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EQT slows down while other Pa. gas drillers pick up permitting

Appalachian driller EQT Corp., the nation's No. 1 gas producer by volume, sharply cut the number of well permits it pulled in Pennsylvania in April, dragging the statewide total of issued permits down 26% year over year despite significant increases in permitting activity by other drillers.

Pennsylvania drillers collected 99 permits in April, once again largely split between the dry gas northeast and NGL-rich counties in the southwest corner of the state, compared to the 133 issued in April 2017.

EQT and Rice Energy, which merged in November 2017, pulled 72 permits to drill, largely in Washington and Greene counties south of Pittsburgh, in April 2017, four times the 18 permits issued to EQT in April 2018, according to data from the state's Department of Environmental Protection.

While EQT was slowing down in Washington and Greene counties, rival Range Resources Corp. picked up steam, pulling 25 permits in April, the most by any driller in the state, with 15 of those permits in the heart of EQT's territory, Washington County.

Range executives said the upswing in activity in the Marcellus Shale south of Pittsburgh is directly related to the start of Energy Transfer Partners LP's 3.25-Bcf/d Rover Pipeline LLC across the border in Ohio and West Virginia, which will let Range sell more gas outside the Appalachian basin.

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"Rover represents the last firm transportation commitment that Range has made for natural gas, and we expect to fill this capacity by the fourth quarter of this year," Range CEO Jeff Ventura told analysts on the company's first-quarter earnings call. Range is selling 130 MMcf/d of its production in the glutted basin but plans to move all that gas out of Dominion's M2 market for sale in the Midwest or the Gulf Coast, Ventura said. "Our plan is to fill the remainder of the Rover capacity as we grow throughout 2018."

Tioga County, on Pennsylvania's north-central border with New York and prospective to the stacked geology of both the Utica Shale and overlying Marcellus, more than tripled the number of permits issued in April year over year, to 14. National Fuel Gas Co.'s Seneca Resources Corp. exploration and production division accounted for seven of the permits there in April, and Spanish energy giant Repsol SA's North American E&P unit, Repsol Energy North America, accounting for five others.

Dry gas Susquehanna and Lycoming counties in northeast Pennsylvania trailed the southwest portion of the state despite seeing total permitting increase slightly compared to a year earlier. Cabot Oil & Gas Corp. split Susquehanna County with Southwestern Energy Co. as permitting more than doubled in a year, to 12. Private equity-backed Inflection Energy LLC accounted for seven of the 11 permits issued in Lycoming County in April, an increase of two over April 2017.