American Oil and Gas Reporter - December 2022 - 35

ConventionSec tion: Gas and Oil Association of WV
Industry's Intertwined Hopes
Illustrated In West Virginia
By Del Torkelson
CHARLESTON, W.V.-West Virginia's
oil and gas producers have much
to celebrate. Natural gas commodity prices
have been strong all year, an overwhelming
majority of West Virginians support the
oil and gas industry, and the Covid-19
pandemic seems more a distant memory
than a major consideration for most of
the state's businesses and citizens.
In theory, these favorable conditions
should dot West Virginia's landscape with
drilling and workover rigs. But instead
of putting the pedal to the metal, most
oil and gas companies are operating on
cruise control, says Gas and Oil Association
of West Virginia President Maribeth
Anderson.
" Things are steady, " describes Anderson,
director of government relations for Antero
Resources Corp. in Charleston. " Could
people bring in more rigs and increase
activity? Maybe, but for some producers
there is a lack of takeaway capacity. "
" Companies have more cash to do
things such as pay investors, who have
been very patient during tougher times, "
considers GO-WV Executive Director
Charlie Burd. " Companies also would
like to invest some of that cash into new
infrastructure, but the regulatory environment
makes it difficult to get new
pipelines in the ground. "
Companies' production decisions must
account for the extent to which their
output can reach customers. It does not
matter how eager those customers are if
the product is stuck elsewhere, Burd emphasizes.
" Capacity is capacity, " he
muses. " If we ignored it, we would drill
ourselves into unsustainable prices. "
Pipelines are not the only infrastructure
necessary to connect producers with consumers,
Burd observes. He notes that
U.S. liquefied natural gas export facilities,
as well as European LNG import terminals,
are running full tilt. That means Europe's
exceptionally high natural gas prices
make almost no difference in U.S. producers'
investment calculus. " If the gas
is over here, the price over there doesn't
matter, " he chuckles. " That is not only
" Pennsylvania and Ohio have had great
success with natural gas power generation.
West Virginia has not been able to crack that
code and has virtually none. Expect GO-WV to
see if there is anything the legislature can do to
encourage some of that investment. "
-Maribeth Anderson
President GO-WV
true for LNG, but also propane, diesel
and other fuels. "
The upshot amounts to allowing companies
to develop infrastructure, Anderson
describes, citing the most prominent example
of a midstream project that will
address the issue, pending federal approval.
" The lack of pipeline capacity stifles oil
and gas production growth, " she says. " I
am speaking here about the difficulty we
have seen with permitting the Mountain
Valley Pipeline. "
" That pipeline is 95% complete, " Burd
says regarding the 300-mile project that
seeks to connect northwestern West Virginia
with southern Virginia. " Only a few miles
of pipeline are needed to complete it. "
Nevertheless, he acknowledges, the
remaining miles include several stream
crossings, which give anti-development
activists tools to frustrate the approval
process in court after permits have been
issued. Through it all, GO-WV continues
to back the project, Burd notes. For example,
the association filed a letter of
support with the Federal Energy Regulatory
Commission that urged it to extend
the project's construction deadline.
" Eventually, the commission awarded
MVP an additional four years of construction
time, " he observes. " Unfortunately,
MVP will have to go back and
obtain all those same permits again, even
though those environmental fears already
have been addressed through extensive
reviews. After that, the fear is who will
protest next. "
A Disconnect
Pipelines have not always been a primary
battleground on which oil and gas
opponents have resisted new development.
" In 2007-08, it was all about water
quality and if we had enough water, "
Anderson recounts. " Technicians and
engineers in the industry figured out
how to recycle and reuse water, so the
anti-oil-and-gas community strategically
moved on to the next thing and now
pipelines are controversial. "
In the time since, numerous interstate
pipeline projects have been scuttled amid
litigation, delays and regulatory limbo,
Anderson observes, with new midstream
projects into New England proving particularly
rare. " It is mind-boggling that
the head of a New England utility had to
write a letter to the president of the United
States about being unable to afford LNG
imports when the region is 200 miles
from one of the country's-and world's-
richest gas fields, " she remarks. " When
will common sense prevail? "
Both of West Virginia's U.S. senators,
Democrat Joe Manchin and Republican
Shelley Moore Capito, have authored
legislation to back pipelines, generally,
and MVP, specifically, Burd observes.
Manchin's vote in favor of the reconciliation
package that President Biden signed
in August hinged on convincing the Democratic
congressional leadership to back
a pipeline permitting bill, published reports
note, but so far that reform has lacked
sufficient votes.
DECEMBER 2022 35
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