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Permit Activity last week.  

  • PA –4 permits; a very slow week
  • OH –18 permits; Gulfport in Belmont; Antero in Noble; EnerVest in Tuscarawas

Expo/Industry events for the next few months:

DUG Eagle Ford September 15 – 17, San Antonio, TX

Shale Insights September 24 – 25, Pittsburgh, PA

  • PA’s only Expo where all the E&P companies will be in attendance from Access Midstream to XTO Energy.  Come visit us at booth 535.  We’ll make introductions wherever we can.
  • For a limited time, is sharing a $100 Registration Discount code AERNM4 for those wanting to  attend SHALE INSIGHT™ 2014.  The code will give registrants a $100 discount on conference registration ($875 instead of $975). Register now  and visit booth #535.  This code is valid until September 15 and is valid for MSC non-members only.

The Fourth Annual West Virginia Oil & Gas Expo October 1, 2014

Flash-Fire-Workshop October 8th Pro Football Hall of Fame, Canton, OH

  • Bill Radford, Safety Basin Coordinator, Eclipse Resources will be the featured speaker. It will be a good networking event for everyone in safety compliance and you’ll learn latest about FR clothing and handling.

Shale Gas Symposium, October 8th Agri-Plex Expo Center, Allentown, PA

Utica Summit II, October 14th, Canton, OH

  • Learn about the downstream opportunities coming to OH and western PA as the result of the cracker plants and more.  National and local speakers will give you real insight into what’s coming.  
  • See what will be happening with the new Ohio cracker plant
  • Register now

Midstream PA 2014, November 18TH, Penn State

  • PA’s first midstream conference.  Speakers from MarkWest, Williams, UGI and more.  You will learn what’s coming in midstream in 2015. Limited sponsorships and seating.  
  • Register now to reserve your seat

Latest facts and a rumor from the Marcellus and Utica Shale

  • Rumors from the PA Energy Games


    The rumors while at the PA Energy Games was the announcements from Shell last week about the Gee and Neal wells in Tioga County, PA.  With the increased activity from Shell in the form of RFP’s, many people wondering how many rigs Shell will be bringing into PA.  I heard a rumor that it will be bringing five (5) rigs next month.  We’ll have to wait and see on that rumor.

    There is also considerable excitement about Shell with its purchase of the Ultra leases.  Shell representatives have told local businesses that the Ultra purchase strongly positions Shell for significant growth in the Marcellus Shale


    The purchase of Shell leases is seeing a pick up activity at Rex also.  We’ll be looking to see if Rex brings more rigs into PA.
  • Shell cracker – another step toward reality.  Shell Chemical LP has applied for a permit to build two docks and 24 smaller structures to moor barges near the site of its proposed petrochemical plant in western Pennsylvania.

    Shell's application is being reviewed by the U.S. Army Corps of Engineers, which controls traffic on the Ohio River. Shell has proposed building the plant on the riverfront site of a former zinc plant owned by Horsehead Corp.

    Shell hasn't formally committed to building the plant, which would convert ethane from Marcellus Shale natural gas liquids into chemicals used to make plastics, tires and even antifreeze.

    Shell spokesman Michael Marr says getting the necessary permits is a "prerequisite" for Shell to make a "final investment decision."

    Shell has said it may take years to decide whether to build the plant.
  • Giuliani comments on Nat Gas in NY.  Former New York City Mayor Rudolph Giuliani urged President Barack Obama to fast-track applications to export natural gas as a means to promote energy production domestically and influence foreign policy.

    If exports of liquefied natural gas had been approved five years ago, it would give the U.S. another tool to deal with Russia today, Mr. Giuliani said.

    “You know how President Obama is looking at nonmilitary options to solve things such as the invasion of the Ukraine by Russia?” Mr. Giuliani said. “It would have been within our abilities to export a massive amount of natural gas — possibly to Europe; if not Europe, to other parts of the world — which would then have an impact on the world price of natural gas and would deprive [Russian President Vladimir] Putin of the only strength he has left in his economy. I believe this would be stronger than any of the sanctions placed on them.”

    Mr. Giuliani argued that even if U.S.-sourced natural gas were shipped to customers in Asia, rather than Europe, it still would provide leverage. Other suppliers of liquefied natural gas, such as Australia, could then supply Europe.

