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Utica Shale Development: How do early-stage characteristics equate to other N. American shale plays?
Oil & Gas Financial Journal ^ | WarlickEnergy via OGFJ | Don Warlick

Posted on 10/23/2012 5:05:35 AM PDT by thackney

Analysts say that the Utica Shale, which is nearly equal to the size of the Eagle Ford play in Texas could become the third-largest shale play in the United States, producing as much as 250,000 to 500,000 barrels of oil a day. The Ohio Department of Natural Resources estimates that the Utica’s potentially recoverable reserves could range from 3.75 TCF of gas and 1.31 billion barrels of oil to 15.7 TCF gas and 5.5 billion barrels of oil.

In comparing the Utica to the Eagle Ford, the following: TVD in the Utica can be as shallow as 4,500 feet versus ~ 6,000 feet in the Eagle Ford, recovery factor can be 5% versus 4%, formation thickness 140 feet versus an average of 100 feet and porosity of 8% versus 5-8% in the Eagle Ford.

With regard to activity and players here is what's happening so far:

* Chesapeake holds more than 1 million net acres in the Utica and is by far the most active driller with a total of 87 wells with plans to finish 2012 with 15 operated rigs. They have significant funds to support their development through the end of 2014 thanks to the remaining drilling carry from their January 2012 joint venture with Total.

* After Chesapeake released data for five wells drilled in Carroll and Harrison Counties in the Utica/Point Pleasant play earlier in the year, everyone took notice. Their Buell well IP was 9.5 MMCFED of gas, 150 BD of condensate, and 1,275 BD of NGLs for a total of 1,040 BOED.

* Then came Gulfport Energy's Wagner 1-28H well in Harrison County producing 14 MMCFED of dry natural gas and 1,881 BD of natural gas liquids (after processing) along with 432 barrels of oil, significantly higher than the IP rate of Chesapeake's Buell well. Gulfport plans to drill 200 wells in the area in the next four years.

* There are other big players here also: BP has invested, then there’s Hess and CONSOL who entered into a 50/50 joint venture a year ago valued at almost $600 million to fund their drilling and development across 200,000 acres.

And there is more activity when it comes to deals taking place in the Utica involving acquisitions and infrastructure as indicated by the following examples:

* EnerVest Ltd. amassed a huge collection of Utica drilling rights beginning in 2003 with plans to harvest their investment. Accordingly they plan to sell drilling rights to about 70% of this acreage and retain slightly more than 200,000 net acres whose potential will be determined in the future. It's estimated this sale could generate more than $6 billion.

* In September Spectra Energy, EnBridge and DTE Energy formed a Utica pipeline joint venture with plans to commence operations by late 2015 depending upon demand at that time. Total investment for this new pipeline system is estimated at $1.2 billion to $1.5 billion.

* Also in September NiSource and Hilcorp Energy announced a joint venture to construct their Pennant Midstream gathering pipeline infrastructure with NGL processing in Northeast Ohio/Western Pennsylvania. Reportedly it will cost around $300 million.

Summary: There are more announced (and unannounced) deals and plans that will be adding to Utica momentum, supporting a transition from early-stage to a bigger development opportunity that will probably rank with the big shale plays in the future. It will depend, of course on continuing investment by larger players like Chesapeake, Hess, BP, CONSOL and others plus the near-term economics of crude oil and liquids to affirm a logical path forward in Utica development.


TOPICS: News/Current Events; US: Ohio; US: Pennsylvania; US: West Virginia
KEYWORDS: energy; oil; shalegas; utica
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1 posted on 10/23/2012 5:05:47 AM PDT by thackney
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2 posted on 10/23/2012 5:06:18 AM PDT by thackney (life is fragile, handle with prayer)
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To: 103198

Mark...


3 posted on 10/23/2012 5:09:59 AM PDT by 103198
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To: thackney

Cheap energy is the answer to our economic woes. That and dismantling Obama’s EPA. Billions of investment in refineries and chemical plants are already planned—if they can get the permits.


4 posted on 10/23/2012 5:18:11 AM PDT by SC_Pete
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To: thackney

Now that they’re discovering all these recoverable reserves in the US, are similar claims being made around the world? (ie Is there more oil than we can shake a stick at?)


