The Northeast ONG Marketplace - Winter 2017

PO BOX 1001 YOUNGWOOD, PA 15697

WINTER 2017

PRSRT STD U.S. POSTAGE PAID BECKLEY, WV 25801 PERMIT NO.19

CHANGE SERVICE REQUESTED

Major Industry Players Form The Environmental Partnership PG. 14

The Future Course for the PA Petrochemical Industry PG. 18

PA Severance Tax Update

NEW TECHNOLOGY PG. 12

PG. 22

®

ENERGY SERVICES

Gas Processing Made Easy

CLEAN COOL QUIET SAFE

STEEL

BUILDING S

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EN G IN EER IN G

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The Northeast ONG Marketplace

LEE SUPPLY’S SOLUTIONS

Tanks & Domes

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ONE that can match their customers’ needs to the best quality products and services.

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Winter 2017

Page 3

ONG MARKETWATCH STEEL NATION’S FIRST SYMPOSIUM FOR CLIENTS, VENDORS, AND SUBCONTRACTORS SCORES HIGH MARKS. Washington, PA – December 5, 2017 - Steel Nation, located near Pittsburgh, Pennsylvania, invited clients, vendors, and subcontractors to the Hyatt Hotel, Meadows Casino on November 29, 2017 to attend its 2017-2018 Symposium. Steel Nation is a full-service construction, engineering, and environmental firm that specializes in the design, construction, service, and repair of Pre-Engineered Metal Buildings (PEMBs). More than 70 business leaders were in attendance to listen to presentations, exchange information, and to engage in break-out sessions.

President, Mark Caskey, who in 2008, started the business in a spare bedroom, has developed Steel Nation into one of the fastest-growing companies in the region, with three divisions that primarily serve the Oil & Gas industry; Steel Nation Buildings, Steel Nation Engineering, and Steel Nation Environmental. The company also is active in the Water and Wastewater and Healthcare industries.

Caskey opened the symposium by saying, “Not only did I want to bring us all together today to talk about what’s going on in the industry, but to say “thank you” to all of our clients, preferred vendors, and subcontractors who have been a part of this exciting ride.”

Dianne Fretz, General Manager, Pittsburgh Air Systems added, “So many organizations regard their vendors as expendable commodities, not business partners. It was very refreshing to see the mutual respect and admiration that Steel Nation and its vendors have for each other.”

“The business is changing,” added EVP, Alan Reid. “The symposium was an excellent forum to communicate that message to our partners so that they can prepare to adjust their business operations accordingly.”

“We’ve been working with Steel Nation for about four years,” said Frank Kmetz, VP, Corle Building Systems. “Our team holds quarterly meetings with the Steel Nation team and it’s paid off. Our business has grown and we’ve helped them win customers.”

“We intend to make this an annual event,” concluded Mark Caskey. “As our keynote speaker said, we’re seeing no projected industry slowdown. What we do see are a lot of additional opportunities in water/wastewater, environmental, and in the healthcare fields. There’s going to be a lot to talk about at the next symposium.”

Steel Nation is a proud Washington, Pennsylvania-based corporation working primarily in the energy sector of North America. Originally founded to design/ build/turn-key large scale coal prep plants, Steel Nation has evolved into the leading designer/builder of transmission, storage, and compression facilities, for the mid-stream and transmission operations of the Oil & Gas industry throughout the Marcellus, Utica, and other American shale plays.

Responsible Reclamation

An opportunity to restore diversity • Conservation seed mixes

Keynote speaker, David J. Spigelmyer, President of the Marcellus Shale Coalition, asserted that despite some legislative challenges, this is an exciting time for the Oil & Gas industry, particularly in the Pennsylvania region.

“20% of America’s natural gas comes from Pennsylvania,” said Spigelmyer. “And Pennsylvania is number one in the country in unconventional gas production.”

Noting that natural gas continues to create jobs, generate revenue, improve air quality, and has been responsible for revitalizing manufacturing, Spigelmyer said, “Natural gas can change the outlook for the world’s energy supply.”

Keynote speaker, David Spigelmyer, addresses the symposium attendees.

Spigelmyer added, “At the Steel Nation symposium, contractors from across the region gathered to applaud the company’s continued growth in support of responsible shale gas development here in the Commonwealth. Events like the Steel Nation symposium shine a spotlight on the enormous jobs multiplier that shale gas development provides to our region.”

Chris Becker, President of G.W. Becker Overhead Crane Products, said, “It’s great to bring companies together in a cooperative setting for industry updates, constructive input, and ideas for improvement. I look forward to future events.”

“At Steel Nation, we view our preferred vendors and subcontractors as part of the Steel Nation family,” said Mark Dooley, EVP/CFO. “Our success depends largely on being able to provide the best value to our clients, and they help us meet those goals.”

• Native seeds • Pollinator forage • Bioengineering materials

ernstseed.com sales@ernstseed.com 800-873-3321

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The Northeast ONG Marketplace

ASSOCIATION MEETINGS IOGAWV Winter Meeting | January 23–24, 2018 Charleston, WV - www.iogawv.com

OOGA Winter Meeting | March 7–9, 2018 Columbus, OH - www.ooga.org

PIOGA Spring Meeting | March 21, 2018 Pittsburgh, PA - www.pioga.org

ADDC Region II Meeting | April 26-28, 2018 Gaylord, MI - www.addc.org

ADDC Region I Meeting | May 17–19, 2018 Findlay, OH - www.addc.org

Jeff Metz

537 Park Drive Weirton, West Virginia 26062

jmetz

ARTICLES

ADVERTISER INDEX

MARCELLUS DRILLING NEWS............................. 5

ALBERTA RIG MATS............................................ 15 ALPINE ELECTRIC................................................. 4 AUDUBON............................................................ 23 BEG........................................................................ 8 CST INDUSTRIES.................................................. 2 DMC DESIGN....................................................... 15 ERNST SEED.......................................................... 3 LEE REGER BUILDS............................................ 15 LEE SUPPLY........................................................... 2 LYDEN OIL COMPANY......................................... 17 MID-ATLANTIC STORAGE.................................... 4 NORTH AMERICAN FIELD SERVICES.................. 4 STEEL NATION...................................................... 1 SUNNYSIDE SUPPLY........................................... 13 TD CONNECTIONS.............................................. 23 WEAVERTOWN ENVIRONMENTAL.................... 15

INDUSTRY INSIGHT: Effective Local Communications..................................................... 6 NEWS FROM STEPS............................................. 7 PIPELINE NEWS: Pipeline Activity in the Northeast ............................................................................... 8 NEW TECHNOLOGY: Oil & Gas Applications for Remote Camera Systems................................. 12-13 SHALE CRESCENT NEWS: Be a Dealer (of Hope)... ........................................................................ 16-17 PENNSYLVANIA NEWS: “FORGE THE FUTURE“ Describes Future Course for PA Petrochemical Industry................................................................. 18 INDUSTRY INSIGHT: Site Selection in the Tri-State Area................................................................. 20-21 INDUSTRY INSIGHT: Severance Tax and Regulatory Reform: The Great Debate of this Decade!........................................................... 22-23

CALENDARS ASSOCIATION MEETINGS.................................... 4 NETWORKING EVENTS...................................... 15 TRAINING & WORKSHOPS................................ 23 UPCOMING EVENTS........................................... 11

EVENTS MUM..................................................................... 24

CONTACT US FOR ADVERTISING, INFORMATION OR MAILING LIST CHANGES:

The Northeast ONG Marketplace PO Box 1001 • Youngwood, PA 15697 724-787-4451 E-mail: info@ongmarketplace.com

The opinions expressed in the Northeast ONG Marketplace are those of the authors and not necessarily those of the Northeast ONG Marketplace or its advertisers. Any warranties or representations made in the advertisements or articles are the responsibility of the specific contributor and not The Northeast ONG Marketplace. The Northeast ONG Marketplace will not be liable for any misprint in advertising copy which is not the fault of The Northeast ONG Marketplace. If a misprint should occur, the limits of our liability will be the amount charged for the advertisement.

Winter 2017

Page 5 at the Top 20 Marcellus Operators by production, you will immediately notice that the three largest producers (Chesapeake, Cabot Oil & Gas, and Southwestern Energy) take up nearly half the pie. Those three have wells almost exclusively in the northeastern part of Pennsylvania (Chessy and Southwestern have some wells in other parts of the state). What’s even more mind blowing: Cabot’s massive production at #2 in the Marcellus, just barely behind Chesapeake, all comes from a single, northeastern county: Susquehanna County, PA. Enjoy this visual feast by visiting: https://goo.gl/T5Va8A.

Each weekday Marcellus Drilling News (MDN) locates and shares news, along with a healthy sprinkling of commentary, covering the Marcellus and Utica Shale region.

