Rig count in shale play pegged at 49

SALEM – The Utica/Point Pleasant shale rig count for the week ending July 26 was at 49, according to the Ohio Department of Natural Resources.

Twenty new permits were issued. Six were issued in Guernsey, five in Monroe, three in Harrison, and two each in Belmont, Noble and Washington counties. The accumulated drilling permit total is at 1,421 with 970 horizontal wells drilled with 487 wells producing.

In news related to Utica shale development, during an earnings call this week, Gregory P. Hill, president and chief operating officer of exploration and production for Hess-Consol, said after divesting 100 percent of its dry-gas acreage in the play, it could zero in on the more lucrative wet gas.

Hess-Consol sold the 100 percent of its dry-gas acreage land to Aubrey McClendon’s American Energy Partners, according to the earnings call transcribed on the Seeking Alpha website. McClendon, the founder and former CEO of Chesapeake Energy who was ousted last year.

Hess-Consol said divesting the dry gas acreage to American Energy Partners allows it to focus on more profitable areas of the play.

It said the appraisal and early development of its 43,000 core net acres in the Hess-CONSOL joint venture continues to be encouraging while in the second quarter the joint venture drilled 10 wells, completed 11 and tested five. In total, the joint venture has now drilled 52 wells, completed 37 and tested 20 since inception in 2012.

Hess-Consol said the results from a well in Cadiz (Harrison County) were “particularly encouraging” with rates of up to 3,450 barrels of oil equivalent (BOE) per day with 51 percent to 53 percent liquids based on 24-hour test.

In another shale gas and oil development, Dallas-based Exco Resources said it was experimenting with “refracturing” wells.

Harold L. Hickey, president and chief operating officer said, “We’ve been at the forefront of Haynesville (shale play) manufacturing, so we now have the opportunity to optimize our base production, tap the upside of our HBP (held by production) assets.

“To optimize our base production, we’ve initiated multiple projects including refracturing of wells to capture new reserves and accelerate production, reducing operating pressure with compression projects and installing artificial lift to minimize base production declines, and we are very, very encouraged by our initiatives,” according to Seeking Alpha transcripts of Exco’s earnings call.

He explained the company just completed its first re-frac test of a 2010 well in Lousianna. Hickey said they attempted to “re-stimulate the shale reservoir near the wellbore.”

That effort included pumping one continuous job for 15 hours, using a temporary diverting agent to stimulate multiple sections of the lateral, he said.

“We’ve seen a 1.3 million cubic feet per day increase in production and a 2,800 psi increase in tubing pressure noting that the well is continuing to clean up,” he said. “While we’re still analyzing this first re-frac, we think the re-frac opportunities across our Haynesville portfolio are significant and can help offset PDP declines. We have an inventory of over 400 PDP wells to potentially re-frac, and we’re excited about the early results that we and our partners are experiencing. We’re working on a plan to test different re-frac designs to optimize cost and production in ’14, with plans to implement re-frac campaign in 2015.”