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Utica Shale News
Utica Shale - Consol Energy (CNX) - February 2012 - Ohio
Utica: In the Utica Shale Joint Venture with Hess Corporation, CONSOL Energy has
a rig drilling in the western portion of Tuscarawas County, Ohio
Utica Shale Formation - November 2011 -
Chesapeake Energy Corporation (NYSE:CHK) today announced two transactions to monetize a portion of its 1.5 million net acres
of leasehold in the Utica Shale play primarily in eastern Ohio. Fully implemented, the transactions would result in consideration
to Chesapeake of approximately $3.4 billion. JV Transaction Values 570,000 Net Acres of Chesapeake Utica Shale
Leasehold at $8.55 Billion, or $15,000 Per Net Acre - Link
Utica Shale - Anadarko Petroleum (APC) - November 2011 -
Anadarko Petroleum (APC) announces news that they have entered the Utica Shale, acquiring 300,000 acres. Details Below.....
Utica Shale - Exxon Mobil (XOM) - October
2011 - Exxon Mobil announced in late October 2011 that they have a position in the Utica Shale and are buying mineral
rights leases in Ohio. This is very exciting news as we are now seeing major oil companies show up to the Utica Formation,
just like we saw in the Bakken Shale. See more below...
Utica Shale - Hess (HES) - September 2011
- Hess (HES) enters Utica Shale - Hess Corporation (NYSE: HES) announced today it has acquired Marquette Exploration LLC and
other leases in Ohio's Utica Shale, boosting its acreage position by 85,000 net acres at a cost of approximately $750 million.
Utica Shale - Michigan (MI) - August 2011 - Devon
Energy (DVN) announced today that the company is exploring the Utica Shale in Ohio and Michigan. Devon Energy also has
acquired many mineral rights acres in the Oil zone of the Utica Play located in Ohio.
Carroll County, OH - August 2011 - Rex Energy (REXX)
recently acquired mineral rights to 11,000 acres in the Utica Shale. The Ohio portion of the Utica Shale is where the
major oil field is located. Carroll County Acres are currently selling for $3,600 according to REXX. Rex
Energy is also planning to test the Pennsylvania (PA) Utica Shale Field in Butler County, PA. Natural Gas can
be found in the PA portion of the Utica Shale.
Utica Shale - Ohio - July 2011 - Chesapeake Energy
(CHK), the largest leaseholder in the Utica Shale, says the Utica formation could be a larger oil discovery than
the Eagle Ford Shale in South Texas. See more below...
Companies Drilling the Utica Shale
- Quebec, Ohio, Pennsylvania, New York, West Virginia, Michigan - Utica Shale Stocks
Chesapeake Energy (CHK) - Chesapeake Energy (CHK) has recently talked about their 1.2 million net acreage position in
the Utica Shale - Chesapeake Announces a Major New Liquids-Rich Discovery
in the Utica
Shale in Eastern Ohio Having achieved successful results from recent drilling activities in eastern Ohio, Chesapeake
is announcing the discovery of a major new liquids-rich play in the Utica Shale. Based on its proprietary geoscientific, petrophysical
and engineering research during the past two years and the results of six horizontal and nine vertical wells it has drilled,
Chesapeake believes that its industry-leading 1.25 million net leasehold acres in the Utica Shale play could be worth $15
- $20 billion in increased value to the company. Chesapeake’s dataset on the Utica Shale includes approximately 2,000
well logs, full-suite petrophysical data on approximately 200 wells, 3,200 feet of proprietary core samples from nine wells
and production results from three wells. As a result of its analysis, the company believes the Utica Shale will be characterized
by a western oil phase, a central wet gas phase and an eastern dry gas phase and is likely most analogous, but economically
superior to, the Eagle Ford Shale in South Texas. Chesapeake is currently drilling in the Utica Shale with five operated
rigs to further evaluate and develop its leasehold and anticipates increasing its rig count to eight by the end of 2011 and
reaching at least a range of 16-20 rigs by year-end 2012. Also, the company believes that its leasehold position in the Utica
Shale will support a drilling effort of at least 40 rigs by year-end 2014. Chesapeake is currently conducting a competitive
process to monetize a portion of its Utica Shale leasehold position, which will be through an industry joint venture process
or through a number of other monetization alternatives. The company anticipates completing a Utica Shale transaction in the
2011 fourth quarter. With regard to the Utica Shale, we are happy to report confirmation
of market rumors that Chesapeake has made a major new liquids-rich discovery in the Utica Shale of eastern Ohio. In some respects,
the play reminds us of the Haynesville Shale in the fact that we worked undercover for more than a year to develop the basic
geological and petrophysical model. We built the largest leasehold position in the play and then drilled the first discovery
wells. This
is certainly also the case with the Utica, where we started
working on the play 1.5 years ago, started buying leases shortly thereafter and, today, quietly and efficiently have built
the late -- have built the largest leasehold position in the play. Importantly, we're the only company that has drilled a
producing horizontal Utica Shale
well in Ohio. On
the other hand, economically, the Utica looks
similar, but is likely superior to the Eagle Ford Shale in South Texas. The similarity is that we expect the Utica to have 3 phases: a dry gas phase on the
eastern side of the play, a wet gas phase in the middle and an oil phase on the western side. Their difference is that we
believe the Utica will
be economically superior to the Eagle Ford because of the quality of the rock and the location of the asset. While we are not ready yet
for competitive reasons to discuss our production results to date or our reserve estimates for the future, I can confirm that
we have drilled 9 vertical wells, have drilled 6 horizontal wells, have drilled and analyzed 3,200 feet of proprietary Utica core
and have examined over 2,000 well logs that have penetrated the Utica to date. As with every other shale play, the highest returns go to the companies
that have focused their leasehold buying in the core of the play, as Chesapeake has done in the past in the Barnett, Haynesville
and Marcellus and as we are doing again in the Utica. So what's the Utica going to be worth to our shareholders? Based
on what we have seen from our first wells and what we have seen from recent Eagle Ford JVs and other JVs across the industry,
we believe our 1.25-million net acres in the Utica should be worth $15 billion to $20 billion for Chesapeake shareholders. That's
a big number to be sure, but we believe we understand the hydrocarbon potential under our acreage and we also know a fair
amount about how to create and extract value from a play such as this. I might also add that in the Utica, as in the Mississippi Lime, we have been approached with a number of alternative monetization
ideas that we believe will be quite competitive with the standard industry JV process. We are very excited about this new Utica discovery
and believe, over time, it will be more important to us and the industry than the 4 other major unconventional plays that
Chesapeake has discovered over the past 4 years: the Granite Wash, the Haynesville Shale, the Tonkawa sand and the Mississippi
Lime. We're also very
excited about the Utica's very positive implications
for the state of Ohio and, in fact, for the entire U.S., as the Utica should emerge as a key driver in the future growth of U.S. energy supplies, especially
in natural gas liquids. I would like to complement the efforts of Chesapeake's Appalachian Basin asset team for their discovery
of this play and for assembling the remarkable and dominant leasehold position we have acquired in the past year.
Anadarko Petroleum (APC) - Anadarko Petroleum (APC) takes big stake in the Utica Shale Play - "Additionally,
in the U.S. onshore, we've been assembling a position in Ohio's Utica Shale, and over time, we have acquired interests in
approximately 300,000 gross acres in the prospective liquids-rich window at attractive entry costs. We've recently spud our
first well in the play and look forward to an active drilling program in this emerging area."
Devon Energy (DVN) - Devon Energy (DVN) is an exploration company in the Utica Shale - DVN has been leasing land in Ohio and Michigan - There
has been a lot of discussion lately of the Ohio Utica Shale. And as most of you know, Devon was an early mover. We've established
110,000 net acres in what we believe in the heart of the oil window. The primary risk to a shale play is of course the ability
to move fluid through a very tight reservoir. However, we have now analyzed the core from our first Utica well and are highly
encouraged by the positive permeability indications seen in our first well. Based on these early results, we believe the oil
window could offer some of the best economics in the play. We plan to drill 3 additional Ohio Utica wells this year. Just
to the north is our 300,000 net acre position in the Michigan Basin is prospective for both the Utica Shale, as well as the
A1 Carbonate. As you may know, this has historically been a prolific basin. We are particularly excited about the potential
of the A1 Carbonate which was the source rock for the Niagaran Reef play in Michigan. We drilled our first 2 vertical core
wells and are currently evaluating the data.