5 posted on 10/23/2012 5:24:47 AM PDT by ROCKLOBSTER (Celebrate "Republicans Freed the Slaves" Month)
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To: SC_Pete
We'd have to dismantle the governor up here in NYS...He's being a real pr... about this. We KNOW how fracking works. It's been around for 50 years.

Plenty of unpopulated areas in the southern tier to frack.

If you think wells/streams are being contaminated...then you don't know how it works.

6 posted on 10/23/2012 5:24:59 AM PDT by Sacajaweau (r)
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To: SC_Pete
Billions of investment in refineries and chemical plants are already planned

More in the chemical plant than refineries planned as of today.

We already refine more than the US can use. The decades of expansions and upgrades at our existing refineries combined with the fallen demand has given us a surplus in refining capacity.

7 posted on 10/23/2012 5:31:17 AM PDT by thackney (life is fragile, handle with prayer)
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To: Sacajaweau
Billions of investment in refineries and chemical plants are already planned

You are right on your points. Just to give you a little more ammunition, hydraulic fracturing is now 63 years old. Since Stanolind Oil introduced hydraulic fracturing in 1949, close to 2.5 million fracture treatments have been performed worldwide. (as of 2010)

http://www.spe.org/jpt/print/archives/2010/12/10Hydraulic.pdf

8 posted on 10/23/2012 5:37:15 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney

The end of the tan area extends down into Scott County Tennessee. I have a map with hand written notes by my grandfather and Howard Baker about Scott county leases way back in the 30’s. Howard Baker was the father of Senator Howard Baker Jr.


9 posted on 10/23/2012 5:38:23 AM PDT by bert ((K.E. N.P. N.C. +12 ..... Present failure and impending death yield irrational action))
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To: ROCKLOBSTER

There has been some additional exploration outside the US to take advantage of the combination of hydraulic fracturing with steerable horizontal drilling. However, it appears the shale resources seem to be largest in the US, giving us advantage in this area.


10 posted on 10/23/2012 5:41:59 AM PDT by thackney (life is fragile, handle with prayer)
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To: Sacajaweau

Sorry, I meant to reference your statement:

We KNOW how fracking works. It’s been around for 50 years.


11 posted on 10/23/2012 5:42:46 AM PDT by thackney (life is fragile, handle with prayer)
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To: ROCKLOBSTER

Naw. Shale is not found outside the boundaries of the US.

/s

But seriously, folks. Shale oil and gas will never be “cheap energy.” It costs too much to drill and maintain such a field.

But they are monumental game changers politically. All large countries, and a lot of small ones, are going to have major plays. This in the long run will destroy OPEC’s and the Arabs’ political and economic power, which was based on inability to get the oil anywhere else.

In the shorter run, OPEC will have a major incentive to keep prices down so these countries aren’t incentivized as much to develop their plays.


12 posted on 10/23/2012 5:44:04 AM PDT by Sherman Logan
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To: sauropod

bfl


13 posted on 10/23/2012 5:53:59 AM PDT by sauropod (Only two of God's creatures can employ the term "we": newspaper editors and men with tapeworms-Hayes)
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To: thackney

Philly is re-opening 2 refineries and keeping 6 others open. The surplus will drive energy prices down. The results of that will be transformative. And kill solar companies. NATGAS is a whole other discussion.


14 posted on 10/23/2012 6:09:05 AM PDT by SC_Pete
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To: Sacajaweau

Meanwhile, Ohio, PA, and WV are creating jobs by the thousands.


15 posted on 10/23/2012 6:12:09 AM PDT by SC_Pete
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To: Sherman Logan
Every basin in the world has source rocks that are potential candidates. The bottom line is if it economical as the decline on these type of wells is pretty steep. I am not too familiar with the geology of the Arabian peninsula but I can guarantee that the Mother of All Source Rocks is down below the conventional reservoirs. The same for Prudhoe Bay.
16 posted on 10/23/2012 6:21:45 AM PDT by crusty old prospector
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To: thackney

Anyone seriously interested in the future of America should read this industry report on unconventional gas by IHS a Denver-based consulting company:

Here’s the link:
http://www.ihs.com/info/ecc/a/download-unconventional-gas-report-2012.aspx?rcs=CICForcast_05_StrongOfferIndustryDriver21339640199356

Here’s an excerpt from the Executive Summary:

Unconventional gas is expected to lead future growth in US natural gas productive capacity. By 2015, the share of
US natural gas produced from unconventional sources will increase to 67% and, by 2035, will reach 79%. Increased
unconventional gas activity will contribute to capital investment, job opportunities, economic growth, government
revenue, and lower prices across the country including:
• Nearly $3.2 trillion in investments in the development of unconventional gas are expected to fuel the increase
in production between 2010 and 2035.
• In 2010, unconventional gas activity supported 1 million jobs; this will grow to nearly 1.5 million jobs in 2015
and to over 2.4 million in 2035.
• By 2015, unconventional gas activities will contribute nearly $50 billion in federal, state and local government
tax and federal royalty revenue; between 2010 and 2035, continued development of unconventional gas will
generate a cumulative total of nearly $1.5 trillion in federal, state, and local tax and royalty revenue.
This study, which focuses on 58 unconventional gas plays across the lower 48 US states, assesses their economic
impact on each individual state. Three types of gas plays are analyzed in this report: natural gas extracted from shale formations, tight sands, and CBM. These are referred to collectively throughout this report as “unconventional gas.”1

ENJOY. America’s future is bright. Just get Obama out of the Whoite house.


17 posted on 10/23/2012 6:24:07 AM PDT by SC_Pete
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To: thackney
This discovery could rejuvenate the "rust belt" and give new employment to the W.Va. coal miners that are being laid off. Hopefully, the governors of these states will have the good sense to overrule the eco-nuts and develop these resources ASAP.

The article mentions a pipeline being planned. Any info on where that will run and tie in to the existing network???

18 posted on 10/23/2012 6:26:53 AM PDT by Wonder Warthog
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To: SC_Pete

The EPA was another bad idea from Nixon. Anyone should have known that giving the government power to regulate every phase of business and development in this country would inevitably lead to a bureaucratic power grab that would shrink the private sector and increase the government.

Government never stays within its bounds because power corrupts, as the Founders well knew.


19 posted on 10/23/2012 6:28:53 AM PDT by txrefugee
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To: Sherman Logan
"It costs too much to drill and maintain such a field."

Sorry. Not buying that. With steerable horizontal drilling and fracking ONE well can replace dozens of vertically drilled wells, and access broad swaths of "tappable volume" from a single platform (reducing environmental impact).

Let's see your data.

20 posted on 10/23/2012 6:33:36 AM PDT by Wonder Warthog
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To: Wonder Warthog

And check out this report:

http://www.ihs.com/info/ecc/a/download-unconventional-gas-report-2012.aspx?rcs=CICForcast_05_StrongOfferIndustryDriver21339640199356


21 posted on 10/23/2012 6:42:03 AM PDT by SC_Pete
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To: thackney

Oh no, we’re running out of fossil fuels!

Let’s clothe ourselves in ugly windmills.


22 posted on 10/23/2012 6:57:58 AM PDT by 353FMG (The US Constitution is only as effective as those who enforce it.)
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To: SC_Pete
I've only skimmed a few pages, but there is GREAT stuff here. One immediate surprise to me is Colorado ranking up at the top between Texas and Louisiana among the "producing states".

Anyone interested in this thread should read this report (multiple PDF files of report and various appendices).

Thanks much!

23 posted on 10/23/2012 7:02:55 AM PDT by Wonder Warthog
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To: SC_Pete

....also the Green River deposit....has estimate 3 trillion barrels....as big as the current known rest of world reserves....


24 posted on 10/23/2012 7:05:16 AM PDT by spokeshave (The only people better off today than 4 years ago are the Prisoners at Guantanamo.)
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To: Wonder Warthog

The cost I mentioned is compared to the minimal cost of essentially drilling a hole and capping the well, which is what the Saudis essentially have to do. Till now.

Fracking may be quite low-cost compared to deep sea drilling and some of the other high-cost ways of getting oil.

My only point is that fracked oil won’t be “cheap.” We’re very unlikely to go back to $20/barrel.

Tried to find some info on cost/barrel for fracked oil vs. Saudi production. Did not succeed. 95% of information easily available out there is just about how evil and inefficient in the long run fracking is.

IOW, it’s produced by opponents who just want ammo to stop the practice. They could conceivably be right, but there obvious bias means their info must be taken with a major dose of salt.


25 posted on 10/23/2012 7:11:27 AM PDT by Sherman Logan
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To: Sherman Logan; thackney
"My only point is that fracked oil won’t be “cheap.” We’re very unlikely to go back to $20/barrel."

