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Artex Energy Selling 14,885 Utica Acres in Eastern Ohio

Artex Energy Group, a subsidiary (on paper) of Marietta, OH-based Artex Oil Company, is selling 14,885 Utica Shale acres located in Noble, Guernsey, Washington and Tuscarawas Counties (southeastern OH). On its website, Artex claims it is “one of the largest oil and gas producers in Ohio” pumping out “millions of dollars per year in royalties to landowners.” The company says it has drilled and operates “more than 600 operated wells in Ohio.” Some of those wells are Utica Shale wells. However, many of their wells are conventional (vertical only) non-shale wells. The auction notice says 87% of the leases being offered are held by production. Over 2,000 acres is part of a joint venture Artex has with Antero Resources on land in Noble and Washington Counties. Artex is accepting bids now and will accept bids through March 2nd, with a target closing date of March 31st. Here are the particulars of what is being offered for sale…
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Price Gregory Hiring 400 People in OH to Build Cornerstone Pipeline

help wantedIn December 2013 MDN told you about the Cornerstone Pipeline project–a pipeline that will stretch nearly 50 miles from the MarkWest cryogenic processing plant in Cadiz, OH northwest connecting to M3’s fractionator plant in Scio and M3’s cryogenic processing plant in Leesville along the way as it terminates and connects to Marathon Oil’s refinery in Canton, OH (see Marathon Petroleum’s Newly Announced “Cornerstone” Utica Pipeline). The pipeline will flow, at various times, crude oil, condensate and natural gasoline being produced from the Utica Shale. The $140 million project is now ramping up and hiring 400 people to build the pipeline. Price Gregory is the company tapped to build it and Dover (Tuscarawas County), OH has been selected as the headquarters and staging area for the project…
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OH Court: Landowners Can’t Cancel Lease for Royalty Nonpayment

can of wormsAn unfortunate decision in an Ohio court case may have far-reaching implications for Ohio landowners. In Armstrong v. Chesapeake Exploration, L.L.C., landowners Myron and Nikki Armstrong purchased 61 acres of land in Tuscarawas County, OH in 2003 with an existing oil and gas lease (dating back to 1972). After purchasing the property, the Armstrong’s land was pooled into a drilling unit and a well was drilled. We do not know how much (or even if) the well produced in the way of gas and oil. We don’t know if it was hooked up to a pipeline for production. We assume it was hooked up and is producing because the Armstrongs have sued to cancel the lease saying they haven’t received a single royalty check since the well was drilled. Tuscarawas County Court ruled that because there is no express provision in the original lease saying “you can cancel this lease if we don’t pay you the royalties we say we’ll pay you,” the court ruled in favor of Chesapeake and the company that owns the lease and is supposed to pay the royalties–Belden & Blake. The Armstongs appealed the decision to the Ohio Court of Appeals, Fifth Appellate District. That court has just ruled the same way–saying even though royalties haven’t been paid, that’s not a good and sufficient reason to cancel the lease…
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EVEP Reports Waterless Fracked OH Well is a Bust

disappointmentReading through earnings calls transcripts (hey, somebody has to do it), we discovered what we believe no one else has (yet) discovered or reported. On an earnings call yesterday, top management from EV Energy Partners, one of the largest acreage holders in the Utica Shale, shared interesting initial results from the test Utica well they drilled in Tuscarawas County, OH–a well drilled using waterless fracking technology from GASFRAC (see Details on GASFRAC’s Waterless Frack Test in OH Utica). The theory being tested by EVEP is that using water during fracking of a well targeted for oil recovery somehow damages the chances of oil recovery. GASFRAC used a mix of 75% butane and 25% mineral oil to frack EVEP’s “Nettles” well. The results? On yesterday’s earnings call EVEP Chairman John Walker revealed that after 90 days in production, the Nettles well is producing about half the production of a similar nearby well fracked using water. That is–the waterless frack job was a big disappointment…
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Chesapeake Tries Waterless Fracking at OH Utica Shale Well

Big NewsSomething we consider pretty big news: Chesapeake Energy is running an experiment with waterless fracking. They’ve contracted with Canadian waterless fracking company GASFRAC to attempt what is the second (that we’re aware of) waterless frack job on a Utica Shale well–in Tuscarawas County, OH. The first waterless frack job done by GASFRAC was for EV Energy Partners on a Utica well also in Tuscarawas County (see Details on GASFRAC’s Waterless Frack Test in OH Utica). We consider it a good sign that Chessy thinks its worth a few million bucks to try it out for themselves. Chessy stresses this is still very preliminary…
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Details on GASFRAC’s Waterless Frack Test in OH Utica

Two weeks ago MDN was (we believe) the first to call attention to a very short reference in the quarterly update from Canadian oilfield services company GASFRAC–a line that says GASFRAC had finally begun fracking a Utica Shale well using their waterless technology (see GASFRAC Begins Waterless Fracking Job in OH Utica). At the time we had no details about where the well is located, and who the exploration company is that GASFRAC is doing the work for. We now know those bits, thanks to some ace reporting by Tom Knox at Columbus Business First
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Kinder Morgan/MarkWest OH Midstream Projects Advance

In August, Kinder Morgan, MarkWest and The Energy and Minerals Group (EMG) announced a new joint venture on two projects aimed at the Marcellus/Utica Shale region. The first is a a 400 Mmcf/d cryogenic processing plant in Tuscarawas County, OH, and the second a new NGL pipeline from Ohio all the way to the Gulf Coast (see 2 New OH Projects: Cryo Processing Plant & NGL Pipeline to Gulf).

