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  • Permit Activity.
    • PA – 6 permits; Anadarko is not leaving PA; just received 3 permits
    • OH –10 permits; Hess getting active in Belmont County
  • Expo/Event activity
    • The OOGA Oilfield Expo is the largest event of its kind in the eastern United States. The I-X Center is an impressive facility, uniquely capable of housing the wide array of equipment and services deployed in the oilfield. Exhibit space has been expanded and refined, a Safety Congress component has been added, industry-specific training being offered, and completed with the Fall Technical Conference and Oilfield Symposium – bringing the decision makers, industry professionals, and suppliers together at one very impressive venue.
  • Advertising in Facts & Rumors – due to many inquiries, we have decided to accept advertising in Facts & Rumors. Our newsletter goes to over 3300 businesses in the oil and gas industry in the Marcellus & Utica Shale region. If you are interested in placing a banner ad in the newsletter, please contact me.

Latest facts and a rumor from the Marcellus and Utica Shale

  • Blue Racer still on hold. Marcellus and Utica Sshale companies depending on the Blue Racer Midstream plant for processing are out of luck until at least January, as the facility remains completely shut down after part of it caught fire Sept. 21.

    "Blue Racer's Natrium plant in Marshall County remains in a safe shutdown mode. We are making the repairs needed to restore service," said Blue Racer spokeswoman Casey Nikoloric.

    Though Dominion Resources originally developed the Natrium plant and the full-time workers at Natrium are considered Dominion employees, Blue Racer now officially owns the facility as part of a $1.5 billion deal between Dominion and Caiman Energy.
  • Shell information looks promising. Shell Oil Co. is still actively exploring a plan to build a huge natural gas processing plant in western Pennsylvania, and may have selected engineering firms to do feasibility studies.

    In March 2012, Shell chose a possible site about 35 miles north of Pittsburgh for the so-called ethane cracking, or cracker, plant.

    But Shell has cautioned that a final decision on whether to build the multibillion dollar plant wouldn't be made for several years. While some recent media reports suggested that the project might be canceled, The Associated Press found that Shell still has scores of people working on the assessment.

    Shell has an option to buy the industrial site in Monaca that's now owned by Horsehead Corp. In an early November conference call, Horsehead CEO Jim Hensler said Shell continues to be "extremely active" at the site, with "about 70 people crawling all over" it recently.

    Shell spokeswoman Kimberly Wendon told the AP in an email that "our evaluation of the site continues" and that the process "typically takes several years to complete." Wendon added that the company expects a similar time frame in Monaca.

    There also are other signs Shell is seriously considering the project.

    Gulfport Energy Corp. said in early November that it signed a contract to provide Shell with raw natural gas for the project, if it gets built. And last month Chemical Week, an industry publication, reported that Shell has chosen two multinational engineering firms to do feasibility and pre-project planning. Executive Vice President Graham Van Hoff told the publication that Bechtel Corp. and Linde AG of Germany would do the preliminary work.

    Energy experts say it's simply too early to tell whether Shell will or won't build the plant, since the final decision involves worldwide market conditions and competing projects, both within the company and by competitors. Shell CFO Simon Henry suggested in a late October conference call that the company will have to choose among several large new investments over the next year or two.
  • Anadarko leaving PA (Unfounded rumor). We reported that we heard a rumor that Anadarko may be leaving PA. We’ve done some digging to learn that Anadarko has 120 employees in Williamsport and there are staying there. Anadarko this past week just received three permits in Lycoming County.
  • EQT big midstream plans in 2014. With midstream being the next big frontier in the development of the Marcellus shale, big plans and even bigger investments are being made.

    In 2014, MarkWest Energy Partners LLP expects to spend $2 billion in capital to fund 22 major fractionation processing projects, 21 of which are located in the Marcellus and Utica shale regions, according to Scott J. Garner, vice president of corporate development and joint venture management for MarkWest.
  • Magnum Hunter wants cracker in WV. The CEO of a company with active Marcellus and Utica Sshale operations in Monroe, Washington, Wetzel, Tyler and Pleasants counties said having an ethane cracker in nearby Parkersburg would be "phenomenal."

    "Ethane is something that we are going to have to deal with, particularly as we get more wells on line," said Gary Hunter, chairman and CEO of Houston, Texas-based Magnum Hunter Resources, during a conversation following his Friday speech at the DUG East conference. "Having a cracker in our own backyard would be great."
  • More Americans like fracking. The Robert Morris University Polling Institute – in partnership with Trib Total Media – released its findings from a national survey on tightly-regulated shale development. The poll shows that a “plurality of Americans” support hydraulic fracturing as well as the benefits associated with shale development. These undeniable, positive impacts are not only cascading across Pennsylvania – which boasts some of the “most productive natural wells on earth” – but also the nation, as America’s energy security and global competitiveness sharply increasing.
    Here are key excepts from RMU’s poll, which further indicate that America’s Heartland Supports Safe, Job-Creating Shale Development:
    • Among those with an opinion, the majority, 56.4%, supports fracing;
    • 73.9% see new drilling technologies which allow fracing helping the United States move to energy independence;
    • 80.1% suggest fracing has the potential to help the United States economy; and
      60.2% suggest the United States begin exporting new natural gas resources resulting from fracing.

Comments from DUG East

  • Gulfport Energy 2014. Jim Palm, chief executive officer for Gulfport Energy Corporation, said the deepest well they have drilled so far was in Guernsey County. It is known as the Wagner Well, and has reached 8,700 feet. He said the average well cost is projected at around $9.5 million in 2014.
  • He said that plans are to continue drilling in 2014 and increase the leasing acreage held by the company in southeast Ohio.

    “There’s no place where we have drilled a well that we wouldn’t go back and drill again,” said Palm.

    Palm said his company budged $225-275 million to be spent on leasing acreage in the next year. However, he doesn’t expect to be paying any crazy high leasing prices. He did add that Gulfport would pay more for large acreage blocks over smaller pieces of land.
  • Eclipse 2014. Eclipse Resources recently acquired some 185,000 acres in the Utica, split between Belmont, Guernsey, Harrison, Monroe and Noble counties , OH and the emerging oil window.

    Eclipse Resources is the company that purchased Oxford Oil in June 2013.

    Benjamin Hulburt, president and chief executive officer for Eclipse Resources, said he hopes to grow the rig count to six by the end of 2014. There are three rigs drilling in Ohio now.

    Eclipse has 25 wells currently drilled or waiting completion.

    Hulburt said the company’s 10-year drilling plan includes three to five wells on a pad with 6,000 feet laterals. He said the company is testing spacing of the laterals to find out what works best with the Utica shale in the southeastern portion of the state.
  • Consol 2014. Consol Energy has big plans for 2014, including ramping up the Marcellus and more exploration in the Utica shale.

    Nick DeIuliis, president for Consol Energy, said the company has eight rigs drilling in the Marcellus shale in a joint venture with Noble Energy. He added there are plans for 75 wells in West Virginia.

    In the Utica shale, nine wells have been drilled with the partner, Hess Energy. He expects the number to grow after midstream projects get underway, including an agreement made with Blue Racer.

    “Both plays show great promise for Consol,” said Deluliis.

    One project Consol is working on is at the Pittsburgh Airport in Allegheny County. Deluliis said there will be 50 wells drilled at the airport.
  • Antero’s Utica Shale update; some impressive numbers.
  1. Company has been running four frack spreads or frack teams in the Appalachian Basin.
  2. Its rates of return in the Marcellus shale have been 40 percent in the rich gas area to 90 percent in the highly rich condensate area. In the Utica shale, the rates of return are about 100 percent in the rich gas area to more than 200 percent in the highly rich condensate area.
  3. Company has been drilling the longest laterals in the Marcellus Shale. It averaged 7,100 feet for the 34 wells completed in the third quarter.
  4. It is moving toward shorter stage lengths or SSL completions. The costs are 20 percent higher but production is 20 to 30 percent more.
  5. Antero has plans to add first compression facility in the Utica shale. Those plans should be outlined by the end of November. It is looking at 120 million cubic feet per day.
  6. Antero has drilled 250 miles of laterals in West Virginia and has encountered no faulting in the rock. That is a major advantage, officials said.
  7. Acquiring additional Utica shale acreage will be difficult, Antero said.

DUG East observation. One thing that analysts and companies agreed on at the at Hart Energy’s 2013 DUG East conference was that the industry has never seen a shale play where so much success has been found so early.

Rig Count

  • Baker Hughes Rigs count for the November 15 reporting week.
    • PA Marcellus 55 – up 1
    • PA Utica 2 – unchanged
    • Ohio Utica 34 rigs – unchanged
    • WV Marcellus 32 rigs – up 1

PA Permits for October November 15 to November 21, 2013

County TownshipE&P Company

1.Lycoming Cascade Anadarko
2.Lycoming Cascade Anadarko
3.Lycoming Cascade Anadarko
4.SusquehannaBrooklyn Cabot
5.Washington Morris CONSOL
6.Washington Smith Range

OH Permits – week ending November 16, 2013

County TownshipE&P Companies

1.Belmont Warren Hess
2.Belmont Warren Hess
3.Belmont Warren Hess
4.Belmont Warren Hess
5.Belmont Warren Hess
6.Carroll Lee Chesapeake
7.Carroll Lee Chesapeake
8.Morgan Center PDC Energy
9.Morgan Center PDC Energy
10.Morgan Center PDC Enery

Take advantage of the bullish outlook and become a member in now or and secure your budget for membership in 2014.

Looking for workers, advertise on

Joe Barone 610.764.1232
Vera Anderson 570.337.7149
Andrea Bagnell 610.256.1898

Utica Summit 2019