Utica Shale Activity Highlights: July 2016

Utica shale gas production in Ohio climbed first-quarter 2016 in spite of falling commodity prices.

Gas production in the Utica averaged 3.6 billion cubic feet per day (Bcf/d) in the first quarter—up by 80% from 2015 volumes of 2 Bcf/d, according to the Ohio Department of Natural Resources.

The increase in gas production can largely be attributed to new pipelines and pipeline access in the Appalachian Basin.

Kinder Morgan Inc. (NYSE: KMI) said June 28 it has sold a 50% stake in its Utopia Pipeline Project to Riverstone Investment Group.

Utopia will connect ethane supply sources in Ohio’s Utica Shale to the petrochemical market in Sarnia, Ontario. The project will include 215 miles of new, 12-inch diameter pipeline constructed from Harrison County to Fulton County in Ohio and then connect to existing Kinder Morgan pipeline and associated facilities.

The total project cost is estimated to be about $500 million. Riverstone is also funding its share of future capex to complete construction and commissioning of the pipeline project.

Earlier in June, a subsidiary of Royal Dutch Shell Plc (NYSE: RDS.A) announced plans to build a major petrochemicals complex that will use ethane from shale gas producers in the Marcellus and Utica to produce polyethylene.

RELATED:

Shell May Be Moving Forward With Marcellus Cracker

Takeaway: Getting Gas Out Of The Marcellus/Utica

The facility will have an ethylene cracker with polyethylene derivatives unit on the Ohio River near Pittsburgh. The location is ideal because more than 70% of North American polyethylene customers are within a 700-mile radius of the site, according to Shell.

1. Eclipse Resources: 7/13/16

Eclipse Resources Corp. (NYSE: ECR) reported results from a Utica Shale well, #1 Purple Hayes, in Section 33, Millwood Township, in Guernsey County, Ohio.

RELATED: Eclipse’s Purple Hayes Seeks To Redefine Well Development

Production at #1 Purple Hayes is being managed with the goal of a stabilized rate of 5.6 MMcf/d of gas, according to the State College, Pa.-based company.

The horizontal well has an extended lateral of 18,500 feet and was drilled to 27,048 feet. It bottomed about 3.5 miles to the northwest, and the true vertical depth is 7,465 feet.

The well was completed with 124 stages of fracturing. Production was about 5 MMcf of 1,300 British thermal units (Btu) gas, with 1.2 thousand barrels (Mbbl) of condensate per day after the first 24 hours of flowback into sales.

The well was tested on an unreported choke size with a flowing tubing pressure of about 3,200 pounds per square inch (psi). After stabilization and well clean-up, the condensate yield is expected to match the original estimates of about 175 to 180 bbl/MMcf of gas, the company also noted.

2. Consol Energy: 4/22/16

Consol Energy Inc. (NYSE: CNX) has announced results from a Utica Shale well that was completed in late 2015.

The #4IHSU Gaut in Westmoreland County, Pa., had an initial 24-hour flow test of 61.4 MMcf per day of gas. It was completed in 30 stages after the company drilled a 5,800-foot lateral. The total depth is 20,941 feet, 13,362 feet true vertical.

The Murraysville Field producer is on a 640-acre lease in Section 8, Vandergrift 7.5 Quad, Washington Township. Consol, based in Canonsburg, Pa., holds the drilling rights to about 84,000 net acres prospective for the Utica Shale in southwestern Pennsylvania, including close to 60,000 net acres in Greene and Washington counties.

3. Consol Energy: 4/20/16

A dry gas Utica Shale completion was announced by Consol Energy on the company's acreage in Pennsylvania in Section 9, Rogersville 7.5 Quad, Center Township, in Greene County.

The Woodruff Field discovery, #9GHAHSU Consol, initially flowed 61.9 MMcf of gas per day. It was tested on an unreported choke size with a flowing casing pressure of 8,312 psi.

The well was completed in 30 stages of fracturing after the company drilled a 6,141-foot lateral. It has an estimated drilling depth of 21,071 feet and an estimated true vertical depth of 13,438 feet.

4. Travis Peak Resources: 3/29/16

Austin, Texas-based Travis Peak Resources LLC has scheduled three horizontal tests in the Utica Shale play in Pennsylvania, IHS reported.

In Tioga County, #1H and #2H Abplanalp will be drilled from offsetting surface locations in Section 8, Potter Brook 7.5 Quad, Westfield Township. The #1H Abplanalp is expected to reach 18,930 feet, 10,989 feet true vertical. The #2H Abplanalp will have a shorter lateral and the planned depth is 15,829 feet, 11,004 feet true vertical. Both horizontal ventures will be drilled out of pilot holes with respective depths of 11,500 feet and 11,632 feet.

About two miles to the east is the proposed #1H Painter in Section 9, Potter Brook 7.5 Quad, Westfield Township. Following the drilling of an 11,500-foot vertical pilot hole, the Utica Shale venture will be drilled to a total depth of 18,565 feet, 11,074 feet true vertical.

5. Range Resources: 2/2/16

A second Utica Shale well in the dry gas portion of the shale play has been brought online by Fort Worth, Texas-based Range Resources Corp. (NYSE: RRC).

In Washington County, Pa., #9H Claysville Sportsman's Unit was completed under choke management flowing 13 MMcf/d of gas. The planned depth was 20,807 feet, 11,308 feet true vertical. Production is from a 5,228-foot lateral and was fracture stimulated in 32 stages.

A 2014 completion, #11H Claysville Sportsman's Unit, had an initial production rate of 59 MMcf/d. The unit has an estimated ultimate recovery of 15 Bcf of gas, according to Range.

6. Rice Energy: 12/2/15

Rice Energy Inc. (NYSE: RICE) is on track to bring online the company's first Utica Shale well in Pennsylvania.

The #50U John Briggs in Greene County has reached total depth and a 5,800-foot lateral section has been completed. The well was drilled from the John Briggs pad and was expected to reach a true vertical depth of 12,850 feet, the Cannonsburg, Pa.-based company said.

Several shallower Marcellus Shale gas wells were drilled from the pad in 2013 at total depths of around 13,000 feet, 7,600 feet true vertical.

7. EQT: 10/28/15

A Utica Shale discovery by an EQT Corp. (NYSE: EQT) subsidiary was tested during a 24-hour period flowing 72.9 MMcf of gas.

The #591340 Scotts Run well was drilled to 20,348 feet with a 3,221-foot lateral that was completed in 18 stages in Greene County, Pa. The Btu content is 1.018 MMBtu/Mcf with 98.5% methane, the Pittsburgh company said.

The well is located in Section 5, Rogersville 7.5 Quad, Morris Township in the dry gas portion of Greene County.

Larry Prado, activity editor, can be reached at lprado@hartenergy.com.