article discussing Delek, Noble and development of Israel’s Leviathan Natural Gas Mediterranean resource.

    Goodwin, R.W.; “Natural Gas Assures Israel’s Future”; Energy Pulse Weekly; February 24, 2011
    http://www.energycentral.com/generationstorage/fossilandbiomass/articles/2389/Natural-Gas-Assures-Israel-s-Future/

    Richard W Goodwin 9/28/16

  2. Pingback: A Warning for Scotland: Push Forward on Natural GasNatural Gas Now

Leave a Reply

Your email address will not be published. Required fields are marked *


 Powered by Max Banner Ads