Magnum Hunter Resources announced today they have begun shale drilling at a second Ohio location–this one in Monroe County, OH. While the fact that Magnum is now ramping up their Utica drilling program is interesting–that’s not the “new news” in the announcement. The new news is this:
The Monroe County wells are the first wells Magnum Hunter will drill using their new robotic drilling rig, a Schramm T500XD. Furthermore, they plan to drill an astonishing 18 wells at this one location–10 of them Marcellus wells, and 8 of them Utica wells. In addition, Magnum is keeping it “all in the family,” by using subsidiary Triad Hunter to operate the wells and subsidiary Eureka Hunter to pipeline the gas from the wells… Continue reading
Although Friday for Magnum Hunter Resources was marred by the sad news of the flash fire in Tyler County, WV, the company (earlier in the day) issued a good news press release, one of importance: Magnum Hunter, through it’s subsidiary Triad Hunter, has just started drilling it’s first Utica Shale well in Ohio—northern Washington County.
The press release identifying where it’s being drilled:
Magnum Hunter Chairman and CEO Gary Evans was on hand Monday in Marietta, Ohio for the grand opening of the new regional office building for Magnum’s Marcellus and Utica Shale subsidiary Triad Hunter. Triad has (so far) leased 85,500 acres in the Marcellus Shale and 81,800 acres in the Utica Shale. The new office is located centrally to both the Marcellus and Utica plays—together referred to as Appalachia.
Triad spent $1 million to remodel a downtown Marietta building that will be their Marcellus/Utica regional headquarters. So far over 40 Triad employees have moved in. Magnum Hunter, through subsidiaries including Triad Hunter, Alpha Hunter, Eureka Hunter, Green Hunter Water and Viking International Resources has its fingers in a lot of different pieces of the drilling pie. According to Gary Evans, their commitment to Appalachia is long-term…
The Marcellus Shale is the powerhouse workhorse, but the Utica Shale continues to be white hot for development. Magnum Hunter Resources and its subsidiary Triad Hunter announced yesterday the company will drill a minimum of four Utica “test wells” in 2013. Provided they find a good result, they plan “further development” of their 107,000 gross acres of Utica Shale leases later in 2013—which connotes they’ll drill those test wells early this year. In fact, Triad Hunter is already working on their first Utica well pad in Washington County, OH. A second well pad in Washington County is already in the planning stages, as is a well pad in Noble County.
Magnum Hunter’s press release outlining their plans for Ohio, including references to new OH Marcellus wells just completed and new pipelines on the way for some of their existing OH Marcellus wells:
Drilling company Magnum Hunter Resources announced a joint operating deal yesterday with Eclipse Resources to drill 12 Marcellus and 12 Utica Shale wells on 1,950 acres in Monroe County, OH over the next three years. Both companies together will invest $200 million in the program.
The reason for the partnership between these fierce competitors? According to Magnum Hunter, it’s due to the “treacherous terrain in this region” of the state. They want to pool resources and keep costs down. Of course, it also helps that Eclipse will start using Magnum’s pipeline system (Eureka Hunter Pipeline), providing more revenue for the midstream area of the business.
Two years after Magnum Hunter bought out Triad Energy Resources, Triad is flourishing in the Marcellus and Utica Shale of Ohio and West Virginia. The company has gone from producing 750 barrels of oil equivalent per day (boe/d) to more than 15,000 boe/d. Triad just bought out another company (Viking International Resources, see this MDN story) and has added an additional 51,500 acres in WV and OH to their drilling portfolio.
Here’s the lowdown on the incredible success story of the company now called Triad Hunter:
Magnum Hunter’s subsidiary company, Triad Hunter, has just closed on a lease deal to take possession of 15,558 gross (12,186 net) acres in Ohio’s Utica Shale. The deal is for $2,037 per acre, or $24.8 million total. The seller has not been identified and according to the press release the seller may have more acreage to sell to Triad Hunter if they can clear up problems with title to some of the additional property.
Some interesting comments made by Magnum Hunter CEO Gary Evans at the recent Marcellus Midstream Conference in Pittsburgh at their projected activity in 2011 and conventional vs. unconventional shale gas plays: