Ten new Utica Shale wells were approved by the Ohio Dept. of Natural Resources (ODNR) for the week covering Oct. 28 through Nov. 3. Here’s a breakdown on where the permits were issued:
Although Carrizo Oil & Gas and CONSOL Energy have both either left or stopped drilling in the Utica Shale in Trumbull County, Ohio, energy giant BP says they’re staying the course and expect to drill their first well in Trumbull in April 2013. Of course, BP has a vested interest in making it work in Trumbull—they leased 80,000 acres in the county last year for $331 million.
Here’s what a BP spokesman recently said about Trumbull County:
Yesterday MDN reported that Carrizo Oil & Gas had sold off it’s interest in lease acreage in Ohio’s northern Utica Shale region for $43 million (see this MDN story). Carrizo did not identify the buyer, but the enterprising Youngstown Business Journal did.
Here’s who it is:
CONSOL Energy has decided to stop working on the first-ever Utica Shale well in Trumbull County, Ohio saying they are “re-prioritizing” their activity in the county. Does that mean CONSOL is leaving the county?
Here’s what we know:
For those living in eastern Ohio and along the border in West Virginia, be on the lookout for a new free publication called Shale Play, published by the Warren (OH) Tribune Chronicle and its sister publications.
[UPDATE BELOW] Plumbers and Pipefitters Local 396 won a competitive grant process to receive funds for job development in the Utica and Marcellus Shale plays. Local 396 craftsmen consist of plumbers, pipefitters, steamfitters, and HVAC/refrigeration fitters.
Bombshell: Halcon Resources Corp. is paying NCL Appalachian Partners $194 million (over $6,000 per acre) to take over land leases for drilling on 31,000 acres mostly in Trumbull County, OH (and about 3,000 acres in Mahoning County, OH). This is not money going to landowners but to the leaseholder, NCL. And it’s for old leases dating back to the 1960s.
By comparison, mass transfer of lease deals done by Chesapeake and others have been in the $1,000-$2,000 per acre range. But there is a difference: the lower-priced deals include a one or two percent royalty on anything produced going to the original leaseholder. Again, this is not landowner royalties, but leaseholder. It’s hard to follow the bouncing ball on this story.
The leases purchased by Halcon are not without potential problems (for Halcon) and opportunities (for landowners):
MDN reported on Monday that Chesapeake Energy had purchased the rights to leases and had transferred ownership of those leases for more than 14,000 acres from two counties in Ohio—Trumbull and Mahoning (see this MDN story). We now know that’s only half of the number of acres they transferred. We now also know who they bought the rights from and how much they paid for those rights.
An excellent story in today’s Youngstown (OH) Business Journal covers the massive number of lease transfers taking place in Ohio—specifically in Trumbull and Mahoning counties. At the end of June, both counties received an order to transfer more than 7,000 existing oil and gas leases to a single lease for Chesapeake Energy—and that’s in each county!
Patriot Water in Warren, Ohio lost its permit to dispose of treated shale gas drilling wastewater via the Warren municipal wastewater treatment plant earlier this year. A few weeks ago they won a ruling against Ohio’s EPA (OEPA) and thought that would allow them to restart shipments of treated wastewater, but the OEPA said “not so fast” and has steadfastly refused to reissue a permit to allow it (see this MDN story for background).
Last Friday the president of Patriot Water, Andrew Blocksom, issued a strongly-worded statement saying the OEPA and Ohio Dept. of Natural Resources (ODNR) treatment of Patriot is tantamount to government abuse, and it needs to stop.
We get the full text of Blocksom’s statement from the Youngstown Business Journal:
Yet more evidence that when shale drilling arrives, so do jobs and economic expansion. This time the evidence comes from Warren, Ohio.
From the number of area residents hired by the drilling industry in new jobs, to increased business for restaurants, an increase in new car sales, an increase in new home sales and even an uptick in tax revenues—all of the economic indicators in eastern Ohio are trending up—amidst the worst economy since the 1920s. Why? Shale drilling on private land.
Patriot Water in Warren, Ohio is fighting a battle on both the legal and publicity fronts. Yesterday they scored some points in the publicity column by (finally) getting a representative from the Ohio Department of Natural Resources (ODNR) to tour their facility.
Brief background: Patriot’s facility processes wastewater from hydraulic fracturing, removing the nasty stuff so the water is clean and able to be disposed of through the local Warren municipal wastewater processing plant. But the Ohio Attorney General, Mike DeWine, and the Ohio Environmental Protection Agency rescinded Warren’s permit to accept the wastewater from Patriot, saying Patriot’s technology is not up to scratch (see this MDN story for more background on Patriot’s legal squabble with the OEPA).
There was a small spill of brine (Utica Shale wastewater) from a tanker truck in Trumbull County, Ohio last weekend. An estimated 100-150 gallons leaked from the back of the truck along a roadway for about 5 miles. The county engineer is concerned about it—the Ohio Environmental Protection Agency says there’s nothing to worry about.
The Ohio Environmental Protection Agency (EPA) reached out to MDN to let us know that there is an ongoing issue with Patriot Water in the City of Warren, Ohio. In short, Patriot is still not allowed to send the fracking wastewater they treat to the Warren municipal sewage treatment plant for disposal.
Last week MDN highlighted that Patriot had apparently won their case against the EPA with the Environmental Review Appeals Commission (see this MDN story). However, the Ohio EPA says “not so fast.” They have a different interpretation of what the ERAC ruling says, and they maintain the permit they’ve issued to the City of Warren has not (and will not) change, meaning Patriot will still not be allowed to dispose of treated wastewater via Warren.
Here’s the statement from Ohio EPA Director Scott Nally on the ERAC ruling:
Earlier this year MDN reported on the story of the Patriot Water Treatment facility in Warren, Ohio. Patriot accepts and treats raw fracking fluid from Marcellus drilling operations, removing heavy metals, bromide and other contaminants. Last fall, Ohio Attorney General Mike DeWine, a Republican who seems to be rather anti-drilling in his actions, declared that Patriot’s permits were illegal because they were not using the latest technology (see this MDN story).
The Ohio EPA took DeWine’s findings as a cue to go after Patriot to shut them down. They did so by not allowing the City of Warren to accept Patriot’s treated wastewater. With no place to send the treated wastewater, Patriot had to shut the plant down in April. Patriot appealed the EPA decision and on Tuesday, Patriot prevailed. The plant will reopen today.
According to Terry Fleming, executive director for the Ohio Petroleum Council, Trumbull County is “at least” 18 months away from any active drilling for oil and gas.
Fleming’s update for Trumbull County: