Page 8 - NorthAmOil Week 11 2021

NorthAmOil PIPELINES & TRANSPORT NorthAmOil

Mountain Valley extension

scores legal victory

NORTH A proposed extension of the Mountain Valley connect, will ever be completed. That pipeline
CAROLINA pipeline, known as the MVP Southgate project, has also experienced its share of legal battles and
has won a legal victory in the 4th US Circuit was lacking three sets of permits at the time the
Court of Appeals. Last week, the court over- decision was made, in August 2020. However,
turned a decision by North Carolina’s Depart- two sets of those permits have subsequently
ment of Environmental Quality (DEQ) to deny been regained and Equitrans Midstream, the
a water permit for the project, saying the depart- company developing both projects, is attempt-
ment had not adequately explained why it had ing to find an acceptable way forward for the
denied the permit. third.
The 4th Circuit ordered the North Carolina A hearing officer said at the time of the rejec-
regulators to address two issues. The first is tion of the permit for MVP Southgate that the
inconsistent statements from a hearing officer extension would effectively be redundant if the
who at one point found that the project had less- mainline was not completed. And while Moun-
ened its impact on water bodies “to the greatest tain Valley has some way to go before its fate is
extent possible”. The second is why the DEQ certain, it appears to be a step closer to being
opted to deny the certification outright rather built.
than granting conditional approval. While the An MVP Southgate spokesman said fol-
department would be able to reject an applica- lowing last week’s court decision that the pro-
tion for the permit again, it would need to pro- ject would work with the North Carolina DEQ
vide reasons for doing so that would stand up in to satisfy any concerns that it may have. But a
court. statement from the department to a local radio
Local media reported that the denial of the station noted the “unnecessary risk” the pipe-
permit had been based in large part on uncer- line would pose to bodies of water in the state,
tainty over whether the main Mountain Val- suggesting that there is some way to go before an
ley project, to which MVP Southgate would agreement can be reached.™

INVESTMENT

Ovintiv reportedly nears Eagle Ford sale

TEXAS US independent Ovintiv is reportedly at the acquisition of Newfield Exploration in 2019.
advanced stage of talks over a potential sale of A deal between Ovintiv and Pontem could
its acreage in South Texas’ Eagle Ford shale for be announced as soon as this week, according
over $800mn. The buyer has been identified to Reuters’ sources, though there is no guarantee
as Pontem Energy Capital, a privately owned that it will be finalised.
energy investment firm, by sources familiar with Ovintiv acquired the Eagle Ford assets from
the matter that were cited by Reuters last week. Freeport-McMoRan in 2014 for about $3.1bn.
Neither Pontem nor Ovintiv have commented The fact that it is now selling them for almost a
on the matter. quarter of this illustrates how much the value of
Denver-based Ovintiv – which was previ- shale acreage has declined in the years since as
ously known as Encana and headquartered in crude prices have languished. Two of the sources
Canada – is in the midst of a multi-year debt told Reuters that Pontem’s bid for the assets was
reduction programme, which includes generat- well above what was rivals were offering, after the
ing around $1bn from asset sales. The company sale attracted multiple private equity bidders.
announced in February that it had also agreed to The company has gradually narrowed its
sell its Duvernay assets in Alberta, Canada for focus to a handful of core assets in the US’
around $263mn to an anonymous buyer. It said Permian and Anadarko basins, as well as the
at the time that the deal had put it on track to Montney shale play in Canada. As well as the
reduce debt to $4.5bn by the end of 2022. Duvernay and Eagle Ford positions that it is exit-
Ovintiv’s debt stood at around $6.9bn at ing, it also has assets in the Bakken and the Uinta
the end of 2020, having been increased by the Basin, which are considered to be non-core.™

P8 www. NEWSBASE .com Week 11 18•March•2021