Over 50,000 people read MDN each month, making it an excellent barometer to inform ONG Marketplace readers which topics generated the most interest for those who work in the oil, natural gas and associated industries. Below is a summary of the top 5 stories that were most-read over the past 30 days on MDN. Cumulatively, the following five stories were read over 11,000 times in the past month. #1 Most Read: China Agrees to Invest Amazing $83.7 BILLION in WV Shale, Petchem (Nov. 9) The “Art of the Deal” is still alive and well for Donald Trump. Trump, along with an entourage of various state officials, are currently on a trade mission in Asia.

This morning (our time) a flurry of announcements were issued about Trump (and others) convincing China to invest $250 billion (a staggering number!) in various projects in the U.S. A whopping $83.7 billion of that (a full third!!) will be invested in one state–West Virginia. And the WV investment, according to the announcement, will be in “shale gas and chemical manufacturing projects.” The investment will come over the next 20 years, so yes, we’ll believe it when we see it.

However, we cannot overstate how big and how good this news is for our friends in the Mountain State. While no specific projects are mentioned, we get this enticing tidbit from the announcement: “The projects will focus on power generation, chemical manufacturing, and underground storage of natural gas liquids and derivatives.” Sounds to us like we now know where the $10 billion NGL storage facility will be located. It also sounds to us like a cracker plant may be a possibility.

And a number of Marcellus-fired electric plants. This is truly a “wow” story! To read the full story, visit: https://goo.gl/87xLGn. #2 Most Read: Out with the Old: Rice Energy Sign Comes Down Day of EQT Merger (Nov. 14) Yesterday the Marcellus/Utica experienced a fracking earthquake of historic proportions. That is, a fracking earthquake metaphorically speaking. Yesterday Rice Energy was merged into EQT, creating the largest onshore natural gas producing company in these United States. The $8.2 billion deal was first announced back in June. There was plenty of drama along the way–primarily opposition to the deal by evil corporate raider Jana Partners, in collusion with Atlas Energy. Fortunately their effort to stop the deal didn’t gain traction. Yesterday was the day when the two companies became one. Two Rice Energy board members, Dan Rice IV and Bobby Vagt, joined the EQT board. Another two independent (outside either firm) board members were also added–Thomas Karam, founder and Chairman of Karbon Partners, and Norman Szydlowski, former president and CEO of SemGroup Corporation. Standing by the virtual water cooler, MDN has overheard that many Rice personnel were nervous about what yesterday would bring. You know the routine: Two rooms–one for those staying, and one for those getting the heaveho. Everyone waiting to get “the call” to whichever room they’re assigned. We’ve been there. It sucks. But that’s the reality in today’s corporate world. One thing we found interesting is that the huge Rice Energy sign on the company’s (former) HQ building was taken down yesterday–the very day the two merged. An MDN friend caught some of it on a smartphone video (below). EQT isn’t wasting any time making a statement: Out with the old, in with the new. To see the video and read more about this historic event, visit: https://goo.gl/jSov67. #3 Most Read: Cool Charts: Top 20 Marcellus Drillers, Top 20 Utica Drillers, More (Dec. 4) Hart Energy publishes an excellent magazine called Exploration & Production (E&P). A recent article published on the E&P website reports on rising production of natural gas in both the Marcellus and Utica Shale plays. As MDN has continued to report month after month with the release of each monthly EIA Drilling Productivity Report, our region consistently hits new production records. The E&P article recounts some of those EIA record-breaking stats, and then inserts a series of charts that we found extremely interesting and useful–because they convey so much information in a visual, fast way. Below are those charts. When you look

#4 Most Read: Tyler County, WV Mentioned as Candidate for $10B NGL Storage Hub (Nov. 13) In May 2016, MDN brought you the news that a researcher at West Virginia University (WVU) believes a natural gas liquids (NGL) storage hub is what the Marcellus/Utica region really needs. According to Brian Anderson, director of WVU’s Energy Institute, without ethane storage (and pipelines) the Marcellus/ Utica region risks seeing its abundant ethane leave the area, mostly heading to the Gulf Coast. We need that ethane here, in our area. Kevin DiGregorio, executive director of the Chemical Alliance Zone, also took up the cause in an editorial in July 2016. Since that time we’ve run a number of stories about the proposed $10 billion NGL storage hub for the Marcellus/Utica. In particular, West Virginia’s two U.S. senators, Shelley Moore Capito (Republican) and Joe Manchin (Democrat) have been pushing hard for such a hub. It has been thought that WV and PA and OH would need to cooperate to help fund such a project. Even the mighty Shell cracker is “only” costing $6 billion! So $10 billion is almost incomprehensible. But then everything changed last week when we told you we now have a pretty good idea of how the project will get funded–by the Chinese. West Virginia has, from the beginning, been the state most often mentioned as the location for such a storage hub–but until now no specific site has come across our radar. That’s changed. With money flowing from China for a bevy of shale-related projects, different locations across the Mountain State are speaking up. Tyler County is the latest, saying they are under consideration for the $10B NGL storage hub, and they will do “whatever needs to be done” to win the project. There are, however, two other locations in WV also under consideration. Read about all three locations here: https://goo.gl/ pbqtcH. #5 Most Read: ECA Sells Marcellus/Utica Assets to ArcLight Capital – Shareholders Shafted (Dec. 1) Big news concerning Energy Corporation of America (ECA), a privately owned company founded in 1963 with corporate headquarters in Denver, CO. The company owns (or rather owned) and operated approximately 4,600 (mostly vertical) wells, 5,000 miles of pipeline, and leases more than 1 million acres in North America–most of it in Appalachia. We spotted a press release yesterday that says ArcLight Capital has acquired substantially all of ECA’s natural gas production and pipeline assets.

But here’s where it gets interesting. ArcLight has set up a subsidiary called Greylock Energy, which will own the assets–all of the ECA natgas/pipeline assets will go to Greylock. The former CEO of ECA, Kyle Mork, will become the CEO of Greylock.

Many (most?) of top management from ECA will become part of Greylock. The existing ECA palatial headquarters building in Charleston, WV we told you about back in 2014 will become the new HQ for Greylock. In other words, it’s all still ECA, but there’s a new nameplate on the door. So what really happened? What happened, according to an MDN source, is that ECA did something akin to what we’ve seen a number of times before: they converted debt into equity (ownership) and shafted existing shareholders out of millions of dollars. Except in this case we’re not sure ECA actually had large debts. There’s no way to know since it’s a private company. But the pattern is the same. ECA gave the keys to new owners, leaving the previous owners (i.e. shareholders) standing on the curb holding an empty bag. To read more, see: https://goo.gl/hykoYq.

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The Northeast ONG Marketplace

INDUSTRY INSIGHT

EFFECTIVE LOCAL COMMUNICATIONS By: Shayla Owens, PR Specialist, Orion Strategies It’s hard to hate someone you’ve met. However, the strategy and intent behind that meeting and all future interaction is key. In the case of energy companies and community stakeholders, tensions can be high from the beginning - most times due to preconceptions configured by both sides. Many problems stem from the fact that both parties have already assumed too much about the other based on negative generalizations, leaving little opportunity for sustainable, cooperative relationships to form and grow. However, for oil and natural gas companies hoping to do business in a small, local community, it is critical to understand that community outreach and strategic communication is the most important step in planting that first seed to cultivate those relationships.

Small towns know their local business owners by name and both parties say hello to one another at the grocery store and when dropping their kids off at school. If bigger, outsider companies want to build relationships with people in places like these, they have to be willing to put faces with their names and become active members in a community. Simply putting a face with a name—especially with an energy company’s name—can make all the difference in sprouting sustainable relationships in local communities. First impressions are important because a business’ identity is made up of many attributes before it fully exposes itself to a community. And the best way for a community to get to know the new business in town is to meet the people who work there and learn their intentions.

At first glance, a corporate entity is typically thought to be unapproachable, powerful, and self-serving - all characteristics that could make local residents mistrust or even dislike an outsider. However, knowing how to go through the process of communicating and weaving symbiotic relationships is the trick. And, the word trick here, is being used as a figure of speech.

From a public relations perspective, the worst thing an individual and company can do is let another party believe their words and intentions are being explicitly shared. Then, it turns out that all interaction was an attempt to deceive or reach a hidden agenda. Strategies like those come to mind when we think about how crooked politicians operate. A big part of any politician’s job has to do with their ability to communicate effectively, but a crooked politician’s definition of effective communication can be slanted. And, as cliché as this expression is, it only takes that one bad apple to spoil the bunch. Time and time again, the energy industry has been generalized based on those instances of bad apples, and there are many multi-million dollar movies out there to prove it.

For better or worse, companies have two identities: the ones they build themselves and the one society builds for them - which can sometimes result in a sort of Dr. Jekyll and Mr. Hyde situation. The media has excelled at documenting any instance of corporation malfeasance, and Hollywood has turned out movie after movie portraying the dichotomy of the Big Bad Company and some young, brave soul determined to save the environment and the local community from corporate exploitation or pollution. Rarely does any industry that harvests natural resources such as fossil fuels get to be the hero, or even get to be on the hero’s side for a change. So, how does the energy industry combat this?

Do they pay to produce their own movies where the company gets to be the good guy? Should they work on reaching younger audiences, making sure every kid in the world has a coloring book with Talisman Terry, the “friendly” Fracosaurus dinosaur in it?—this is actually a real thing. Or do they work on building their own company’s image, striving for transparency and integrity in all that they do?

Although children’s characters like the Fracosaurus seems like the fun route to take, there are serious questions to be considered: Do energy companies appear to sincerely care about the messages they send out to residents in the local communities where they plan to operate? Have they thoroughly considered their strategy for community outreach and communication alongside their plans to drill?

When in the energy industry, a company should want to focus on the part of their identity that they have control over, starting with strategies of effective communication and community outreach - which do much to show local residents that monsters don’t lurk the halls of all big companies like they do in movies. Most importantly, company officials should be eager to get to know community leaders and other stakeholders, and strive to reach positive outcomes for all involved. And, the sooner these interactions occur, the better.

Too many times, when companies think about community outreach, they picture donations, charity, or volunteering. Now more than ever, businesses are encouraged to get involved in the communities where they operate, donating their talent, time, resources, and experience to grow local economies and build sustainable relationships. All of these strategies are wonderful and very much needed in local communities. However, effective community outreach is also the way companies choose to interact with stakeholders, ranging from one-on-one conversations with stakeholders, public events, social media, and even the appropriate language on the company website.

Energy companies like to express themselves in language such as excellence, efficiency, and innovation. Although those attributes are useful if a business wants to be seen as competitive in a national or global market, those priorities are less effective in positioning a business in a local community. In establishing an identity that makes a business more relatable, more human, it is important to uphold values such as empathy, generosity, and integrity - not just insinuating them on the company website or discussing them during team meetings, but to make sure they are genuinely implemented into all efforts of community outreach on a daily basis.

Shayla Owens is a public relations specialist with Orion Strategies, a strategic communications and public relations firm. She can be reached at sowens@orionstrategies.com

Winter 2017

Page 7

NEWS FROM STEPS The National Service, Transmission, Exploration & Production Safety (STEPS) Network is an all-volunteer organization which was founded in 2003 in South Texas by OSHA and Industry in an attempt to reduce injuries and fatalities in that region. The effort was successful, and STEPS has continued to grow, currently including twenty-two independent regional networks serving twenty producing states. Eight of the networks have signed formal alliances with OSHA, and the National STEPS Network signed a formal Alliance with OSHA and NIOSH on December 2, 2014 and renewed it for five years in Dec. 2016..

The National STEPS Network includes Operators and Contractors in the Oil and Gas Exploration, Production and Product Transmission industry as equally valued members in partnership with OSHA, NIOSH, API, AESC, IADC, IPAA, other trade associations and educators across the country. The Network's goal is to serve all producing regions of the United States and to eventually share our philosophy internationally.

onshore upstream industry S&H issues. We have an ongoing initiative to develop educational materials including safety alerts based on industry fatality statistics.

To date we have distributed a silica video as well as safety alerts for tank gauging, hot work, portable engines, and limitations of portable atmospheric monitors in English and Spanish. We are currently working on safety alerts for ground disturbance and dropped objects.

Our first and most successful initiative, SafeLandUSA is a standardized safety and health onboarding orientation for the US onshore upstream industry.

SLUSA was founded in 2005 and went live in 2010. Through the efforts of the allvolunteer board and advisors, including AESC, ETC, IADC, OSHA and PEC, we surpassed the 1,000,000 student milestone on July 4, 2017. This is an eight-hour instructor-led orientation covering 24 elements with a 100-question exam.

The National STEPS Network owes its success to a dedicated team of volunteers from coast to coast, and north to south. Our vision is seeing our industry reach the goal of incident free operations. This is obviously a lofty goal, and we haven’t made it yet, but together we are heading in the right direction.

Our initiative includes the Emerging Issues Focus Group, which, in collaboration with OSHA, NIOSH and others, meets periodically to address important US

PLAN YOUR 2018 NORTHEAST ADVERTISING! In addition to our regular print distribution of over 8,000 industry professionals, the Northeast ONG is distributed at conferences, expos and meetings throughout the region. These issues are anticipated to be distributed at the following conferences: Volume 8

Materials Deadline

Anticipated Additional Distribution

Issue 1 Feb 2 OOGA Winter Meeting Issue 2

March 22

Ohio Valley Oil and Gas Expo

Issue 3

April 27

Eastern Gas Compression Roundtable

Issue 4 June 1 DUG East Issue 5 July 12 Issue 6

August 23

Shale Insight/WV Energy Expo

Issue 7 October 11 OOGA Technical Conference Issue 8 Dec 6 Marcellus-Utica Midstream Conference

724-787-4451

PO Box 1001, Youngwood, PA 15697

www.ongmarketplace.com

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Page 8

The Northeast ONG Marketplace

PIPELINE NEWS

PIPELINE ACTIVITY IN THE NORTHEAST By: Ray Keller, National Sales Manager, Pipeline Division, BEG Group, LLC The ONG Marketplace is proud to welcome Ray Keller as a regular contributor for pipeline news! Mr. Keller started a lifelong career in the pipeline industry in 1966, working part time as a warehouse man for CRC-Evans Pipeline, a major specialized pipeline equipment manufacturer based in Tulsa, OK. After graduating Lycoming College, Williamsport, PA in 1970, with BS in Accounting he accepted a full time outside sales position with CRCEvans Pipeline. Starting in 1973, he participated in the construction of the Trans Alaskan Pipeline Project. In 1976, he was promoted to Manager US Eastern Division of CRC-Evans, in Elizabeth, NJ. Remaining with CRC-Evans until 2014, he spent many days on ROW’s in nearly all 50 States, including major projects in Canada and Mexico. During that time, he brought many new and innovative equipment components to the market place including pipe bending, ditch padding, automatic welding and field joint coating systems.

After retiring for a brief time in 2009, he founded Rayven Pipeline Consulting, LLC based in Toms River, NJ. Recently he took on BEG Group, LLC as a client and holds the position of National Sales Manager, Pipeline Division for that company.

Currently living in Delaware, he enjoys boating, fishing, and working the pipeline ROW’s with the many contractors he has come to know over the years.

This article will highlight some of the major projects currently in progress and a few that are on schedule for early 2018 construction.

KINDER MORGAN UTOPIA PIPELINE PROJECT Harrison County OH to Fulton County OH 215 miles 12” Scheduled completion early 2018 All spreads Minnesota, Ltd. NATIONAL FUEL GAS LINE TNY REPLACEMENT Erie City, NY 7 miles 24” Scheduled completion 01/2018 Otis Eastern Service EQT MIDSTREAM EQT GATHERING SYSTEM 11 miles 20” & 11.4 miles 12” Dodridge & Ritchie Counties WV All Spreads Ace Pipeline ENERGY TRANSFER ET REVOLUTION PROJECT Beaver, Butler,Washington Counties, PA 61 miles 24”,14 miles 12” Scheduled completion 01/2018 All Spreads WILBROS SPECTRA ENERGY ACCESS SOUTH PROJECT Noble & Monroe Counties, Megis & Athens Counties OH 14.7 miles 36” Scheduled completion 02/2018 All Spreads M G Dyess Co. UPCOMING 2018 WORK MAJOR PROJECTS MOUNTAINEER EXPRESS 42” WV EASTERN SHORE NATURAL GAS 24”, 16”, 10” PA & DE

CURRENT JOBS IN PROGRESS

NATIONAL FUEL GAS 24” PA & NY

SUNOCO LOGISTICS/Energy Transfer ME2 PROJECT Phil, PA to Washington PA dual 16” & 20” 350 miles Scheduled completion mid 2018 Spread 1 Welded Construction Spread 2 Trinity Pipeline Construction Spread 3 Michels Pipeline Spread 4 Precision Pipeline Spread 5 Welded Construction Spread 6 Otis Eastern Service

MILLENNIUM P/L VALLEY LATERAL 16” Orange County NY

WILLIAMS/TRANSCO ATLANTIC SUNRISE PROJECT Tunchannock, PA to near the MD border in Lancaster County, PA. 197 miles 30” & 42” Spread 1 Michels Pipeline Spread 2 Latex Construction Spread 3 Henkels & McCoy Spreads 4,5,6 & 7 Welded Construction ASR Compressor Stations 605 Wyoming County PA & 610 Columbia County PA LMC Industrial ENERGY TRANSFER ET ROVER BURGESSTOWN LATERAL Burgesstown PA 64 Miles 36” Scheduled completion 02/2018 Spread 1 Pumpco, Inc.

WILLIAMS/TRANSCO

CONSTITUTION PIPELINE PA & NY

NEXUS PIPELINE OH SOUTH JERSEY GAS

PINELANDS PIPELINE PROJECT 24” NJ

Next issue we will include more specific information on the 2018 work as it becomes available.

Big Switch® is extremely user friendly making our laborer’s job safer and it’s the environmental wave of the future!

