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The Marcellus/Utica Production Rocket Ship in WV

Prior to 2012, Brooke County, WV produced zero natural gas. Nada. Zippo. Nothing. In 2012 the county produced 1.4 million cubic feet (Mmcf) of natural gas. Barely a blip. In 2013, Brooke County produced 8 BILLION cubic feet of natural gas. The trajectory for the county, and other counties in the northern panhandle of WV is startling–thanks to the Marcellus and now the Utica Shale. Brooke is not the only eye-popping example in WV…
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New Condensate Processing Coming to Utica/Marcellus from Ergon

coming soonNew condensate processing is on the way later this year from Ergon, Inc.–a company headquartered in Mississippi but with refineries and processing facilities in Ohio and West Virginia (and operations that include western Pennsylvania, Kentucky and New York). Ergon announced yesterday the company has spent over $75 million in the past two years to upgrade facilities, and continues to spend. Coming later this year is a 10,000 barrel per day condensate stabilization facility in Marietta, OH. Coming next year, the same kind of facility (also 10,000 bbl/d) in Newell, WV…
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5th Upper Devonian Driller + Maps of Best UD Spots to Drill

out of the blueIt seems as if “out of the blue” the Upper Devonian Shale (UD) has popped up on the radar screen–quite suddenly and in quite a big way. The Upper Devonian is located a few hundred feet above the Marcellus Shale layer in the northeastern U.S. Over the past few weeks, MDN has highlighted stories of drillers expanding their UD drilling programs–including CONSOL, Rex Energy, Range Resources and EQT Corporation (see EQT 4th Driller to Target Upper Devonian Shale Layer). Courtesy of a sharp MDN reader, we can add a fifth UD driller to the list: Chesapeake Energy. Todd Sigler reports that Chesapeake has drilled an Upper Devonian well in Hancock County, WV and has several Upper Devonian permits in extreme western Beaver County, PA.

Todd also pointed us to two excellent drilling presentations about the UD, one from Range Resources and one from Rex Energy, which we’ve embedded below. The Range presentation includes a good backgrounder on the UD and a great series of maps showing where the best places to drill in the UD can be found–currently–based on our knowledge and experience so far. The Range presentation also discusses how Range (and others) are adopting a “stacked play” strategy of drilling the Upper Devonian, Marcellus and Utica layers–all in the same well bore. How cool is that?!
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WV Scores Another Shale Supply Chain Company – from Italy

West Virginia is working hard to attract all kinds of businesses to the state that plug in to the shale industry supply chain—and it’s paying off. Reporting that the state gave them “some very interesting support,” Italian company Pietro Fiorentini, a pressure regulator and valve manufacturer, said they first need to gage interest to their products, but they’re already feeling good about WV and making plans to build a new, $9 million manufacturing plant in Weirton, WV.

Support from the state (and local municipalities) is not the only reason for the company’s interest in the northern panhandle of WV—geography is the other prime reason…

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Drillers Ship NGLs from Weirton, WV to Houston via Barge

Good old American ingenuity…Drillers are not waiting for processing plants to be completed or pipelines to come online in order to sell their natural gas liquids (NGLs) from the Marcellus and Utica Shale region. A few weeks ago, one million gallons of NGLs were loaded on a tanker barge originating at the port in Weirton, WV. The barge floated first down the Ohio River, and then the Mississippi River on its way to Houston, TX for processing.

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WV Refinery Expanding with Marcellus/Utica Crude Oil

Ergon, Inc., a crude oil processor headquartered in Jackson, MS but with operations in other states, including West Virginia, announced Wednesday there’s enough crude oil flowing from the Marcellus and Utica Shale region that they are investing $78 million to add more refining capacity to their plant in Newell, WV.

From the Ergon press announcement:

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WV Landowners Drive a Hard Bargain for Pipeline Deals

Some West Virginia landowners who feel shortchanged with low drilling signing bonuses ($5 per acre) and royalty rates (12.5%) are holding out for better deals to run pipelines across their property, and that’s leading to a slow-down of new wells coming online in the state, according to a former DEP representative.

Counties being affected by the slowdown include Ohio, Brooke and Hancock. Typically pipeline easements are a one-time payment, like a signing bonus, and are based on a per foot price. How high will those prices go? Some of the numbers being tossed about are breathtaking.

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