Editor’s note: Assistant Business Editor David Conti is leaving the Tribune-Review after more than 20 years at the paper.
When we launched Flowback and the Tribune-Review’s On the Grid energy news pages two years ago, several key issues dominated the oil and gas industry’s attention.
Pipelines had become a flashpoint. Opponents of drilling and fracking looked to block pipeline projects involving Bakken crude oil or Marcellus gas as their best shot of slowing shale development.
Complaints from landowners who signed royalty leases with companies but thought drillers were unfairly deducting fees reached a fever pitch as courts took up their cases.
Shale gas producers in Pennsylvania were constantly defending the hundreds of millions of dollars they paid annually in impact fees as a valid alternative to a proposed severance tax.
And about 2,000 industry reps were heading to the David L. Lawrence Convention Center to discuss hot topics during the annual Shale Insight conference.
Today, pipelines remain the frontlines in the battle between environmentalists and drillers, as evidenced by permit delays in the Marcellus and the tense standoff over the Dakota Access Pipeline.
Elected officials in Bradford County — a pro-drilling region for years — are so angry over royalty deductions they have hired a PR firm to help make their case.
Producers are still defending the impact fee as per-well revenues have dropped to their lowest levels since the collections began.
And Shale Insight again kicks off at the convention center this week, this time with a little added attention as GOP presidential nominee Donald J. Trump is scheduled to give a keynote address.
None of this is to say nothing has changed in the oil and gas landscape over those two years.
Indeed, since last fetching more than $4 per million British thermal units in 2014, the benchmark price of natural gas fell to a 16-year lows — $1.67 — before “recovering” to nearly $3 over the past few months.
That price drop prompted a massive pullback from the Marcellus and other shale plays. Companies had fewer than 30 drilling rigs working in the Marcellus this month, compared to 80 in September 2014.
And a few questions that nagged the industry two years ago have been answered. Shell will build that ethane cracker in Beaver County after all. Exports of ethane and liquefied natural gas have begun. Gas can replace coal as the dominant fuel for U.S. power plants.
The point is, there seem to be a few constant sticking points in the oil and gas landscape.
Harnessing the benefits of U.S. oil and gas requires pipelines, and they must go through someone’s yard. Landowners and governments will want a piece of the profits. Some environmentalists will do anything to block more drilling.
If the industry or general public or elected leaders can’t get past those points, little will change.