-Jimmy Joyce Project Manager/Otis Eastern Services

Big Switch™, the flexible mesh tube

sock filled with switchgrass, helps retain sediment and other pollutants so cleaned water can flow through.

Contact: Ray Keller, National Pipeline Sales Manager

732-245-7264 www.thefacilitators.net 740-680-0343

Patent Pending

Winter 2017

Page 9

Coming in 2018 - New Logo and More Issues!

Ad Size

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2 Page Center Spread 21.44” W x 12.8” H

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Page 2 or 3

Additional 10%

724-787-4451

ALL ADS ARE IN FULL COLOR Digital files may be high resolution PDF, TIFF, or Adobe Photoshop. Submit photos not less than 200 dpi. Logos, text or other images should be sent 400 dpi or greater as JPEG, TIFF, or EPS file. Our color process is CMYK, color text or text within a color background needs to be bold for proper registering with this type of printing process. If you don’t have a prepared ad but have a draft designed; we can work with you to create your advertisement at 20% with two revisions.

Email info@ongmarketplace.com

PO Box 1001, Youngwood, PA 15697

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Page 10

Exciting things are on the way! We’re making a slight change to our name. As the Northeast ONG, we want to highlight our unique status as the only publication covering all oil and gas related activities in this region of the United States. We’re focusing our content on the policies and projects that impact our readers the most. We’re doubling the number of print issues to bring you the most current information and we’re launching an email newsletter to provide updates in between. We hope you’re looking forward to what the Northeast ONG will be bringing to you as much as we’re looking forward to delivering it!

The Northeast ONG Marketplace Robert Johnson, President, ADKL LLC has nearly twenty five years of government relations experience.

This includes considerable state and local government background. Recently, he served in the Pennsylvania Governor’s SWPA Office as Deputy Director. Mr. Johnson has served as an Executive Assistant to the Pennsylvania State Senate Majority Whip.

Robert has an intimate knowledge of state government, its agencies, departments, and how they function.

Robert Johnson, ADKL President, has experience serving municipalities across Southwestern Pennsylvania with government regulations, public policy, and funding opportunities. Robert has extensive background in transportation, environmental, natural gas, real estate, and health care issues. rjohnson@adkl.org

The Northeast ONG Editorial Advisory Board This team of experts has been working in the oil and gas industry for decades. They not only write for the Northeast ONG, they are still working in the industry today. Their keen understanding of the industry and connections at all levels allow Northeast ONG readers to understand the depth and impact of industry developments. Look forward to reading their insights each issue and feel free to reach out to them with your thoughts and ideas.

Bryce Custer brings with him experience in all aspects of commercial real estate.

Including acquisition, disposition and development of office, retail and industrial projects. Current focus is serving the needs of the Petrochemical, Oil & Gas, Derivative Industries and Energy Services companies capitalizing on the drilling and exploration of the Utica /Marcellus Shale in Eastern Ohio and the Northern Panhandle of West Virginia (Appalachian Basin and Ohio River Corridor). Primary focus is in the area of Site Selection for industrial clients utilizing rail throughout Ohio and West Virginia and barge along the Ohio River. Experience in site selection for Natural Gas Power Companies (Carroll County Energy and Southfield Energy), industrial, distribution and for companies that have a need to be in proximity to the Shell (Pennsylvania) and PTTP Cracker (Ohio) along the Ohio River Corridor. bryce@ ohiorivercorridor.com For thirty-two years, Joe Greco has served as a facilitator and business developer, building strategic alliances by creating and implementing successful marketing and networking concepts for local, regional and national companies. Currently Joe is President of BEG Group LLC a company that provides nationally certified USDA erosion/ filtration medium that is 100% biobased/ biopreffered. Joe is also the Regional Advisor for the Service Transmission Exploration and Production (STEPS) Network for STEPS of Pa and Twin Tiers STEPS both out of Pennsylvania, Appalachian STEPS Network of West Virginia and Buckeye STEPS of Ohio. joe@ greco.tc

Greg Kozera is the Director of Marketing for Shale Crescent USA. He is also the President and CEO of Learned Leadership LLC. Greg has worked in the oil and natural gas industry for over 40 years in positions of Regional Operations Manager, Sales Manager, Project Manager and Engineer for several Fracturing and Cementing Service Companies including Halliburton (34 years), Targe Energy (a drilling company), Weatherford, Superior Well Services, Nabors and C&J Energy. Greg is also an adjunct professor at Pierpont Technical and Community College teaching Leadership and Soft Skills. Mr. Kozera is a two term past President of the Virginia Oil and Gas Association, a member of the Board of Directors for Energize West Virginia, the Ohio Chapter of the National Speakers Association, and the North American Coalbed Methane Forum. www.gregkozera.com Teresa Irvin McCurdy provides personalized consulting services primarily in the energy setor to guide clients through the government and regulatory process and asset them with their public relation needs through her firm, TD Connections, Inc. She also conducts business development for numerous clients in the natural gas industry. She prides herself on getting to know her clients, finding the common ground and creating a winwin for her clients and those they are negotiating with.

ONG Update is our new email newsletter to be published in between each print issue. This will provide our readers with the latest legislative developments, pipeline news and events. To make sure you receive yours, send us an email to info@ongmarketplace.com.

Winter 2017

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UPCOMING EVENTS JANUARY 23-25

MARCH

(cont.)

8-9

SPE Hydraulic Fracturing Technology Conference

NGA Annual Sales & Marketing Conference

The Woodlands, TX | www.spe.org

Newport, RI | www.northeastgas.org

30-1

27-28

Marcellus-Utica Midstream

Produced Water Management

Pittsburgh, PA | www.marcellusmidstream.com

Pittsburgh, PA | www.shale-water-marellus-utica.com

27-28

FEBRUARY

SPE/ICoTA Coiled Tubing and Well Intervention Conference The Woodlands, TX | www.spe.org

6-7 IADC HSE & Training Conference and Exhibition Houston, TX | www.iadc.org

APRIL

7-9 NAPE Summit Houston, TX | www.napeexpo.com

7-9 SPE International Conference on Formation Damage Control Lafayette, LA | www.spe.org

21-23 Annual Winter Meeting San Antonio, TX | www.aesc.net

9-10 OGIS New York New York, NY | www.ipaa.org

10-11 National Fluids Conference & Exhibition Houston, TX | www.aade.org

16-17 WVMA Marcellus and Manufacturing Development Conference Morgantown, WV | mmdc.wvma.com

25-27

MARCH

PESA Annual Meeting Greensboro, GA | www.pesa.org

30-3

1-2 Illinois Oil and Gas Association Convention Evansville, IN | www.ioga.com

Offshore Technology Conference Houston, TX | www.otcnet.org

6-8 IADC/SPE Drilling Conference and Exhibition Ft. Worth, TX | www.spe.org

Denotes National Event

Visit our website for links to these events

WWW.ONGMARKETPLACE.COM/EVENTS

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The Northeast ONG Marketplace

NEW TECHNOLOGY

OIL & GAS APPLICATIONS FOR REMOTE CAMERA SYSTEMS By: David Gaw, CEO, Sensera Systems Seeing is believing. But getting eyes-on remote drilling or production sites has traditionally been difficult and expensive. First there is the issue of power. Drilling sites may have temporary or intermittent power. Production sites may have no power, with SCADA/telemetry systems having their own dedicated solar system.

Secondly, there is the issue of network connectivity. SCADA systems typically do not provide enough bandwidth to support image or video data.

Fortunately, there are a number of recent technology developments that have combined to make it more feasible than ever to deploy cameras at remote drilling and production sites.

BATTERY AND SOLAR TECHNOLOGY Traditional remote solar/battery systems such as sealed lead acid, have a fairly limited cycle life when used as rechargeable systems. Cycle life determines how many charge/discharge cycles a battery can sustain before losing significant capacity.

Lithium based battery systems such as Lithium Iron Phosphate (LiFEPO4) can provide as many as 3000 cycles (~ 8 years) before losing 20% capacity. This is about 6-8x better than typical lead acid technologies. The result for a remote camera system is reliable operation for years – maintenance free.

Some battery chemistries such as LiFEPO4 also support “rapid charge rates”. Quick charging is important in a remote solar powered camera system. Rapid charging means that when the sun peaks out from the clouds for a few minutes here and there, the system can recharge rapidly – make hay while the sun shines! The result again is reliable 24/7/365 operation from a solar powered camera system.

LOW POWER, SMART CAMERA SYSTEMS Advances in microelectronics and integrated electronic design have enabled designers to create camera systems with extremely low power consumption. The low power consumption means smaller size and lower costs.

The method that system integrators have used in the past is to combine off-the-shelf components to build a remote camera system. These systems would combine an IP security camera, router, cellular modem, charge controller, voltage converters, battery pack, and solar panel. In addition, some sort of supervisory controller is often needed to monitor and reboot hardware remotely. A typical system of this design will require 30-40 watts or more of power. This results in a requirement for a table-sized solar panel, and 100+ lbs. of batteries.

