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Chesapeake Talks About Pipelines for OH Processing Complex

Last week, Chesapeake Energy announced it was partnering with M3 Midstream and EV Energy Partners to build a new $900 million gas processing complex in Ohio’s Harrison and Columbiana counties by the middle of next year (see this MDN story). At an industry conference this week, Chesapeake and its partners spoke about the pipelines they will run to the plants and between the plants:

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Chesapeake to Build $900M Processing Plant in OH Utica Shale

gas processing plantChesapeake Energy is partnering with M3 Midstream and EV Energy Partners to build a new $900 million natural gas processing complex with facilities in Ohio’s Harrison and Columbiana counties by the middle of next year. The facility will be the largest of its kind in eastern Ohio, providing a place for Chesapeake and other drillers to process natural gas and the all-important natural gas liquids. French energy giant Total, a 25 percent joint venture partner with Chesapeake in the Utica Shale, also has an option to participate in the project.

From the Chesapeake press release:

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New MarkWest Deal to Develop Infrastructure in OH Utica Shale

A joint venture between MarkWest Energy and The Energy and Minerals Group (EMG), called MarkWest Utica EMG, has just signed a deal with Gulfport Energy to build new gathering pipelines for Utica wells in Harrison, Guernsey and Belmont counties (Ohio). The deal also includes MarkWest Utica processing the gas produced by Gulfport, including natural gas liquids, at its Harrison County processing complex.

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More on MarkWest’s New Investment in Ohio’s Utica Shale

Yesterday, Ohio Gov. John Kasich and others provided more details about MarkWest’s Tuesday announcement that they will build two new natural gas liquids (NGL) processing plants and a new fractionation plant in Ohio’s Utica Shale (see MDN’s story on the original announcement here).

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MarkWest to Expand/Build NGL Plants on New Agreements

MarkWest Energy Partners, a major midstream player in the Marcellus and Utica Shales, just announced major expansion plans that will add an additional 600 million cubic feet per day (mmcf/d) of natural gas processing capacity which includes natural gas liquids (NGLs). Most of the new capacity will come from expansion of its Majorsville, WV plant. The expansion is made possible by new long-term agreements MarkWest signed with CONSOL Energy, Noble Energy and Range Resources to process NGLs.

MarkWest also announced they will build two new processing plants in Ohio’s Utica Shale—in Harrison and Monroe counties.

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Eastern Ohio Landowner Group Nears Deal for Marcellus Lease – Terms Include $3,700 per Acre, 17.5% Royalty

A group of landowners with 20,000 acres in Jefferson County and Harrison County, in eastern Ohio, is nearing a lease deal to allow Marcellus Shale drilling. One of the energy companies in the final bidding is XTO Energy (now a division of Exxon Mobil).

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Western Reserve Petroleum Leases 4,500 Marcellus Shale Acres in Eastern Ohio in Last Two Weeks

Western Reserve Petroleum has just snapped up lease rights to 4,500 acres in the past few weeks in Jefferson and Harrison Counties in eastern Ohio, located close to the border of West Virginia and not far from Pittsburgh, a prime Marcellus Shale region.

With one company locking up about 4,500 acres for oil and natural gas exploration over the past two weeks, Jefferson County property owners appear to be getting their own taste of the Marcellus Shale rush.

While companies such as Chesapeake Appalachia, A B Resources, CNX Gas Corp., Dominion Exploration and others are gobbling up property rights in West Virginia, Western Reserve Petroleum is quickly staking its claim to the oil and gas rights in eastern Ohio.

“It has taken us less than two weeks to acquire 4,500 acres in Jefferson and Harrison counties,” said Molly Johnson Phillips, lease acquisition manager for Western Reserve. “We are glad to give some smaller landowners a chance to get in on this.”

Western Reserve is not disclosing how much they are paying for the leases. Recent deals just across the border in West Virginia have seen a signing bonus of $3,600 per acre and royalty payments between 12 and 19 percent.

*The Intelligencer/Wheeling News-Register (May 30) – Gas Rush On In Jefferson