Exxon Mobil (XOM) - Exxon Mobil (XOM) Utica Shale News - Exxon Mobil is also actively exploring several other early stage liquids-rich play in the United
States, including the Utica Shale play in eastern
Ohio and western Pennsylvania. Our position in the Utica
stems from our recently completed acquisition of the Phillips companies and represents incremental upside to the Phillips
acquisition, which was focused on the Marcellus. The Phillips acquisition included 45,000 net acres prospective for the Utica in Ohio, and we have increased our position now to over 75,000 net acres. We anticipate drilling our
first Utica well in early 2012
- Forest Oil FST - Over the last two years, Forest Oil has accumulated approximately 269,000
net acres, under lease or farmout at Utica Shale. Utica Shale
(60 – 100% WI) – Forest drilled and completed the first three horizontal Utica Shale wells in Quebec's St.
Lawrence Lowlands, which were successfully cased and fracture stimulated in four stages with rates ranging from 100 –
800 Mcf/d. Frac load flowback was incomplete due to the lack of coiled tubing units in the area. Forest expects to continue
to test its wells after the winter season is over. Although sustained rates were not as high as anticipated, the tests have
allowed Forest to identify the section of the shale it intends to target in future test wells. Each of the wells were tested
in different sections of the Utica Shale with an objective of gathering data on productivity to allow optimization of future
completions. Furthermore, Forest proved the ability to successfully drill the wells horizontally and pump multi-stage slickwater
frac jobs without major operational issues.
( from seekingalpha )
Our mechanical success rate expanded in 2008 with a successful drilling and completion of a three well horizontal
pilot program in the Utica Shale in Quebec. I
need to remind you, we are the first mover in this play, and as a result, we are blazing the trail for development in this
base. Each of the three wells targeted a different section of the Utica and they were also in three different geographic areas. We tested our three wells after pumping four
stage fracs on each one. Our rates achieved were between 100 Mcf per day and 800 Mcf per day without full recovery of the
load water from the fracs. The Utica like
old shale will have an evolution of technique to become fully commercial. We've seen this in the Barnett and the Haynesville with earlier results being encouraging, but not nearly as good as they are today. August 2009 Update: Well, we have ten year leases up there, what we are doing there is we took all the rocks and the data, and did a frac
rock mechanics work including with BJ in Houston and that was supposed to come out this summer and of course summer time is
better than when we frac those wells. Up to this point, we were the only company who had done horizontals, and I understand
there have been two announcements publicly, one private firm in Cavalry, where we’ll have interest in I believe J.C.
and then also Talisman has announced several horizontals, so we’d be interested in seeing how those come out on the
drilling and the completion. Although, others have had trouble on the drilling, we have not. It would be the completion and
basically what we are talking is about redoing it on the frac jobs and trying it again.
- Talisman Energy TLM - Talisman Energy is very active in the Utica Shale Natural Gas Field
-Talisman’s Quebec acreage is along the St. Lawrence River where the Company has currently earned or acquired a total
of 310,000 net acres. The Company also has rights to earn up to an additional 460,000 net acres. In 2008, one well was drilled
and another was drilling over year end. Initial tests from the Gentilly recompletion were also conducted. Talisman expects
to complete the drilling component of its earning phase (two additional wells) by the end of the first quarter of 2009. The
Company anticipates that testing will continue into the second and third quarters of 2009 depending on equipment availability.
Talisman will continue evaluating the potential for commercial gas in Quebec throughout 2009. 2011 Utica Shale Update - In Quebec, the provincial government has announced that it will allow a limited amount of shale activity as part of
a strategic environmental assessment. Production from Talisman's conventional areas was 441 mmcf/d of natural gas and 20,200
boe/d of liquids, up slightly from the comparable average for 2010. The company drilled 36 gross conventional wells (31.8
net) during the quarter.