I dunno. My sense is that it might indeed happen.

"Tried to find some info on cost/barrel for fracked oil vs. Saudi production."

I suspect friend Thackney can probably clue us both in on those numbers.

26 posted on 10/23/2012 7:18:43 AM PDT by Wonder Warthog
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To: SC_Pete
Philly is re-opening 2 refineries and keeping 6 others open.

Are you trying to say they will spend billions to do that?

The surplus will drive energy prices down

The price of oil is the primary driving point for the price of gasoline. Existing refineries running or re-opening are not going to drive down the price of oil. The margin of gasoline over crude oil is thin and not expected to significantly decrease.

27 posted on 10/23/2012 7:26:35 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney

Okay, here’s your billions:

http://royaldutchshellplc.com/2012/03/15/shell-oil-picks-pittsburgh-area-site-for-multi-billion-dollar-petrochemical-refinery/


28 posted on 10/23/2012 7:33:26 AM PDT by SC_Pete
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To: Wonder Warthog

You are most welcome. Please share the good news far and wide!!!!!!!!!


29 posted on 10/23/2012 7:38:16 AM PDT by SC_Pete
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To: Wonder Warthog; Smokin' Joe
With steerable horizontal drilling and fracking ONE well can replace dozens of vertically drilled wells

While that statement is likely true in being capable of stretching far enough to cover that distance, I believe the typical horizontal well is normally only going to reach 1/2 mile to 1.5 miles, maybe 2 miles. The economics get much more expensive trying to reach significantly farther with few and much more expensive rigs available to reach multiple miles horizontally underground.

I believe the typical economics are not so much of replacing many vertical wells with a single horizontal. The main reason they are used in the shale plays is the vertical wells can rarely produce enough, long enough in time to be economic.

So instead of replacing a dozen vertical wells, they allow production in a field that would not be economic without horizontal steerable drilling.

I'm pinging Smokin' Joe to see if he agrees. He knows this side of the business more than I. Most of my work comes after the drilling is in place and the production facilities are being built.

30 posted on 10/23/2012 7:41:38 AM PDT by thackney (life is fragile, handle with prayer)
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To: txrefugee

Nison was never a conservative: he wanted the love of the liberal establishment. He was demonized becausse he was outing the COMMUNISTS in the Roosevelt and Truman administrations. They never forgave him no matter how many liberal programs he came up with: including the EPA. And then he tries fixing prices???? How stupid.


31 posted on 10/23/2012 7:41:54 AM PDT by SC_Pete
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To: SC_Pete

http://royaldutchshellplc.com/2012/03/15/shell-oil-picks-pittsburgh-area-site-for-multi-billion-dollar-petrochemical-refinery/

That is not an oil refinery. Nor is it one of the existing oil refineries you mentioned.

That facility is taking Natural Gas liquids, primarily ethane, and converting to feedstock for the chemical industry.

The following has more information from the Shell web site. Shell calls the facility a petrochemical complex. A few media types have mistakenly called it a refinery. It will not accept crude oil and it will not produce gasoline, diesel or fuel oil; it is not a refinery.

http://www.shell.com/home/content/chemicals/aboutshell/our_strategy/marcellus_cracker_project/about_project/

I agree with your first statement about billions of dollars being spent to expand our domestic chemical (including petrochemical) industry. I do not agree that there is much in the way of oil refinery expansion currently being planned. There is some expansion/upgrades planned at a couple of refineries in Texas to accept more of the light oil from the Eagle Ford versus the heavier oils currently imported from overseas.


32 posted on 10/23/2012 7:49:36 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney

I’ve been waiting to see you on FreeRepublic to ask your opinion on something.

BP is running the pipeline from the WA refineries at half capacity, the refineries are out of storage capacity and the crude is backing up at the docks? What’s going on? price manipulation?


33 posted on 10/23/2012 7:51:35 AM PDT by Eva (Obama and Hillary lied, Americans diedI)
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To: Eva
BP is running the pipeline from the WA refineries at half capacity

Which pipeline?

the refineries are out of storage capacity and the crude is backing up at the docks?

BP's Cherry Point Refinery in Washington had a fire that caused a three month shutdown. It caused a lack of ability to process as much crude for quite a while.

