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Latest facts and a rumor from the Marcellus and Utica Shale

  • Chevron in OH and NW PA. Chevron will be hiring more people as it increases drilling in Ohio and NW PA (Rumor)

    Chevron is the second largest lease holder in OH after Chesapeake.  It has drilled a couple of test wells.  Based on its aggressive drilling plans, 300 wells in 2014, this seems to make sense.
  • Chevron to drill in Somerset County PA. Work could be underway this fall to put a Marcellus Shale well in Somerset County.

    It’s the second well that energy giant Chevron is planning in the region. The other is a Jackson Township project announced in April.

    Chevron officials say they hope to drill one well this fall in Conemaugh Township. The yield would help them gauge whether additional drilling should occur in that area.

    “It’s going to be an appraisal well, just like in Jackson Township,” said Mikal Zimmerman, policy and public affairs officer for Chevron Appalachia, the company’s natural gas drilling arm.

    “Information we gather from (the well) helps us determine how we should proceed.”

    The horizontal well is planned on an undeveloped multi-acre field along Keafer Hill Road between Somerset Pike and Tire Hill.
  • Secretary of Energy Moniz supports fracking and LNG exports.  Secretary of Energy, Ernest Moniz has stated in a speech at an Energy Conference that he supports the fracking and LNG exports.  He is supposed to present his recommendations for LNG exports by the end of the year.
  • President Obama seems to be supporting Natural Gas.  President Barack Obama’s speech this past week on climate change forcefully rejected some key arguments made by opponents of natural gas fracking, upsetting some environmental groups that otherwise back his climate goals.

    Obama, in his address Tuesday calling for urgent action to address climate change, praised what he called “cleaner-burning natural gas” and its role in providing safe, cheap power that he said can also help reduce U.S. carbon dioxide emissions.
  • Shell delays decision on Beaver County, PA site. Shell again delayed its decision to buy land for a petro­chemical plant in Beaver County, officials said Friday.

    A Shell spokeswoman and government and civic leaders said the announcement is not a bad sign for the project, a multibillion-dollar plant called a “cracker” that will help turn ethane into plastic.

    “We're still on track. We're still continuing to evaluate the site,” Windon said, noting the company is studying transportation to the site, working on government permits and communicating with people in the county.

    Shell struck a deal in March 2012 with Robinson-based Horsehead Holding Corp. for its 300-acre site along the Ohio River. It has an option to buy the land but never fully committed to buy or build on it. The option expired this weekend, but the company received its second six-month extension since December.

    I’m not surprised by this.  In my conversations with PA government officials, there are a considerable number of permits to be received which is very time consuming.  Nothing ever happens as fast as we want it to happen.
  • Gov. Corbett pushes DRBC to lift its moratorium.  Gov. Corbett has sent a strongly worded letter to the Delaware River Basin Commission, urging it to end a three-year moratorium on natural gas drilling in the basin by adopting drilling regulations.

    He said he wanted "to convey a profound sense of frustration and disappointment on behalf of my constituents due to the inaction of the commission."

    Regulations would open Pennsylvania's 13 eastern counties - notably those in the northeast, atop the Marcellus Shale - to drilling.

    Industry and a property owners' group cheered the action, but an environmental advocate said it was inappropriate.

    The letter was dated Thursday and confirmed Friday by Corbett's office. On Tuesday, President Obama presented his climate-action plan, praising natural gas as a valuable "bridge fuel."
  • UPS switching more trucks to LNG.  United Parcel Service’s announcement that it plans to expand its fleet of trucks running on liquefied natural gas, or LNG, to 800 by the end of next year is just the latest in a line of companies casting their vote for natural gas as the preferred commercial vehicle fuel. UPS joins AT&T, Frito-Lay, Republic Services, Ryder, Swift, Waste Management and many others making the switch to American natural gas.

    In recognizing the potential of natural gas, the Senate Energy and Natural Resources Committee recently held hearings on what role the federal government can play to ensure that more American companies move more American goods on trucks running on American fuel.

    I see announcements like this almost daily.  Before we know most trucks in U.S. will be running on LNG.
  • Eclipse Resources increasing its stake in the Utica.  Eclipse Resources has acquired the Oxford Oil Company LLC, with approximately 184,000 net acres in Ohio and 13.8 Bcfe of proved developed producing reserves. Oxford Oil was subsequently renamed to Eclipse Resources–Ohio LLC and will remain a wholly owned subsidiary of Eclipse Resources.

    Prior to the acquisition, Eclipse Resources owned approximately 41,000 net acres in Belmont, Guernsey, Monroe and Noble counties in Ohio, where the largest wells in the Utica shale play have been reported to date. With the acquisition of Oxford, Eclipse Resources now owns approximately 90,000 net acres in these core Utica Shale counties, as well as in Harrison County, Ohio. Eclipse Resources has recently completed drilling a Utica Shale well in Monroe County, and has participated in five wells in Noble County that have shown strong initial production rates and high liquids yields. The company is currently running one rig in the play, and is participating, on a non-operated basis, in operations of three additional rigs in the play.

    "We are excited to have completed this very significant acquisition, making Eclipse Resources one of the largest acreage owners in the ‘core’ of the Utica shale play in southeastern Ohio,” said Benjamin W. Hulburt, president and CEO of Eclipse Resources. “We plan to grow our operated Utica-focused rig count to up to five horizontal rigs running in the play between now and year-end 2014. We are planning a very active drilling program in Harrison, Guernsey, Noble, Belmont and Monroe counties, commencing immediately and continuing for the next several years. Concurrently, we will look to opportunistically add leases to enhance our already attractive, contiguous acreage base.
  • PDC getting in Washington County OH. The Denver-based company plans to develop at least nine wells in the Utica play, including the one we visited near the Washington County village of Waterford.

    Like others in the Utica play, the well will use horizontal hydraulic fracturing to free oil and gas trapped in shale deep underground. The method allows drillers to extend pipelines laterally out to 5,000 feet after they drill down about 6,000 feet.

    Salen told us PDC Energy is spending $75,000 to $100,000 a day to drill the well in Washington County.
  • Rex Energy meeting success in Carroll County OH.  Rex has said it has placed its G Graham 1H Utica shale well onto sales production with 30-day output of 1256 barrels of oil equivalent per day.

    The output from the Warrior North prospect probe in the Appalachian Basin in Carroll County, Ohio was made up of 46% natural gas liquids, 33% gas and 21% condensate.
    Rex Energy Corporation chief executive Tom Stabley called the well’s results “among the best in Carroll County to date”.

    “With over 110 additional locations on our approximately 16,000 net acres in Carroll County, we believe this result further demonstrates the potential value of our acreage position,” he added.
  • Mark West first Utica Shale plant goes into operation.  Development of the Utica Shale play has kept Harrison County a hub of activity in recent weeks with completion of MarkWest’s cryogenic plant in Cadiz and construction of a road to link the M3 Midstream natural gas processing plant in Scio with state Route 151.

    MarkWest’s cryogenic plant, which has a processing capacity of 125 million cubic feet per day, went into operation during the last two weeks of May, said Kevin Hawkins, manager of investor relations for the company.

    It is the first major cryogenic facility in the Utica Shale play and MarkWest’s first in Ohio, he said. The company will add a second cryogenic plant at Cadiz by mid-2014.
  • Drilling will be increasing.  According to RigData, although margins are tights drilling is sure to increase with a constant eye on cost containment from exploration and development companies. 

Rig Count

  • Baker Hughes Rigs count for the June 28 reporting week. 
    • PA Marcellus 52 rigs – down 1
    • PA Utica 2 rig – up 1
    • Ohio Utica 32 rigs – up 2
    • WV Marcellus 25 rigs  – up 3

PA Permits for June 21 to 30

    County            Township          E&P Company
1. Beaver             Darlington         Chesapeake
2. Beaver             New Sewickley  Penn Energy
3. Bradford          Granville            Chesapeake
4. Bradford          Overton             Chesapeake
5. Bradford          Troy                   Talisman
6. Bradford          Troy                   Talisman
7. Bradford          Troy                   Talisman
8. Bradford          Troy                   Talisman
9. Bradford          Troy                   Talisman
10. Bradford        Troy                   Talisman
11. Bradford        Troy                   Talisman
12. Bradford        Troy                   Talisman
13. Bradford        Troy                   Talisman
14. Bradford        Warren              Talisman
15. Bradford        Warren              Talisman
16. Bradford        Warren              Talisman
17. Bradford        Warren              Talisman
18. Bradford        Warren              Talisman
19. Bradford        Wilmont              Chesapeake
20. Butler             Butler                 XTO
21. Butler             Butler                 XTO
22. Butler             Butler                 XTO
23. Cameron        Shippen              Seneca
24. Cameron        Shippen              Seneca
25. Greene           Jefferson            Energy Corp.
26. Greene           Jefferson            Energy Corp.
27. Greene           Washington        EQT
28. Greene           Washington        EQT
29. Indiana           Center                XTO
30. Jefferson         Polk                    Exco
31. Lawrence        Pulaski               Hilcorp
32. Lycoming         Gable                 Seneca
33. Lycoming         Lewis                 Seneca
34. Lycoming         Lewis                 Seneca 
35. Lycoming         Lewis                 Seneca
36. Lycoming         Lewis                 Seneca
37. Lycoming         Lewis                 Seneca
38. Lycoming         Lewis                 Seneca
39. Lycoming         Lewis                 Seneca
40. Lycoming         Lewis                 Seneca
41. Lycoming         Lewis                 Seneca
42. Lycoming         Lewis                 Seneca
43. Lycoming         Upper Fairchild   Inflection Energy
44. Lycoming         Upper Fairchild   Inflection Energy
45. McKean            Sergeant           Seneca
46. McKean            Sergeant           Seneca
47. Susquehanna   Apolacon           Talisman
48. Susquehanna   Apolacon           Talisman
49. Susquehanna   Apolacon           Talisman
50. Susquehanna   Apolacon           Talisman
51. Susquehanna   Auburn              Chesapeake
52. Susquehanna   Clifford              Southwestern
53. Susquehanna   Hartford            Cabot
54. Susquehanna   Hartford            Cabot
55. Susquehanna   Hartford            Cabot
56. Susquehanna   Lenox                Southwestern
57. Susquehanna   Liberty               WPX
58. Susquehanna   Liberty               WPX
59. Washington      Amwell               Range
60. Washington      Amwell               Range
61. Wyoming          Meshoppen        Chesapeake
62. Wyoming          North Branch      Chesapeake

OH Permits – week ending June 22

    County         Township   E&P Companies
1. Belmont        Somerset   Gulfport
2. Belmont        Somerset   Gulfport
3. Belmont        Somerset   Gulfport
4. Belmont        Colerain     Gulfport
5. Carroll           Lee            Chesapeake
6. Carroll           Louden      Chesapeake
7. Carroll           Louden      Chesapeake
8. Carroll           Fox            Chesapeake
9. Columbiana   Hanover    Chesapeake
10. Harrison      German     Chesapeake
11. Harrison      Archer        Hess
12. Harrison      Archer        Hess
13. Harrison      Archer        Hess
14. Harrison      Archer        Hess
15. Mahoning    Poland       Hilcorp
16. Monroe        Lee           Triad Hunter

The second half of 2013 is going to be active.  Become a member of to tap into this future growth.

Joe Barone 610.764.1232
Vera Anderson 570.337.7149
Andrea Bagnell 610.256.1898

Utica Summit 2019