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  • Ohio Valley Oil & Gas Expo.  Visit us at the Ohio Valley Oil & Gas Expo.  Our booth will be in the main building.  We look forward to seeing you at the Vendors’ Reception the night before and the day of the Expo.
  • Disappointed.  We have not heard any good rumors lately.  If you have one, please send it to us.  Hopefully, we’ll hear something at the Ohio Valley Oil & Gas Expo next week.

Latest facts and a rumor from the Marcellus and Utica Shale

  • XTO receives approval for 5 wells in Butler County.  Buffalo Township Supervisors on Wednesday gave the go-ahead for proposed Marcellus Shale natural gas wells on Howes Run Road.

    They also approved a scaled-down plan for The Village at Sarver's Mill housing development that still calls for about 150 houses.

    XTO Energy has proposed to drill as many as five wells on property at 448 Howes Run Road owned by the Harold and Dorothea Harvey estate.

    It would take about a month to drill each well, during a 24-hour operation, which includes the hydraulic fracturing process, or fracking, used to release the natural gas in the shale, according to XTO's application to the township.
  • Halcon Utica update.  The top executive from Halcón Resources Inc. reports that its first two wells in the Utica shale should be tested in April, "with more wells following each and every month."

    During a conference call Thursday, Floyd C. Wilson, chairman and CEO of the Houston-based company, told analysts that Halcón is delineating the 130,000 acres it holds in the Utica play, which includes drilling operations in Trumbull County in Ohio and Mercer County in western Pennsylvania.

    “During the first half of this year, we’ll drill 10 or 12 wells across our holdings in the play,” Wilson reported. Two wells -- the Phillips 1H well in Mercer County and the Allam 1H in Venango County, Pa. -- are completed and in a designated “resting” period, he said.

    Two other wells are either completed or being completed while two more are being drilled, he said.

    “We remain highly confident that our research is pointing us in a good direction in this great new play,” Wilson said.

    Two other wells are either completed or being completed while two more are being drilled, he said

    Halcón will drill the first 10 wells "to delineate acreage, which will allow for a more focused approach to wells drilled in the second half of 2013," the company said in its Feb. 28 earnings release. Halcón currently operates two rigs in the play and expects to add one to two additional rigs by year end.

    Halcón reported that it intends to invest $200 million and drill or begin drilling between 20 and 25 new wells in the Utica. It operates two sites in Mercer, Pa., and is finishing a new well in Hartford Township in Trumbull County.

    Meantime, Halcón Field Services, a subsidiary, is working on developing an infrastructure plan for this region of the Utica, Wilson added. "Infrastructure ownership is our goal whenever practical, and a multi-modal approach to transportation to the best market is planned,” he elaborated. “A complete infrastructure solution in this complicated area is a year or more away."
  • Updated Ohio shows well locations by E&P Company.  Thank you ODNR.
  • New head of the Energy Department supports natural gas development. President Barack Obama's choice to lead the Energy Department pledged to increase use of natural gas Tuesday as a way to combat climate change even as the nation seeks to boost domestic energy production.\

    Ernest Moniz, a physics professor at the Massachusetts Institute of Technology, said "a stunning increase" in production of domestic natural gas in recent years was nothing less than a "revolution" that has led to reduced emissions of carbon dioxide and other gases that cause global warming.

    The natural gas boom also has led to a dramatic expansion of manufacturing and job creation, Moniz told the Senate Energy Committee.

    Even so, Moniz stopped short of endorsing widespread exports of natural gas, saying he wanted to study the issue further.

    A recent study commissioned by the Energy Department concluded that exporting natural gas would benefit the U.S. economy even if it led to higher domestic prices for the fuel.
  • Magnum starts drilling in Washington County, OH. Magnum Hunter Resources Corp. said Friday it has dropped a drill bit into its first Utica Shale horizontal target in Ohio's northern Washington County along the Noble County Ohio border. The well is being tapped from the Farley pad which is designed for four wells.
  • Consol drilling update in the Marcellus and Utica Shale region.  Coal and natural-gas producer Consol Energy expects to drill 11 horizontal shale wells in the Utica this year, all in Noble County, according to the company.

    Consol, considered an independent exploration and production company, operating at or below others in its peer group, planned to scale back its production efforts heading into the new year.

    By the end of the first quarter, Consol had drilled 14 horizontal shale wells — 12 in the Marcellus and two in the Utica. Notably, in Ohio, the company completed its first multiwell pad, when multiple laterals are extended to maximize returns, in Mahoning County.

    Though the company has two horizontal rigs drilling in the Utica, one rig will be released after drilling begins at a site in Noble County.
  • Gulfport Energy bet on Utica paying off.  Gulfport Energy (GPOR) has made a big bet on Ohio acreage in the Utica shale. The company owns 128k acres of property in the Utica and its current drilling program suggests production from the formation should jump over the coming two years.