In an integrated low-power remote camera system, all those components are combined into a single set of microelectronics. This reduces costs, size and improves reliability. A remote camera system such as Sensera’s SiteWatch-PRO2 weighs less than 20 lbs. including solar panel and batteries. This means one person can easily install and move the system.

A “Smart” camera refers to a device that does more than spit out video. It can have onboard processing for video analytics, circuitry for managing power and health monitoring, ability to send alerts, and substantial onboard storage for recording locally, avoiding cellular data costs. These types of “smart” cameras are ideal for remote applications in oil and gas, to keep cellular costs minimal, improve system reliability, and to make installation simple.

LTE AND 4G COVERAGE Traditional oil and gas applications have relied on private custom networks or SATCOM for site communications. For some extremely remote sites those remain the best options. For a large number of other locations, cellular, specifically 4G/LTE, can be a very effective option. Cellular coverage has continued to improve each year, and 4G/LTE technologies allow for higher data rates, and lower power consumption of devices.

Monthly costs have come down somewhat, but also include increasing amounts of data. That means that costs per megabyte have dropped substantially. Traditional remote camera systems can require substantial cellular data. Modern site cameras have intelligence built in to send data only when events are detected, saving substantially on cellular data costs.

Winter 2017 CLOUD CONNECTED Modern remote site cameras connect to a cloud service. This provides automated and secure archival of collected imagery – no shuffling of SD cards or emailing around photos, or hassling with FTP servers. Cloud connected systems also provide access to the cameras in real-time from any smartphone, tablet, or PC without requiring Apps to be installed by the IT department. Real-time alerts for events detected by the remote camera are relayed through the cloud and delivered to the user via email or text message within seconds.

The cloud greatly simplifies deployment of remote site cameras since no software install or configuration is required, no IT expertise is needed for setup, and anytime/ anywhere access is provided to all users instantly.

THERMAL CAMERAS AND VIDEO ANALYTICS Today's state-of-the-art remote site cameras include multiple detectors to provide optimal detection and monitoring under low-power conditions. Cameras such as Sensera’s SiteWatch PRO2 model include a thermal imager for long-range detection of people and vehicles on the drilling or production site. The thermal imager is coupled with video analytics to provide robust detection under all lighting and weather conditions day or night. The SiteWatch PRO2 also includes low-light black and white camera and a color camera, to support recognition and identification in all lighting conditions. IR Illumination is used to provide high quality images even at completely dark sites.

A remote camera solution such as the SiteWatch PRO2 can support a wide range of applications in oil and gas, including intrusion detection, logging visitors to a site, observing and documenting operations, and supporting site safety.

A smart, solar/wireless/cloud camera system such as the SiteWatch PRO2 represents a new breed of options for remote site monitoring in oil and gas applications. Lowcost, simple to deploy with now power or network needed, the SiteWatch PRO2 and similar cameras can provide 24/7/365 real-time monitoring to prevent theft and improve operations.

About the Author David Gaw is CEO and Founder of Sensera Systems, a leading manufacturer of next-generation, low-cost, solar/wireless site cameras for construction, security, energy, and industrial automation. David has B.S. and M.S. degrees in Computer Science and over 25 years of experience creating technology-based products in a wide range of automation markets. Contact David or Sensera Systems at www.

SenseraSystems.com.

Page 13

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The Northeast ONG Marketplace

ONG MARKETWATCH ENVIRONMENTAL PARTNERSHIP

WASHINGTON, December 5, 2017 – America’s natural gas and oil industry today announced a landmark partnership to accelerate improvements to environmental performance in operations across the country. Focused initially on reducing methane and volatile organic compound (VOC) emissions, the Environmental Partnership includes 26 natural gas and oil producers, who produce a significant portion of American energy resources. Participating companies will begin implementing the voluntary program starting January 1, 2018.

“This groundbreaking partnership further demonstrates the industry’s leadership and commitment to responsibly developing America’s energy resources while reducing emissions,” said Jack Gerard, president and CEO of the American Petroleum Institute. “U.S. methane emissions have fallen over the past decade as domestic natural gas and oil production has increased significantly due to the industry’s technology innovation and efforts to increase efficiencies. The Environmental Partnership seeks to accelerate emissions reductions and we’re headed in the right direction.”

Collectively, at the time of launch, the participating companies represent operations in every major U.S. natural gas and oil basin. The Environmental Partnership is a historic agreement bringing together American natural gas and oil companies of all sizes to take action, learn and collaborate in an effort to further improve our environmental performance.

“Industry is committed to environmental stewardship and the Environmental Partnership is a good vehicle to deliver industry focus and action. We are proactively taking steps to reduce methane emissions to ensure the sustainability of natural gas for generations to come,” says Greg Guidry, Executive Vice President for Shell’s Unconventionals business.

“We at Pioneer are glad to participate in this voluntary initiative that will allow even more companies to develop critical energy resources in an even more environmentally responsible manner,” said Mark Berg, Executive Vice President, Corporate/Vertically Integrated Operations at Pioneer Natural Resources. “The Environmental Partnership will help America’s natural gas and oil industry share goals, technologies and best practices that will make our environmental stewardship even stronger.”

The Environmental Partnership’s first initiative is focused on furthering action to reduce air emissions, including methane and volatile organic compounds, associated with natural gas and oil production. To accomplish this, the Environmental Partnership has developed three separate Environmental Performance Programs for participating companies to implement and phase into their operations starting January 1, 2018.

The three Environmental Performance Programs include: 1. Leak Program for Natural Gas and Oil Production Sources: Participants will implement monitoring and timely repair of fugitive emissions at selected sites utilizing detection methods and technologies such as Method 21 or Optical Gas Imaging cameras.

2. Program to Replace, Remove or Retrofit High-Bleed Pneumatic Controllers: Participants will replace, remove or retrofit high-bleed pneumatic controllers with low-or zero-emitting devices.

3. Program for Manual Liquids Unloading for Natural Gas Production Sources: Participants will minimize emissions associated with the removal of liquids that, as a well ages, can build up and restrict natural gas flow.

In addition to its programs, the Environmental Partnership will provide a platform for industry to collaborate with stakeholders and learn from one another.

“The industry has a long record of implementing technology and practices that have proven to increase efficiency and reduce the environmental footprint of operations,” said Gerard. “In establishing the Environmental Partnership, the natural gas and oil industry is working together to promote the most effective programs and opportunities to improve environmental performance throughout our operations.”

Since its inception in 1919, API has developed research, standards and best practices for safety and environmental performance, including guidelines and software for estimating and reducing greenhouse gas emissions, guidelines for sustainability reporting, and hundreds of industry training programs. To date, the industry has reduced methane emissions from natural gas production 16.3 percent from 19902015, while natural gas production increased 55 percent. In addition, partially due to greater natural gas use in electricity generation, U.S. carbon emissions from energy consumption in 2016 were at their lowest level since 1992.

Participants at launch include: • Anadarko • Apache • BHP • BP • Chesapeake Energy • Cabot Oil and Gas • Chevron • Cimarex Energy • ConocoPhillips • CrownQuest • Devon Energy • Encana • EOG Resources • Exxon Mobil subsidiary XTO Energy • Hess • Marathon Oil • Murphy Oil • Newfield • Noble Energy • Occidental Petroleum • Pioneer Natural Resources • Shell • Southwestern Energy • Statoil • TOTAL • Western Gas Partners To view more information about the program and companies’ commitments, visit www.TheEnvironmentalPartnership.org API is the only national trade association representing all facets of the oil and natural gas industry, which supports 10.3 million U.S. jobs and nearly 8 percent of the U.S. economy. API’s more than 625 members include large integrated companies, as well as exploration and production, refining, marketing, pipeline, and marine businesses, and service and supply firms. They provide most of the nation’s energy and are backed by a growing grassroots movement of more than 40 million Americans.

Winter 2017

Page 15

NETWORKING EVENTS Since 1991

December 19 APA Speaker Dinner Canonsburg, PA | www.appalachianpipeliners.org January 10 YPE Crew Change Canonsburg, PA | www.ypepittsburgh.org January 16 APA Speaker Dinner Canonsburg, PA | www.appalachianpipeliners.org January 30 ABGPA Midstream New Year Kickoff Pittsburgh, PA | www.abgpa.org February 20 ABGPA Midstream Speaker Luncheon Canonsburg, PA | www.abgpa.org

FOR MORE EVENTS VISIT WWW.ONGMARKETPLACE.COM/EVENTS

Page 16

The Northeast ONG Marketplace

SHALE CRESCENT NEWS

BE A DEALER (OF HOPE) By: Greg Kozera, Director of Marketing, Shale Crescent USA

I teach a class in Leadership and Soft Skills at Pierpont Community and Technical College in Fairmont, West Virginia as an Adjunct Professor. It is one of the ways I try to give back to the industry that has given me and my family a nice living for over 40 years. I love working with young people.

They are so full of energy and hope. In August, I looked my students in the eye and said, “If you can graduate from here as planned and stay drug free, a $40- $50,000 per year job with benefits will be looking for you in the Oil and Gas or Petrochemical Industry.” Several of my students have already been hired by companies in the region. The world has changed. I could not have made this statement 10 years ago. All three of my children had to leave West Virginia for Maryland and Virginia to find these high wage jobs.

“Leaders are dealers in hope.” Says leadership expert John Maxwell. Mr. Maxwell also said, “If there is hope in the future there is power in the present.”

As an athletic coach, college instructor and business leader I know that Mr. Maxwell is right. When people have a dream that they believe incredible things can happen.

Way back in 1999 the high school boys’ soccer team where I am assistant coach had never won even a section championship. We usually won a few more games than we lost. That year we began teaching leadership to our seniors. At the beginning of the season I asked our seniors, “What is your dream for this season.” BJ our captain said, “Coach, we want to play for the State Championship.” This was totally unrealistic but BJ was able to convince me, Bruce (our head coach) the other seniors and then the Team that it was possible. Our Team began to train and practice at a higher level. The boys work ethic got stronger. They complained less. After an incredible season, against all odds, we played Morgantown High in Wheeling for the State Championship. Their hope in the future changed what they did in the present. It also changed the future for the boys that followed them, some of them were not even born in 1999. Thirteen State Tournaments, seven State Finals and five State championships later I can say that our players believe in the future. I have seen similar results in business, sales and safety. When people have hope and belief in a dream (the future) they are more likely to do the work and then the magic begins to happen.

We have a similar situation as we work to bring high wage jobs back to this region that we have branded as Shale Crescent USA. If you remember your history the “fertile crescent” in the Middle East was the cradle of civilization.

If you use your imagination the Ohio River which is at the center of Marcellus and Utica production makes a crescent as it flows from Wheeling southwest between Ohio and West Virginia. The Marcellus and Utica have been a game changer for our region and the United States thanks to horizontal drilling, hydraulic fracturing and American ingenuity.

As our “rust belt” communities begin to regain hope in the future people change their actions. Young people like those in my class go back to school for a technical degree. They study with a purpose. They work with a purpose.

They have a reason to stay off drugs. Their attitude changes and that becomes

contagious. That is not the case everywhere. In October, I met a CEO from a company in the Netherlands when we were at the Global Plastics Summit in Chicago who said, “Americans are so optimistic. You would never see that in my country.” Recently I met a student from France who was working at Walt Disney World in Florida. He wants to stay here. I asked, “What is the biggest difference between here and France?” He quickly responded, “Here you still believe in your future.” We have a similar situation in the coalfields of West Virginia. Many of the coal jobs are not coming back. Unless those folks leave their future looks bleak right now. How sad to live in a place that doesn’t have hope or optimism in the future. They also have a huge drug problem.

My guess is that many people turn to drugs when they have no hope.

It is important for all of us to have hope in the future so that we will do the work to prepare for it in the present. This optimism may give many people the reason they need to stay off drugs. This optimism is also a reason for prospects to choose to come here to The Shale Crescent USA and bring their business. If you were going to spend millions or even billions of dollars to expand and grow your company, what type of community would you prefer to relocate to? We can all choose to be dealers of hope to those we come in contact with. Maybe you can help someone to avoid a drug problem or seek treatment because of the hope you have given them. Maybe you can encourage someone go back to school to prepare for one of these high wage jobs. These aren’t just jobs. They are careers. If you don’t have hope already, my desire for you in the coming year is for you to understand why we should all have hope in our future. You need to have hope so that you can help others develop their own hope.

The jobs we have been talking about are real. In the Parkersburg/ Marietta area companies like Solvay and Hino have already announced major expansions creating hundreds of jobs. They will need prepared and educated people to fill them. Other companies in the Shale Crescent Region I talk to are quietly expanding and hiring. One company is starting their planned new hires at $80,000 a year. Other companies outside of the USA have expressed their interest in locating in the Shale Crescent Region. Just this week one of our prospects from the Global Plastics Summit reached out to us. We have a conference call with them next week. We have been invited to Japan in January to present to the Japan Petrochemical Industry Association in Tokyo (JPCA). We will be telling the Shale Crescent story to a who’s who of Japanese companies encouraging them to come here.

I asked my students, “When you are making $50,000- $60,000 per year plus overtime after you graduate, how are you going to spend that money? My students don’t just have hope, they have a vision. Here are their top 3 dreams.

1. Buy a brand-new pickup truck. Not just any new pickup. They have a vision of their specific make, model, color, accessories, sound system and interior.

2. Buy a house. They are renting or living with family now and want independence.

3. Buy WVU season football tickets.

How this will help our local economy? Someone will sell them pickup trucks.

Homes will be built or remodeled. They will buy groceries, big screen TVs and numerous household items locally. They will go movie theaters and

Winter 2017 eat at local restaurants. They will PAY TAXES. Soon they will need baby furniture, toys and clothes. They will need health care, financial planners and attorneys. You get the picture. It starts with hope.

I love seeing young people and adults who have hope and are excited about the future. Local businesses can be excited about this growth. One big advantage my community college students have is that after two years of school they will have a degree that gets them a job with little or no student debt. What this means for local businesses is that these students don’t have big student loan payments and will have more money to spend.

If you have doubts I challenge you to put them aside and have the courage to believe in a positive future. This is our time to thrive if we understand the potential we now have and seize the moment. It may be the best Christmas gift we can give our families. This isn’t a sprint it is a marathon. Even a marathon starts with a single step. Believe in your future.

Thoughts to ponder.

Greg Kozera is the Director of Marketing for Shale Crescent USA www. shalecrescentusa.com. He has over 40 years of experience in the energy industry. Greg is a leadership expert with a Masters in Environmental Engineering and the author of four books and numerous published articles.

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The Northeast ONG Marketplace

PENNSYLVANIA NEWS

“FORGE THE FUTURE“ DESCRIBES FUTURE COURSE FOR PA PETROCHEMICAL INDUSTRY By: Robert Johnson, President, ADKL, LLC Peoples Natural Gas (PNG) and Chevron Appalachia commissioned a report titled “Forge the Future” earlier this year. It was presented by Morgan O’Brien, President and Chief Executive Officer of PNG, and Stacey Olson, President of Chevron Appalachia at the 2017 Shale Insight Conference in Pittsburgh.

Forge the Future is a comprehensive study of natural gas development in Pennsylvania including the petrochemical industry. With the Shell Cracker Facility site prepared for construction, Pennsylvania and the Tri-State region has an excellent opportunity for significant job and revenue growth from the energy industry.

The report estimates a $60 billion economic windfall and 100,000 jobs new jobs over the next ten years.

Recommendations from Forge the Future include: • Increase gas-fired power and heating – ensuring all Pennsylvanians benefit from low-cost gas for residential and commercial/industrial users • Create industry clusters in Petrochemicals, Advanced materials, and Data- driven Automated Manufacturing • Increase gas exports – crucial to making gas production viable without harming gas competitive prices in PA Forge the Future focuses extensively on the above three recommendations and provides numerous charts and data to support these initiatives. The report discusses a number of steps needed to move forward. It uses research and fact-based analysis provided by McKinsey and Company.

The report suggests a public-private sector advocacy effort to ensure Pennsylvania enacts the right policies to move natural gas development forward. Statistics are provided projecting the economic benefits of natural gas over the next ten years.

Energy development should be promoted to offset declines in Pennsylvania manufacturing. Energy growth will lead to more and better jobs, higher personal income, and more tax revenue to fund public health, safety, and human services.

Ultimately, Pennsylvania citizens will have a better quality of life from the development of Marcellus and Utica Shale.

Forge the Future discusses how Pennsylvania natural gas is currently stranded due to low prices and the lack of infrastructure to move the gas to market. Since gas is plentiful across Pennsylvania, higher exports and more demand is unlikely to have any negative impacts on consumer prices.

The report discusses the importance of taking action now. Business sectors, especially the plastics industry, are currently deciding where to make long-term investments. These capital investments will be in the billions of dollars. Pennsylvania and the Tri-State region including Ohio and West Virginia must compete with other regions across the country for these investment dollars. Public policy from a regulatory and tax climate must create incentives for the industry to locate their future operations in the region.

Let us not forget about Philadelphia and Eastern Pennsylvania. With pipeline and other infrastructure in place, all of Pennsylvania will benefit through lower utility prices, higher paying jobs, and more business/personal tax revenue. Other areas of the country are moving forward. The report makes reference to the Permian

basin in the U.S. Southwest where a large amount of ‘associated gas” is produced.

Pennsylvania must take advantage of our economic opportunities as soon as possible.

Forge the Future sets a course and direction for the natural gas industry to follow.

This is a thorough analysis and an excellent read for all involved in the energy industry. Public officials and economic development staff across Pennsylvania are also encouraged to read Forge the Future. Data in this report supports pro-energy policies across the state.

