Statewide OH

Economic Impact | Industrywide Issues | Jobs | Ohio | Statewide OH | Utica Shale

United Airlines Beginning Flights from OK to OH
December 21, 2012December 21, 2012

Don’t tell Ohio Gov. John Kasich, but more “foreigners” (i.e. out-of-state oil and gas workers) are coming to Ohio, and they’re doing it using (gasp) commercial airlines. Call the TSA! Beef up the border guards! If you’re not quite sure what MDN is referring to, see this MDN story for background.

A sure sign that Ohio’s Utica Shale is undergoing a rapid expansion is that United Airlines has just announced they will begin offering nonstop flights between Oklahoma City and Cleveland in February. The new flights begin on Valentine’s Day—giving Gov. Kasich a big metaphorical kiss on the smacker. Here’s the new news:

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Industrywide Issues | Ohio | Statewide OH | Taxation

OH Republicans Set to Cave on High Drilling Tax
December 20, 2012December 20, 2012

Are Ohio Republicans about to cave on supporting the dreadfully awful idea of high severance taxes on shale drilling in order to “spread the wealth around” by transferring that money into a fund to allow a state income tax cut? Sadly, it seems the answer is “yes.”

Yesterday at a press conference, Ohio House Speaker Bill Batchelder (Republican from Medina) said he thinks Republicans will support a higher severance tax once their palms are greased with pork projects they understand more about it.

Read More “OH Republicans Set to Cave on High Drilling Tax”
Energy Companies | Gulfport Energy | Lease & Royalty Payments | Ohio | Rhino Resource Partners | Statewide OH

Gulfport Adds Another 30K Utica Net Acres, Pays $10K/Acre
December 18, 2012December 18, 2012

Gulfport Energy announced yesterday they have purchased another 30,000 Utica Shale acres in eastern Ohio for $300 million—or $10,000 per acre. That brings Gulfport’s grand total to 137,000 gross Utica Shale acres (99,000 net acres). Gulfport bought the acreage from its Utica Shale joint venture partner Wexford Capital. Perhaps a better way of phrasing it: Gulfport increased its ownership interest in acreage in which they’ve already invested.

Gulfport and Wexford, along with Rhino Resources, have previously invested in both two and three-way Utica Shale jv’s together (see this MDN story). So far, Gulfport has drilled the top producing wells in Ohio (see this MDN story for the secret to their success).

Read More “Gulfport Adds Another 30K Utica Net Acres, Pays $10K/Acre”
Chesapeake Energy | Energy Companies | Gulfport Energy | Ohio | Statewide OH

Chesapeake Admits Misjudging Ohio Utica Sweet Spot
December 14, 2012December 14, 2012

The Utica Shale is still in its infancy and drillers are still trying to get a fix on the “sweet spots” that will produce the most natural gas, gas liquids and even oil. Rendering an opinion on the best places to drill can be a career-ender, like it was for one long-time ODNR employee (see this MDN story).

Chesapeake was the early mover in Ohio’s Utica Shale, and it’s still the biggest driller in Ohio. However, we have an interesting admission from Chesapeake this week: They’ve misjudged the “emerging fairway” of the Utica in Ohio. While Chesapeake is concentrating most of their drilling in Carroll and Columbiana counties in the northern part of the state, Gulfport has drilled the four highest-producing wells in the Utica in counties to the south.

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Industrywide Issues | Ohio | Public Opinion | Statewide OH | Taxation

OH Poll Shows Support for Higher Drilling Tax is Slipping
December 14, 2012December 14, 2012

A new Quinnipiac University Poll shows a majority of Ohioans continue to support a higher severance tax (what they term a “new tax” when asking the question) on the shale drilling industry—especially if it would cut their income taxes. But the simple headline does not reveal the whole picture.

When you look at the internals of the poll (full copy of the questions and results is embedded below), you find that (a) support for the tax is slipping, and (b) it’s Ohio Democrats who support the tax in large numbers, while Republicans only tip to the support side when it comes to the question of lowering income taxes.

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Accidents | Dominion Energy | Energy Services | Industrywide Issues | Ohio | Pipelines | Statewide OH

PUCO Fines Dominion East Ohio $500K for Pipeline Accident
December 14, 2012December 14, 2012

The Public Utilities Commission of Ohio (PUCO) has fined Dominion East Ohio $500,000 over a natural gas explosion and fire at a pipeline regulator station in January 2011 in Fairport Harbor, Ohio. The resulting fires severely damaged 11 homes and another 150 homes required repair or maintenance of their gas-powered appliances because of the mishap.

From the PUCO press release:

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Industrywide Issues | Jobs | Ohio | Regulation | Statewide OH

Ohio Dems Accuse Gov. Kasich of Hypocrisy on “Foreign” Workers
December 14, 2012December 14, 2012

Ohio Democrat politicians, like Ohio Gov. John Kasich (a Republican) want to limit the number of “foreigners” working in the oil and gas fields of the state. Foreigners means hard-working, experienced oilfield workers from Louisiana, Texas and Oklahoma (traditional oil and gas states).

Ohio Dems think Kasich is not doing enough to keep them thar darned foreigners out:

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Energy Services | Halliburton | Industrywide Issues | Muskingum County | Ohio | Statewide OH | Supply Chain

Small Businesses Learn about Selling to Utica Shale Drillers
December 13, 2012December 13, 2012

Do you work for or own a company interested in providing products or services to the drilling industry industry in eastern Ohio—specifically in and around Muskingum County? People in your shoes attended an Oil & Gas Seminar at the Muskingum County Business Incubator yesterday and heard about how to start selling to the industry.

Some sage advice for businesses wanting to sell into the industry from Halliburton Procurement Manager Daniel Etter:

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Energy Companies | Guernsey County | Ohio | PDC Energy | PDC Mountaineer | Statewide OH | Utica Shale

PDC Energy: Production from 1st Utica Well, 2013 Forecast
December 12, 2012December 12, 2012

PDC Energy issued their 2013 forecast yesterday, along with an impressive production report on their first Utica Shale well, drilled in Guernsey County, OH. They plan to spend $53 million next year to drill and complete five horizontal Utica Shale wells in Ohio. Part of that budget will also be spent on additional acreage to lease—acreage contiguous to their existing leased acreage. (Landowners who are not yet leased, here’s an opportunity for you.)

PDC also has a joint venture in the Marcellus Shale and plans to allocate $48 million for its 50% share toward drilling and completing 14 wells and certain midstream infrastructure projects (pipelines/processing) .

Read More “PDC Energy: Production from 1st Utica Well, 2013 Forecast”
Economic Impact | Industrywide Issues | Ohio | Pipelines | Processing Plants | Statewide OH | Utica Shale

$10 Billion+ in Utica Shale Infrastructure Coming to Ohio
December 10, 2012December 10, 2012

The Akron Beacon Journal ran an excellent round-up article on Sunday looking at the mammoth infrastructure investments (pipelines, processing facilities, etc.) being made in Ohio’s Utica and Marcellus Shale region—like in excess of $10 billion of investments already under way or planned for the near future.

Here’s a quick overview:

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Industrywide Issues | Ohio | Regulation | Statewide OH | Taxation

Ohio Legislature Sees Flurry of Shale Drilling Bills
December 10, 2012December 10, 2012

As the Ohio General Assembly comes to a close later this month (the end of their two-year term), Democrats have introduced a number of bills aimed at restricting the Utica and Marcellus Shale drilling industry in the state. Fortunately the Assembly is controlled by Republicans, so these bills will go nowhere. Still, it’s instructive to see what’s on Democrats’ hearts and minds, and possibly what the future holds if the political winds in Ohio change.