    The company is actively drilling in the formation and its first 10 wells averaged a peak rate of 798 barrels of condensate per day, 10.0 MMCF of natural gas per day and 1,166 barrels of NGLs, or 3,630 barrels of oil equivalent per day ("BOEPD"). In Q4, Utica production was 69k BOE, up from 17k BOE in Q3.

    The early results have emboldened Gulfport to double down on the Utica.  The company currently has 3 rigs drilling in the Utica, with a fourth coming on this month, and plans to spend $382-426 million of its $458-512 million capital spending budget there this year alone. Overall, the company hopes to drill 50 gross wells in Eastern Ohio this year.
  • Shell and Williams announce joint venture which impacts Shell ethane cracker plan.  Williams Partners L.P announced today that it has agreed to launch a new midstream joint venture with Shell to provide gas gathering and gas processing services for production located in Northwest Pennsylvania. The venture will invest in both wet-gas handling infrastructure and dry gas infrastructure serving Marcellus and Utica Shale wells in the area.

    The new venture, Three Rivers Midstream, has signed a long-term fee-based dedicated gathering and processing agreement for Shell’s production in the area, including approximately 275,000 dedicated acres. The joint venture also plans to pursue gathering and processing agreements with other producers in the liquids-rich areas of Northeast Ohio in addition to Northwest Pennsylvania.

    Three Rivers plans to construct a 200 million cubic feet per day (MMcf/d) cryogenic gas processing plant and related facilities. The location will be determined at a later date. The planned large-scale gas processing complex would be expandable as Three Rivers’ business grows. The initial plant is expected to be placed into service by second quarter 2015.

    “This new joint venture builds on our strategy of creating large-scale infrastructure solutions that will provide Shell and other producers with access to the best markets for their natural gas and natural gas liquids, whether they be in the Northeast or the Gulf Coast,” said Alan Armstrong, chief executive officer of Williams Partners’ general partner.

    “The system is expected to be connected to two major proposed developments in Pennsylvania – Shell’s proposed ethylene cracker (feasibility still being studied) in Beaver County and the proposed Williams - Boardwalk joint venture to develop the Bluegrass Pipeline system that would deliver Marcellus and Utica liquids to the rapidly expanding Gulf Coast and export markets. The proposed Bluegrass pipeline is targeting a late 2015 in-service date.

    This announcement certainly reinforces my belief that Shell’s ethane cracker plant is moving forward even though some skeptics think it will not.
  • Chesapeake leaving Stark and Portage Counties. Chesapeake Energy is putting 94,000 acres of Utica Shale leases in Stark and Portage counties up for sale.

    The offering represents about a tenth of the roughly 1 million acres the driller has leased in the region.

Baker Hughes Rig Counts

  • Baker Hughes Rigs count for the April 12 reporting week.  
    • PA Marcellus 57  rigs – down 4
    • PA Utica 2 rig – unchanged
    • Ohio Utica 32 rigs – up 2
    • WV Marcellus 24 rigs  – up 4

PA Permits for March April 7 - 13

     County            Township        E&P Company
1. Allegheny          Findlay            Range
2. Allegheny          Findlay            Range
3. Allegheny          Findlay            Range
4. Bradford            Overton          Chesapeake
5. Bradford            Overton          Chesapeake
6. Bradford            Troy                Chief
7. Bradford            Troy                Chief
8. Bradford            Troy                Chief
9. Bradford            Troy                Chief
10. Bradford          Troy                Chief
11. Bradford          Wilmont          Chesapeake
12. Clarion             Madison          Northeast Nat. Ener
13. Lycoming          Gamble           Anadarko
14. Lycoming          Gamble           Anadarko
15. Lycoming          McHenry          PA Gen. Energy
16. Lycoming          McHenry          PA Gen. Energy
17. Lycoming          McHenry          PA Gen. Energy
18. Susquehanna   Hartford          Cabot
19. Susquehanna   Hartford          Cabot
20. Susquehanna   Hartford          Cabot
21. Susquehanna   Lathrop           Cabot
22. Susquehanna   Lathrop           Cabot
23. Susquehanna   Lathrop           Cabot
24. Susquehanna   Lathrop           Cabot
25. Susquehanna   Springville       Chief
26. Washington      Cross Creek    Range
27. Washington      Hopewell         Range
28. Washington      Buffalo             Range
29. Washington      Buffalo             Range
30. Washington      Buffalo             Range
31. Washington      Morris              Consol
32. Washington      West Finley      Noble   

OH Permits – week ending April 6

     County    Township    E&P Companies
1. Belmont      Union       Gulfport
2. Belmont      Union       Gulfport
3. Belmont      Union       Gulfport
4. Carroll         Lee          Chesapeake
5. Carroll         Lee          Chesapeake
6. Carroll         Lee          Chesapeake
7. Harrison      Monroe    Chevron
8. Harrison      Monroe    Chevron
9. Mahoning    Jackson    Halcon

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Utica Summit 2019