Here is a link to the full report: http://paforgethefuture.com/pdf/PA-Forge-the-Future.pdf This article was submitted by: Robert Johnson President of ADKL LLC www.adkl.org rjohnson@adkl.org

Winter 2017

Page 19

ONG MARKETWATCH BASIN ENERGY GROUP ANNOUNCES KATKO MERGER Katko joins the Basin portfolio of companies providing services to the natural gas industry.

RICHMOND, Va. November 6, 2017 – Turning Basin Capital (“TBC”) announced today that its portfolio company, Basin Energy Group (“Basin”), has completed a merger with Katko, LTD. (“Katko”). Katko joins current Basin operating companies, ProActive Services, Appalachian Production Services, and Starett Energy Services, to provide complementary production and midstream services for the natural gas and oil industry in the Ohio, West Virginia, and Pennsylvania.

Headquartered in Carmichaels, PA, Katko has been an industry leading production and midstream services firm for over 22 years by specializing in well hook up services, maintenance of midstream and production assets and specialty welding services in Ohio, Pennsylvania and West Virginia. Its customers include natural gas and oil producers as well as midstream operators in the Appalachian region.

With the addition of Katko, Basin now has more than 300 employees operating out of five offices covering seven states.

Joining the Basin board of directors is the owner and founder of Katko, John Bettem. John brings a lifetime of experience in the region as an entrepreneur and service provider. Bill Johnson, President and CEO of Basin said, “We are excited to add John to the Basin Board of Directors as we look to build Basin into the premier production services firm in the region.”

On partnering with TBC and Basin, John Bettem said, “I believe TBC through its portfolio company Basin Energy Group is the best partner for Katko to achieve its objectives. This merger allows Katko and its employees to be part of one of

the region’s most comprehensive service firms with the capability to cover any producer or midstream operator focused on the Marcellus/Utica Basin.”

Basin is devoted to servicing natural gas and oil producers by assisting in the production and transportation of natural gas and associated liquids with a focus on operations in Ohio, Pennsylvania and West Virginia. Basin continually seeks to expand its service offering, geographic presence and customer base through organic growth as well as through strategic 2 acquisitions. Tom Willingham, Managing Director at TBC, said, “We are bullish on natural gas, the Appalachian region and infrastructure services and believe the combination of Katko and Basin Energy Group adds to our capabilities to take advantage of improving market trends.”

The transaction closed on November 3, 2017. Terms were not disclosed. To learn more about Basin Energy, visit www.basinenergygroup.com.

About Turning Basin Capital TBC is a private equity firm with a unique focus on lower middle market companies that cater to the energy sector. The principals of TBC believe this is an underserved market segment abounding with attractive businesses that are well-positioned to benefit from the overall growth and evolution of the domestic energy market. TBC is focused on aligning with the strongest management teams in this sector, who can take advantage of its experience in growing businesses to achieve an even greater market position and value. TBC focuses on the lower middle market and targets companies with adjusted earnings below $5 million and enterprise values typically less than $20 million. To learn more about Turning Basin Capital visit www.turningbasin.com.

For more information, contact: Dani DeVito 304-288-7104 ddevito@basinenergygroup.com

WHEN LOOKING FOR OIL AND GAS, YOU GO TO THE MOST PROMISING SITE. WHEN LOOKING FOR DEALS, THE SAME HOLDS TRUE...

YOU GO TO

NAPE SUMMIT

•

7-9 FEB 2018 www.NAPEexpo.com

•

HOUSTON, TX

Page 20

The Northeast ONG Marketplace

INDUSTRY INSIGHT

SITE SELECTION IN THE TRI-STATE AREA By: Bryce Custer, President, Ohio River Corridor, LLC Site Selection in the Tri-State (Ohio, West Virginia and Pennsylvania), Ohio River Corridor is becoming more complex than ever. In the past, we would receive a request for a certain size facility on a certain size site close to the following infrastructure needs. Site selectors, local and state economic developers would then search for a specific site either through local real estate on-line services or send out a cryptic list of needs with a cryptic project name. People were tasked with finding the appropriate site with little or no information. How can you meet the clients needs without ever speaking with them? How can you find them the “perfect” site?

Is there a “perfect” site?

I have had the privilege to work with companies nationally and globally on their site selection process. Never has a client asked if I had a site certified location. As a matter of fact, the actual site is the last thing that is discussed throughout the client discovery process. I have placed natural gas power plants, hotels and manufacturing facilities at locations that were not on the market. The key is understanding the client’s critical success factors, then, finding the appropriate facility/location. I have also learned over the years that there is no perfect site and most every property is for sale. The question is do you want it more than the current owner?

Pitching sites that I have on my sign on, or pitching sites that my public/quasipublic organization controls, will begin to influence the site selection process. As the saying goes “If I have a hammer, everything looks like a nail”. This does not serve our clients.

At the time that I write this, Amazon is looking for a site for another headquarters.

States, counties and municipalities are bending over backwards to attract Amazon.

Do you think that Amazon cares about what property is site certified? Does Amazon care if the property is listed with a local or national brokerage? The answer is no. Look at one of the top criteria for Amazon; livability and is the appropriate infrastructure in place for our employees (quality of life/work balance). The point is that every company has their unique set of criteria and each priority is different.

The actual site is typically towards the bottom. All things being equal, If Amazon wanted to move into your city would you be able to find the appropriate site? Odds are the answer is a profound YES!

Abundant (low cost) Feedstock: What does my client require to produce their product? Low cost natural gas?

Butane, propane, ethane? Does the project require a large supply of electricity?

If the company requires steel, plastic, chemicals or resins, is there an appropriate supply? Process and cooling water are a major factor with some projects. Proximity to the Ohio River could be key.

In the Tri-State area we have some regulated and unregulated utilities. This may be a major factor in your site selection criteria.

Infrastructure/Logistics: Is the site near four lane interstates or state routes? Can raw materials and finished product be easily transported? Do you need on site barge cells? Intermodal? Rail? (one or two sources of rail service?) Close to airports? How critical is access both domestically and globally?

The Ohio River Corridor allows access to the gulf coast to import and export materials throughout the Midwest. The Ohio River designated as M-70 by the Ohio Department of Transportation, provides access from Pittsburgh, PA to Kansas City Missouri. The Shell petrochemical facility in Monaca PA will be utilizing the Ohio River to offload pieces and components of the facility resulting in savings of millions of dollars versus rail or truck.

Barge traffic is beginning to increase along the Ohio River. A typical barge “tow” is 15 barges fleeted 3x5 for a total size of 105’ x 1,185’. This is equivalent to 216 rail cars with six locomotives or 1,050 semi-trailer/truck. Utilizing the Ohio River can result in a significant savings moving raw materials and product. Many are also calling barge the “green” alternative due to the fact less fuel/ton of product is needed to ship.

Workforce / Workforce education One of the first questions that Bidell Gas Compression from Calgary Canada asked prior to locating to Weirton was regarding workforce. Does the area have the workforce and a community school that we can work with to train our employees?

Throughout the Ohio River Corridor, we have hard working employees that have the “muscle memory” from working in the mills and facilities located up and down the river. Our community schools have stepped up and created programs specific to the needs of companies locating in the area.

Over the years I have found the role has evolved from being a real estate professional to be your client’s team member or consultant. No longer can we just provide a list of buildings and acreage for sale. Do you understand your clients mission and critical success factors? Do you understand your clients process? Do you understand all the tangible and intangible factors that your client demands in order to find the “best” location regardless of which state, county or municipality location?

Proximity to Customers: Who are your customers? We have helped many clients map out their existing and potential customer base to find the best location in the tri-state area. Your customer may be a utility that you will sell power to, your customer may be transient guests at a hotel. Whatever and wherever your customer is, logistics and location play a key role.

What are general critical success factors that clients are looking for? This is a complex question and every client is different. Over the years six common themes seem to surface. There has been no specific order. Each client will then prioritize the six into the order that best suits their site selection needs: • Abundant / Low Cost Feedstock • Infrastructure • Workforce / Workforce education and development • Suitable Site • Proximity to Customers • Incentives (national, state and local)

We have found that distance is less important than drive time. A client may be twenty minutes down the road, but it could take an hour to get there due to single lane roads and traffic. This is a key consideration when determining the delivery of product and the number of turns it will take to make to your client.

Incentives: We are fortunate to have very strong economic development programs from the state and local levels available to support companies bringing jobs to the area.

The State of West Virginia and the Northern Panhandle of West Virginia Business Development Corporation played in key role in locating Bidell Gas Compression and Pietro Fiorentini, a manufacturer of valves and pressure regulators to the Weirton West Virginia area.

Winter 2017

Page 21

The Pittsburgh Regional Alliance and the Pennsylvania Department of Community and Economic Development played a key in the Shell Petrochemical facility in Monaca, PA. Team NEO, APEG and OMEGA along with local economic development offices and county port authorities are available to work with clients to put together incentive packages throughout the Ohio River Corridor.