    Noting the debate over shale development domestically, Mr. Giuliani said the energy industry should conduct a “massive campaign to educate the American people.” Currently, New York State has a moratorium on Marcellus Shale development and several cities across the country have very publicly banned hydraulic fracturing.

    “I would conduct this in the year 2015 — which is the lead-up to the 2016 presidential campaign — a very well thought-out, a very well-planned campaign throughout the United States,” he said. “Maybe focus more in the key states where the presidential election will be battled out among the Democrats and Republicans to explain what this can do for us, what it can do for our economy.”
  • PA Top energy destination (Thank you, Shale Media Group). When you think of energy powerhouses across the United States, the traditional energy giant, Texas, may first come to mind. However, the tide is changing. Pennsylvania was recently named Top Global Destination of the Future for Energy-Intensive Industries by the Foreign Direct Investment (FDI) Association. Consequently, Pennsylvania was the only U.S. location to make the list. Ontario, Canada came in second, while Sheffield, United Kingdom and Ostersund, Sweden tied for third place.Worldwide nominations were accepted and evaluated by a panel of distinguished global industry consultants, according to the FDI Association, while the designation was for the achievement of regions actively implementing strategies to support foreign direct investment in the energy sector.

    “Pennsylvania has the second largest energy field in the world, and we are responsibly harvesting these resources to create family-sustaining jobs and reinvigorate local communities all over the commonwealth. Thanks to our ‘all of the above-and below’ energy strategy, Pennsylvania has earned international recognition in terms of energy production and is leading the way toward American energy independence,” expressed Pennsylvania Governor Tom Corbett.
  • OH wells production way up.  Ohio’s horizontal shale wells produced almost 2.5 million barrels of oil and 88.6 billion cubic feet of natural gas during the second quarter, according to data from the state Department of Natural Resources.

    The numbers represented a 27 percent rise in oil and a 32 percent increase in natural gas over the first quarter.

    Brine production from the wells increased 20 percent to just under 1.4 million barrels.

    Of 562 wells listed during the second quarter, 504 reported production, while the rest waited to be connected to pipelines.

    The producing wells averaged:
    • 4,895 barrels of oil.
    • 176 million cubic feet of natural gas.
    • 67 days in production.

Antero Resources’ Myron well in Noble County produced the most oil with 78,309 barrels during 91 days.

Hall Drilling’s Hercher North well in Monroe County produced the most natural gas with 1.4 billion cubic feet during 91 days.

  • U.S. Nat Gas going to Mexico.  The growing glut of U.S. natural gas is helping to power a manufacturing boom in Mexico.

    Natural-gas exports across the southern border have risen 11% so far this year, to two billion cubic feet a day, according to Bentek Energy, an analytics company based in Denver.

    And that flow of gas could double in the next few years, analysts say. Companies have announced plans for at least seven new pipelines to take gas across the border from Texas and Arizona, including one expected to start transporting fuel at the end of the month.

    The increasing flow of gas is easing a supply shortage in Mexico, where fuel is costly and industrial demand is booming in industries including electricity production, petrochemicals and auto manufacturing, which has roughly doubled since 2009.

    The exports are also helping to reduce the overabundance of gas drillers that are pumping in areas such as the Eagle Ford Shale in South Texas, where gas is trading for less than the U.S. benchmark.

    While Mexico has significant shale resources of its own, its energy companies have lacked the expertise and desire to tap them, analysts say. The country has been meeting its fuel needs in part by importing liquefied gas that can cost three times as much as piped-in gas from the U.S.
  • Marcellus October production.  The Marcellus Shale basin is expected to produce more than 16 billion cubic feet of natural gas per day by October, according to a new projection by the U.S. Energy Information Administration.

    According to the administration’s monthly drilling productivity report, new wells are expected to yield 752 million cubic feet per day. Legacy production, however, is to drop by 530 million cubic feet per day, leading to a net increase of 222 million cubic feet daily.
  • Gastar hits big well in WV.  Gastar Exploration is pleased to provide an operational update on recent well results and activity in the Utica/Point Pleasant play in West Virginia.