Here’s the list of bills recently introduced, and a summary of what they would do:

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Industrywide Issues | Jobs | Ohio | Statewide OH

OH Gov. Kasich Continues Trash Talk Out-of-State Workers
December 7, 2012December 7, 2012

Ohio Gov. John Kasich, a Republican and most of the time a good conservative, inexplicably continues his jingoistic talk about out-of-state oil and gas workers as “foreigners”—even though the companies who hire in his state have pumped more than $3 billion into his state so far.

Kasich started that kind of trash talk earlier this year, in February, but he obviously still feels that way and reiterated it again this week:

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Carroll County | Chesapeake Energy | Energy Companies | Energy Services | Industrywide Issues | Ohio | Statewide OH | Tervita | Wastewater

Chesapeake Hires Tervita Corp to Build OH Wasterwater Plant
December 7, 2012December 7, 2012

Calgary-based Tervita Corporation, an environmental and energy services company, has been selected by Chesapeake Energy to build a wastewater treatment facility in Carroll County, OH. Carroll is the epicenter of Chesapeake’s drilling in the Ohio Utica Shale. The facility will be used to recycle drilling wastewater from Chesapeake’s Utica drilling, as well as other water-related services.

From the Tervita press announcement:

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Industrywide Issues | Ohio | Regulation | Statewide OH

[Corrected] ODNR Moving to Quarterly Production Numbers for O&G
December 5, 2012December 5, 2012

CORRECTION: MDN has just been alerted by our friends at the Akron Beacon Journal that our information about quarterly reporting coming from ODNR is not correct. The proposed legislation which contained language about filing quarterly updates to production numbers ultimately did not pass the state legislature and therefore Ohio will (for now) stay on yearly reporting—which is unfortunate. Our thanks to Bob Downing for the heads-up on this.

On Monday the Ohio Dept. of Natural Resources (ODNR) issued its annual Ohio Mineral Industries Report. A very small part of that report covers drilling and production for oil and gas in Ohio (see that section of the report below). ODNR has taken a lot of criticism lately over the fact that shale oil and gas production numbers are only required to be filed and reported once per year by drilling companies. ~~Apparently the criticism has prompted ODNR to change the reporting requirement.~~

~~Starting in 2013, the ODNR will require (and will itself) report oil and gas production numbers on a quarterly basis.~~

Read More “[Corrected] ODNR Moving to Quarterly Production Numbers for O&G”
Chesapeake Energy | Economic Impact | Energy Companies | Hydraulic Fracturing | Industrywide Issues | Ohio | Research | Statewide OH | Utica Shale

EIA Report: Rig Count in Utica Shale Doubles in One Year
November 21, 2012November 21, 2012

Yesterday the U.S. Energy Information Administration (EIA) provided a detailed update on shale drilling activity in the Utica Shale. They found that the number of drilling rigs in the Utica has doubled from October of last year to October of this year. Also of keen interest: 86% of the active rigs in the Utica (now) are targeting shale oil. Last October the number of 15% of active rigs—which shows a remarkable shift in the Utica. Although the report says “shale oil,” MDN takes that to mean “wet gas,” or shale oil and natural gas liquids. The report finds that Chesapeake Energy continues to be the Big Kahuna in the Utica Shale with 39% of all new well starts in Ohio year-to-date.

Here’s the full EIA Utica Shale update posted yesterday (along with some great charts):

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Carroll County | Chesapeake Energy | Columbiana County | Economic Impact | Energy Companies | Harrison County | Industrywide Issues | Lease & Royalty Payments | Ohio | Statewide OH | Utica Shale

Chesapeake Says 3 OH Counties are “Core of the Core” in Utica
November 21, 2012November 21, 2012

On the third quarter earnings call with analysts earlier this month, Chesapeake Energy officials were asked about the Utica Shale and their thoughts, now more than a year in, of how the Utica stacks up against the Eagle Ford, and how Chesapeake’s “core of the core” strategy is working in the Utica. Chesapeake CEO Aubrey McClendon answered the question this way, identifying the three counties in Ohio that are “the core of the core” for the company:

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