- Equitable Resources EQT - EQT has Utica Shale deposit exposure: CEO: The second well at
this point is a vertical into the Utica, that's
where we're headed, we’ll frac and complete both of those wells. So, one will be horizontal, one will be vertical. See
how it goes and produce them. If they work, we'll produce them into the pipeline at that point. Beyond that though if the
Utica doesn't work we’ll just back off
inside of that current vertical well and then drill out a horizontal Marcellus well through that same exact hole, that's one of the reasons we did this year as we sort of get a relatively cheap look at
the Utica with this well. But if Utica works, we will produce. If it doesn't work we'll back off and drill on horizontal
Marcellus. If the Utica does work, we'll go ahead
and drill on the third well here. The third well will be a horizontal Marcellus well. Hope that clears that up. Update: We're still in that process of engineering, a bigger frac job in the Utica Shale. We're thinking about drilling another
well but we don't know whether in the context of the market conditions whether we are going to do that sooner or later and
when we drill later, if we drill, we liked it, frac both at the same time. So we're sort of on a little bit of hold on the
Utica at this point.
Dominion Resources (D) - Dominion Resources (D) offers services in the Utica Shale Play - Our next major project in the Marcellus and Utica
regions has been finalized. We have acquired a site on the Ohio River in Natrium, West Virginia to construct a large gas processing
and fractionation plant. With the rising price of oil and the depressed price of natural gas, drilling activity in the region
has shifted from a dry gas to wet gas areas of the formation as producers look to capture the economic value of the natural
gas liquids. As a result, the region has a significant need for additional processing and fractionation capacity. The Natrium
site can access production in both the Marcellus and Utica Shale regions and is able to ship products
via barge, rail, truck and pipe, offering significant value to producers.. Range Resources RRC - In addition to pursuing the Marcellus Shale we’ve also initiated studies on the Utica Shale, Berquette, Genesse and Limestreet Shales. In terms of the Utica, we’ve actually been studying the Utica for a long time regarding to the Marcellus in
2004. I would imagine sometime next year we’ll probably drill our first Utica well.
Range Resources Utica Shale 2010 Update: We've have also drilled, and tested one horizontal Upper Devonian well, and one horizontal Utica well in Pennsylvania. This is the first horizontal Utica well in the entire Appalachian Basin and the first Upper Devonian Shale well
on Pennsylvania. Both wells successfully tested gas. However, we plan to keep the results confidential for a while due to
competitive reasons. And in the Utica Shale, we think it's primarily perspective on the Western half of the State. The good news is we've got
1.3 million acres in the State from primarily all in Pennsylvania of which 600,000 acres are in the Southwest portion of the
play. So, a lot of our acreages perspective for that is the big upside.
Consol Energy CNX - Consol Energy (CNX) Utica Shale Update - As reported two weeks ago, the Gas Division made its first discovery
in the Utica Shale, in Eastern Ohio. At a depth of 8,450 feet, the vertical well encountered 200 feet of Utica Shale. During
a 24-hour period, the unstimulated well open-flowed 1.5 MMcf. We plan to hydraulically fracture, and then open-flow the well.
If successful, the Gas Division will drill a horizontal well on the same pad. February 2012 Update - Ohio Utica: In the Utica Shale Joint Venture
with Hess Corporation, CONSOL Energy has a rig drilling in the western portion of Tuscarawas County,
Ohio. The second component is the Utica,
of course. And we still view the Utica, as well
as it has as more on the exploration phase. We will learn quite a bit about it between seismic and exploratory drilling between
the 2 parties over the course of 2012 and really, over the course of the first 2/3 of 2012. That impact and when that timing
will be has yet to be determined. So that's how we sort of look at the liquids from those 2 components. One is more determinable
at this point. You'll start to see it late '12, early '13. The other side, let's see what these Utica results indicate across the 200,000 acres, and we'll go from there in terms
of what that means and the timing.
Chevron (CVX) - Chevron (CVX) Utica Shale Update - Clearly, excitement's been building on the Utica shale opportunity. And then
something that's a bit of a focus this morning with Chesapeake's release and conference call. I know and I believe Chevron
has 600,000 acres that you disclosed that has Utica oil shale exposure. But you didn't call
that out in Slide 17. Maybe you could discuss how you're thinking about activity there and play potential into 2012?
George Kirkland Okay.
Well, let me first say we believe it's a little bit too soon to conclude on the potential of the Utica.
We've got a good acreage position in the Utica from the Atlas acquisition. We're going to do what we do everywhere in
the world. We're going to evaluate that. And the only the way we can evaluate it is we're going to have to drill some wells
and test performance. So it's something for the future, but it's, like you say, too early at this point in time to, I think,
hype it.