What’s going on? price manipulation?

I have never found an oil company outside of OPEC that was willing to shut anything down so their competition who remained running could make more money.

34 posted on 10/23/2012 7:59:01 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney

I stated that cheap energy will transform America. It will save our economy.

Here’s the report:

http://www.ihs.com/info/ecc/a/download-unconventional-gas-report-2012.aspx?rcs=CICForcast_05_StrongOfferIndustryDriver21339640199356

Enjoy. Be happy that cheap energy is the simple solution.


35 posted on 10/23/2012 8:00:39 AM PDT by SC_Pete
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To: SC_Pete

I read the report. I agree cheap energy builds our economy and also was a significant part of our past successes.

The only point I took exception with that you made was about the refineries. That is not part of that report, it deals with the production of Natural Gas.

I believe we mostly agree. I’ll quit beating the horse.


36 posted on 10/23/2012 8:12:17 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney

BP is back to 100%. BP manages the pipeline for ALL the refineries, but it is only operating at 50% capacity. The ships are backing at at the docks with crude, with no explanation. It’s making a lot of extra work and costing a lot of money.

I’ve never seen it before, either. That’s why I’m asking what you think.


37 posted on 10/23/2012 8:18:18 AM PDT by Eva (Obama and Hillary lied, Americans diedI)
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To: thackney

Here’s the info on Philly oil refinery:

http://www.reuters.com/article/2012/07/02/us-sunoco-carlyle-philadelphia-idUSBRE8610JF20120702

It’s direct result of the Marcellus. In the article it mentions another one that was saved too.

Money quote:

“The US East Coast plants certainly have better prospects than their European competitors and the growth in US domestic production of crude and natural gas is improving those prospects further,” said John Auers, a refinery expert with Turner Mason in Houston.


38 posted on 10/23/2012 8:22:12 AM PDT by SC_Pete
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To: SC_Pete

I guess you think this horse still has legs.

The Marcellus is helping to keep Natural Gas prices low for furl and power to the refinery. Domestic cheaper crude from the Midwest to the Bakken helps the economics of keeping the refinery running.

I don’t see them spending billions of dollars to expand. According to the article you linked, most of there upgrades are related to clean fuels and “green” initiatives, not items to bring the price of fuel down. See below:

Philadelphia Energy Solutions plans to construct and upgrade units at the plant, moves that could help the refinery meet new lower sulfur fuel requirements for home heating oil in the region.

The joint venture plans to convert a middle distillate hydrotreater into a mild hydrocracker and construct a natural gas-based hydrogen plant to produce greener fuels. In addition, they plan to upgrade the plant’s catalytic cracker to improve performance and reliability.


39 posted on 10/23/2012 8:48:10 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney
"While that statement is likely true in being capable of stretching far enough to cover that distance, I believe the typical horizontal well is normally only going to reach 1/2 mile to 1.5 miles, maybe 2 miles."

I was thinking more in terms of being able to go north/south/east/west from a single insertion point. Two miles in all those directions is covering a LOT more volume than two miles straight down. I suspect, as usual, that there are a spectrum of possibilities, some already exploited and some not yet so.

You need to take a peek at the report posted by SC_Pete. The economic numbers are staggering. Texas will be adding 100 BILLION dollars a year to its economy by 2035 due to "unconventional" oil and gas (if I'm reading that table right).

40 posted on 10/23/2012 9:21:09 AM PDT by Wonder Warthog
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To: Wonder Warthog

In the GIS info I see for the Bakken and Haynesville shale, I only see horizontal reaching in a single direction.

http://sonris-www.dnr.state.la.us/gis/agsweb/IE/JSViewer/index.html?TemplateID=341

https://www.dmr.nd.gov/OaGIMS/viewer.htm


41 posted on 10/23/2012 9:58:33 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney
For your reference the recent USGS Report in PDF Format:

Assessment of Undiscovered Oil and Gas Resources of the Ordovician Utica Shale of the Appalachian Basin Province, 2012

Have you heard any rumors (i believe coming out of Ohio) regarding finds beneath the Utica pilot wells?
42 posted on 10/23/2012 10:25:00 AM PDT by PA Engineer (Liberate America from the Occupation Media.)
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To: SC_Pete
Just some recent news coming out of the Monaca, PA location:

Shell offers payments instead of taxes for plant
43 posted on 10/23/2012 10:30:17 AM PDT by PA Engineer (Liberate America from the Occupation Media.)
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To: PA Engineer

That’s a good move on their part. But remember the employees will be drawing salaries and paying taxes themselves. They will also buy homes, cars, fo to movies, buy clothing food, etc. Thye economic spinoff of that plant will be enourmous for that whole region. AMERICA ON THE MOVE.


44 posted on 10/23/2012 10:49:41 AM PDT by SC_Pete
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To: SC_Pete
That’s a good move on their part. But remember the employees will be drawing salaries and paying taxes themselves.

Agreed, however I think it indicates their engagement in this location.

There already is a great deal of rail, highway, barge and pipeline infrastructure there. I thought it was a smart move and was happy the State actually supported the arrangement.

This location and current infrastructure will promote related industrial production in close proximity to the plant. It is going to be interesting.
45 posted on 10/23/2012 11:05:14 AM PDT by PA Engineer (Liberate America from the Occupation Media.)
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To: PA Engineer
Have you heard any rumors (i believe coming out of Ohio) regarding finds beneath the Utica pilot wells?

I attribute that rumor solely to a messed up AP title.

Her you can see the title:

Utica shale, below the Marcellus, contains large gas, oil reserves, study shows
http://www.pennlive.com/midstate/index.ssf/2012/10/utica_shale_below_the_marcellu.html

Next you find the exact same AP article with the title:

U.S. Geological Survey: Pennsylvania has natural gas and oil under Utica Shale
http://www.eveningsun.com/news/ci_21712618/u-s-geological-survey-pennsylvania-has-natural-gas

Neither article mentions anything about being beneath the Utica. Both reference the Utica being beneath the Marcellus.

Both reference the information coming from the recent USGS assessment of the Utica as the source of information. Neither the announcement, the abstract nor the report made an mention of anything beneath the Utica. It only mentioned the Utica being beneath the Marcellus.

USGS Releases First Assessment of Shale Gas Resources in the Utica Shale: 38 trillion cubic feet
http://www.usgs.gov/newsroom/article.asp?ID=3419#.UIbbxW9lV8F

Assessment of Undiscovered Oil and Gas Resources of the Ordovician Utica Shale of the Appalachian Basin Province, 2012 {Abstract}
http://pubs.usgs.gov/fs/2012/3116/

The full report you had in your link.

46 posted on 10/23/2012 11:33:52 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney

The energy social grapevine has taller tales than your average fishermen. Thanks.


47 posted on 10/23/2012 12:20:27 PM PDT by PA Engineer (Liberate America from the Occupation Media.)
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To: thackney
We routinely drill just under two miles in a lateral (usually about 9500 ft.--10000 ft. or so from the surface location. IIRC, the record is far greater than that, in the North Sea, but the most we've done was about 12,000 ft. over in the edge of the Elm Coulee Field in Monatana. Those limits are more legal constraints determined by lease spacing than physical limitations.

We can drill four or more wells from a single location pad, and cover 8 square miles of formation with those wells, so it isn't out of line to say that 16 (320 acre spacing) to 32 (160 acre spacing) vertical wells would be replaced by the 4 laterals--between 4 and 8 wells per lateral.

48 posted on 10/23/2012 2:27:13 PM PDT by Smokin' Joe (How often God must weep at humans' folly. Stand fast. God knows what He is doing)
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To: Wonder Warthog

While one well can replace 4-8 vertical wells (realistically), the cost to drill that well (about 10,000 ft. down, and about 10,000 ft. over) will run by completion roughly 8 to 10 million dollars. Break even price on most wells runs in the range of $70 to $80/bbl of oil.


49 posted on 10/23/2012 2:37:19 PM PDT by Smokin' Joe (How often God must weep at humans' folly. Stand fast. God knows what He is doing)
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To: thackney
So instead of replacing a dozen vertical wells, they allow production in a field that would not be economic without horizontal steerable drilling.

As a rule, in unconventional gas/oil plays, this is the case. The vertical wells which are 'replaced' would not, individually, have reached payout as a general rule. The ability to frac two miles of pay (+/-) versus ten feet (or less) per well is what makes it work.

50 posted on 10/23/2012 2:43:13 PM PDT by Smokin' Joe (How often God must weep at humans' folly. Stand fast. God knows what He is doing)
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