Speaking on an earnings conference call last week, Kinder Morgan CEO Richard Kinder gave a brief update on the two projects. Bottom line, the projects continue to advance, but still no mention of capital expenditure they expect to lay out. (Note: For details on these two KM/MarkWest midstream projects, along with a comprehensive list of 111 midstream infrastructure projects planned for the Marcellus/Utica, see the newly released Volume 2 of the 2013 Marcellus and Utica Shale Databook)…
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McClendon’s Utica Company Does JV with OH Driller, Drilling Soon

Yesterday MDN brought you the news that former Chesapeake Energy CEO Aubrey McClendon had started a second company specifically created to target the Utica Shale (see Aubrey McClendon Forms Utica Company, Gets Major Investor). In true Aubrey “wheeling and dealing” fashion, his new company, called American Energy Utica, is already forming joint ventures with other companies in the Utica Shale. One of those companies is Red Hill Development, an independent oil & gas driller located in Dover (Tuscawaras County), OH.

Red Hill Development is tickled pink to be working with McClendon and says the partnership will be an ongoing venture “for many years to come.” According to Red Hill, the new joint venture is already applying for permits and will begin drilling by the end of this year. The focus of their drilling efforts? Guernsey and Harrison counties…
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2 New OH Projects: Cryo Processing Plant & NGL Pipeline to Gulf

Looks like the Williams/Boardwalk Bluegrass NGL pipeline is about to get some competition. Yesterday, Kinder Morgan, MarkWest and The Energy and Minerals Group (EMG) announced a new joint venture on two projects aimed at the Marcellus/Utica Shale region. The first project is a 400 Mmcf/d cryogenic processing plant in Tuscarawas County, OH to separate raw natural gas into methane and natural gas liquids (NGLs). The second project is a new NGL pipeline that will, like the Bluegrass, run from Ohio all the way to the Gulf Coast. There’s no mention of how much the partners will invest in the two projects, but we believe it could easily approach $1 billion of new investment in the northeast.

This announcement is great economic news for Ohio (Tuscarawas County in particular), and great economic news for Marcellus/Utica drillers who need extra takeaway capacity for the NGLs they’re currently producing. The press release from Kinder Morgan with details about the two new projects:
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OH Gov. Kasich Goes Foreigner-Hunting in Strasburg

Never mind that under Barack H. Obama illegal aliens continue to pour across an unprotected border along Texas, Arizona, New Mexico and California (new Democrat voters streaming across to assist in the next election). Ohio Gov. John Kasich has far more important work to do in personally securing Ohio’s borders by investigating “foreigners” (i.e. American citizens) from exotic locations like Louisiana, Arkansas, Oklahoma and yes, Texas who come to Ohio to operate oil and gas drilling equipment. Kasich is on a mission to keep them out! (See OH Gov. Kasich Continues Trash Talk Out-of-State Workers.)

Kasich’s latest excursion in foreigner-hunting led him to Strasburg (Tuscarawas County), Ohio, to Schlumberger–pronounced shlum-bur-zhay, kinda Frenchy soundin’ y’know. Inquiring minds want to know… Did Kasich find any foreigners working there?
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New Processing/Fractionation Plant Coming to Tuscarawas County OH

MDN first told you about a new natural gas processing and fractionation plant that may be coming to Tuscarawas County, OH back in early March (see Kinder Morgan to Build Processing & Fractionation Plants in OH?). Good news for Ohioans—Kinder Morgan has confirmed that the necessary EPA permits have been secured and once they have customers lined up, they plan to move forward with construction…

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Kinder Morgan to Build Processing & Fractionation Plants in OH?

The Akron Beacon Journal reports that Kinder Morgan, the country’s largest pipeline company, is seriously considering Tuscarawas County, Ohio as the location to build both a new natural gas processing plant and a new fractionation (separating) plant. If true, it could mean up to $1 billion in new investment for Tuscarawas County.

Here’s what the Beacon Journal is reporting:

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EnerVest Strategy: Sell Utica, Drill Vertical, Expand Midstream

In September of last year, EV Energy Partners/EnerVest put 539,000 Ohio Utica Shale acres on the auction block, thinking they would get around $6 billion for it (see EnerVest Puts 539,000 Utica Shale Acres on Auction Block). In November, the company said they should complete the sale of the Utica acreage by the end of 2012 (see EV Energy Selling 539K Utica Shale Acres by Dec 31). That turned out to be a tad optimistic. EnerVest still does not have a deal for their Utica acreage.

An update on the company’s strategy from EV Energy Partners Chairman John Walker and EnerVest President Mark Houser, from Friday’s analyst call:

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Carrizo’s 2013 Plans: Drill in Marcellus, Buy Acreage in Utica

Carrizo Oil & Gas announced their 2013 spending plans today. Drilling activities will see a $500 million investment by Carrizo, with $70 million of that allocated to drilling in the Marcellus Shale. Also, Carrizo announced that yesterday they closed on an option to pick up more acreage from Avista Capital in the Ohio Utica Shale for $63 million.

The Utica deal means Carrizo now owns 14,000 net acres located in Guernsey, Noble and Tuscarawas counties in Ohio—although they’ve not allocated money to drill in the Utica for 2013.

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CONSOL’s Plans for Ohio Utica Shale Have Begun

CONSOL Energy’s drilling in Ohio’s Utica Shale is now under way and ramping up rapidly, according to CONSOL’s Harry Schurr who spoke Wednesday at a workshop on the campus of Kent State University. They’ve already drilled their first Utica well in Tuscarawas County, and they plan to drill 15 more this year. CONSOL also has a joint venture with Hess. Hess plans to drill six Utica wells this year.

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