Rex Energy REXX - Rex Energy REXX Utica Shale - is looking to test the Utica Shale at the end of 2011. Carroll County,
Ohio — Warrior Prospect Rex Energy has acquired the rights to lease approximately 11,000 net acres in Carroll
County, Ohio (subject to title review) where the company intends to conduct exploratory operations for oil and natural gas
within the Utica Shale. The company is continuing to lease acreage in this area and is planning its first well in 2012. The
company expects to pay approximately $40 million or an average of $3,600 per acre. For additional information on the
Warrior Prospect, please visit the company's website at www.rexenergy.com and refer to the updated corporate presentation. For the remainder of the year, Rex Energy plans to drill an additional
six Marcellus wells, one Upper Devonian Shale well and one Utica Shale well in the Butler County area. Including the Upper Devonian and
Utica Shale wells, the company plans to fracture stimulate an additional nine wells and place into service ten additional
wells for the remainder of the year. 2011 Capital Investment Increase Rex Energy increased its
2011 capital investment budget from $175.4 million up to $235.6 million. The $60.2 million increase is due to the following
investment opportunities: - $41.0 million in leasing capital predominantly associated with the acreage acquisition
in the Utica Shale play
I'd like to talk about our expansion into the Utica Shale. Right now, we have
approximately 83,500 gross and roughly 58,000 net acres that we feel are prospective in the Utica
Shale. Much of this acreage is in Butler County, where we have our Marcellus Shale operations. We also have about 3,400 net
acres in Mercer County that is prospective for Utica development. We have recently made an
arrangement -- recent agreement for 11,000 net acres, pending title approval, in Carroll County, Ohio. You can note that we
are essentially at ground zero in relationship to the Chesapeake activities in Carroll County. We are currently drilling our
Utica Shale test, the Cheeseman well in Butler County, and should have results sometime in the fourth
quarter. We are very excited about the potential of the Utica Shale and feel this could add considerable
value to our portfolio of oil and gas properties. Utica Shale Geology At this point, I'd like to introduce Dave Pratt, our Senior Vice President of Exploration. Dave has over 25 years of experience in the
Appalachian Basin, including significant experience in Ohio, and we'd like him to discuss our thoughts on geology of the Utica Shale play. Thanks, Pat. The Ordovician age Utica Shale at Point Pleasant
Formation is believed to be the source rock for over 300 million barrels of oil and 3 trillion cubic feet of gas reserves
from overlying Silurian age Clinton sandstones and deeper Cambrian-Ordovician age Knox carbonates and sandstones in Eastern
Ohio. In Western Pennsylvania and Eastern Ohio, the Utica Shale is over 150 feet thick and the underlying
Point Pleasant Formation is 140 feet thick. These formations are a mixed carbonate/shale sequence, containing total organic
carbon content ranging from 2.4% to 3.7%. These numbers, while not particularly rich compared to source rocks such as the
Marcellus Shale, are very effective numbers due to the very thick section of potential source rock. The Point Pleasant has
very high resistivities on geophysical logs, indicating the section is hydrocarbon bearing. Log analysis indicates that porosities
in the Point Pleasant Formation range from 8% to 12%, comparable to the highest porosities Rex has seen in its Marcellus wells
in Butler County. The Utica Point Pleasant Formations in Eastern Ohio are sufficiently mature to
be in the wet gas space. The Range Resources' Zion [ph] well drilled approximately 11 miles to the south of the Rex Cheeseman
well tested 4.4 million cubic feet a day of dry gas according to data released by Range. While the Range Resources Zion [ph]
well represents the highest known dry gas and the Chesapeake wells in Eastern Ohio are apparently in the wet gas phase, the
location of the transition from dry gas to wet gas has yet to be determined. Structural dip in Eastern Ohio is very
gently dipping to the southeast but rapidly steepens in Western Pennsylvania. The Rex Cheeseman well is projected to be about
650 feet, structurally high, to the Range's Zion [ph] well at about 150 feet low to several Chesapeake locations in Western
Beaver County, Pennsylvania. Rex anticipates penetrating the Point Pleasant Formation at a TVD of approximately 9,150 feet
in the Cheeseman well. Rex intends to vertically drill the Cheeseman well through the Point Pleasant Formation and run geophysical
logs in sidewall cores before plugging back and drilling the horizontal section of the well. The well is planned to have a
3,600-foot lateral I'd like to go on a little bit more detail about our Warrior Prospect acreage in Carroll County.