    The Simms U-5H well in Marshall County, West Virginia, Gastar's first Utica/Point Pleasant well, produced at an initial 48-hour gross sales rate of 29.4 MMcf/d of natural gas on a 30/64ths choke with approximately 6,700 psi of flowing casing pressure.  The well lateral length is 4,447 feet and was completed with 25 hydraulic fracturing stages that used approximately 10.6 million pounds of sand proppant.  Gastar has a 50% working interest ("WI") in the Simms U-5H well (43.2% net revenue interest ("NRI").

    J. Russell Porter, Gastar's President and Chief Executive Officer, commented, "We believe the Simms U-5H is one of the most productive wells to date in the dry gas Utica play, particularly when considering the relatively short lateral length.  The well has exceeded our pre-drill expectations with excellent porosity, pressures and flow rates. Along with successful Utica activity from other nearby operators, this well significantly de-risks Gastar's Utica/Point Pleasant assets."

    "Our current plans are to drill one or two additional Utica/Point Pleasant wells later this year and early 2015 to demonstrate its consistency across our leasehold. At that time, we will carefully evaluate further drilling plans in light of regional natural gas prices and returns on investment relative to our internal investment opportunities."
  • Eclipse Resources puts 7 wells into production.   The wells are on two pads in southeastern Ohio. One of the pads, the two-well Shroyer pad, is in Monroe County. The wells have combined for 42.5 million cubic feet per day of production in the 10 to 20 days they have flowing into sales, according to the company.  The wells have average lateral lengths of 7,819 feet.

    “Our Shroyer wells are our longest laterals to date and mark our fifth and sixth operated wells in our dry gas type curve area, more than any other producer in the Utica Shale,” said Eclipse CEO and Chairman Benjamin Hulburt in a statement.

    The other pad, the five-well Mizer pad, is in central Harrison County. They have combined for a production rate of 10.1 million cubic feet per day and about 1,800 barrels per day of condensate, according to the company. The wells have been producing into sales for 2 to 13 days.

    The company said it expects that the production rate will increase because the wells are still coughing up flowback water.

    “The Mizer wells are our first operated wells in our condensate type-curve area, and we are pleased to see that they are producing at higher initial liquids yields than we expected,” Hulburt said. “Based on these initial results, we are encouraged that all seven of the announced wells should produce in line with our type curve expectations and are hopeful that the Mizer condensate rates will continue to exceed our expectations."

Rig Count

  • Baker Hughes Rigs count for the September 5th reporting week.  
    • PA
      • Marcellus 55 rigs – up 2
      • Utica 2 rigs – unchanged    
    • Ohio
      • Utica 41 – unchanged    
    • WV
      • Marcellus 27 unchanged
    • TX
      • Eagle Ford – 202 down 1
      • Permian Basin – 473 up 5
    • NM
      • Permian Basin – 90 up 1
    • ND
      • Williston – 183 unchanged            
    • MT
      • Williston – 8 unchanged
    • CO
      • Niobrara – 57 up 1
  • TOTAL U.S. Rig Count 1925 up 11

PA Permits for September 4, to September 11, 2014

       County               Township              E&P Company
1.    Armstrong           West Franklin         Pennenergy
2.    Greene                Morris                    EQT
3.    Greene                Morris                    EQT
4.    Greene                Morris                    EQT

OH Permits – week ending September 6, 2014

       County                Township              E&P Companies

1.    Belmont               Washington            Gulfport
2.    Belmont               Smith                    Am. Ener. Utica
3.    Belmont               Smith                    Am. Ener. Utica
4.    Belmont               Washington           Gulfport
5.    Belmont               Washington           Gulfport
6.    Belmont               Washington           Gulfport
7.    Belmont               Washington           Gulfport
8.    Harrison               Moorefield             Gulfport
9.    Harrison               Franklin                Am. Ener. Utica
10.    Harrison             Franklin                Am. Ener. Utica
11.    Harrison             Franklin                Am. Ener. Utica
12.    Noble                Marion                  Antero
13.    Noble                Marion                  Antero
14.    Noble                Marion                  Antero
15.    Noble                Marion                  Antero
16.    Noble                Marion                  Antero
17.    Tuscarawas       Clay                     EnerVest
18.    Tuscarawas       Clay                     EnerVest

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Utica Summit 2019