Crude Oil ( ) Brent Crude ( ) Natural Gas ( ) S&P 500 ( ) PHLX Oil ( )
Current RRC Stock Info

New task force focuses on developing Pennsylvania infrastructure responsibly

In 2014, Pennsylvania became the second largest natural gas producing state after Texas, producing over 4 trillion cubic feet of natural gas last year, according to the Energy Information Administration. The shale revolution has allowed companies to unlock massive quantities of natural gas locked in tight formations, doubling Pennsylvania’s output from 2012 to 2014.

Range Resources (ticker: RRC) has seen record-setting initial production (IP) rates in its Utica/Point Pleasant well, drilled in Washington County, Pennsylvania. The well achieved an average 24-hour test rate of 59.0 MMcf/d against simulated pipeline pressure and conditions during the initial flow back, a rate the company believes to be a record for any horizon drilled in the Appalachian Basin, as well as the highest IP rate of any Utica well.

Pennsylvania’s production explosion quickly outpaced the growth of midstream infrastructure, however, creating bottlenecks throughout the state. To ensure that new pipeline infrastructure meets the needs of everyone, from the industry to environmental agencies and Pennsylvanian citizens, Governor Tom Wolf created a task force, called the Pipeline Infrastructure Task Force (PITF).

On July 7, Governor Wolf appointed the task force’s 48 members, which includes stakeholders from state agencies, the legislature, federal and local governments, the pipeline and natural gas industries and environmental groups, according to a press release. The group will recommend policies, guidelines and best practices to guide the build out of pipelines in Pennsylvania.

John Quigley, acting secretary of the Pennsylvania Department of Environmental Protection (DEP) and chairman of the task force, said the state anticipates the construction of as many as 25,000 miles of gathering pipelines over the next 10 years.


Pennsylvania Natural Gas Infrastructure. Source: EIA

“The industry needs to see this infrastructure developed to overcome low prices,” said Quigley. “There’s a lot of stranded gas in Pennsylvania, wells that have been drilled that aren’t connected to any infrastructure. So the industry is facing a big challenge to get their gas to market.”

The task force will be informed by an additional 101 individuals, serving on 12 workgroups, who will focus on such issues as pipeline safety and integrity, siting and routing, environmental protection, conservation, agriculture, emergency preparedness, natural gas end use, county government, local government, public participation, workforce and economic development, and historical, cultural and tribal issues, according to the press release.

The members will define a set of recommendations and best practices for: planning, siting and routing pipelines; amplifying and engaging in meaningful public participation; maximizing opportunities for predictable and efficient permitting; employing construction methods that reduce environmental and community impacts; and developing long-term operations and maintenance plans to ensure pipelines safety and integrity. The task force will provide a report of recommendations to Governor Wolf by February 2016.

Important disclosures: The information provided herein is believed to be reliable; however, EnerCom, Inc. makes no representation or warranty as to its completeness or accuracy. EnerCom’s conclusions are based upon information gathered from sources deemed to be reliable. This note is not intended as an offer or solicitation for the purchase or sale of any security or financial instrument of any company mentioned in this note. This note was prepared for general circulation and does not provide investment recommendations specific to individual investors. All readers of the note must make their own investment decisions based upon their specific investment objectives and financial situation utilizing their own financial advisors as they deem necessary. Investors should consider a company’s entire financial and operational structure in making any investment decisions. Past performance of any company discussed in this note should not be taken as an indication or guarantee of future results. EnerCom is a multi-disciplined management consulting services firm that regularly intends to seek business, or currently may be undertaking business, with companies covered on Oil & Gas 360®, and thereby seeks to receive compensation from these companies for its services. In addition, EnerCom, or its principals or employees, may have an economic interest in any of these companies. As a result, readers of EnerCom’s Oil & Gas 360® should be aware that the firm may have a conflict of interest that could affect the objectivity of this note. EnerCom, or its principals or employees, may have an economic interest in any of the companies covered in this report or on Oil & Gas 360®. As a result, readers of EnerCom’s reports or Oil & Gas 360® should be aware that the firm may have a conflict of interest that could affect the objectivity of this report.