We believe that this acreage lies in the liquids window of the Utica Shale and has the potential
for both condensate and natural gas production. With its close proximity to major pipelines and infrastructure, we are looking
forward to development in 2012. Based on our contiguous acreage position, we have identified approximately 80 net drilling
locations in the Warrior Prospect to date based on 4,000-foot lateral links and 1,000-foot spacing between the laterals. In
order to execute our drilling program in the Utica, we have contracted with our drilling partner, Union Drilling, to build
Rex a state-of-the-art new drilling rig capable of drilling to these deeper depths in the play. The rig is scheduled to be
delivered in the second quarter of 2012. November 2011 Update - Utica Shale Test Well Results Rex Energy completed its initial horizontal Utica Shale test well,
the Cheeseman #1H. The well had a lateral length of 3,551 feet and was completed with 12 stages of fracture stimulation. The
well is located in Muddy Creek Township, Butler County, Pennsylvania and had a stabilized 24-hour test rate of 9.2 MMcf/d
of dry natural gas. The well is currently shut in and current plans are to have the well placed into sales once the gathering
line is completed, which is scheduled for January 2012. The company is encouraged by these results and plans to drill and
complete additional Utica Shale wells in Butler County during its 2012 drilling program. Rex will discuss its Pennsylvania
Utica Shale development plans and expected well costs in December when the 2012 capital budget is released. Rex Energy
has closed on its 11,000 acre position in Carroll County, Ohio, which is prospective for the liquids portion of the Utica
Shale. The company continues to lease additional acres in its Warrior prospect and is targeting a goal of 15,000 committed
acres by year end.
Hess Corp (HES) - Hess Corp (HES) now has a position in the Utica Shale - Hess Corporation (NYSE: HES) announced today it has acquired Marquette
Exploration LLC and other leases in Ohio's Utica Shale, boosting its acreage position by 85,000 net acres at a cost of approximately
$750 million. The leases, in which Hess will have a 100 percent working interest, are in Jefferson, Harrison and Belmont
counties. Appraisal activities on this acreage are planned to commence in the fourth quarter. Together with the previously
announced joint venture with CONSOL Energy, the transactions provide Hess with approximately 185,000 net acres in the Utica
Shale play. "With these transactions, we have built a strategic acreage position in the Utica Shale, allowing
us to strengthen our portfolio of unconventional resources in high quality assets, leverage our operating expertise and create
significant potential for future growth in reserves and production," said John Hess, Chairman and CEO of Hess Corporation. February 2012 Update - Regarding the Utica Shale, our appraisal drilling program will be designed to delineate the oil-, liquids-
and gas-rich areas on both our 100%-owned acreage and that owned by our 50-50 joint venture with CONSOL Energy. On our 100%-owned
acreage, we plan to acquire 200 square miles of seismic and drill approximately 7 wells. The joint venture will also acquire
approximately 200 square miles of seismic and plans to drill 22 wells. We will also continue to pursue and delineate unconventional
opportunities globally.
We're up to about 198,000 acres now in the Utica Shale. So we're very pleased
with our early entry into that position and feel like it's a strategic acreage position, an emerging unconventional play.
Remind everybody most of the land's either owned in fee or held by production, with the balance being under long-term leases.
And, finally, the acreage has very high net revenue interest. So, again, a very nice position in an emerging play. Regarding
the well, we recently completed that well in December that was drilled by Marquette prior to the acquisition. The well was
drilled in a dry gas location, we knew that. But it was ready to complete, so we went ahead and completed it. And while we're
still testing the well, we can report that the initial rate from the well was 11 million cubic feet per day on a 24/64 choke.
So that's a very good result. We're very pleased with that result. It's very encouraging, but, obviously, there's a lot more
appraisal drilling necessary to delineate our acreage position and, in particular, figure out where the oil condensate and
dry gas windows are.
PDC Energy (PETD) - PDC Energy (PETD) Utica Shale Ohio - PDC has acquired the rights for up to 40,000 net acres
in the Utica shale play in southeastern Ohio for approximately $70 million. The Company plans to fund $14 million in 2011
and expects the remaining $56 million to be funded in 2012.
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