Connecting the Dots: Successful site selection involves all the above factors plus cooperation from the community and community leaders. Determine the most important aspects for a successful operation, then work with an expert that can cross boundaries to find the best site and facility for your client. www.OhioRiverCorridor.com Twitter: @OhioRiverCRE Bryce@OhioRiverCorridor.com

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Page 22

The Northeast ONG Marketplace

INDUSTRY INSIGHT

SEVERANCE TAX AND REGULATORY REFORM: THE GREAT DEBATE OF THIS DECADE! By: Teresa Irvin McCurdy, President of TD Connections, Inc. At the time of writing this article, the Pennsylvania (PA) House of Representatives is still debating a severance tax/regulatory reform bill for a couple of weeks with no immediate resolution in sight. Should the House pass HB 1401, it would then go to the Senate for consideration and ultimately the Governor to approve or veto.

However, its fate is unknown as there have been numerous amendments adopted to the bill to reform the regulatory environment for oil and gas.

The debate over whether to have a severance tax in PA has been looming since the Marcellus took center stage in 2010 as reports of potential reserve numbers grew exponentially and the public and some members of the legislature saw the natural gas industry as a revenue source to help solve the Commonwealth’s financial problems. In 2012, Act 13 was adopted to impose an Impact Fee on unconventional natural gas operators as a compromise to a severance tax. A sizeable portion of the revenue was allocated to local governments to help offset impacts due to natural gas development and a portion to the state’s general fund. This fee, which is basically a tax, is in addition to all the other federal, state and local taxes that other businesses pay in PA. Why is it fair to single out a sector of the oil and gas industry and expect them to pay “extra” to do business in PA via an impact fee or a tax? Especially now, after all the oil and gas industry has been doing business in PA since 1859? Some argue its fair because it is severing valuable resources, the size of unconventional vs conventional operations, impacts to local government and the environment? Or perhaps the biggest reason is “just because it is the gas industry.” But is that fair?

Would Pennsylvanians tolerate this type of debate for any other industry?

For example, agricultural has always been a “protected resource and industry” of the state. There is no severance tax for farmers who sever valuable resources (crops) from the land. According to a 2012 FIC Census of Agriculture, PA had over 7.7 million acres of farm land or used about 27% of the land. The runoff from farms has had an adverse impact on the health of PA’s streams and the Chesapeake Bay for decades. Measures have been imposed to reduce the runoff but according to the Chesapeake Bay Magazine, in 2016 only 40% of farms were in “compliance.”

However, there is no loud public outcry or protests seeking a tax on farmers due either to its size or environmental impact.

Why? Because we need to eat? Because the Ag industry has a strong lobbying presence? Because we have a lot of small farmers trying to make a living? Or is it “just because” farming is not considered a “sin industry” unlike the gambling, tobacco, and anything fossil fuel.

Furthermore, everyone agrees we need to protect our drinking water sources which has resulted in strict water management regulations for businesses. However, there are little to no regulations for residential private water wells for drinking and there is no consumptive use fee (tax) for consuming water like businesses are charged. A homeowner can have a well drilled that does not meet drinking water standards, yet still be able to drink from it. Some water wells have high levels of sulfur and other minerals that can cause health problems, but you don’t see people protesting or demanding that the legislature and DEP do something about it.

Why? Because people don’t protest about something that will make them have to do something, such as pay a tax. Because a person is not viewed the same as “big oil” with deep pockets? Because no elected official wants to interfere with a person’s

use of their own land. Why does it seem that those in charge listen more to the uninformed masses then common sense and science?

That is where the tide is turning, which is why a severance tax bill is getting loaded down with regulatory reform. Because the perception is that if you must have a severance tax, then you should get something for it, such as regulatory reform.

With the heightened interest to tax the gas industry has also come one to regulate it and in the past 8-years the PA Department of Environmental Protection’s (DEP) has issued numerous regulations, general permits and guidance documents.

But to be fair, don’t automatically jump to the conclusion that it was all DEP’s idea to regulate. Let’s go back to Act 13 which created the Impact Fee as well as required DEP to draft regulations regarding water supply protection, water management plans, gathering lines, well control, etc. Sure, some may say that DEP used this as a stepping stone to then make other changes, but some of the regulations needed updated.

If you are reading this and conduct business in PA, then you are affected by decisions and regulations made by DEP, but do you know that DEP is only 22 years old? Kind of. In 1901, the legislature created the Dept. of Forest and Waters (DFW) to protect those resources. In 1970, DFW was abolished and replaced with two agencies: The Dept. of Conservation and Natural Resources (DCNR) and The Dept. of Environmental Resources (DER) until 1995 when DER was changed to DEP. However, DEP must abide by statues that were written since 1901.

DEP is made up of 6 main substantive Bureaus: 1) Waste, 2) Air, 3), Radiation, 4), Remediation, 5) Active and Abandoned Mine Operations), and 6) Oil and Gas. Each has its own book of codes, statutes, and/or regulations. Have you ever tried to read all of them? They are old, convoluted, outdated, and in some cases conflict with each other. Due to this, disparities are created simply due to which bureau your operations fall under.

For example, to permit a piece of equipment under one bureau’s regulations you may only have to fill out a simple form which typically would be approved in less than 30-days. But take that same equipment to do the same functions and permit it under a different bureau, you may be required to complete a complicated form, hold a public hearing, and approval typically takes about a year. This doesn’t make sense, but its not DEP’s fault - it is the statute they must follow which could have been written up to 50 years ago or more.

So, who’s to blame or right in wanting more or less regulations or the changing from an impact fee to a severance tax? Perhaps somewhere there is some middle ground yet to be determined. However, I thought these sayings were befitting in the scenario below.

Problem: Permits are not being issued in a timely manner.

The regulated community points a finger at DEP and blames them for not getting permits issued on-time and sometimes seek legislative reforms as a result. Perhaps not in all cases, but in helping numerous clients get permits approved, I have often found that the blame is on all three (applicant, DEP, legislature) sides. I.e., the application was not complete or clear; DEP reviewers are new and inexperienced or simply not enough reviewers; or perhaps what is being permitted is not addressed in statute or at least in a way that allows DEP to easily approve the permit.

Winter 2017 Solution: Work together and use a mediator.

On the permittee side: Remember writing a paper for school and you were told to have someone proof your work before you hand it in because a fresh pair of eyes will find things you missed because you already read it 60 times. The same goes for submitting a permit, a news story or even a picture book. I created a picture book with captions. After reading the fine print on screen numerous times, I hit publish. Later my 12-year old niece points out my spelling/typos.

Why? Because I wrote it and read what I thought it said rather than what it actually did. Important take away is to have a pre-application meeting with DEP to ensure you are on the same page before you submit your “complete” application.

On DEPs side: An amendment to the severance tax bill would provide for the use of third party reviewers to help with the lack of staff due to budget cuts or reduced revenue from fees. Under the right conditions this could help reduce the backlog of permits while reducing overhead for DEP. Furthermore, by having DEP staff act like a manager and review the permits along the way and give final approval, DEP is still maintaining control.

On the Legislative side: A bill has been introduced to require the Legislative Reference Bureau to review the cumbersome statues and provide recommendations. This is a good start but it must be done working together with the regulated community and DEP staff who are in the weeds everyday. The three cannot continue to operate in silos and hope that these issues will go away.

I know that the three do talk, but not always together and not with a common goal to fix the root of the problem which in part is the state statutes and laws. Yes, there are other problems, but the article is short. So I leave you with a challenge; the next time you find a fault, present a solution. In all of my years of working with DEP, members of the General Assembly and any Administration; I have never seen such a genuine commitment to wanting to resolve this problem. It may not feel that way to some that are reading this, but the climate is ripe for a change.

If you have a problem and/or a solution, Teresa would love to hear from you by contacting her at 717-329-6402 or Teresa@TDConnections.com.

Page 23

Ed Northrop Director of Oil & Gas

PIPELINE INTEGRITY PIPELINE ENGINEERING SURVEY & MAPPING PSM, HAZIDs, & HAZOPs R-O-W ACQUISITIONS PIPELINE INSPECTION 4600 J Barry Court, Suite 100 | Canonsburg, PA 15317 814.882.9532 | enorthrop@auduboncompanies.com www.auduboncompanies.com

TRAINING & WORKSHOPS

December 20 PEC Basic – Safeland USA Zelienople, PA | www.pioga.org/events January 9 Safeland USA – Aware Rig Pass Cambridge, OH | www.rjrsafety.com January 18 Safeland USA – Aware Rig Pass Washington, PA | www.rjrsafety.com February 13 Safeland USA – Aware Rig Pass Bridgeport, WV | www.rjrsafety.com

IS THE PROCESS IN HARRISBURG “UNCLEAR” TO YOU?

February 15 Safeland USA – Aware Rig Pass Washington, PA | www.rjrsafety.com

Let us “guide” you through the process!

Legislative/Regulatory issues/questions?

Email Teresa@TDConnections.com or call 717-329-6402!

FOR MORE TRAINING VISIT WWW.ONGMARKETPLACE.COM/TRAINING

Page 24

The Northeast ONG Marketplace

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